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TABLE of CONTENTS A LETTER FROM THE EDITOR
QUARTERLY GUILD & INDUSTRY REPORTS
Updates from guilds and associations within states, across the nation, and beyond!
PROS AND CONS OF THIRD PARTY DTC
DOOR COUNTY DISTILLERY
What did previous historic events do to the spirits industry?
Clicks don’t always mean cash
A STORY OF TWO ROADS – PART 2
Brand Buzz with David Schuemann
Capturing the spirit and the “spirit” of Wisconsin
A PRESCRIPTION TO EASE THE DISCOMFORT OF WORKING WITH THE TTB From the Good Guy Distillers
ECONOMICS OF WHISKEY PRODUCTION FOR THE GROWING CRAFT DISTILLERY 78 Part 1 – Value Creation
IT’S NOT EASY BEING GREEN 33 Legal considerations for marketing your sustainability efforts
Part 3 – In conclusion
SPIRITS TRADE GROUPS FORM STRATEGIC PARTNERSHIP, FOCUS ON DTC LEGISLATION
THE SPIRIT(S) OF SAVANNAH
An “all hands on deck” moment
Recent legislative updates
Ghost Coast Distillery combines local soul and outside perspective to create innovative bottles
JUNIPER IS NO LONGER JUST JUNIPER
The juniperus genus is home to surprising diversity
Leopold Brothers malt from the ground up
Viable strategy or grift?
LOOKING FORWARD 61 New on-ramps to careers and career advancement in the spirits industry focus on equity, education
DISTILLING THE PAST
Appalachian Gap Distillery of Middlebury, Vermont
from the COVER
GETTING TO KNOW YOUR GRAIN 84 Malt specs and calculations
RAISING SPIRITS IN THE FINGER LAKES
THOUGHTS ON IRISH WHISKEY
Hollerhorn Distilling of Naples, New York
From the 12th century to today
FOUNDATIONS OF CRAFT DISTILLING
A TWIST ON AT-HOME COCKTAILS
A GOOD READ?
A TASTE OF VIRGINIA
STRIPPED DOWN TO THE CORE
Part 3 – Distilling
DRNXMYTH’s engineering innovation and bartender partnerships disrupt a key drinks sector
Where to look for distilling-related information
Two heavyweights of Virginia craft food and drink get together
The rise of the simplification of product lines
Cover image by Amanda Joy Christensen
Issue 36 /// Fall 2021
BOURBON S TA R T S W I T H WHITE DOG
PUBLISHER & EDITOR Brian Christensen CREATIVE DIRECTOR Amanda Joy Christensen SENIOR WRITERS George B. Catallo Devon Trevathan
CONTRIBUTORS Corey Day Stephen Gould Beth Hatef Paul Hughes, Ph.D. Aaron Knoll Rich Manning Jeff Quint
AGED SPIRITS AND NEW FILL BARREL STORAGE AVAILABLE FOR LEASE OPENING FEB. ‘21 • 55,000 SQFT Bourbon Whiskey storage facility in Woodford Co., KY
David Schuemann Mark Shilling Matt Strickland Gabe Toth Lisa Truesdale Bao M. Vu
• Horizontal racking and palletized storage
Clare Barboza George B. Catallo
• Long & short term storage solutions
Amanda Joy Christensen Gabe Toth
SALES & MARKETING Ashley Monroe
• Meets DISCUS and FM global standards
ARTISAN SPIRIT is a quarterly publication by Artisan Spirit Media.
www.whitedogllc.com firstname.lastname@example.org Office 859-214-7000 Tyler Harris 859-806-5855 Mark Harris 859-321-2049
www.artisanspiritmag.com facebook.com/ArtisanSpiritMagazine ArtisanSpiritM ArtisanSpiritM General Inquiries (509) 944-5919 Advertising (509) 991-8112 PO Box 31494, Spokane, WA 99223 All contents ©2021. No portion of this magazine may be reproduced without the written consent of the publisher. Neither Artisan Spirit Media nor ARTISAN SPIRIT magazine assume responsibility for errors in content, photos, or advertisements. While ARTISAN SPIRIT makes every effort to ensure accuracy in our content, the information is deemed reliable but not guaranteed. We urge our readers to consult with professional service providers to meet their unique needs. At ARTISAN SPIRIT, we take the opportunity to enjoy many different craft spirits and adult beverages. However, it’s also our responsibility, and yours, to always drink responsibly. Know your limit, and never drink and drive.
ARTISAN SPIRIT’s number one goal is to share and celebrate the art and science of artisan craft distilling. But please remember to follow all the laws, regulations, and safety procedures. Be safe, be legal, and we can all be proud of the industry we love.
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THANK YOU TO ALL OUR SPONSORS. Our mission at Artisan Spirit Magazine is to share and celebrate the art and science of artisan craft distilling. We are humbled by the support of our sponsors. With their help, we can further our common goals of supporting creativity, innovation, and integrity within the industry we all love so much.
The American Spirits Exchange is a national importer and distributor serving the alcoholic beverage industry (spirits, wine, and beer). We provide domestic and international companies with access and support to the U.S. market. Regardless of your size — from micro, craft distiller to publicly traded multinational — our focus fuels your growth. Our flagship Foundations™ program provides companies with access to the U.S. market. We handle your business-to-business functions from start to finish: permitting, brand approvals, purchase order processing, invoicing, and compliance.
BSG is focused on supplying craft distillers with the best ingredients from around the world. The craft distilling market trusts BSG to deliver the finest ingredients at competitive prices, without sacrificing customer service. With distilling malts and grains from Rahr Malting Co., Weyermann®, Simpsons, Crisp and Malting Company of Ireland, as well as a full range of yeasts, yeast nutrients, enzymes, botanicals, and finishing products, we have a wide range of distilling ingredients to help you create high quality, artisanal spirits.
Cage and Sons Distilling Systems build premium distillation systems and equipment for premier distilleries. Every element of Cage and Sons equipment is designed and crafted to provide you with the very best distilling experience at an affordable rate because we know that bottom line matters, but so does function. At Cage and Sons, adequate is never an option, and we continue to develop and design new high functioning, cutting-edge distillation systems that enhance the distillation industry. Cage and Sons works every day to bring you the very best distillation systems for the very best value.
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Unlike other agencies that work within a blinding myriad of industries; our focus is 100% within the spirits, wine, beer, and other alcohol sectors. This specialization has allowed us to become experts in the alcohol beverage category. We have an exceptional understanding of design that sells, complemented by professional project management and flawless production oversight. The result has been strategic solutions that consistently produce both critical acclaim and strong measurable return on investment for our clients.
The Distilled Spirits Council of the United States (DISCUS) is the leading voice and advocate for distilled spirits in the United States. Representing producers and marketers of distilled spirits, DISCUS advocates on legislative, regulatory, and public affairs issues impacting the distilled spirits sector at the local, state, federal, and international levels; promotes the distilled spirits sector, raising awareness and opening markets in the United States and around the globe; and encourages responsible and moderate consumption of distilled spirits as part of a healthy adult lifestyle based on evidence-based research and policy. DISCUS also powers Spirits United, a grassroots platform for the distilled spirits industry. Spirits United is comprised of a community of advocates united with a common goal: to ensure adult consumers can enjoy distilled spirits where they want, how they want, and when they want. Learn more at distilledspirits.org and spiritsunited.org.
Decorative label solutions…we’ve got you covered. Fort Dearborn has the expertise and creative appreciation for development and application of labels for the spirits market. Whether your application needs cut & stack labels with specialty hot stamping and embossing, the “no label” look of pressure sensitive film labels, or full body graphics using shrink sleeve labels, we have a product to meet your needs. We service brands large and small. Contact us today to discuss your brand building objectives.
Trusted Oak Expertise Since 1912. We’ve been in this industry for over 100 years, during which time we’ve learned a thing or two about what makes a great barrel to age great spirits. Our R&D team and account managers have hundreds of barrels currently in experimentation. Partnering with distillers, we think outside the box to develop new products that push your vision forward. Our Mission: To craft world-class oak barrels and other cooperage products so our employees, customers, and communities flourish.
Lallemand Biofuels & Distilled Spirits is the industry leader in supplying fermentation products and valueadded services to the distilled spirits industry. We specialize in the research, development, production, and marketing of yeast and yeast nutrients as well as a solid belief in education of the distilled spirits industry. A vital part of the alcohol production process, fermentation products from Lallemand Biofuels & Distilled Spirits have been designed and selected to create value by tailoring objective solutions to distillery needs.
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Moonshine University is located in Louisville, Kentucky on the Beverage Campus with its sister company, Flavorman. Moonshine University offers a variety of classes for enthusiasts, entrepreneurs, industry professionals, and those seeking careers in the distilling industry. Our distillery was designed as part of our classroom, and all classes incorporate hands-on learning and sensory evaluation in order to provide a complete and comprehensive education. In addition to its knowledgeable instructors, Moonshine University hosts a range of renowned industry experts for specialized instruction and training.
Founded in France in 1897 and based in the USA for more than 30 years, Saverglass provides for the premium & super premium spirits and wines. Over the years, the Saverglass Group has distinguished itself by its undeniable quality of glass coupled with innovative decoration techniques. Today, one of Saverglass’ main asset lies on its product offer: 110 original designs and 425 references which represent the largest selection on the market! Thirsty for genuineness, Saverglass has created exclusive bottles dedicated to Artisanal distilleries: The Craft Spirits collection is designed to convey the image of authentic, locally sourced and rare high-quality products. Recently, the Group has strengthened its presence and service offering in the US by opening an ultra-modern bottle manufacturing and decorating plant in North America.
Southern Distilling Company is one of the largest artisan distilleries in the nation. We offer product development, contract distilling (standard and custom mash bill whiskeys, rum, and agave spirits), barrel warehouse aging, batching, blending, bottling, and co-packaging of award-winning products. We also keep an extensive inventory of aged bourbon and rye whiskey available year-round. Our spirits are distilled in top-of-the-line Vendome Copper & Brass Works continuous column stills. Our product development services include working with you to perfect an existing recipe and consultations to help you create your own recipe. We can barrel and warehouse age your product to meet both short and long-term goals. At Southern Distilling Company, you get standout spirits that make brands unforgettable.
For over 60 years Tapi USA has produced cork stoppers and a wide variety of bottle closures. Family-owned and operated since its inception, our company continues to develop new products and enter new markets. Tapi USA is proud to support the growth of the artisan distillery industry and is honored to be the Bottle Closure Sponsor for Artisan Spirit Magazine.
Total Wine & More is the country’s largest independent retailer of fine wine, beer, and spirits. Our strength is our people. We have over 5,000 associates, who must demonstrate comprehensive beverage knowledge before they are invited to join our team. After coming on board, all of our team members undergo an extensive initial training program. We believe that an educated consumer is our best customer. We want to demystify the buying experience for our customers so they will feel confident in choosing the bottle that is perfect for them. Total Wine & More works closely with community and business leaders in each market it operates to support local causes and charitable efforts.
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In our first three decades, funded by leading distillers and lead by an independent Advisory Board, we worked alongside dedicated advocates to create best-in-class, science-based educational programs, design cuttingedge communications campaigns and champion effective legislation that made our roads safer, communities stronger and families healthier.
That’s real progress — but we’re not done. The next decade presents new challenges in the fight to advance alcohol responsibility — challenges we will rise to meet and overcome — but we need your help. Like the 30 years before, it will take the leadership, commitment and united effort of people like you—distillers who want a better, more responsible future for us all. Join us, and let’s define the future of alcohol responsibility, together.
A LETTER FROM THE EDITOR: I had a number of revelations hit me while attending American Distilling Institute’s 2021 conference in Louisville, Kentucky. The first, unsurprisingly, was that I missed being around people. It may not come as a shock to you, but I’m a pretty unapologetic extrovert, and not attending conventions, guild meetings, and group events took a bigger toll than I had expected. So it was electrifying to walk through a room of hundreds of distillers excitedly sharing stories, vendors holding court with potential buyers, and the bright eyes of educators back in front of crowds of eager students. The second revelation was how many new distillers and vendors were in attendance. Fresh startups in the distilling business may have had their plans slowed or put on hold, but it didn't derail the momentum the craft community has been building on for the last two decades. There were a multitude of “new” vendors. Some startups, and others making the jump from food, wine, and beer to begin serving the distilling market. Alongside them stood hundreds of motivated entrepreneurs who had been waiting a year and a half to stand face-to-face with their peers. It was energizing! It’s easy to forget that despite years of growth the craft distilling world is still relatively young. The potential to grow our distilling family is far from exhausted. I look forward to welcoming new readers as we finally get to look each other in the eyes and shake hands. Or hug. I’m a big hugger.
Brian Christensen (509) 944-5919 /// firstname.lastname@example.org /// PO Box 31494, Spokane, WA 99223
: The article Legal Landmines in the Ready-To-Drink Cocktail Category, by Nichole Shustack and Isabelle Cunningham appearing in the Summer 2021 issue of Artisan Spirit, was initially attributed to the incorrect author.
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A barrel should be more than an aging vessel, it should be a partner in achieving your desired flavor profile. Using science-based research and experimentation, ISC barrel experts collaborate with world-class distillers to create innovative barrel solutions for their unique spirits.
PERFECTING THE SPIRIT OF AGAVE
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Y R T S U D N I & S D T L R O I P U E R G Y L R E T R QUA T
he fall 2021 guild reports highlight several incredible legislative wins for the distilling industry. From eliminating bottle limits in tasting rooms to reducing taxes, the long road to regulatory improvements is heartening. Many states are also happy to report strong member numbers, and a growing community of new craft producers. It’s our honor to welcome these new members to the distilling family!
— BRIAN CHRISTENSEN
AMERICAN CRAFT SPIRITS ASSOCIATION ACSA's DTC committee has been gearing up to support direct-to-consumer shipping bills which will be filed in a large number of states in 2022 legislative sessions. There is a significant amount of opposition to these bills, but inspired by our winery compatriots, and observing the difficulties of many of our small members in accessing distributor partnerships, ACSA believes this path holds incredible promise for the smallest distilleries above all. The pandemic has highlighted as never before consumers' desire to engage with spirits brands online, whether ordering full-size bottles for their enjoyment, or participating in online tastings. We will be partnering with DISCUS to create a coalition focused on advocating for this issue and will have more exciting news on that front coming soon. 1
country — it has been too long! In As Americans have started venturVIEW ACSA'S the meantime, our webinar offerings ing out to tasting rooms near their DTC WEBPAGE — free with your membership — homes or near their vacation destiare always changing, but the library nations, they will again ask whether of past webinars can be viewed at they can ship products home. ACSA your convenience. is focused on bringing this ability to As always, if you are not currently a distilleries nationwide. In the meanmember of ACSA, join us! We are the time, please visit our DTC webpage1 if you would like to learn more about direct only nonprofit trade association built by craft shipping laws in your state, or the benefits to distilleries and focused on uniting, educatproducers, states and localities, and access to ing, and advocating for our community. Your the wholesale tier. support has made it possible for our group Signups have begun for the annual convento consistently work on improving the busition, scheduled for December 4–6 in Louisness and regulatory landscape for craft distillville, Kentucky. I hope to see many industry eries. For more details on memberships, see people there, and share in sharpening my www.americancraftspirits.org. expertise in safety, strengthening distributor Becky Harris partnerships, building my digital presence, President, Chief Distiller, Catoctin Creek and reconnecting with distillers around the President, American Craft Spirits Association
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AMERICAN DISTILLING INSTITUTE The American Distilling Institute annual conference returned in August with a live audience of more than 1,600 and over 150 exhibitors in Louisville, Kentucky. After a successful virtual event in 2020 that drew more than 1,000 attendees, the live event featured the Bourbon Summit on the 23rd, local distillery tours, a keynote by Bill Samuels, chairman emeritus of Maker’s Mark, and dozens of practical workshops and sessions. Kentucky Distillers Association President Eric Gregory and Distilled Spirits Council President Chris Swonger also joined ADI founder Bill Owens on the agenda. DTC, RTD, and TTB — the craft industry’s three big 3-letter acronyms — dominate the headlines. On direct-to-consumer, or DTC, an ADI survey of 269 distilleries in January indicated that DTC generated 39 percent of total sales for those who are in DTC states such as Alaska, California, Connecticut, Idaho, Nebraska, Nevada, New Hampshire, New Mexico, and North Dakota; and cocktail-togo states, including DC, Iowa, Ohio, and Kentucky. While New York State distilleries can
no longer ship spirits to customers, dropping the number of DTC states to nine, fall 2021 may see California allow DTC permanently, or disallow the practice. ADI has joined DISCUS and ACSA to back DTC as a core consumer choice. On ready-to-drink, or RTD, Nielsen IQ reported that hard seltzer sales hit $4 billion in 2020, up from $500 million in 2018, and pre-mixed RTD cocktails are projected to hit $728 million in 2021 and will grow to $1.63 billion by 2027. For example, Spokane, Washington’s Dry Fly Distilling now offers “packable cocktails” in a can featuring their award-winning spirits, and Garrison Brothers in Texas now has a RTD pouch version. Craft distillers are favoring RTD as a way to control cocktail mixing, so consumers get a positive flavor experience without having any bartender skills. In addition, RTD is a cash flow booster and a market expander, because it lets distillers sell to someone who may not buy a bottle of their straight product. The TTB has sought out industry feedback on anti-competitive practices and barriers to
entry in the market. ADI’s survey of its members showed several items on their priority list. Craft distilleries want broader availability of DTC shipping. They want greater ability to self-distribute. They want removal of limits on bottle sales, cocktail sales, pop-up permits, and Sunday sales. Also, 42 percent of distillers report difficulty finding a distributor in state, and 62 percent report difficulty finding an out-of-state distributor. The Government Affairs page on Distiller.com has complete details. Lastly, we will be offering two classes in the fall. In November at Mine Hill Distillery in New England we will be offering a threeday class on setting up a distillery, financing, operations, and sales/marketing. In December our annual class on blending, maturation, and warehousing will be offered at Ironroot Republic in Denison, Texas. Jay Whitehead Editor, Distiller Magazine American Distilling Institute
DISTILLED SPIRITS COUNCIL OF THE UNITED STATES The DISCUS team has kicked conference planning into high gear as we quickly approach our second annual DISCUS Conference. We hope you will join us in Austin, Texas from October 6-8 as we build for the future with America’s spirits industry leaders, decision makers, and supply chain partners. You can register here to be a part of the action and hear the latest on mission-critical policies, connect with spirits business executives at networking events, learn from industry thought leaders, and walk away with tangible insights to boost your business. New Survey Shows Overwhelming Consumer Support for DTC Shipping of Spirits
A new DISCUS survey conducted by IWSR Drinks Market Analysis showed overwhelming consumer support for directto-consumer shipping of distilled spirits. 14
Key takeaways included:
> 80 percent of consumers believe distillers should be allowed to direct-ship spirits
> 76 percent would purchase spirits online shipped directly from distillers
> 75 percent agree wine and spirits should be subject to the same DTC shipping laws Currently, 46 states allow the direct shipment of wine, but only nine states allow DTC shipping for distilled spirits. As a result of the pandemic, an additional seven states temporarily allowed distillers to ship to in-state consumers. Unfortunately, some of those temporary measures have already expired. In some states, there are bills to make direct-to-consumer shipping permanent. We are pleased to announce that we have formed a strategic partnership with the American Craft Spirits Association (ACSA) and American Distill-
ing Institute (ADI) to collaborate on working to pass spirits DTC shipping laws in states around the country. American Whiskeys Remain Only Spirit Subject to Tariffs in Transatlantic Trade Disputes
In June 2021, the U.S. reached agreements with the EU and UK to suspend tariffs on U.S. rum, brandy, and vodka in the long-standing WTO Boeing-Airbus disputes. This was a welcome and important development in our call for a return to duty-free trade in distilled spirits. Unfortunately, American whiskeys remain the only spirit subject to tariffs in the transatlantic trade disputes due to the continued application of a 25 percent tariff in connection with a dispute on steel and aluminum. Our priority issue is to secure the immediate removal of the EU and UK tariffs on W W W . ARTISANSPIRITMAG . C O M
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American whiskeys. Negotiations with the EU and UK are on separate tracks. The EU’s tariff on American whiskeys is scheduled to double to 50 percent on December 1, 2021 if no agreement in the dispute is reached. The UK is currently reviewing its tariffs imposed in response to U.S. steel and aluminum tariffs and DISCUS submitted a comprehensive submission. The UK will announce its decision sometime this fall. 30 States Take Legislative Action to Allow Cocktails To-Go in Support of Devastated Hospitality Businesses
Thirty states have taken legislative action to allow cocktails to-go either on a permanent or temporary basis, providing a lifeline for hospitality businesses that continue to face repercussions from the harsh economic impacts of the COVID-19 pandemic. During COVID-19, more than 35 states began allowing restaurants and/or bars to sell cocktails to-go as an economic relief measure via executive orders or other temporary measures. Since then, 16 states and the District of Columbia passed legislation to make cocktails to-go permanent, and 14 other states passed
legislation to allow cocktails to-go on a temporary basis. Some states are still considering cocktails-to-go legislation. DISCUS Partners with ENERGY STAR for Upcoming Energy Performance Indicator Benchmarking Tool
DISCUS is also partnering with EPA’s ENERGY STAR program to develop energy-saving tools and resources for distilleries, including a new Energy Performance Indicator (EPI) benchmarking tool, which will enable distilleries to secure ENERGY STAR certification for production facilities, which could lead to cost savings for distillers. The ENERGY STAR score generated by the EPI benchmarking tool will enable distillers to quickly understand and communicate a facility’s energy performance, and to identify energy waste to target for cost-saving improvements. In return, this can earn recognition for top performers through a public-facing ENERGY STAR certification. This can ultimately be helpful for brand marketing and in attracting new customers.
Responsibility.org Hosts National Alliance to Stop Impaired Driving Conference
Responsibility.org, in collaboration with the Governors Highway Safety Association (GHSA) and the American Automobile Association (AAA), hosted the National Alliance to Stop Impaired Driving Conference, which focused on multiple substance impaired driving (the operation of a motor vehicle while impaired by drugs and alcohol or a combination of drugs). This conference brought the nation’s foremost experts and influencers together to examine the challenges and complexities of multiple substance impaired driving. Participants engaged in discussions ranging from roadside screening and detection, toxicology, and emerging technologies, to adjudication and remediation, behavior change, opportunities, and solutions. As a result of this conference, Responsibility. org will prioritize a national action plan. To learn more, visit NASID.org. Chris R. Swonger President & CEO Distilled Spirits Council of the United States and Responsibility.org
DISTILLERS GRAIN TECHNOLOGY COUNCIL The Distillers Grains Technology Council will be hosting its 25th annual symposium on October 25 and 26 at the Louisville Downtown Marriott in Louisville, Kentucky. As the beverage distilling and biofuel manufacturing industries have grown, it has become increasingly important to pursue innovative strategies for spent grains, stillage, and distiller grains utilization. Speakers this year will address many aspects, including equipment and technologies for separating spent grains,
processing and drying, sales and marketing, and use in a variety of livestock and pet species. This year we will also host a Reverse Pitch Competition to promote innovative technologies for capturing value from spent grains beyond animal feed alone. More information about the event, including speakers and registration, is available online.2
LEARN MORE ABOUT THE 25TH ANNUAL DISTILLERS GRAINS SYMPOSIUM
The Distillers Grains Technology Council was established in 1945 by Hiram Walker and Seagram’s Distillers Corporation to develop and promote value from spent grains and distillers grains. More about the Council can be found at www.distillersgrains.org. Kurt A. Rosentrater, Ph.D., SEA Executive Director and CEO, Distillers Grains Technology Council
NATIONAL HONEY BOARD By the time you read this, we’re probably wrapping up our annual National Honey Month celebration in September. As you can imagine, it’s quite a busy month celebrating 2
all things honey with consumers, chefs, distillers, brewers, and food manufacturers. This year’s celebrations focused on our Honey Saves Hives programs, which educates
consumers about the importance of honey bees to our food supply. Honey bees are crucial to our food system because they naturally produce honey and pollinate more than 90
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different crops, including apples, avocados, melons, broccoli, cranberries, and more. Let’s look at gin specifically and its botanicals. Five of the most common botanicals, including coriander, cardamom, cucumbers, lavender, and cinnamon, all require honey bee pollination. Can you imagine Hendrick’s Gin without the cucumber? Neither can we, which is why we spend so much time talking about the importance of honey bees, not only
for the production of honey, but also for the more than 90 different other crops honey bees pollinate. So when you craft a spirits recipe with honey, understand that you are doing more than just sweetening or flavoring your product. You’re also supporting beekeepers and their efforts to keep honey bees healthy. You’re strengthening the connection between our pollinators and our planet’s entire ecosystem.
In other National Honey Board News, we’re thrilled to announce the launch of social media networks for distillers, brewers, and food manufacturers! Follow @Honey4Pros on Instagram, Facebook and Twitter. Keith Seiz Ingredient Marketing Representative National Honey Board
AMERICAN STATE GUILDS FLORIDA FLORIDA CRAFT SPIRITS ASSOCIATION This summer brought long-awaited good news to the distillers of Florida. Senate Bill 46, more than eight years in the making, was
MARYLAND MARYLAND DISTILLERS GUILD Happy summer everyone, hope this note finds you well. In Maryland we now have 40 distilleries, including a few in startup mode. This is a milestone that we haven’t seen in the Old Line State since the early 1900s. We also have 13 affiliate members that we cannot thank enough for all of their continued support. There is a great energy in the air here in Maryland with customers touring distilleries again, tasting rooms open, community farmers markets buzzing, and consumer tasting events happening. One of the main focuses of the Maryland
officially passed into law on July 1. The bill resets the volume cap for distillers to 250,000 gallons, removes the bottle limit from six bottles per person per spirit to unlimited, and, most importantly, gives distilleries the option of selling cocktails from their adjoining tasting room as long as the alcoholic ingredients
are branded product produced on site. Florida distillers will be spending the summer adapting their tasting rooms to usher in this new law change.
Distillers Guild is continuing to advance our businesses collectively. We are thrilled to announce the guild has launched a new app, in partnership with the Maryland Wineries Association, Brewers Association, and Grow & Fortify. In the first week we have seen nearly 2,000 downloads, far exceeding our expectations. The app includes trails, a handy “near me” feature for finding the closest craft beverage producers, and a geo-passport. We sincerely thank the team at Grow & Fortify for making this app come to life; we truly believe it will enhance visitor experience and help showcase all the great craft producers we have in the state of Maryland. After a year of planning we will be debuting our “Spirits of Collaboration'' program, a series of products developed by our members to highlight the collegiality and creativity of
our industry. The first release is a gin crafted by McClintock Distilling in Frederick and Gray Wolf Spirits in St. Michaels. It should be out early September. These products will be available for sale at the two distilleries, all guild events, and at marylandspirits.org. All proceeds benefit the Maryland Distillers Guild. We are excited for all the events still to come and the anticipation of fall releases. We all know there is nothing better than live music and interacting with the communities that take such pride in their local craft and continue to be so supportive. It’s great to feel that energy again.
David C. Cohen President, Florida Craft Spirits Association President & Head Distiller, Manifest Distilling
Brian Treacy President, Maryland Distillers Guild Sagamore Spirit
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Process aids for higher ethanol yield and fermentation consistency.
View our extensive offering of craft distilling inputs at lallemandcraftdistilling.com.
NORTH CAROLINA DISTILLERS ASSOCIATION OF NORTH CAROLINA The North Carolina General Assembly is still in session and the Alcohol Beverage Control Omnibus Bill, which includes all of the Distillers Association of North Carolina (DANC) priorities, is being considered in the
OREGON OREGON DISTILLERS GUILD After four years of effort, SB316 will become law. The Oregon distillery tasting room tax rate will be reduced to five percent on the first $250,000 of sales. For years, Oregon distillers identified the tasting room tax structure as their top concern. By working together, we made our case to the Oregon legislature. The Oregon Liquor and Cannabis Commission (OLCC) made SB316 effective as of July 1. The OLCC has been an ally in our efforts, and the new compensation structure was part of their proposed budget before the session began. Two sessions ago, the ODG membership
PENNSYLVANIA PENNSYLVANIA DISTILLERS GUILD The Pennsylvania Distillers Guild has tapped former Pennsylvania Labor and Industry Secretary Kathy Manderino as executive director to help grow the membership and organizational efforts of the guild, effective immediately. Manderino brings to the table a wealth of experience in state government, nonprofit management, and leadership in voluntary
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Senate. If enacted, the ABC Omnibus Bill will significantly improve the regulatory environment for North Carolina distillers. The transition to the new computer system at the North Carolina ABC warehouse has been difficult. Our members reported that they are not receiving orders from ABC stores for their products, and the contractor for the state-owned warehouse acknowledged there
is a system problem that randomly causes requests for North Carolina products to be dropped from store orders. At DANC’s request, ABC Commission leadership has authorized direct shipment of North Carolina products until the computer problems are resolved.
agreed to pay an extra contribution to fund our efforts in Salem. This allowed us to hire Dan Jarman and Crosswater Strategies to lead our lobbying efforts. We were a floor vote away from passing our bill before the walkout ended the special session in 2020. While it was extremely disappointing to come so close without achieving our goals, we built a strong base of support in Salem and at the OLCC because of contributions that session. Westward Whiskey stepped up with a major contribution along with the following members: JAZ Spirits, Crescendo Spirits, Sinister Distilling, 503 Distilling, Ewing Young Distillery, Trail Distilling, Vinn Distillery, Freeland Spirits, New Basin Distilling, Pilot House Distilling, Stone Barn Brandy-
works, Thinking Tree Spirits, Branch Point Distillery, Aria Gin, New Deal Distillery, and Oregon Spirit Distillers to help continue lobbying this year. Brad Irwin with Oregon Spirit Distillers, past president and now legislative chair for the Oregon Distillers Guild, was instrumental in leading the way to get SB316 passed. Unfortunately, in five years, the current bill sunsets, so our lobbying efforts to make SB316 permanent will continue. There is more to be done. Nonetheless, SB316 is a huge victory. Here’s to a successful future for Oregon Distillers!
member organizations. In addition to serving as Labor and Industry’s chief executive, Manderino, an attorney has also been a commissioner on the Pennsylvania Gaming Control Board, a state legislator, executive VP of a human services organization, manager of a statewide education advocacy campaign, director of membership services for a labor-management group, and member of the governing board of a voluntary membership organization. We are excited to have Kathy working with us to help grow our guild to the next level.
Since the guild was founded roughly six years ago, it has been an all-volunteer effort, and the membership has grown to over 30 Pennsylvania distillers. With so much interest in craft distilling, local agribusiness, and travel and tourism built around the industry, the guild is pleased to be able to tap into Kathy’s expertise to help further grow and mature our organization to enhance benefits to our members, as well as to the Pennsylvania growing economy.
With the reopening of Wyoming businesses in the spring, we’ve been diligently executing events and promotions aimed at elevating
our distillery members and creating revenue for the Wyoming Distillers Guild. In June, our members came together for the first time
Pete Barger President, Distillers Association of North Carolina, Principal Partner, Southern Distilling Company
Tom Burkleaux President, Oregon Distillers Guild, New Deal Distillery
Robert Cassell President, Pennsylvania Distillers Guild
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in well over a year for a tasting event in our capital city of Cheyenne, where they satisfied nearly 200 thirsty palates eager to sample the finest spirits in Wyoming. In October, the guild will hold its inaugural tasting gala adjacent to and in partnership with the Wyoming Film Festival in Sheridan. That weekend will also include our annual member meeting and retreat. We’re working hard to grow unity in our state among our members and create strategic partnerships with
diverse organizations. August saw the launch of our Allied Trade Partner membership, bringing industry partners closer to our distillers in order to help their businesses grow. Keep an eye on our social media channels (@wyodistillersgiuld) for new happenings and releases throughout the state. Our website launch will be coming soon as well as a new online merch store. We’re looking forward to a slightly
quieter fall when we can start preparing for our 2022 legislative session. Cheers to a great year of recovery! Michelle Forster Executive Director, Wyoming Distillers Guild email@example.com
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A STORY OF TWO PART 2
his is the second article in a series that covers the road to market. In Part Two we will cover what it takes to follow the more traditional road to market of developing your READ A STORY OF TWO ROADS PART 1 own distillery. This is by far the most expensive and time-intensive route, but it’s one that allows for the flexibility of creative expression and provides the artistic outlet and lifestyle of physically crafting your own product, which appeals to many distillers and consumers.
THE STARTUP COSTS The answer to the question of what it costs to setup a distillery is: It depends. The costs vary depending on your goals. Start by asking yourself these questions: Do you want to build your distillery brand for generational enjoyment? Build it to sell? Or is your goal a lifestyle-driven, break-even/ small-profit equation where you create small production products as much for the fun and experience as the business? For the purpose of these articles, we are going to concentrate on Distilled Spirits Plants (DSPs) that are producing well above a 50-gallon batch size and are interested in developing a successful brand that will support their families for generations or set the stage for an exit strategy sale. W W W . ARTISANSPIRITMAG . C O M
WHAT THINGS SHOULD YOU BUDGET FOR WHEN SETTING UP A DISTILLERY?
Time – Planning a budget around the assumption everything will go according to plan on the first try, or will stay on schedule, is a recipe for failure. The realities of setting up your business; licensing; acquiring property; zoning approval; fire and water approvals; and licensing on a federal, state, and local basis will take lots of patience, money, and time. Always anticipate delays and determine whether you are able to financially weather a delay. Money – Develop a strong and well-thoughtout business and marketing plan that is fully realized with the costs associated with both short-term startup and longer-term projections, factoring in shifting marketplace realities and expansion to support future demand. Whether the capital is coming from your own pocket, a bank, or investors, strong and considered business and marketing plans will be critical components to both your short- and long-term success. Consider initial expenses such as facility costs, licensing, legal advice, financial plans, brand development (including name development, logo, and packaging design), and market testing, as well as continuous costs such as sales support and ongoing advertising and promotion for your brand. Develop a well-thought-out strategy for chan-
nel sales — will you be able to sell bottles and/or cocktails onsite? Can you sell directly to consumers and self-distribute or will three-tier distribution be a necessity? Also, consider your product mix. Do your offerings require aging (such as bourbon)? Are they quick-turn, unaged products (such as vodka and gin) or canned cocktails? Or a mixture? Planning & Initial Costs – These costs can include brand development and testing, legal fees, financial plans, and business plans. Depending on how much of this you can bootstrap, you should plan on anywhere from $50,000-$150,000. Distillery Setup – It’s nearly impossible to generalize the cost to purchase or lease a property, as costs vary greatly depending on location. Distillation equipment, infrastructure, and supplies typically run around $1 million. If you want your distillery to have a tasting room or a cocktail bar, the costs could increase by another $200K or more. Dry Goods – Assume about $500K in the first year. In following years, this should increase in correlation with your (hopefully) increasing production. People – Salaries drastically vary depending on location and other factors, but assume about $500K per year.
WHAT IS THE GENERAL STARTUP RANGE IN DOLLARS TO START A DISTILLERY INCLUDING BRANDING AND MARKETING, PERMITS, PLANNING, ARCHITECTS, STILL, EQUIPMENT, ETC. From our experience and research, to build a proper distillery and successful brand with all the components — including licensing, facility, locations — it can range upwards from $2-$5 million. Not all of this is needed upfront, but crafting a carefully considered budget with lots of input from industry resources will go a long way toward avoiding the surprises others have endured. 25
HOW LONG (MONTHS/YEARS) DOES IT TAKE FROM START TO FINISH TO SETUP A DISTILLERY?
Again, it depends. Location will be a big factor in the project timeline. For example, if your distillery is in a central business district within a large city, acquiring the building and work permits can be a tedious process taking more than six months — and that is just to get started. However, if you are located somewhere more rural, where the local government is smaller, things can move very quickly.
WHAT IS THE AVERAGE OR RANGE OF COST FOR A STILL?
Sizing and still design/type are key. Smaller commercial stills can cost as little as $5,000-$10,000, while giant continuous systems can run into the high six figures. On average, a new craft distillery operating a 200-500 gallon still, we would budget around $50,000-$100,000 for the still and setup (accompanying costs of shipping, piping, installation, etc.).
WHAT KIND OF LICENSING DO YOU NEED TO SETUP AND OPERATE A PHYSICAL DISTILLERY?
You should start with federal, then state, and finally local. At the federal level, you will need a DSP. Then, you will need an alcohol manufacturing permit and a business license from your state. Finally, you will get down to county and local levels where you will need all sorts of licensing and permits such as a fire marshal approval, building code inspections, boiler inspections, effluent monitoring and approval, and the list goes on.
WHAT KIND OF LICENSE DO YOU NEED TO SELL AN ALCOHOL BRAND IF YOU DO NOT PHYSICALLY PRODUCE THE PRODUCT? Skipping over all the requirements and licensing needed to start any business, selling alcoholic beverages at its most basic requires a federal wholesaler permit to legally collect profits from alcohol sales. From there it depends largely on what state(s) you want to sell in. You will need to sort out partnership agreements and contracts with whoever is producing the alcohol for you, as well as with the distributors that you sign on with in different markets.
In our final segment, we’ll explore the planning, requirements, and startup costs associated with the less traditional road to market: a marketing-driven distillery. This road less traveled is becoming increasingly popular and could potentially be a more lucrative route to market for the craft distilleries of tomorrow.
David Schuemann is the owner and creative director of CF Napa Brand Design. For more information, visit www.cfnapa.com or call (707) 265-1891.
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GOOD GUY DISTILLERS
A PRESCRIPTION TO
EASE THE DISCOMFORT
OF WORKING WITH THE TTB WRITTEN BY MARK SHILLING
s most of us reading Artisan Spirit already know, successfully launching and operating a distillery requires a tremendous amount of planning, organization, soul-searching, blood, sweat, and tears. And, despite those early, naïve assumptions about a quick rise to meteoric success, we all know now that those activities will be a constant companion throughout the lifetimes of our DSPs. Another constant companion will be the mass of records, reports, tax returns, permit amendments, formulas, COLAs, and a never-ending barrage of nearly incomprehensible and seemingly superfluous regulations — in short, the Tax and Trade Bureau of the U.S. Department of Treasury. From here on out, the success of your business will be inextricably tied to your understanding of, and relationship with, the rules and staff of the TTB. By my observation, most people approach government agencies with some degree of fear and trepidation, and often their “post-approach” experience is one of annoyance and frustration. These are all valid responses to the “disease” of over-regulation and bureaucracy, but relief is available. The prescription is an understanding of the history and purpose of the TTB along with a healthy mixture of informed and inquisitive personal relationship building.
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Although the TTB of today was created — or rather, re-created — in 2003, its history goes back to the First Congress of the United States, convened in New York in 1789. It was during this Congress that the United States Treasury was formed to manage the financial affairs of the new nation, and foremost among its duties was the repayment of Revolutionary War debt on behalf of the 13 original states. To do that, Congress passed the first internal revenue tax — the Whiskey Tax Act of 1791. Over the decades, regulation of alcohol has evolved and the TTB of today is responsible for much more than the protection and collection of revenue. The Federal Alcohol Administration Act, passed in 1935 to manage the legitimate, post-Prohibition alcohol industry, tasked the agency with establishing permit requirements and assuring the public of an honest industry, complete with fair competition and trade practices as well as consumer protections enshrined primarily through advertising and marketing requirements. In the drafting of the FAA Act, Congress chose to include a little known but very important feature — language giving the administrator broad authority to “prescribe such rules and regulations as may be necessary to carry out his powers and duties.”
By my observation, most people approach government agencies with some degree of fear and trepidation, and often their “post-approach” experience is one of annoyance and frustration. These are all valid responses to the “disease” of overregulation and bureaucracy, but RELIEF IS AVAILABLE.
The historical result of this language has been that although the agency has specific boundaries within which they must operate, the way in which they may design, implement, and enforce the provisions within those boundaries includes a very wide latitude. With that very condensed version of its history, it’s easy to perceive TTB as the stereotypical, monolithic agency filled with faceless automatons exercising the command-and-control type management we generally expect from the government. And to be fair, sometimes they are exactly that. They have a job to do and they do it, and they do it by the book. The Code of Federal Regulations, CFR, is full of rules, often with no explanation as to purpose or intent, and certainly not written in any sort of straightforward, reasonable way. Trying to get the help desk on the phone can be maddening, the online portals for permitting, formulas and COLAs are clunky and certainly not very intuitive, and even most of the staff don’t know what some of the lines are for on the monthly reports. Bureaucracy fully living up to its stereotype, right? But there is another side to TTB that many don’t see. Unlike many (most?) government agencies, TTB has a very customer service– oriented management philosophy. They innately understand that their top priority is collecting tax revenue and that permittees that are not operating are not creating revenue. As such they would much rather help you become compliant than unnecessarily penalize you in a way that might prevent your successful operation. Having spent a fair amount of time working with the TTB, I’ve come to a number of realizations over the years that have been very helpful in creating a healthy, positive working relationship with the agency, and it starts with getting to really know the rules and the staff.
Once you understand why a particular rule exists, it is MUCH EASIER to figure out how to comply.
Most of the federal regulations governing your distillery are found in Title 27 of the Code of Federal Regulations. If you don’t have one, get a copy. Read it. Reread it. Use a highlighter and put some tabs on sections. Make notes about questions you have and be prepared to ask them when you have a chance. Once you understand why a particular rule exists, it is much easier to figure out how to comply.
#protip: Oftentimes there is more than one way to do it right. Don’t just do your monthly reports and submit them. Take some time to try and understand why they exist, and why certain information is requested.
#protip: Sometimes even TTB doesn’t know. The industry has evolved over the years and forms haven’t always kept up with the pace, but even an understanding of why something was initially done, even if now obsolete, can be very helpful. I remember the day I learned that storage, processing, and production weren’t specific, physical locations in the distillery and that there were multiple ways that I could correctly account for the movement of liquid around the distillery. Mind blown. One of the most frustrating things about TTB is all the recordkeeping requirements. They are like little Easter eggs peppered throughout the code. You can’t just go to the TTB website, get a list, and download some forms, and honestly, I’m not 100 percent certain that I’ve found them all. Obviously, the reason you must keep certain records is to ensure that your reports are accurate (and unimpeachable), and the reason you must submit reports is to ensure your taxes are paid, but there is another great reason to put some extra time and effort into things like bottling records, transfer records, tank records, records of records, and the like. All those records — if well done and kept up — lead to better organization and better efficiency in all your operations, which in turn leads to a well-run, competitive, and successful business.
Having spent a fair amount of time working with the TTB, I’ve made a number of realizations over the years that have been very helpful in CREATING
A HEALTHY, POSITIVE WORKING RELATIONSHIP with the agency, and it starts with getting to really know the rules and the staff.
A few things I’ve found helpful for records and reports: keep electronic copies on a (well-protected) cloud drive, and also keep well organized hard copies in binders in your office. If you ever need to go back and sort out a problem, it really helps to have all the pertinent info spread out right in front of you and it will reduce the chance of mistakes made by tabbing through lots of open documents. If you need to share that info with anyone else, it’s much safer than giving a stranger access to your entire network. And finally, if you find yourself on the phone with the TTB (or anyone for that matter), you don’t really want to annoy them with suddenly not being able to find the right folder or file on your computer. Staying well-organized and compliant on paper means understanding the rules, and doing that sometimes means talking directly to the TTB. Talking directly to the TTB can be incredibly helpful or incredibly frustrating but for me it helps to be mindful about the people of the agency. First and foremost that they are agents, highly trained and dedicated to the mission and responsibilities of the government, but also real people, with families, hobbies, and personalities. Get to know them as people, not just faceless arbiters of incomprehensible rules. You will find them to be some of the most helpful, supportive people in all of the U.S. government.
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Also, keep in mind that our industry has grown exponentially over the last couple of decades. Where not that long ago there were only a handful of “craft” distilleries around the country, we now number close to 3,000. Not only is TTB a relatively small agency that has not been appropriately funded to expand along with its regulated community, they also have responsibility for our cousins in “the other alcohols” as well as tobacco and firearms. Sometimes you will get a staff person with 20 years’ experience in suppressors or cigars who has been moved over to COLAs or someone new to the agency who still doesn’t know a blended whiskey from a blend of straight whiskies. Patience is a virtue, but so is asking to speak with a supervisor. If you
aren’t getting the information you need, don’t hesitate to escalate. I’ve seen too many people take the first response as if it were gospel, when sometimes it isn’t. Going back to that earlier statement, we often see the TTB as this monolith of absolutism, but it is not — it is an agency of people and sometimes you just need to make sure you are talking with the right person, that they fully understand your question, comment, or need. Most importantly, don’t be afraid to engage. I think we often think of regulators as the boogie men, the ones who are out to get us, the ones to avoid at all costs. In this case, they are from the government and they really are here to help.
We often see the TTB as this monolith of absolutism, but it is not — IT IS AN AGENCY OF PEOPLE and sometimes you just need to make sure you are talking with the right person, that they fully understand your question, comment, or need.
Mark Shilling is the founder of Revolution Spirits, a favorite stop along the Central Texas distillery trail, and a partner in Big Thirst Consulting, working with distilleries from coast to coast. Mark previously served as president of the American Crafts Spirits Association and currently chairs the ACSA government affairs committee. He is an an outspoken advocate for the industry and can be reached at firstname.lastname@example.org.
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IT’S NOT EASY BEING GREEN Legal Considerations for Marketing Your Sustainability Efforts
Written by Bao M. Vu and Corey Day
onsumers are increasingly seeking out eco-conscious “green” brands.1 You may have already decided to go green by implementing sustainable practices at your distillery, or maybe it’s something you’re planning to do. And that’s great. Commendable, even. But if you’re considering advertising your green practices or incorporating them into your branding, you need to exercise caution. Your well-intentioned efforts may be setting you up for a consumer lawsuit, or a federal or state enforcement action. There are both federal and state laws designed to protect consumers from false or misleading statements. Unfortunately, it’s easy to run afoul of these laws if you don’t pay careful attention to how you market your products. Violating these regulations and laws may result in substantial penalties by way of government action or private claims from customers or competitors that can lead to refunds, disgorgement, and paying attorneys’ fees. On the federal front, the FTC has released “Green Guides” with specific considerations for marketing claims ranging from recyclable materials to renewable energy use.2 These guides aren’t empty suggestions. The FTC actively brings claims against businesses whose marketing practices fall short of these guides.3 The main thrust of the
1 Empowered Consumers Call for Sustainability Transformation, Forbes ( Jan. 21, 2020), https://www.forbes.com/sites/forrester/2021/01/21/empowered-consumers-call-for-sustainability-transformation/?sh=2f1edaf22042 2 Press Release, Fed. Trade Comm’n, FTC Issues Revised “Green Guides” (Oct. 1, 2012), https://www.ftc.gov/sites/default/files/attachments/press-releases/ftc-issues-revised-green-guides/greenguides.pdf 3 Lesley Fair, Deceptive “Certified Organic” Claims Leave Consumers Verklempt, Business Blog (Sept. 19, 2019, 11:04 AM), https://www.ftc.gov/news-events/blogs/business-blog/2019/09/deceptive-certified-organic-claims-leave-consumers-verklempt W W W . ARTISANSPIRITMAG . C O M
FTC’s guidance is that in order to avoid making misleading claims, businesses need to be specific and substantiate their statements. They need to do so by having scientific information to confirm their claims. Businesses also need to use sufficient qualifications and disclosures to prevent misleading reasonable consumers. Beyond the FTC’s regulations, many states have their own laws that are more protective or cover different types of advertising claims. By way of example, California is far stricter on “compostable” and “biodegradability” claims, essentially banning those terms for most marketing. For example, let’s say you advertise carbon reduction efforts such as “we offset our carbon emissions by purchasing renewable energy.” That claim would be too broad. To withstand legal scrutiny, among other things, that claim would need to specify what component of your operations you’re referring to (e.g., Scope 1 direct emissions, Scope 2 electricity consumption, or Scope 3 indirect emissions), as well as how much of such emissions are being “offset.” Without those qualifications and disclosures, the implication may be that you offset each and every ton of carbon dioxide equivalent emissions associated with your product, which likely is not the case. What’s more, you would need to have documents that show a scientifically accurate and reliable method of calculating your carbon emissions in the first place. In short, there are significant risks to thoughtless green marketing. But, going green is not only good on its own; customers also increasingly want to know if your business is environmentally sound. So, if you’re going to make eco-friendly claims, take the time to do your research and get it right. DISCLAIMER: This article is intended to be a source of general information, not an opinion or legal advice on any specific situation, and does not create an attorney-client relationship with our readers.
Bao M. Vu is a Partner with the law firm Stoel Rives LLP. He regularly advises clients on compliance with complex consumer protection and environmental statutes and regulations. He can be reached at email@example.com or 415-500-6572. Corey Day is an alcohol beverage attorney and litigator at Stoel Rives LLP (stoel.com). He likes chatting about potent potables, so email him: firstname.lastname@example.org; call him: 916-319-4670; or follow him on twitter: @coreyday.
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Don’t Miss Our Last Workshops of 2021 Fundamentals of Distilling ADI returns to New England! This workshop offers a full review of setting up a distillery — from financing, to operations to sales/marketing.
Location: Mine Hill Distillery in Roxbury, CT Dates: November 5 to 7
Blending, Maturation & Warehousing Nancy Fraley, internationally renowned independent Master Blender, will be teaching this class on all aspects of barrel maturation. This very successful, in-depth master class returns for the 4th year and sells out early.
Location: Iron Root Distillery, Denison, TX Dates: December 5 to 8
For more information: distilling.com/events/ Contact: email@example.com
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Spirits Trade Groups Form Strategic Partnership Focus on DTC Legislation
Written by Margarett Waterbury
here’s been plenty to hate about the pandemic, but one thing consumers seem overwhelmingly sold on? The ability to buy booze online. As the landscape shifts yet again, spirits industry trade groups have begun to advocate in earnest to make it easier for distillers to sell their products directly to consumers through the mail. A recent webinar and briefing from the Distilled Spirits Council of the United States (DISCUS) outlined the current state of the landscape. Currently, 46 states and the District of Columbia permit direct shipping of wine, while just nine states and the District of Columbia offer spirits producers the same privilege. Seven additional states temporarily permitted distillers to deliver or direct-ship spirits in-state during the pandemic, but two of those states have already let the measures expire, and others are scheduled to do the same. Restrictions exist despite overwhelming consumer demand for the ability to stock their home bars from the comfort of their, well, home. The International Wine and Spirits Record (IWSR) Drinks Market Analysis conducted an online consumer survey of 2,056 legal drinking age consumers in March 2021. Nearly three in four reported currently shopping online for groceries, and 62 percent said they had already purchased beverage alcohol on the internet. Their purchases were split almost evenly between wine (33 percent), spirits (32 percent), and beer (31 percent). Younger generations are more likely to shop for alcohol online, but not overwhelmingly so. Seventy-one percent of Millennials had purchased beverage alcohol online, as had 45 percent of Baby Boomers. Significant differences across racial and gender groups were not evident, with 70 percent of Asians, 67 percent of Hispanics, 66 percent of Blacks, 61 percent of Whites, 67 percent of men, and 56 percent of women reporting buying alcohol online — all larger shares, in fact,
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than the 53 percent of consumers who reported having ever purchased alcohol directly from a winery, brewery, or distillery. The survey also underscored the depth of consumer support for direct-to-consumer (DTC) shipping of distilled spirits within and across state boundaries. Eighty percent of those surveyed agreed or strongly agreed that “spirit distillers should be allowed to directly ship their products to legal drinking age consumers in any state, just as the wineries do,” and more than three in four said they would personally consider buying spirits online to be shipped directly to them from inside or outside of the state. Pandemic-era changes to state shipping laws gave many distilleries a tantalizing preview of exactly how direct-to-consumer shipping could impact their businesses. Blinking Owl Distillery in Santa Ana, California, said that temporary DTC laws enacted in California during the pandemic permitting in-state shipping resulted in a $65,000 impact on their business. With that benefit expected to sunset in just a few months, Head Distiller Ryan Friesen says he’s not sure how to plan for the future. “There is no doubt the governor’s temporary approval of in-state direct shipping of spirits helped save Blinking Owl Distillery during the
pandemic, but we are left to wonder how to bridge the gap when this vital revenue stream, which is slated to be rolled back on January 1, 2022, goes away,” said Friesen. Christine LoCascio, DISCUS chief of public policy, said that DTC can comfortably coexist with the three-tier system. “We fully support the three-tier system and view direct-to-consumer shipping as an enhancement to the evolving and modern marketplace,” said LoCascio. Friesen echoes that perspective. “Allowing me to reach more consumers through direct shipping will help me build our brand and generate enough interest to ultimately grow our wholesale distribution,” he said. “That’s the end goal.” For now, DTC remains a dream for many producers. Yet there are subtle indications at the state and even federal level that lawmakers may be more open to the idea. Rep. Jackie Speier (D-CA), Rep. Dan Newhouse (R-WA), and Sen. Jeff Merkley (DOR) recently introduced a bill called the
USPS Shipping Equity Act (H.R. 3287/S. 1663) that would enable the U.S. postal service to ship beverage alcohol products where DTC shipping is allowed. The bill currently has 28 co-sponsors in the House. Supporters include groups from every segment of the beverage alcohol industry, as well as the American Postal Workers Union. Key selling points are that the bill would give consumers more choice, generate new revenue for the USPS, and ensure appropriate safeguards for safe shipping and delivery. Building on this momentum, DISCUS, the American Craft Spirits Association, and the American Distilling Institute also announced the formation of a strategic partnership, with the goal of passing laws that permit spirits DTC shipping, a topic they say will be a top legislative priority for all three organizations. “Consumers agree that distillers should be able to ship their products directly to them in a safe and responsible way,” said LoCascio, “just as wine has done for decades.”
Margarett Waterbury is a drinks writer who lives in Portland, Oregon. Her first book, Scotch: A Complete Introduction to Scotland’s Whiskies, released in fall 2020.
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SPECIAL THANKS TO THE SPONSORS MAKING THIS POSSIBLE
Spirits-Based RTDS Recent Legislative Updates Written by Beth Hatef
f you follow the alcohol industry at all — as a producer, distributor, retailer, or even as a consumer of alcohol beverages — surely you are aware of the recent ready-to-drink (RTD) alcohol beverage craze. Although the explosion in popularity of RTD beverages is certainly not limited to the alcohol industry, one particular area of recent growth has been in the spirits-based RTD space. With this growth has come many changes in the legislative landscape. As a refresher, RTD alcohol beverages fall into several different categories, including hard seltzers, hard kombuchas, flavored malt beverages (FMBs), and wine- and spirits-based cocktails. All of these categories have seen phenomenal growth in the last couple of years, fueled by a consumer desire for convenient, often lower calorie and lower alcohol content alcoholic beverages. On the spirits side in particular, according to the Distilled Spirits Council of the United States (DISCUS), the RTD and premixed cocktail category grew more than 125 percent in 2020. The spirits-based RTD industry is an approximately $300 - $400 million industry at the moment. Bank of America has estimated that in the next five years, it could reach $3 to $5 billion. Indeed, a wide range of players in the spirits industry — from the largest producers and importers to startup craft distillers and everyone in between — want to get in on the action. A recent DISCUS survey found that 45 percent of craft distillers who responded were already producing RTDs, and an additional 20 percent planned to do so in the near future. Of the distillers not already producing RTDs, more than 60 percent noted that they would be interested if excise tax rates on these products were lower.
Key Legal Issues Facing Spirits-Based RTDs Producers of spirits-based RTDs currently face two major obstacles with respect to the production and distribution of these products: (1) high excise taxes; and (2) limits on distribution. These hurdles are based on the fact that states generally classify spirits-based RTDs, notwithstanding their lower alcohol content, in the same category as other types of distilled spirits. Federally, spirits-based RTDs are currently taxed at the distilled spirits tax rate (as opposed to malt-based RTDs, which are taxed at the much lower beer tax rate). Because state alcohol laws typically do not distinguish between full-strength distilled spirits and lower-alcohol spirits-based RTDs, most states currently impose the same alcohol excise tax rate that applies to distilled spirits to spirits-based RTDs. Spirits industry groups, most notably DISCUS, are working to change that by lobbying — at the federal and state level — for lower excise tax rates for spirits-based RTDs (also known as equalization). Unsurprisingly, DISCUS’ efforts have been met with pushback, particularly from the beer industry. Moreover, in a number of states, current laws restrict how spirits (and, by extension, spirits-based RTDs) are sold. In the 17 states with control systems for spirits, spirits-based RTDs generally must be sold in the same manner as other, higher-ABV distilled spirits (i.e., through the control system). This substantially limits the retail outlets that can carry these products. In some states, the fact that spirits-based RTDs must be sold through the control system affects self-distribution rights as well. In addition to lobbying for equalization of excise tax rates, DISCUS and spirits industry members have been pushing to expand the availability of spirits-based RTDs in retail channels and through direct-to-consumer shipments.
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Update on Legislative Efforts
DISCUS has stated its long-term goal of lower federal excise tax rates on spirits-based RTDs, citing the current unlevel playing field between spirits-based RTDs and malt-based RTDs. DISCUS’ goal is to end the competitive disadvantage currently facing spirits-based RTD producers. DISCUS also has been focusing its efforts on increasing market access, at the retail level, for spirits-based RTDs. Usually a state-licensed
In late May, Michigan’s governor approved several bills to increase availability in the marketplace of spirits-based RTDs. In particular, SB 144 sought to increase access to spirits-based RTDs in the market and lowered the excise taxes applicable to these products. Under the new legislation, the tax rate on spirits-based RTDs (defined to include beverages of up to 13.5 percent alcohol by volume) was reduced from $0.48 to $0.30 per liter.
Nebraska Also in late May, Nebraska’s governor signed into law legislation (LB 274), lowering taxes on canned cocktails (among other things, i.e., making the “cocktails to-go” measure temporarily enacted during Covid permanent). The bill defines an RTD cocktail as containing up to 12.5 percent alcohol by volume, and enacts a new excise tax rate of $0.95 per gallon (the same as Nebraska’s excise tax rate for wine). Without the new category, RTD cocktails were taxed in Nebraska at $3.75 per gallon. Although the Nebraska Liquor Control Commission found that the legislation would, at first, create losses in tax revenues for the state in excess of $1.5 million in the 2021-22 fiscal year, the commission also anticipated that growth in spirits-based RTD sales as a result of the reduction in taxes could make up this loss.
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In early summer, the New Jersey Assembly was considering SB 3452, which sought to reduce state excise taxes on spirits-based RTDs below 9.9 percent alcohol by volume. The bill received significant pushback from the beer industry, which noted the disadvantages of passing the legislation (e.g., decreased tax revenues for the state). In response, DISCUS submitted testimony to the Senate Budget and Appropriations Committee, arguing, among other things, that the state would see substantial increases in excise tax revenues from spirits-based RTDs as a result of the legislation. The bill was reported favorably from the Budget and Appropriations Committee, but stalled when the Senate went on recess in late June. The bill may be reconsidered when the Senate reconvenes in November.
spirits wholesaler may sell spirits-based RTDs, limiting the retail accounts that may receive these products to licensed retailers of spirits. According to DISCUS, there are more than three times as many retail outlets available to malt-based and wine-based RTDs as there are available to spirits-based RTDs. A number of state legislatures considered bills during the 2021 legislative session addressing spirits-based RTDs, including:
North Carolina The North Carolina legislature considered HB 904 in the 2021 legislative session, which would create a new category of alcohol beverages known as “low-alcohol beverage coolers” (of up to 9.5 percent alcohol by volume). The legislation includes these products within the definition of a fortified wine in North Carolina. The bill was referred to a committee in the house in May 2021, and the legislature adjourned in July.
Oregon The Oregon legislature considered HB 3194 in the 2021 session. The legislation would privatize the sale of low-alcohol spiritsbased RTDs, which currently must be sold through Oregon’s control system, and broaden the availability of these products at retail. The bill would apply to beverages containing no more than 14 percent alcohol by volume, and would impose a lower tax rate on these products. The bill has met pushback from some industry members, most notably the Wine Institute. Oregon’s legislative session ended in late June with no action on this bill.
Pennsylvania The Pennsylvania legislature is considering a bill, HB 1154, that would expand spirits-based RTD sales to additional retail outlets (i.e., grocery and convenience stores). As in Oregon, these products currently must be sold through Pennsylvania’s control system. The bill was referred to committee in late June 2021.
Washington SB 5049 was considered by the Washington legislature during the 2021 session. The bill, which has the support of the Washington Spirits and Wine Distributors, sought to reduce the state excise taxes applicable to low-alcohol beverages (i.e., a beverage containing less than seven percent ABV, not including wine or malt beverages). The bill also sought to exempt low-alcohol spirits from Washington’s spirits retailer and spirits distributor license issuance fees. The Washington legislature’s legislative session adjourned in April with no action on this bill.
The spirits industry clearly has a long way to go toward equalizing both applicable excise tax rates and distribution channel availability for spiritsbased RTDs. But the fact that many in the industry, and many state legislatures, are focused on these efforts bodes well for the future success of these products.
Beth Hatef is Counsel in the law firm of Davis Wright Tremaine LLP, based in the Firm’s Washington, D.C. office. A Chambers USA-recognized practitioner, she concentrates her practice on a wide variety of regulatory and distribution issues involving alcohol beverage industry members. Her practice includes counseling on distribution relationships, alcohol regulatory compliance, excise tax compliance, and advising strategic and institutional investors in connection with corporate transactions in the alcohol industry.
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SPIRIT(S) OF SAVANNAH
Ghost Coast Distillery Combines Local Soul and Outside Perspective to Create Innovative Bottles WRITTEN BY RICH MANNING PHOTOS PROVIDED BY GHOST COAST DISTILLERY
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hen my wife and I set foot inside Ghost Coast Distilling in Savannah, Georgia, it marks the first time either of us have set foot inside a distillery in 16 months. The massive space is a bit quiet, which, considering it’s 1:00 p.m. on a Thursday, is to be expected. We walk past the snack racks, the distillery swag, and the cash register and its surrounding bottles to land at the brick-walled bar. We pull up two stools unblocked by partitions. Cocktails and paddled spirits flights ensue. So do conversations with the bartenders — conversations about the distillery and its
spirits, but also geeky chats about drinks, the city, and random bits of pop culture. We’re roughly 2,400 miles from our Southern California house, yet we’re home. This sense of place seems effortless — no small feat in the topsy-turvy world of the pandemic. Ghost Coast’s name has a bit to do with this, since it references Savannah’s reputation as a haunted haven and its proximity to Georgia’s shoreline. Peeling back the curtain a bit reveals the substantial effort done by the distillery to make the home-like vibe possible.
Ghost Coast’s story starts on the back of a cocktail napkin. Co-founders Chris Sywassink and Rob Ingersoll sketched out the distillery’s skeleton on the flimsy paper square, charged by the idea of creating something uniquely American to share with the masses. This was the easy part. Launching what would be Savannah’s first distillery since the days before Prohibition filled their vision with clouds. Georgia was legally ill-prepared for the distilling renaissance in 2016, the year before Ghost Coast officially launched. The Peach State’s post-Prohibition laws forbade distilleries to sell direct or even market to consumers, immediately stacking the deck against anyone hoping to produce local craft spirits. The duo felt the only way they could turn their idea from sketches to stills was to push back against the archaic mandate. “Georgia’s liquor laws hadn’t changed from 1935 to 2016,” explained Sywassink, who also serves as Ghost Coast’s general manager. “We lobbied hard to get the laws changed in our favor. If they didn’t change, it would have been an absolute non-starter for us.” Their efforts paid off. Georgia changed the laws to a rather dramatic degree, allowing distilleries to sell directly to customers, conduct tours, offer samples, and serve onsite drinks. These laws carry the potential to encourage more distilling efforts, potentially allowing Georgia to strive toward a spirits-making reputation it once had before that pesky temperance movement occurred. “Prior to Prohibition, Georgia was one of the
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country’s top liquor producers,” Sywassink said. “However, Prohibition started in Georgia earlier than other states, so a lot of talent that was in the state dispersed elsewhere.”
There was a caveat to Georgia’s state law. While on-site cocktails are possible, no outside spirits can be brought in to finish off a drink. This provision could be a massive headache for a young distillery yearning to build community and a sense of home through a steady on-site drinks program. Yet Ghost Coast saw it as an opportunity to get creative within their portfolio. They leaned on Head Distiller Ken Klehm’s two decades of bartending experience outside the Savannah area to concoct enough spirit variations to build a robust cocktail program, a strategy that led to ambitious ideas like creating eight different bourbon mash bills. While such dis-
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“It was important for us to make good spirits that could not only generate revenue, but also build a solid cocktail program. That way, we could really be engaged with the community.” — Chris Sywassink
CO-FOUNDER & GENERAL MANAGER, GHOST COAST DISTILLING
tilling moxie allowed Ghost Coast to execute their goal in making progressive spirits that balanced traditional and innovative expressions, it also helped them establish a crucial connection with imbibers. “I love an aged rye either neat or with a cube, but a bulk of consumers are cocktail drinkers,” Sywassink explained. “It was important for us to make good spirits that could not only generate revenue, but also build a solid cocktail program.
That way, we could really be engaged with the community.” Ghost Coast has produced 29 different spirits since their launch in 2017 with more in the works. The usual suspects like bourbon, gin, and vodka are present. So are more esoteric choices like fernet. Their handiwork is not defined by sheer quantity: The lion’s share of the bottles available in the retail sector, like their citrus-forward American-style
Burl Gin and their bourbon cask–aged Tiki Spiced Rum, boast medals from entities like the SIP Awards, the American Craft Spirits Association, and the San Francisco World Spirits Competition. Sywassink attributes the success to a strict adherence to making spirits of purpose and not just for creativity’s sake. “If you don’t have a practical side to making a spirit, where you’re not understanding its flavor profile or figuring out how to use it, it’s difficult to enjoy,” he said. “It may be good, but it won’t have any soul.”
Ghost Coast plants its flag in Savannah, but its talent’s roots are more widespread. The head distiller made his bones in Asheville, North Carolina and Chicago. The assistant distiller hails from Kentucky. The marketing manager comes from Cincinnati. The bar manager is a Massachusetts native. These diversified origins help Ghost Coast to carry a robust perspective into their operations, from the way the juice is made to how it gets exposed to the masses. According to Sywassink, they also demonstrate the city’s allure and its remarkable ability to light a spark within those who are new in town. “Once you come to Savannah, you get pulled in without realizing it,” he explained. “You get immersed into the city and its culture, and you realize you should have been here ages ago. We have seen so many people on staff bring their mentality and experiences from other cities; Savannah just recharges their energy, and they start building new experiences. When this happens, it blossoms into something special.” Even with this outside perspective, there’s still enough room for Savannah’s homegrown spirit to shine through Ghost Coast’s juice. This is in some ways in a literal sense — Sywassink cites the city’s water as a key ingredient within the process. It’s also present through the distillery’s local fans, who aren’t afraid to let their opinions known. “The community will take you in with a great big hug, but they’ll also be very honest,” he stated. “If you serve them something they don’t like, they’ll tell you. If you serve them something good, they’ll tell you it better be just as good the next time they have it. That certainly keeps us on our toes.” 46
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We are about to leave Ghost Coast. We are leaving happy, and not just because of the experience — Ghost Coast’s plans for distribution expansion include California, so they’ll be occupying space in our home bar soon. As we’re wrapping up, Sywassink succinctly tells me the mission of Ghost Coast’s bar and why it’s meaningful to gather here as we have. “Have a good time and love your neighbor,” he said. “That’s what it’s all about, really.” This sentiment envelops what was absent for long stretches of time during the pandemic, when distillery tasting rooms were shuttered, the pursuit of happiness occurred in isolation, and hatred ran so rampant. Here at the bar, engaging with kind and knowledgeable people who were just as geeky about booze as us, the good times and love flooded our senses in a way that refreshed and healed. It felt great to be back home.
Ghost Coast Distilling is located in Savannah, Georgia. For more info visit www.ghostcoastdistillery.com or call (912) 298-0071.
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Juniper is no longer just juniper. Written by Aaron Knoll
ruth be told, it never was. Juniper is a broad taxonomic term that refers to the genus Juniperus. That genus contains at least 76 species of juniper (and a further 32 varieties beyond that)1. Juniper trees grow throughout the Northern Hemisphere and thrive in a variety of niches. But they all have in common two things: Needle-like leaves and cones. The one species that most gin distillers know best is Juniperus communis. It grows native all across the Northern Hemisphere in temperate climates. The species is even called out specifically in the European Union regulations for spirits labeling: 20. (a) Gin is a juniper-flavoured spirit drink produced by flavouring ethyl alcohol of agricultural origin with juniper berries ( Juniperus communis L.)2 However, even within this one species, there’s more variation than meets the eye. There may be as many as two subspecies and up to eight varieties. So what does all of this mean? Species, subspecies, and varieties are differentiated based on morphology. The needles are different. The plant has a different shape. The cones are different sizes. These differences allow the plants to thrive in different niches, and therefore have different chemical makeups. The plants and their cones may smell, taste, and distill differently owing to the variety of terpenes present. While distillers in European markets (or those looking to distribute their products in such markets) are limited by the hyper-specific regulations governing juniper type, others aren’t as tightly bound. For example, in the United States, the requirement is merely defined as “Juniper berries.”3 1 Adams (2014) 2 Regulation (EU) 2019/787 (2019) 3 Alcohol and Tobacco Tax and Trade Bureau. 2007
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What has been done with other types of juniper? Death’s Door Gin boasted a scant three botanicals. They used fennel, coriander, and juniper. However, that one juniper might have been best described as two. It was distilled from a combination of imported Juniperus communis and locally grown Eastern red cedar. Also known as “red juniper,” Juniperus virginiana grows widely in the American Midwest and its cones exhibit a very different terpene profile than common juniper. The American Southwest and Mexico are hotbeds for juniper diversity, with many species only growing in this part of the world. The Texas-based WildGins Co. has used this to their advantage and produces two gins that utilize locally foraged, unusual types of juniper. Their WildJune Western Style Gin uses red berry juniper (Juniperus pinchotii). Their WildBark West Texas Dry Gin uses the alligator juniper (Juniperus deppeana). With gin production ramping up in parts of the world where it has not historically been common, it’s not surprising to see producers finding local flora to use in gin. Another region of the world with surprising amounts of juniper diversity is the Mediterranean. Three Brothers Gin is a macerated compound gin produced in Lebanon that utilizes arâr (Juniperus phoenicea) among its botanicals bill.
What are the differences? As with Juniperus communis, many factors affect the individual terpene profiles of juniper cones. The growing season, the weather, and storage conditions all affect the flavor you might get from any individual cone. The data in this table doesn’t represent every cone, but it does paint a picture of the kind of differences you may find among species. The piney, woody4 aroma of α-Pinene is often platonically associated with the aroma of juniper. However, compared to alterna4 All terpene descriptors are excerpted from The Good Scents Company Information System. (http://www.thegoodscentscompany.com/)
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Examples of gins made using different species of Juniper
Comte de Grasse
Cowboy Country Distilling
Brown Mule Gin
Death's Door Spirits
Death's Door Gin
Three Brothers Distillery
Three Brothers Gin
Three Wells Distilling Company*
Mt. Lemmon Gin
WildJune Western Style Gin
Red Berry Juniper
* Closed in 2019 Source: Miller (2020)
Source: Miller (2020)
tive species, Juniperus communis TABLE 2: Essential oil yield by species* has less5 of it among its aroma proEssential file. Juniperus phoenicea6 and JuniType of Juniper Source Oil Yield perus excelsa7 both have α-pinene 2.0 - 7.0% Medini 2011 Juniperus phoenicea as its far greatest component. Juniperus communis is also the 0.30% Stewart 2014 Juniperus virginiana only type of juniper that has sa0.4% - 1.8% Hajdari 2014 Juniperus oxycedrus binene, with “woody, spicy, and 1.20% Judžentienė 2019 Juniperus communis camphoraceous” notes as a major constituent of its oil. Myrcene is * In selected studies also a major constituent of common juniper that was absent exup the flavor in citrus peels, is a major cept in trace amounts in all except Juniperus component in the cones of Juniperus oxycedrus, of which it was the primary arovirginiana.11 Limonene is only a minor matic component.8 constituent of other types of juniper. Juniperus oxycedrus is an interesting type The amount of flavor in each cone, or oil of juniper as its place in spirits is also codcontent per cone, varies, however, it does ified in European law. “Spišská borovička not do so in a manner that is different from is a spirit drink with an alcohol content of your usual supply of Juniperus communis. 40 percent vol., and a characteristic proThis variation is less tied to species and is nounced taste and aroma of juniper Junipemore closely related to harvest season and rus communis, or Juniperus oxycedrus.”9 Simstorage condition.12 ilar to Juniperus communis in α-pinene, it has Overall, the variation is immense. Demore β-pinene, on average more limonene spite all being juniper, the cones of differand germacrene D. It also has among its arent types of juniper have vastly different omatic constituents (E)-nerolidol, a floral/ aromatic profiles. Distillers working with a green molecule not seen in any other type different type of juniper should not assume of juniper in this overview.10 that it’s going to be the same as the Juniperus Limonene, classically citrus in profile communis that they’re used to working with. and the aroma molecule that chiefly makes They should be treated as different botani-
8 Hajdari (2014)
cals when put in a botanical blend. Further, some of these species are not as well studied as others. There is limited literature on berry essential oil content for some less common species of juniper.
9 Technická dokumentácia – článok 20 „Spišská borovička“ (n.d.)
11 Stewart (2014)
10 Hajdari (2014)
12 Shanjani (2010)
5 Buci (2018) 6 Medini (2011) 7 Shanjani (2010)
However, therein lies the excitement and opportunity. Because these juniper species are different, exploring alternative types of juniper in botanical bills affords gin producers an opportunity to differentiate and create new flavor profiles.
Foraging: What do you need to know?
Major Volatile Constituents of Juniper Species* Juniperus phoenicea Medini 2011 ‡
Shanjani 2010 ‡
If you are looking to source local juniper, especially alternative species, be sure to know what you’re grabbing before you pick it. While nowhere near as dangerous as foraging for mushrooms, some poisonous species exist. Juniperus sabina is the most common juniper to be avoided. It grows widely across Europe and Asia and is a popular ornamental because of its bluish-green foliage and wide-spreading branches. All parts including the cones are poisonous. However, many species are safe for human consumption. The book that I recommend is Robert P. Adams’ Junipers of the World. The fourth edition is readily available on Amazon. Adams has been researching plants in the juniper family since the late 1960s. The book, while a tad academic at times, has thorough data on where types of juniper grow and how to identify them. Organizations like Plants for a Future also provide a good starting point for investigating plants from a palatability perspective. While not exhaustive, it can be a valuable starting point † Study examined the content of a * For clarity sake, minor product from Albania. constituents below 1% were commercial for understanding whether a type The data here to illustrate a "typical" omitted from this table example of Juniperus communis. of juniper may be a part of a region’s food culture or plant-based medicine heritage. However, please note that just because it appears in a food or medicinal culture may not explicitly mean it is safe. As long as there is an appetite for experWhen exploring new types of juniper, imentation within gin, there’s space for disalways know what you’re picking. If worktillers to innovate with botanicals, juniper ing with a type of juniper you haven’t seen, included. But despite being in the same do your research before eating or distilling genus, novel species of juniper aren’t exwith it. 50
α-Pinene 63.4% 77.3% 75.6% 57.2% Camphene <1 % 9.3% Sabinene β-Pinene 2.0% 2.5% 1.6% 2.0% Myrcene 1.1% 2.1% 3.5% 4.2% δ-3-carene 1.2% 10.0% α-Terpinene β-phellandrene <1 % 2.5% Limonene 1.5% 3.1% γ-Terpinene 4.0% 3.2% Terpinolene 1.6% α-Campholenal <1 % 1.2% 1.5% Trans-pinocarveol <1 % 1.5% 1.1% Trans-verbenol <1 % 1.6% 4.6% Terpinen-4-ol <1 % 2.4% Verbenone 1.7% Pregeijerene B Bornyl-acetate 0.8% 1.4% Safrole α-terpinyl acetate 1.3% 1.7% β-Elemene β-Caryophyllene 1.4% 2.8% (E)-caroyphyllene <1 % 1.1% α-Carryophyllene γ-Muurolene Germacrene D 1.5% 2.9% γ-Cadinene δ-Cadinene Elemol 1.0% 1.5% Germacrene B 7.2% 11.6% (E)-Nerolidol Caryophyllene oxide 1.1% 3.5% Humulene epoxide II 1.4% γ-Eudesmol β-Eudesmol α-Cadinol 1.8%
What’s next for juniper and gin?
Hajdari 2014 ‡
Juniperus Communis † Buci 2018
<1 % 2.2% 45.5% 57.0%
2.2% 1.5% 2.0% 1.5% 2.0%
1.7% 1.0% 4.5% 1.0% 2.9% 1.3%
2.5% 2.7% 2.9%
‡ These studies included ranges across several samples. The highest percentage and lowest percentages observed within the study are included. For Shanjani, two seasons of variation were included to illustrate range.
actly the same as Juniperus communis and distillers shouldn’t expect them to perform the same in spirits. The best way to achieve a traditional gin juniper flavor is still to use common juniper. However, as a novel botanical and part of a botanical blend, different types of juniper can be interesting new ingredients for
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Sources Adams, R. P. (2014). Junipers of the world: The genus juniperus. Trafford Publishing Co. Adams, R. P. (1970). Seasonal variation of terpenoid constituents in natural populations of Juniperus pinchotii Sudw. Phytochemistry, 9(2), 397-402. Alcohol and Tobacco Tax and Trade Bureau. (2007). Class and Type Designation. In The Beverage Alcohol Manual (BAM). A Practical Guide. (Vol. 2). Buci, A., Hodaj-Çeliku, E., Manaj, H., Abazi, S., Drushku, S., & Lazari, D. (2018). Essential oil composition from Juniperus communis originated from Albania. Journal of International Environmental Application and Science, 13(1), 15-19. Elmer, N. L., & About the author Nicole L Elmer . (2020, January 22). The Texas EIGHT: Love 'Em, hate 'em, or Drink 'Em. Biodiversity Center. https://biodiversity. utexas.edu/news/entry/the-texas-eight. Hajdari, A., Mustafa, B., Gashi, V., Nebija, D., Ibraliu, A., & Novak, J. (2014). Chemical composition of the essential oils of ripe berries of Juniperus oxycedrus L., growing wild in Kosovo. Biochemical Systematics and Ecology, 57, 90-94. Judžentienė, A. (2019). Juniperus communis L.: A review of volatile organic compounds of wild and cultivated common juniper in Lithuania. Chemija, 30(3). Majewska, E., Kozłowska, M., Kowalska, D. O. R. O. T. A., & Gruczynska, E. (2017). Characterization of the essential oil from cone-berries of Juniperus communis L.(Cupressaceae). Herba Polonica, 63(3). Medini, H., Elaissi, A., Larbi Khouja, M., Piras, A., Porcedda, S., Falconieri, D., ... & Chemli, R. (2011). Chemical composition and antioxidant activity of the essential oil of Juniperus phoenicea L. berries. Natural product research, 25(18), 1695-1706.
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Miller, S. (2020, November 21). Bushtucker trials: Making gin with native juniper. Gin Magazine. https://gin-mag. com/2020/12/13/local-juniper-juniperus-varieties-ingins-around-the-world/. Regulation (EU) 2019/787 of the European Parliament and of the Council of 17 April 2019 on the definition, description, presentation and labelling of spirit drinks, the use of the names of spirit drinks in the presentation and labelling of other foodstuffs, the protection of geographical indications for spirit drinks, the use of ethyl alcohol and distillates of agricultural origin in alcoholic beverages, and repealing Regulation (EC) No 110/2008 (2019) OJ L 130. Rajčević, N., Dodoš, T., Novaković, J., Boršić, I., Janaćković, P., & Marin, P. D. (2020). Differentiation of North-Western Balkan Juniperus communis L.(Cupressaceae) populations–ecological and chemophenetic implications. Journal of Essential Oil Research, 32(6), 562-570. Shanjani, P. S., Mirza, M., Calagari, M., & Adams, R. P. (2010). Effects drying and harvest season on the essential oil composition from foliage and berries of Juniperus excelsa. Industrial Crops and Products, 32(2), 83-87. Simonson, R. (2018, January 16). What really goes into juniper harvesting for gin? Milwaukee Magazine. https://www.milwaukeemag.com/juniperharvesting-gin-greengate-farm-door-county/. S tewart, C. D., Jones, C. D., & Setzer, W. N. (2014). Essential oil compositions of Juniperus virginiana and Pinus virginiana, two important trees in Cherokee traditional medicine. Am. J. Essent. Oil Nat. Prod, 2, 17-24. Technická dokumentácia – článok 20 „Spišská borovička“ Zemepisné označenie (n.d.). [In English: https:// shorturl.at/ehzE8]
distillers to experiment with, provided they are foraged responsibly. Australian gin distillers have leveraged local botanicals like wattle seed or finger limes to tell stories about local botanic diversity; South African distillers have harvested plants from the fynbos to illustrate the rich botanic diversity of the African Cape. Local and unusual species of juniper may be the next opportunity for distillers to tell a story through the lens of gin. Aaron Knoll is a noted gin historian, critic, and consultant. He authored 2015's “Gin: The Art and Craft of the Artisan Revival,” which has since been translated into three languages, and additionally co-authored 2013's “The Craft of Gin.” He also founded leading gin website TheGinisIn.com in 2009.
FOUNDATIONS Leopold Brothers Malt From the Ground Up Written and photographed by Gabe Toth
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For Todd Leopold, the question as to whether and why he should build a floor malting at the Leopold Brothers distillery in Denver goes back to a simple conversation from his earliest days as a brewing student. He thinks back to complaining to Bill Siebel, fourth-generation leader of the Chicago brewing school that bears his family name, about the inclusion of malting in the Siebel Institute curriculum.
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“He said ‘Kid, you have to know how to make good malt to know how to make good beer,’” Leopold said. Since then, Leopold has become an artisan who puts quality and flavor as the paramount factor in his production, importing grape spirit from South American to use a historically accurate base for his absinthe, commissioning the design and fabrication of an extinct type of rye whiskey still — the three-chamber still, which was discarded for its relative inefficiency and hasn’t been used since before Prohibition — and, most recently, completing a massive expansion of the floor-malting operation housed at the distillery.
The new malting setup more than quadruples capacity, reduces the work required to malt barley, and improves consistency. Where there had been a 5,000-pound steep (the initial stage of malting, where the grain takes up moisture) there is now a bespoke vertical steep tank made by the German manufacturer Buhler that holds 22,000 pounds of raw barley. Common practice is to use water to rinse the steeped grain out of the tank. However, Leopold wanted a tank that would discharge the steeped grain without any water. Buhler was able to engineer a custom tank that worked the way he wanted it to. “It was me having conversations with them about angle of repose, based on notes I have from books from the late 1800s,” Leopold said. “Designing steep tanks like that hadn’t been done in forever.” The tank is equipped with air nozzles that help to turn over, mix, clean, and wash the grain as it steeps. That allows the grain to properly hydrate and optimizes it for germination. “Boy, did it shorten our steep time,” Leopold said. “The germination is absolutely night and day, the chitting that we get is 99 percent plus every time, an unbelievably efficient system. It really helps with the consistency.” It also helps to scrub the carbon dioxide that the grain produces during steeping. “We have much more efficient CO2 removal. You’re pulling from the bottom of the tank and drawing air through the bed and up out the roof,” he said. The old steep tank at Leopold Brothers was an inefficient horizontal tank, designed that way out of necessity because of the limits of the existing building. They had to shovel grain out of the steep tank. A vacuum pump did what it could to vent CO2, but there was no efficient way to get it all vented. 54
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“There’s a reason that Springbank is the only distillery in the world, that I’m aware of anyway, that uses a horizontal steep tank. It's not a very efficient way of handling it.” The new malting floors at Leopold Bros. are a unique setup among floor maltings, or any kind of malthouse. It uses a two-stage germination, letting the grain get started on the ground floor for two to three days, then moving it to a sump pump in the center of the bottom floor and pumping it up to the top floor, where it will sit again for two to three days to finish germinating. Leopold said the move helps to cool, homogenize, and aerate the germinating grain bed, venting the heat and CO2 created in germination and mixing the bed thoroughly. The horizontal layout also doubles the floor capacity with the same footprint. 56
“Your needs for making distiller’s malt versus malt for brewers is different. You’re driving on a much wider road. If you’re going to start selling malt to brewers, to me the quality control standard is just in a completely different ballpark.”
“It’s worked beautifully,” he said. “It makes much better quality malt, and it’s much less effort.” After germination is complete, the staff hooks a plow to a winch on the floor and pushes the whole batch into the kiln, which is located adjacent to the malting floors, above the bottom floor and below the top floor. Their new kiln has room under the floor to walk in and clean out, and an air diverter so that they can recirculate high-moisture air to make stewed malts such as Munich or Vienna. Or, after the moisture has begun to drop, they can recirculate some of the already heated air for energy savings. In addition to the expansions to the physical building, Leopold installed world-class
— TODD LEOPOLD equipment for grain cleaning, milling, cleaning and debearding, bagging, and palletizing. The system also includes two receiving silos and a variety of grain transport choices including a bucket elevator, pneumatic, auger, and a sump pump depending on the stage of malting. Though things are up and running, he said they’re still “recovering” and working some kinks out after doing most of the expansion in 2020. “I would say never commission during a pandemic, that wasn’t a lot of fun,” Leopold said. W W W . ARTISANSPIRITMAG . C O M
His current lineup includes pale malt, pilsner malt, a distillers malt that can be used for conversion of bourbon or rye mashes, and a “whiskey malt.” Where the distillers malt is germinated and then kilned gently, 24 hours at 120 degrees, to preserve a larger enzyme package, the whiskey malt is germinated hot, only on the top floor, to overconvert the barley, then kilned hotter (adding heat before moisture drops below 20 percent) to create more flavor-active Maillard compounds. The earlier heat on the whiskey malt denatures more of the enzymes and leaves it with a lower diastatic power, but Leopold isn’t worried about that. It will still self-convert a 100-percent malt whiskey. “That allows me to get a lot more flavor,” he said. He has tighter restrictions on the barley he accepts for his brewers malts versus the distillers and whiskey malts, using lower protein barley (10.2 to 10.5 percent) for his pale and pilsner malts. “Your needs for making distillers malt versus malt for brewers is different,” he said. “You’re driving on a much wider road. If you’re going to start selling malt to brewers, to me the quality control standard is just in a completely different ballpark.” He said the expansion was a result of two factors: his needs onsite, and regular requests from brewers. “So many brewers would come and visit us and ask, ‘Can we have some?’” he said. He started supplying malt to local breweries, including New Belgium and Crooked Stave. Brewers Supply Group, who he’d worked with for decades, came calling about distribution, but he didn’t think it would really go anywhere. “It was a lark,” he said. Even though his malts are now available through BSG, he said the distillery is capable of using almost all of it up onsite. Having dabbled in malt whiskey previously, Leopold has now started up a malt whiskey program. He’s expanded production on the three-chamber still, running malt whiskey and an Irish-style whiskey with malted and unmalted barley on it. “It doesn’t make a whole lot of sense to have an enormous floor malting set up and only use it to make distillers malt for bourbon, vodka, and rye,” he said. The three-chamber whiskies are “quite a bit different than coming off of a pot still,” he added. Overall, it’s been a largely successful expansion that brings their capacity to about five million pounds per year. “It’s one of those things where you go, ‘Well, shit. I thought it would work, and it did!’” Leopold said. “That’s always nice, when you design something like that, or the three-chamber still, and it works according to what you thought it would do. It’s a relief.”
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GDCHILLERS.COM Leopold Brothers is located in Denver, Colorado. For more information visit www.leopoldbros.com or call (303) 307-1515. W W W . ARTISANSPIRITMAG . C O M
Viable Strategy or Grift? Written by Devon Trevathan
hen it comes to alcohol, purchasing behavior can seem like it’s influenced by a wealth of factors before the quality of the juice inside is even considered. As consumers, we are much more susceptible to unseen psychological marketing tactics than we may realize. Among them is the concept of scarcity marketing, a tool that has been employed, purposefully or not, to great success within our industry. Scarcity refers to a basic economic problem: the gap that develops between limited resources and limitless wants. When a good or product (or service, if this applies) has a cap on the amount that can be sold, and public desire for the product surpasses that cap, then allocation becomes necessary to decide who should be able to purchase a product (Shi and Chumnumpan, 2020). Sometimes a direct result of this scarcity is that the price of said good or product jumps up, leading to increased profits for the supplier. Whether it was caused intentionally or not, the scarcity correlated with a better market performance for the supplier and a positive final position overall. Scarcity can be the result of supply bottlenecking, mismanagement in forecasting production, or even deliberate marketing schemes, and there is no guarantee that a dip in supply will immediately lead to a boost in sales. There are good reasons why a company might not keep an excess amount of stock — the cost of maintenance, potential to spoil, and inflexibility among them — but getting caught without any stock creates a risk that customers will feel unsatisfied and develop a negative impression of your brand. There’s also the chance, however, that the opposite will be true. Running low or even running out of products can sometimes be a boon to sales, and there are ways to take advantage of the same psychological forces at play through actions such as temporary promotions.
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THEORETICAL BACKGROUND There are four main theoretical lenses through which the value of scarcity marketing has largely been observed. These factors are typically at play when someone feels compelled to buy a product due to a perceived or real sense of scarcity. First is the COMMODITY THEORY, which basically states that the adoption of scarce products can satisfy a consumer’s need for uniqueness. Under the commodity theory, consumers attribute a higher value to products that they feel can signify their uniqueness, and the scarcity of said products enables the satisfaction of this need inherently (Shi and Chumnumpan, 2020). To see commodity theory in action, look no further than the world of commercial art sales. CONFORMITY THEORY also influences purchasing, as certain consumers align their attitudes, beliefs, and behaviors to group norms. Consumers with greater needs for conformity value a product based on the number of people who are buying it. It’s the reason that Amazon lists the number of reviews that each product has or why certain consumers will be compelled to select something from the grocery aisle that’s already been depleted. Clearly, uniqueness and conformity represent competing ideas of purchasing behavior, and they each interact with scarcity marketing in different ways. Consumer need for uniqueness leads to higher product prices and higher profits, while conformity needs tend to lower prices and profits per individual sale. Consumers that have a high need for uniqueness have been found to be more willing to adopt radically new products into their buying regime, but supply scarcity will alter their purchasing behavior, making them more willing to adopt new brands incrementally. Discussions of product scarcity often mention the role of signaling that occurs.
Some companies use product scarcity to implicitly signal a product’s superior quality and/or a consumer’s social status. This clearly ties in with the commodity theory discussed earlier, but conformity theory can also be relevant to signaling literature when it discusses product scarcity (Shi and Chumnumpan, 2020). With products that are rare by nature, such as conspicuous or customized products, there is often an observed need for both uniqueness and conformity. At its core, product scarcity influences a consumer by offering a choice: Buy now or risk missing out on the purchasing opportunity. Consumers with a great need to avoid future regret end up purchasing a scarce product not because of utility, but for concern that they won’t be able to do so in the future. This feeling is easily observable when consumers are faced with time pressures, such as limited-time discounts, which can lead to hoarding behaviors. Empirical evidence suggests that the regret from inaction was a more salient trigger to purchase than that from action, meaning that when the clock is ticking, consumers worried more about the loss of opportunity than they did overspending (Shi and Chumnumpan, 2020). Buying frenzies occur when consumers are placed in these situations. Under normal circumstances, consumers are rewarded if they take a wait-and-see approach to purchasing. But when REGRET THEORY, which describes potential regret from a missed purchasing opportunity, coincides with conformity theory, the result is conditions that penalize wait-andsee behavior since consumers will be worse off after price increases and discounted utility over time. Insufficient supply can cause feelings of agitation in consumers, causing their
focus to narrow. As their emotions rise, brain-clouding arousal suppresses their cognitive process, which further influences their product evaluation. If you’ve ever tried to buy tickets to a popular live concert or show, you certainly know the feeling. Yet another observable consistency in purchasing behavior relates to a consumer’s feeling that their behavioral freedom (for example, to choose a product) is being threatened. This falls under the umbrella of REACTANCE THEORY, which can be useful in explaining a demand seen for products that, due perhaps to government policies or market regulation, has some kind of restricted availability. Consumers can become more motivated to purchase when
the choice of a product itself is limited. It’s rare that any of the theoretical underpinnings mentioned in this article act independently; typically there are at least two theories working in concert to influence the purchasing behavior of consumers. The framework to understand product scarcity and its impacts should integrate all of the theories mentioned so far: The need in consumers for uniqueness, conformity, avoidance of future regret, and behavioral freedom. There exists a causal relationship between all four clusters of factors. The combination of an individual’s characteristics, the types of scarcity, and the types of product that it’s applied to all influence the
REFERENCE Shi, X., Li, F. ORCID: 0000-0002-6589-6392 and Chumnumpan, P. (2020). The Use of Product Scarcity in Marketing. European Journal of Marketing, 54(2), pp. 380-418. doi: 10.1108/EJM-04-2018-0285
impact that product scarcity has on a consumer, and different consumers can react differently depending on their individual characteristics. Still, the information summarized in this piece can be a starting point from which business owners can build a greater understanding of scarcity marketing, because large firms are using these concepts to their advantage, and sometimes small suppliers in our industry can unexpectedly find themselves in a situation of high demand and no stock. This information may help them navigate that difficult position, using it to their advantage to grow their brand value.
Devon Trevathan is the co-founder of Liba Spirits, a nomadic distilling company that focuses on capturing a sense of place in every bottle. She also continues to write about spirits and cocktails, including the science behind distillation and the history of drinks culture. Devon travels constantly these days; if she's not working, she's probably exploring her surroundings in the best way she knows how—her mouth (AKA through food and beverage). You can find her online @devontrevathan or @libaspirits across all platforms.
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LOOKING F O RWA R D New On-ramps to Careers and Career Advancement in the Spirits Industry Focus on Equity, Education
n 2020, the Distilled Spirits Council of the United States (DISCUS) reported that more than 15,000 people were working in the craft distilling industry at more than 2,000 craft distilleries. But how do you get one of those jobs? And once you get one, how do you advance in your career? “Compared to the brewing industry, the distilling industry seems to have almost no educational component available. I was shocked,” said Garrett Oliver, author and brewmaster at Brooklyn Brewery in Brooklyn, New York, and the founder and chair of the Michael James Jackson Foundation, which launched a scholarship program for black, indigenous, and people of color (BIPOC) brewers and distillers in 2020. He said the brewing industry
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has lots of professional intensive courses lasting from three months to two years. But he was surprised to see very few similar options specifically geared towards distilling, despite its complexity. Perhaps it’s because American craft distilling — at least in its modern incarnation — is still in its early days. It’s a strange thing to say about a trade whose origins lie deep in human history. Yet outside of a handful of heritage producers in Kentucky, Tennessee, and Indiana, the vast majority of distilled spirits companies that exist in the United States did not exist a generation ago. Most people who work in craft spirits are starting from scratch, professionally speaking, each one making it up on the fly through a combination of
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networking, informal mentorship, onthe-job training, and self-education. Autodidacts, eat your heart out. For people without the time, resources, or connections to make that approach work (a group that includes many people of color, women, and lower-income people), there are few other options. But over the last few years, new efforts have been made to bridge that gap, including equity-focused programs designed to diversify the talent pipeline in the industry and help aspiring and early-career distillers and brands overcome financial barriers, build their networks, and grow their skills and knowledge. With any luck, the next generation of the spirits industry won’t have to reinvent quite so many wheels. 61
In 2020, the Kentucky Distillers Association announced the launch of the Lifting Spirits Foundation’s scholarship program, which funds scholarships for students in the distilling programs at the University of Kentucky, Kentucky State, and the University of Louisville. “Our hope was to activate scholars from the beginning, get them in these programs, and hopefully keep them in Kentucky and in our industry,” said Sara Barnes, the director of industry responsibility and sustainability for the association. In 2021, the foundation will fund seven scholarships directly, which will be matched by five additional scholarships funded by the schools themselves. Students can apply for the scholarships directly through partner schools. Applicants can come from any background, but awards will be made with a focus on bringing more BIPOC, LGBTQ+, and women into the industry. “We want to strengthen diversity efforts in the industry, and that hasn’t been something that is forward-facing in the bourbon industry in the state of Kentucky,” said Barnes. The scholarship is supported by KDA members. Traditional university coursework can also offer compelling knowledge and credentials for starting a career in distilled spirits. The options range from certificate programs attached to chemistry, food science, or agricultural programs to full four-year and/or masters’ degree programs in fermentation science or chemical engineering. Once a relative rarity, the number of distilling-specific programs has proliferated in recent years, with certificates and degrees offered by institutions of all types, ranging from community colleges to large research universities. Among the more established programs in the United States (but by no means an exhaustive list) are UC Davis, Metropolitan State University of Denver, Oregon State University, the University of Kentucky, Central Washington University, Colorado State University, Appalachian State University, the Siebel Institute of Technology, and SUNY Cobleskill. International English-language programs include Heriot-Watt University in Edinburgh, Scotland, and Niagara College in Ontario, Canada. 62
FOR MID-CAREER PROFESSIONALS
Named for the legendary beer and whiskey writer, the Michael James Jackson Foundation was launched in 2020 with the goal of funding scholarships for people of color to complete professional coursework in brewing and distilling. Recipients are also matched with mentors to help them build relationships and develop new insights into the industry. Initial funds for the scholarship came from an organization that Jackson founded more than 20 years ago at the now-defunct American Institute of Wine and Food, as well as a crowdfunding campaign that has raised nearly $100,000. Many major beer brands, as well as a handful of spirits brands, have also donated. While Jackson was most closely associated with whisky, Oliver, who serves as the foundation’s chair, says applicants can be working in any spirit discipline. “It doesn’t have to be whisky,” says Oliver. “Even though Michael was certainly a champion of whisky, he also loved other distilled spirits, so we thought that was very much in the spirit of his overall drive.” For now, the foundation is focusing on funding scholarships for people who already work in the brewing or spirits industry in some capacity, but want to advance their careers with more education. Five recipients were chosen in early 2021, and the foundation expects to issue another round of awards in time for the fall semester. Over time, it might expand to include folks who are brand new to the industry. “We need to work hard first, establish what we’re doing, and once we’re good at it, we can do a good job for those [newer] people,” said Oliver. The Nearest & Jack Advancement Initiative, created by the Jack Daniel Distillery and the Nearest Green Distillery in 2020 with a combined donation of $5 million, aims to create professional development opportunities for Black professionals and entrepreneurs in the spirits industry. The initiative includes a leadership acceleration program for Black professionals who already work in the whiskey industry and want to advance their careers, and a business acceleration program for Black entrepreneurs who want to grow their spirits businesses. The initiative is also helping to create the Nearest Green School of Distilling at Motlow State College in Tennessee, a new distilling certificate program. The DISCUS Academy offers a wide range of a la carte online courses and certificate programs, as well as in-person events (pre-Covid, anyway). Most cost at least something, but less if you’re a member and some are free. The emphasis is on the business side, with relevant information for a wide range of tiers: managers/owners (e.g.,taking on outside investment, exit strategies), sales (impacts of Brexit, export), production (developing safety policies), and tasting room operations (state compliance, cocktails-to-go, etc.). For the citizen-scientists among us, the American Distilling Institute also offers a Distilling Research Grant program to fund practical research into craft distilling. Funds are disbursed by an independent advisory committee of academics, distillers, and scientists. Recently funded proposals cover topics ranging from how oxygen interacts with distillate in whiskey barrels, to the performance of ancient still types. Look for results from funded projects in ADI’s magazine, Distiller, and presented at the organization’s annual conference. W W W . ARTISANSPIRITMAG . C O M
FOR BUSINESS OWNERS
Since 2015, just 2.4 percent of venture capital financing in the United States has gone to Black and Latino founders, and just 2.3 percent of venture funding worldwide has gone to female-only founders since 2020. Responding to these trends, Diageo and Distill Ventures (DV) announced a $5 million investment in 2021 to fund the first year of a “pre-accelerator” for spirits businesses that are at least 51 percent owned by women and people of color. The program is intended to help overcome barriers to access to early-stage funding, with the goal of positioning diverse drinks entrepreneurs for successful successive rounds of capital raise. Participants, at least for now, must be located in North America or the United Kingdom. Heidi Dillon Otto, managing director of Distill Ventures North America, traces the roots of the inequities in VC financing back to reduced access to early-stage seed funding — which is often raised through personal networks — for women and people of color. Undercapitalized businesses often don’t meet the traditional metrics for investment, even if the concept, company, and founder are worth investing in. “We designed the pre-accelerator to connect with those founders to get their first round of capital so we can work with them to develop their ideas, build up proof points, connect with consumers, get some early commercial points, and then get them ready for what would be our typical process of coming to an investment board,” said Otto. Finalists are coached through the development of a six-month business plan to present to Distill Ventures and Diageo. Awardees receive initial funding, usually between $250,000 and $500,000, as well as the opportunity to work in close collaboration with Distill Ventures to bring their plan to life, learn more about and prepare for the pitch process, build out a team of mentors and outside counsel, and potentially develop longer-term partnerships with DV and Diageo. “It’s not just the amount of funding. It’s the tools we’re focused on giving to founders to unlock the potential of their business,” said Alexandra Sklansky Clough, publicist for Distill Ventures. Participating in the pre-accelerator doesn’t commit the founder to continuing on with Diageo in the future. “We want brands to be connected to capital no matter what. We would love it if, through the pre-accelerator process, we find a great fit and can do further rounds of funding, but there’s many reasons why the fit can change over time,” said Otto. “What we really want is that folks have a better network.” Since the program’s launch in June 2021, Otto said the response has been so robust that Distill Ventures is expanding their internal team to increase the program’s capacity. “We want to make sure we have a broader range of individuals to connect with the founders to learn their story. That connects to the work we’re doing internally — do we have the diversity of humans on our team so we can connect with founders?” she said. Applications are open and rolling, and the pre-accelerator is expected to be a permanent component of Distill Ventures’ business. “We’ll expand every year,” said Otto. While diversifying DV’s portfolio is one goal, she added that she sees the potential impact of the pre-accelerator program as extending well beyond the individual founder or business. “When we’re looking at founders, we’re thinking about what role do we see each of our founders playing as a mentor in the industry, and in their communities,” Otto said. “That ultimately brings a broader representation. If you can get seed funding to underrepresented groups, it just ripples from there.”
Margarett Waterbury is a drinks writer who lives in Portland, Oregon. Her first book, Scotch: A Complete Introduction to Scotland’s Whiskies, released in fall 2020. W W W . ARTISANSPIRITMAG . C O M
Appalachian Gap Distillery of Middlebury, Vermont
Written by Devon Trevathan Photography by Clare Barboza
erhaps we don’t think of Vermont as a land of fine spirits — yet. However, thoughtful brands have come from the Northeast Kingdom, and here’s another one to add to that list: Appalachian Gap Distillery. Affectionately referred to as App Gap, the Middlebury-based distillery became officially certified this year as a carbon neutral company by the nonprofit organization Climate Neutral. While the word Appalachia is most associated with southern states, the Appalachian Gap is a mountain pass found farther north in the Green Mountains of Vermont; the distillery for which it is a namesake resides just southwest of the pass. App Gap was founded by Lars Hubbard and Chuck Burkins in 2011. Hubbard has a varied career history, including stints as a chef, architectural consultant, and now distiller. Burkins was a biochemist for several years before becoming the lead developer for widely used enterprise software. The pair first realized their passion for homebrewing beer — the look of surprise 64
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“One of our core beliefs... is that you don’t buy other people’s stuff and sell it as your own. You make it yourself no matter what it takes, so every drop of stuff that comes out of here is made by us, tasted by us, and it’s kind of a labor of love in some ways.” — LARS HUBBARD
Co-founder, Appalachian Gap Distillery
and intrigue on a friend or even a stranger’s face following that first sip of something they made was intoxicating to both Hubbard and Burkins — before setting their sights on commercial distillation. Hubbard’s approach to owning a distillery has been influenced heavily by his own set of principles. “One of our sort of core corporate, business beliefs, one of our core beliefs as people, is that you don’t buy other people’s stuff and sell it as your own,” he said. “You make it yourself no matter what it takes, so every drop of stuff that comes out of here is made by us, tasted by us, and it’s kind of a laW W W . ARTISANSPIRITMAG . C O M
bor of love in some ways.” To solve the typical conundrum faced by all new whiskey distilleries — how do you survive while your whiskey matures? — the folks at App Gap opted to make and sell a variety of unaged products rather than source a third-party whiskey to sell under their label. It didn’t make the process of opening a new distillery easier by any means, especially as neither Hubbard nor Burkins had distilling experience before they started App Gap, but it was what they felt compelled to do. Learning to distill in real time has its challenges. Add to that the fact that App Gap has
one of two unique stills designed by distiller Duncan Holaday, who was also the consultant for Hubbard and Burkins in the early days, and you’ll get a sense of the uphill battle that awaited App Gap. The people who built the still didn’t quite understand the process, the designer was not trained specifically in that area, and the folks who were receiving the still had yet to produce on a commercial level. Yet they were not deterred. Hubbard chalked it up to “Yankee ingenuity,” a yearning that he and Burkins had to do things with their own two hands, regardless of how that would complicate their business. They have 65
maintained this ethos since their distillery first opened. The product line at App Gap has swollen since they opened their doors — a typical experience for new distillery owners — but Hubbard says it will now shrink back down to a more manageable selection. After making a few gins, an agave spirit, a coffee-infused bourbon, and more, Hubbard said that they will be sticking to their core six moving forward: Ridgeline Vermont Whiskey, Drumlin Champlain Valley Rye, Peregrine Gin, Mythic Gin, and Papilio, a maple syrup and blue agave spirit. A forthcoming whiskey will round out the portfolio of brands that will receive distribution outside of their tasting room. The folks at App Gap are currently working on more fully fleshing out their brand identity and expressing it in a compelling way. They’ve hired outside consultants to put together a number of brand identity documents and manuals that guide people who come aboard so they under-
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stand the mission of the company, what their goals are, and why they do what they do. Or, as Hubbard said, why they “make the stupid choices sometimes.” One aspect of the business that has become an emblem of App Gap Distillery is their commitment to sustainability. When Will Drucker, current head of sales and marketing, joined the team at App Gap, he noticed that they were already making significant strides toward a more sustainable production. “What would happen if we just decided to go full carbon neutral? And we started to do research and we realized, no one is doing this,” he said of their decision at the time. It’s true that, especially in America, few distilleries have made a commitment to full carbon neutrality for myriad reasons, but App Gap decided to go the extra mile. After employing a tool from the US Energy Information Association to make some calculations based on the solar energy they collected and the amount of natural gas they were using, they realized that their carbon footprint was already relatively small. So they opted to work with a fairly new organization called Climate Neutral that helps businesses track carbon status and certifies carbon neutrality. “It was pretty user-friendly; we’re a small team so we don’t have our own internal corporate social responsibility department or whatever, so it was sort of a nice compromise,” explained Drucker. Many of the companies that were already certified through Climate Neutral were ones that Drucker W W W . ARTISANSPIRITMAG . C O M
felt aligned with App Gap’s ethos, even if they weren’t operating within the same industry: outdoor companies like Klean Kanteen and Rumpl Blankets, as well as design, tech, and software companies. The process of becoming officially certified through Climate Neutral required some effort from App Gap’s folks. Not only did they need to gather a surplus of data related to their own production but they also needed to look further up the supply chain, which Drucker said he appreciated as an honest representation of a company’s impact. “The energy impact is up the supply chain at the producers or the transportation or downstream to the customer, etcetera, so we liked that it had that full, incorporating scope re: climate impact,” he said. It was a robust tool available to help companies assess their impact that, while based on aggregate data, was able to get them a salient estimate of the
environmental cost of their methods. The decision to commit to sustainability and seek out certification has been an extension of the principled approach that App Gap’s founders have taken toward owning their business, and they also hope it can become a part of the reworked brand. Evidence suggests that younger generations are prioritizing the health of the planet and sustainability in their decisions to purchase products, and App Gap hopes to bring that consideration into the spirits sector. There’s no clear indication whether or not it has been effective, but Drucker has hope. “Pretty early days,” he said. “Probably a little too early to tell if people really care about this or if it’s going to move the needle in terms of people selecting our product over something else, but again, we just kind of felt like it was the right thing to do.”
Appalachian Gap Distillery is located in Middlebury, Vermont. For more information visit www.appalachiangap.com or call (802) 989-7362.
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What Did Previous Historic Events Do To the Spirits Industry?
Written by Rich Manning
e’ve all heard the sentiment where post-pandemic drinking habits draw comparisons to the Roaring ‘20s. Hell, I know I’ve been guilty of saying as much in previous Artisan Spirit articles. This is great when you’re talking cocktails or bars. It’s not so great when you’re talking spirits. After all, Prohibition kicked in the year after the Spanish Flu pandemic subsided. While people continued to drink illegally, what they were drinking was horrible. From that perspective, the comparison doesn’t really work, and we should be thankful. The truth is, we don’t really know what the future holds for the spirits industry. The pandemic represents the first time the industry, as it exists today, has gone through an event of Ending Prohibition likely saved such magnitude. The lives. At the very least, it prevented people best we can do is from getting extremely sick. All Roaring ‘20s romanlook at how soticism aside, the illicit booze made during Prohibition could be ciety reacted to downright dangerous to consume. The reason stems from the the presence of Volstead Act itself, which contained a stipulation requiring the spirits and the The 21st Amendaddition of chemicals to industrial alcohol to make it undrinkdistilling inment put the kibosh able. Despite this, some moonshiners and bootleggers used the dustry in the to these shenanigans, pavchemically altered juice to make their hooch, resorting to diluaftermath of ing the way for properly made tion tricks to minimize the poisoned effect. The tactics didn’t previous hisspirits to hit the market once again. always work; it’s estimated that some 10,000 people died of toric events. Of course, distillers are still dealing with alcohol poisoning during Prohibition. As the followthe noble experiment’s aftermath, as archaic If the alcohol didn’t kill you, it was likely to disgust you. ing touchstones laws dating back to the Prohibition era continMoonshiners used horrific workarounds to mimic essendemonstrate, it’s ue to place hurdles along the production, distritial yet illegal distilling practices like barrel-aging. Some a bit of a mixed bution, and sales process to this day. These laws used the antiseptic creosote to replicate the smokiness bag. are frustrating, but at least they’re not compelof scotch. Others resorted to dumping rotten meat ling anyone to use lifeless rodents in order to and dead rats into the liquid because the results mimic caramel notes. sort of tasted like bourbon.
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World War II It’s no exaggeration to say whiskey fueled the war effort. Some distilleries used their gear to produce penicillin, as the process of producing the game-changing antibiotic wasn’t all that different from cultivating yeast. They were also called The use of distilling equipment upon to use their stills to produce highto defeat the Axis powers was noble proof alcohol, which could be used to and necessary. But the war effort also hapmake synthetic rubber and explosives. pened right as distilleries were poised to hit their Yet there was a trade-off to alcohol’s post-Prohibition stride, and this disruption caused a transformation from soothing sipfurther delay in their recovery process. It wouldn’t be per to wartime product: American until the early 1950s when American whiskey was prowhiskey production ground to duced on a consistent basis. This didn’t necessarily deter a virtual halt, a necessary move the American public from drinking spirits. If anything, that inadvertently caused a drait helped shape a big part of modern drinking culture. matic uptick in Caribbean rum One can easily make the argument that the uptick consumption among American in rum consumption combined with American imbibers. GIs returning home from the South Pacific planted the roots of the Tiki scene.
The Vietnam War Era The civil rights movement. AssassinaThe fallout from the era is enough tions. Counterculture. Watergate. The late to cause pain to a master distiller or bour1960s and early 1970s were defined by so bon snob. Bottles of American whiskey much more than the Vietnam War, even if weren’t moving like they did in the 1950s and the unpopular war arguably anchored the early 1960s, when the distilling scene reached time period. When the dust settled, a parapre-Prohibition levels of consumption. Legacy digm shift in what was consumed occurred. brands dominated the space because nothing new Whiskey fell out of favor, and vodka took was really being created. To pull from the era’s verits place. The reason for this in part can be nacular, things weren’t groovy, man. If there’s a siltraced back to the widening generation gap ver lining to this aftermath, the nadir suffered by the that happened during the war era. Simply distilling scene was probably not as bad as the one put, the youth rebelled against their parexperienced by the cocktail scene, where sugary ents’ form of relaxation. At first, this mixers replaced fresh ingredients and ill-conceived meant eschewing drinks for other cocktails derisively called “disco drinks” bumped substances. When they returned the classics from the menu. to the bottle, they still rejected what helped their parents unwind.
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New Century, New Ideas The consensus tends to put the craft distillery boom’s origins at around 2005, although some push it closer to 2010. Either date makes it somewhat tough to correlate its roots to a specific historic event. Quantifying the We don’t know exactly how the distilling inmovement as a latent response to the start of the new century feels somewhat dustry will look in the next few years. Yet cliché. Connecting it to the aftermath of 9/11 still feels ghoulish. Nonetheless, there’s room for cautious optimism. Groups even if it doesn’t naturally link to anything, it’s too damn special to not give it a like the ASCA and ADI continue to diligentmention in this piece. ly advocate for small-batch producers and Why? Because it wasn’t an isolated incident. The craft distilling movement push for their release from the surly bonds somewhat coincided with other major paradigm shifts in the food and drink of nonsensical laws. Spirit geeks aren’t goscene. Interest in local, sustainable ingredients and the farm-to-table movement ing to suddenly stop being spirit geeks. The began to flourish. The craft cocktail movement started spreading nationwide. days of using alcohol to defend against a Craft brewing, which had started in earnest a couple decades prior, was in full common enemy — in this case, COVID-19 swing. Suddenly, food and drink mattered in a way that they never seemed to — appear to be over. All things considered, matter before. Craft distilling was a big part of this and will likely remain as maybe the distilling industry will enter the such until the edible and drinkable things that provide exuberance in life Roaring 2020s when the pandemic mercifully cease to deliver. ends. Considering that context, perhaps the right way to correlate the craft distilling movement to something historic is to not correlate it at all. Treat it as a unicorn, a movement that just happened ex nihilo, Rich Manning is a freelance food and drink writer based willed into existence by a burst of passion collectively expein Fountain Valley, CA. He lives about 15 minutes south of rienced by a mass of talented, curious people at once. Disneyland, but he hasn’t gone there in ages — he’d rather visit the nearby breweries and distilleries instead. You can check out some Let’s just say that’s how it happened, because of his other written hackery by visiting richmanning.pressfolios.com. He it sounds pretty effing cool.
What About the Future?
can be reached at firstname.lastname@example.org.
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PROS AND CONS OF
Third Party DTC WRITTEN BY DEVON TREVATHAN
he people have spoken, and this is what they want — nay expect — from suppliers these days: Delivery direct to their door.
However, considering the fact that nationwide direct-to-consumer (DTC) shipping remains elusive, the regular consumer probably doesn’t realize the difficulty faced by distilleries or spirits brands who try to fulfill said wish. Fortunately for both parties, new third-party companies have been cropping up or expanding their services so that they can deliver spirits directly. As with most new trends within an industry, though, using these services isn’t always a direct pathway to success or ROI, and many still have minor hiccups that participating business owners should be aware of.
ONLINE MARKETERS First up are websites that give the illusion of an online retail store. There are rows of products grouped together by category, reminiscent of the shelves at your local bottle shop, and some sites offer deals or commentary on individual brands or distilleries. Just as you can probably get an employee to talk to you about what they’re currently drinking, certain examples of these kinds of sites will offer a similar promotion. This version remains compliant with the three-tier system. The way that these sites fulfill orders is usually by working with a retailer who themselves works with a distributor; essentially, when a customer purchases a bottle through the site, that sale goes to the retailer 72
in question, who then sells it to the third-party site who can ship it to the customer and collect a small marketing fee. There are intricacies and approaches unique to each company, but in essence they are really more online marketers than retailers.
RESERVEBAR Reservebar is one of the better-known online sellers for spirits producers that offers to ship to a customer’s home. To be featured on their website, producers must first shell out a considerable fee. A description of the product is included on the page, as are aromatic and flavor notes, cocktail suggestions, and the product origins, but the page where the product is listed reflects the Reservebar brand and look. Reservebar has positioned itself as a provider of luxury bottles, and while they list items
like Jack Daniel’s Tennessee Whiskey, they do so at a higher-than-average price. They’ve become better known as the purveyors of rare and fine spirits, as well as offering upscale accoutrement like personal engravings on the bottles or crystal glassware. Their shipping is very efficient and straightforward, but using the site is not without significant cost for both suppliers and customers.
CURIADA Curiada is one of the newer companies that provide a platform online for distillers and brands to sell; they started just last year right after the beginning of the pandemic. Launched by industry veterans Adam Caplan, Joey Robinson, and Joanna Franchini, Curiada is meant to be part online marketplace, part curated
collection of spirits. They aim to connect curious drinkers with lesser-known producers that don’t often have an easy way of listing with traditional retailers because of their craft nature, meaning small production volume and even smaller marketing budgets. This mission was inspired by the founders’ experiences working with the big companies in distilling, where they witnessed first-hand the uneven nature of our industry, and began to ruminate on ways to correct that imbalance. “What we saw was that there’s every advantage under the sun to the largest players, be that the three-tier system and regulation, be that the way that the distributor tier is structured,” said Caplan. “Be that the marketing budgets and what’s available to the largest players.” Curiada requires all spirits they list to first be tasted by their in-house testers for quality and flavor, and they pride themselves on keeping their selection relatively modest, as the curated part of their approach really is their USP. But once a brand makes it onto their site, a consistent effort is made to share and emphasize all the value that they have to offer.
ADDITIONAL EXAMPLES INCLUDE: INCLUDE :
Seelbach, Drizly, Mash&Grape
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The people have spoken, and this is what they want — nay expect — from suppliers these days: Delivery direct to their door.
WHITE LABEL PROVIDERS
You also have providers who offer a slightly different service: Instead of creating and operating an online marketplace that you list your products on, these companies build out e-commerce pages that can be linked to on your website. This is being referred to as a white label option, as the customer can purchase a bottle without ever being aware that they’ve gone to a new website operated by a different company to complete the transaction. An upside to this is that the entire process of purchasing online appears contained to the distillery or brand’s website; customers simply go from there to purchasing with one click, and there’s no opportunity for them to become enticed by a different product and pursue purchasing that option instead.
Speakeasy builds out ancillary ecommerce pages that distillers can link to on their own websites. This page can be customized to replicate the branding and design of the individual distillery or product, which creates the impression that the store exists as an extension of the distillery itself. Customized merch, cocktail kits, and experiences can also be sold through the ecommerce solution provided by Speakeasy, which handles all of the warehousing and shipping of the products that are sold through their service. While certainly useful considering there’s no immediate competition listed on the row next to it, listing your products through Speakeasy does come with a regular monthly cost and has the option for digital advertising, web design, and SEO, a service for which they charge on top of the regular price.
ADDITIONAL EXAMPLES INCLUDE: INCLUDE :
Thirstie, Passion Spirits, Barcart, BevShop
SUBSCRIPTION SERVICES Some companies have decided to turn the purchase of spirits online into a regularly occurring activity using subscription clubs. These clubs offer spirits in sample packages that are primarily meant to be a window into what that producer offers. They are more an educational offering that can turn a curious drinker into a new fan with a low stakes commitment.
FLAVIAR Flaviar has made a name for themselves in the subscription box game. Through branding, extensive tasting
notes and profiles, and an informative website, Flaviar has attracted 850,000 registered consumers that are getting a box every month with new spirits. The service they offer is a marketing option worth consideration for some distilleries or brands as it allows customers to try new products in small sample sizes, however there are obvious drawbacks, including the fact that listing with them does not automatically equate to increased bottle sales. Distillery owners or managers need to understand that more work will be necessary to turn over a lead from Flaviar into a regular customer, though the lower barrier of entry could introduce their brand and products to a larger audience of drinkers.
ADDITIONAL EXAMPLES INCLUDE: INCLUDE :
Caskers, Taster’s Club
Third-party DTC shipping providers are cropping up more and more, and there are many ways for a company to utilize this service. Not one is perfect; each service has its own set of pros and cons, and it really is for the individual business owner to decide which, if any, they would like to pursue.
Devon Trevathan is the co-founder of Liba Spirits, a nomadic distilling company that focuses on capturing a sense of place in every bottle. She also continues to write about spirits and cocktails, including the science behind distillation and the history of drinks culture. Devon travels constantly these days; if she's not working, she's probably exploring her surroundings in the best way she knows how—her mouth (AKA through food and beverage). You can find her online @devontrevathan or @libaspirits across all platforms.
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D O O R CO U N T Y D I ST I L L E RY Capturing the spirit and the “spirit” Written by Lisa Truesdale /// Photos provided by Door County Distillery
Living on a narrow peninsula that juts out 70 miles into the water, the residents of Door County, Wisconsin, have always relied on the abundance of the land to meet their needs. For them, “living local” isn’t a new-age trend, and “field-to-table” isn’t a marketing slogan. It’s just the way it’s always been. That’s why, when Door Peninsula Winery was founded in Carlsville in 1974, the owners were intent on using locally grown products, whenever possible, for making their wines. Those locally grown products, however, didn’t initially include any actual grapes. The 74
peninsula’s climate and geography, with Lake Michigan to the east and Green Bay to the west, aren’t suited for conventionally grown grapes like Chardonnay and Cabernet, and cold-climate grapes weren’t widely available yet. But Door County is the ideal location for
growing cherries — spring arrives a little later there, and that delay slows down the bud burst on the trees, reducing the chances of frost damage and resulting in a longer growing season. Now famous for its beloved crop of tart, bright red Montmorency cherries, “the Door” produces 8 to 9 million pounds annually, which accounts for 90 percent of cherry production in Wisconsin, helping the state rank fifth nationwide. The numerous orchards that dot the land also grow apples and several types of berries. For years, the winery’s products were made from these locally grown W W W . ARTISANSPIRITMAG . C O M
“Growing out of a winery, our goal was always to get to brandy, as you need wine to make brandy, and we certainly make a lot of both. Brandy is special in Wisconsin; it’s part of our culture.” — Beth Levendusky MARKETING DIRECTOR
fruits, and the winery and tasting room became known as a popular destination for visitors and locals alike who were looking for locally crafted cherry products. In 1984, Bob and Noreen Pollman purchased the winery and soon expanded the product range to include other fruit wines as well as a fruit/grape blend. The entire peninsula is part of the Wisconsin Ledge AVA, so the Pollmans eventually established their own vineyard about a mile down the road, where they cultivate hybrid grape varieties like La Crosse, St. Pepin, Itasca, and Marquette that were developed especially for the northern climate. This helped the winery continue to grow, resulting in several additions to the original building, a historic two-room schoolhouse with a bell tower. It was chosen by the original owners, in part, because of the thick
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basement walls that are ideal for storing wine. From their huge tasting room and retail space, the winery now sells more than 60 varieties of wine and hard cider, plus other locally made food and gift items, like baskets filled with cherry-forward gourmet foods such as jam and BBQ sauce. In 2011, Door Peninsula Winery expanded again — into distilling.
“The Spirit of Door County” The transition into distilling was a natural one. The winemakers had already perfected their fermenting techniques, and the company could continue to foster the relationships they already had with other local growers and farmers on the peninsula. It was also a natural fit for head distiller Kyle Thomas, who began on the wine-production side of things under the head wine-
maker, but was always eager to start making spirits. He wanted to produce “the spirit of Door County” — products that truly capture the “spirit” of the place. “I’ve always had an interest in distilling, even long before I got into winemaking,” Thomas said. “I spent a lot of time traveling to visit different craft distilleries, trying their spirits and learning about what’s out there, although I knew that I wanted ours to have a Door County focus.” Door County Distillery, the peninsula’s first distillery since Prohibition, opened in 2011 in the same building as the winery. They began with a 150-gallon German CARL still, running everything through there for the first five years or so. As production increased, they added a 600-gallon Italian pot still, and the smaller still now gets used for refining and infusing. Though the distillery side of the op-
eration has its own tasting room, retail store, and production space separate from the winery, the two teams work together, maintaining a symbiotic relationship. That includes trading barrels back and forth — red wine is often aged in bourbon barrels, and rum and gin are sometimes aged in wine barrels. “Growing out of a winery, our goal was always to get to brandy, as you need wine to make brandy, and we certainly make a lot of both,” said Beth Levendusky, the marketing director. “Brandy is special in Wisconsin; it’s part of our culture.” In fact, California-based Korbel reports that Wisconsin is responsible for consuming half of all the brandy Korbel makes, largely because of the state’s long-standing supper-club tradition of using brandy, rather than whiskey, in their old fashioneds. Aged brandy takes time, though, so the first spirits out of the gate were vodka and gin, made with Door County’s pure, filtered, limestone-infused waters; the abundant botanicals like juniper berries; and, of course, lots of cherries. The first brandies were non-traditional, immature ones, distilled from cherry wine and apple wine “borrowed” 76
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from the winery, released 15 months after opening. The first traditional brandies were released after the customary two years, but the one the distillery is most proud of had to wait until 2021. “For our tenth anniversary this year, we were able to release a traditionally styled, commemorative brandy, made from 100 percent Marquette grapes grown right here on the Wisconsin Ledge AVA,” said Levendusky. With bartending in his background, Thomas explains that his approach to spirits-making has always been to make things that he enjoys himself, that he would like to sit around and drink with friends. “I’m always looking at how I personally would want to enjoy that spirit, and what flavors I’d want to come out when mixed,” he said. “Like our gin. I like juniper best when it’s softened with citrus, so that’s going right into the spirit itself. I want that citrus to come out right away.” It’s Thomas’ approach, married with Wisconsin’s love of brandy, that inspired him to create one of the distillery’s most popular products, Cherry Bluff Infusion. “Cherry Bluff is our version of bitters, but
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made specifically for traditional Wisconsin old fashioneds,” he said. “It’s made with Montmorency tart cherries, citrus, and herbs, to enhance the flavors of the muddled fruit in that cocktail.”
The Spirit of Collaboration Though the Pollmans have an orchard next to their vineyard, it doesn’t produce nearly enough for their needs, so they rely on some of the larger Door County orchards like Hyline and Seaquist for their fruit. “It’s fun to visit the local orchards we work with and know that those cherries and apples will be harvested, juiced, fermented into wine, and then distilled right into our spirits,” Levendusky said. They don’t have to go far for the other ingredients they need to make their spirits, either. Just like the symbiotic relationship between the winery and the distillery, there’s also a time-honored one between all the growers, suppliers, and manufacturers in Door County,
according to Levendusky. “Our closest supplier is right across the street,” she said, referring to Door County Coffee & Tea, the coffee-bean source for the distillery’s popular Java Infusion, a neutral grain spirit that can be sipped on its own or added to coffee drinks. “They were also able to use some of our bourbon barrels for a special coffee blend a few years ago.” It’s also been a beneficial two-way street with a local maple syrup supplier: “They took our used bourbon barrels, aged their syrup in them, and then we took the barrels back and refilled them with bourbon for our limited-release maple bourbon.” Door County, by its nature, is exactly what makes everything work so well, she added. “Everyone works with everyone, collaborating and doing what they do best. It’s part of what makes this area so special; everyone comes forth with their best to make something new. “It’s quite a journey, but it all happens right here on the same peninsula.”
Door County Distillery is located in Carlsville, Wisconsin. For more info visit www.doorcountydistillery.com or call (800) 551-5049.
f o S C M I O N O EC WHIS KEY PRODUCTION Part I – Value Creation
for the Growing Craft Distillery
Written by Jeff Quint
Year-end $ cash 1,000,000 e Accounts receivabl 6,000,000 Inventory 7,500,000 Land & Buildings 7,500,000 nt Operating Equipme (3,000,000) iation Accumulated Deprec $ 19,000,000
rowing a whiskey business is fascinating to me. It’s incredibly rewarding, and incredibly complicated when you consider all the variables involved. It feels like there are two separate things going on at once — the sales effort underway in the current year and the production effort that is always focused on four to five years from now. Of course, there are also the bottling crew and the tasting room crew and the accounting/HR/IT functions, etc. Lining this all up and keeping good aged whiskey in stock while maintaining good bank and investor relations can be overwhelming at times. However, when you pull it off, you create an amazing brand in the $ 7,000,000 market and amazing value for yourself and any others involved. Debt 12,000,000 To get started, let’s get into value creation. We’ll answer the “why Equity Capital are we doing this” question, from a business economics viewpoint. Retained Earnings This is a financial discussion, so we’ll set up a very simple scenario $ 19,000,000 to use as an example. If we’re going to take the risks and do the hard work involved in building a new whiskey venture, we need to make sure it pays off for us — that it is/was worth the effort and risk. To that end, we should With those assumptions in place, we would then understand where we might end up if it all goes to plan. So, let’s work through have a balance sheet that may look something like this some numbers … For this simple example, we’re assuming no retained Let’s say we build a whiskey plant and a whiskey brand that gets us to 50,000 earnings — there were probably losses in the early years 9-liter cases of whiskey sold annually, under the following assumptions: that have now been offset by more recent income. We acquire land and buildings at a cost of $7.5 million As for the debt-to-equity mix, we’ll assume recent pos1) (say 75,000 square feet at $100/s.f.); itive cash flow has allowed this company to take on $7 million of bank debt, collateralized partly by accounts re2 ) We acquire a plant and equipment (and thousands of barrels) at ceivable and inventory and partly by the land, buildings, a cost of another $7.5 million; and equipment, along with the personal guarantees of the 3 ) We build inventory (a four-year supply of whiskey) up to a cost primary owners. of $6 million; Lastly, we’ll assume the equity capital was all raised from outside investors in exchange for 80 percent owner4 ) At that point, we’re selling 50,000 cases/year of four-year-old, ship in the company, leaving the founding entrepreneur 90-proof whiskey at an average price of $240/case (targeting a with a 20 percent stake from “sweat equity.” retail shelf price of $40/bottle).
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From a profit and loss (P&L) standpoint, then, assuming we level off at 50,000 cases, we’d have a P&L that looks something like this The 50,000 cases sold generate revenues of $12 million. The product is a $40 bottle of whiskey, so margins are good at 55 percent. Selling costs and general and administrative (G&A) costs are a bit higher than the larger publicly traded companies, as could be expected. Earnings before interest, taxes, depreciation and amortization (EBITDA, or operating income with depreciation expense added back) in this example is probably in the $1.5-2.0 million range. This is important in terms of obtaining low-cost bank debt. Without the EBITDA, this company would need to rely solely on equity infusions to fund its growth. Now that we’ve established the base assumptions and looked at the balance sheet and income statement, we can draw some further inferences for this company:
> The company needs to put away about 2,100 barrels of whiskey
each year just to keep sales flat at $12 million. This is arrived at as follows:
Income Statement Sales Cases Revenues Cost of Sales Gross Margin
$240 45% 55% 28% 20%
12 Months 50,000 $ 12,000,000 5,400,000 $ 6,600,000 3,360,000 2,400,000 $ 5,760,000
Selling costs General & Admin Total SG&A BIT) $ Operating Income (E Interest Expense $ Net Income
840,000 350,000 490,000
º 50,000 cases × 9 liters = 450,000 liters/3.785 (liters to
gallons) = 118,890 gallons × .90 proof = 107,000 proof gallons needed
º Each 53-gallon barrel is put away at 120 proof, or 63.6 proof gallons, but evaporates 20 percent to angel’s share, resulting in a net 50.9 proof gallons at emptying
º 107,000 proof gallons/50.9 proof gallons per barrel = 2,102 barrels needed
> If the company sells 4-year-old whiskey, it needs a minimum
of 8,400 barrels on hand, just to keep sales flat. Further, if the $6 million of inventory on the balance sheet is all barreled whiskey, $6,000,000/8,400 barrels = $714 of carrying cost per barrel/63.6 proof gallons per barrel = $11.23 per proof gallon produced. This feels about right for a producer of this size. It’s far more than the mass producers can make it for, but it’s likely less than the smallest craft shops can produce it for.
> The scenario we’ve set up here has a lot of money tied up in land
and buildings. This could possibly be replaced by leasing a property and paying rent in lieu of owning the property. If you can find a landlord willing to take the risk involved in leasing a property of this size and scope to a startup craft distillery, leasing might be the better choice. It would reduce the amount of the upfront equity you’d need (although you’ll likely still be on the hook for all the leasehold improvements). But leasing will also cause your rent expense to replace the depreciation you’re taking on through your own land and buildings, which will lower your EBITDA (a measure of free cash flow that indicates your ability to make monthly payments against a loan) and limit your ability to incur bank debt, which is generally a cheaper form of financing than raising equity. Either way, it won’t likely have a significant impact on the long-term valuation of your company, from a standpoint of the total final return on investment.
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So What Is This Company Worth? It’s always difficult to determine with precision the value of a company in any limited scenario like this, as there are myriad variables that will factor into that valuation. That said, we can probably estimate some likely ranges. For starters, the larger publicly traded players in our space seem to trade at revenue multiples in the six to seven range. So, if they think they can take your brand, insert it into their distribution system, and grow it at a faster pace than their existing portfolio, they might be happy to pay you something in that range. In our scenario here, that would be $12 million of revenues times, say, a 6.25 multiple = $75 million. Further, if you were the successful distiller/entrepreneur who convinced your equity partners to give you $12 million to build this business in exchange for an 80 percent equity stake to them, the proceeds would distribute as follows: ($75 million – $7 million debt) = $68 million × 20 percent = $13.6 million to you ($75 million – $7 million debt) = $68 million × 80 percent = $54.4 million to your equity partners
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Your equity partners made 4.5 times their money. But how many years did this take? If you accomplished this all in five years, that’s a great success for them. If it took you ten years, that’s still pretty good, with a compound annual return of more than 16 percent. These are the kinds of returns equity investors are looking for — minimum 15 percent. That’s why it’s often best to maximize bank borrowings in a successful venture — keeping the bulk of the increase in valuation for you and your investors. Of course, this valuation can be affected by a number of other considerations, including:
> How easy will it be for the buyer to
plug this product into their portfolio? Do they need a product like this?
> How does this product stand out from others? Is it unique in any way?
> What margin does this product gener-
ate? Is it going to enhance the buyer’s overall margin or erode it?
> Was the product largely “selling itself ”
in the market, or were you spending vigorously to achieve your case volumes? In our scenario, we were spending slightly more than the larger players, with 28 percent selling costs, but not significantly more.
> How much runway does your plant still
have? Can you double this volume for them, or will it entail further significant investments in your/their plant to achieve this further growth?
> Can the buyer easily eliminate most of
your selling and G&A costs when they roll this brand into their portfolio, or will they be encumbered by long-term obligations they’ll inherit from you?
These are only some of the factors to consider in determining the ultimate value of a company in our industry, even under this very simple scenario. But all of these factors are real and they should be considered by you from the onset of your business, and reviewed annually. Even if you own your distillery outright and never plan to sell it, these considerations are important — if they’re significant factors to a buyer, they should also be valuable considerations to you and your own brand.
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Conclusions Building a new whiskey distillery from the ground up is an expensive endeavor that may take a decade or so to stabilize financially. This fact itself creates a pretty big barrier to entry. But, as you can see from this simplified example, the effort and risk can be worth it. In the past decade or so, we’ve seen a couple dozen examples of craft distilleries that have hit a pretty big payday. If you’re independently wealthy and you or your family can inject many millions of dollars into this venture, your patience could be well rewarded. If, however, you’ll need to attract outside investors to do it, you’re going to need very detailed plans and projections, including product prototypes, identified management team members, marketing strategies, etc. Investors at this level expect all of that to be in place. And they generally won’t want to see a plan that takes 10 years to realize, but more like three to seven years. Also, it’s worth noting that value creation, through the eyes of the buyer, is not linear. A company doing half the volume of the one in the above example is not worth half the value. It may be worth nothing at all to many buyers. You have to achieve a certain scale and then, quite suddenly, you become valuable to a buyer. This volume threshold seems to be inching upward as time has elapsed, where buyers are now looking for bigger volumes than they were a decade ago. While this exercise focused mostly on building a whiskey distillery for the purpose of ultimately selling it to a larger buyer, we know many of you — probably most of you — are not attracted to this business for this reason. And so, we each have a different purpose and different priorities. Still, it can be valuable to understand these valuation dynamics and be cognizant of them as we create and modify our own business plans from year to year.
Jeff Quint is the founder and CEO of Cedar Ridge Distillery in Swisher, Iowa.
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PA RT T H R E E : IN CONCLUSION W R I T T E N B Y D E V O N T R E VAT H A N
Beyond brick and mortar...
ales are not happening solely in person anymore, and that means that moneyed businesses and brands just got another leg up because, as we all know, it’s easier for well-funded operations to navigate and engage in the online space. However, as a small business owner, you may have the opportunity to take a more thoughtful and dynamic approach. What matters is that you put in the time and continue to be consistent with your scheme. Individual online interactions are infinitely less impressionable than those in person, so it will take at least seven or eight interactions for your brand to start to stick in someone’s head. Doing so with a creative approach may expedite that process for you, and learning from others in the industry can help pave the way.
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HUMAN INTERACTIONS HAVE GONE ONLINE It may still be the very early days, but human interactions are increasingly happening online, and savvy businesses can take advantage of this move. You’ve probably seen them on Instagram and other platforms — it isn’t just about posting on social media anymore. There’s a growing emphasis on interactions between pages and the people behind them. Q&As, cocktail hours, live videos, and more, this is a rich area with lots of potential to be customized by a company. Vetroelite, a glass manufacturing company based in Italy, has adjusted to the new normal by embracing the digital opportunities at their disposal. Since they typically would attend around 40 global showcases during a single year, they felt that, in the new contactless world we have found ourselves in, this effort needed to be recreated in a safe way. “Without having the possibility to enter in contact directly with a customer, everything changed for us,” said Arianna Morimando, a marketing strategist at Vetroelite. “But I have to say that we have been very quick at understanding the situation and starting to use all the digital tools we have, so a lot of Skype calls.” That also includes developing a digital showroom that allows current and potential clients to e-tour their Italian showroom and get a feel for some of the tangible parts of their business.
BE MINDFUL OF COMMUNICATION The way that you communicate, as well as the content of your communication, matters these days. If you are making a choice to develop an element of your business that you feel gives back or is philanthropic in some way, you should be outspoken about that; however, you should also be careful to communicate that part of your business correctly. A good example of this would be any sustainability or climate-friendly changes that you’re implementing. The beauty of this kind of action is that it resonates with a large group of consumers, it’s a genuinely good thing to do, and it plays into the value-for-money proposition that’s important for businesses these days. Talking about and emphasizing your company’s commitment to sustainability or more environmentally conscious production methods can sway frugal shoppers to feel better about spending the extra money, because then they feel that they’re getting something back in return. However, “gre-
enwashing” your marketing materials, or simply throwing all sorts of meaningless terminology that doesn’t actually connect with consumers or adequately communicate your passion, could backfire on you. More and more consumers have become savvy enough to sense when the marketing material itself is canned and inauthentic, and that outcome would be particularly disappointing if you have real passion for the message you’re trying to spread. It’s one thing to be a moderately successful distillery that gets by on the strength of their products and consistent support from the local and regional market, but becoming a better-known brand requires more work than that. If your only hope with marketing is to maintain communication with your base and slowly trickle in new fans, then you likely can do that without much additional effort. “But at a high level,” said Matt Ebbing, founder and chief creative director at Ebbing Branding and Design, “when you think about brands that transcend what they literally make and become more of a lifestyle brand, they all stand for something that moves people. They all have a spirit or ethos that carries a lot of value. They got there with great storytelling.”
ADD VALUE TO CONSUMERS’ LIVES This last year and a half have been tough on us all. At this point, if brands are not already well-known, breaking through and getting loyal customers will be hard without offering something that will add value to their lives. In the spirits industry, this can be interpreted in many ways. You can support certain organizations or movements that mean something to you with each sale that you make, or you can offer education and entertainment as part of your marketing. However you choose to add value, make sure to do so with thought and integrity, or risk losing those hard-earned sales. Even as the fears related to the pandemic wane (less so now that the delta variant must be dealt with), drinkers will still be looking for a more holistic experience from the products they choose to purchase. If you can offer an experience with your product, whether that’s through education, entertaining content, live interactions, or a cobbled-together approach of all those and then some, you will find more success and support from a wider consumer base. It’s a lot to ask from small business owners who already have so much on their plates, but to ignore these trends could cost you fans and consumers.
Devon Trevathan is the co-founder of Liba Spirits, a nomadic distilling company that focuses on capturing a sense of place in every bottle. She also continues to write about spirits and cocktails, including the science behind distillation and the history of drinks culture. Devon travels constantly these days; if she's not working, she's probably exploring her surroundings in the best way she knows how—her mouth (AKA through food and beverage). You can find her online @devontrevathan or @libaspirits across all platforms. W W W . ARTISANSPIRITMAG . C O M
getting to knowa n your gr i M A LT S P E C S A N D C A L C U L AT I O N S W R I T T E N B Y M AT T S T R I C K L A N D
an, if I didn’t lure you in with that whiplash of a subtitle, then nothing will. “Specs and Calculations”?! Have two words on the page ever simulated a summer blockbuster mind explosion such as these?! I think not! Yeah, I get it. Malt specs and calculations sure as hell don’t sound very exciting. An actual graduate-level class on the science of boredom would probably be more stimulating. Still, this is important stuff for the whiskey distiller. In order to make high-quality drams consistently, you need to understand your grain. And you need to understand it at a fairly granular level. So, let’s wade into the morass of malt specifications to get a better handle on what they all mean and how they affect your distilling. We’ll finish everything off with a few calculations to aid in recipe design. I promise that it won’t (all) be boring. First things first. What IS a malt spec? Well, whenever you order grain from a supplier, they should have an information sheet on file detailing the various parameters that have been tested on that batch of grain. The tests are used by the malting company to ensure that every batch is consistent and fits the desired product profile, but this information is also important to the distiller. The next time you purchase malt from a supplier, ask them for a malt spec sheet (also known as a malt anal-
ysis). If you’ve never bothered to look at one before, you may understandably be confused by the random assortment of numbers and terminology sprawled across the page. Sorting it all out can be daunting at first, but trust me, it’s not hard. And to cap it all off, understanding this stuff will make you a better distiller. Not everything on a typical malt spec sheet is important to distillers, and every malt and grain supplier has their own preferred tests and specs that they provide. However, the following items are what you should keep your eyes peeled for.
• Assortment • Friability • Moisture • Color • Extract • F/C Difference • FAN • Soluble/Total Protein • Alpha Amylase • Diastatic Power Let’s work through the definitions of all these terms so you have a better understanding of their importance and how they can affect your distillery operations. W W W . ARTISANSPIRITMAG . C O M
ASSORTMENT Assortment is a measure of the mixture of different grain sizes in the grain lot. As much as growers and maltsters try, there is no perfect way to obtain barley kernels that are all exactly the same size. Grain size is often an indirect indicator of starch content (fermentable extract) and has a direct impact on malting operations with regards to how quickly the grain takes up moisture. So, it’s important to the maltster. But how does it impact the distiller? Quite simply, having a large assortment of sizes in the malt lot makes setting the mill difficult. If you’re using a hammer mill coupled with a mash filter, this may not be too important to you (though it can be argued that poor assortment values are indicative of low-quality control in general at the malthouse). But most single malt distillers use a roller mill to crush their grain. If you have a wide assortment of sizes, then setting an appropriate mill gap be-
comes virtually impossible. You could set it to the tightest gap possible, but then you run the risk of completely pulverizing your grain and destroying your barley husk material, which aids in wort filtration and runoff. Reduced husk integrity in the mash can cause overly cloudy wort (leading to flavor differences in the fermentation and final distillate) as well as slowing down the overall runoff to the fermenter to unacceptable levels. So, what is a good assortment value? Depending on the maltster or grain supplier you may see different terms here. Typically, the sizes are categorized as either “plumps” or “thins.” Anything less than 2.2 mm is considered thin, while plump grain measures from 2.2 to 2.5 mm for standard two-row malted barley base malts. As a general rule, you want to see plump values of at least 80 percent (the higher the better) and thin values no higher than two percent.
FRIABILITY Friability is a measure of how easy it is to crush the grain. This is a good indirect indicator of lautering and runoff performance. When barley is malted, the aleurone layer that separates the embryo from the starchy endosperm produces a number of enzymes including proteases that break down proteins. These proteases attack the protein matrix that surrounds the starch granules in the endosperm, giving the embryo (and eventually the distiller) access to the valuable energy reserves. If the protein matrix isn’t properly broken down, then problems may arise. First, the grain is harder to mill. The protein matrix is dense and very tough, effects which end up leaving the grain considerably harder than properly modified malt. The next time you have the opportunity, take a single kernel of raw unmalted barley and try to bite into it. [Editor’s note: This is not recommended for distillers with dental
issues. Artisan Spirit is not liable for damage that arises from chewing on raw barley.] You’ll find it’s really hard to crunch on. Compare that with biting into a kernel of base malt, which should be relatively easy to crush between your teeth. The second issue is that poor modification of the barley endosperm tends to lead to poor runoff during lautering and wort transfer. All sorts of viscosity-producing gums and glucans can wreak havoc on runoff performance if they aren’t properly broken down during malting. This also tends to reduce extract recovery, which affects fermentation performance, alcohol recovery, and so much more. Friability is often presented as a percentage on the spec sheet. Acceptable friability levels really depend on the exact type of malt that you’re using, but typically you want to see values of at least 90 percent.
MOISTURE The concept of malt moisture is seemingly self-evident to most people. It’s just the amount of water in the grain, right? Well, yes and no. The amount of moisture residing inside the finished malt has a few important direct and indirect impacts on distillery processes. During the malting process, raw barley goes from around 12 percent moisture by weight to roughly 46 percent moisture during the steeping phase. The additional water allows for enzymatic mobility and for many other biochemical processes to ensue. This includes the W W W . ARTISANSPIRITMAG . C O M
release and formation of various enzymes and the aforementioned protein matrix breakdown. Once the desired degree of malt modification has been reached, the grain is sent to the kiln for drying. The kilning process removes water at a careful clip. The goal is to dry the grain steadily so that the enzymes don’t denature and are effectively held in stasis due to the lowered water activity inside the grain. The more water you remove, the greater likelihood that you’ll destroy some enzymes in the process. This would make it tempting to some to leave a high percent85
age of water in the grain, but this too has serious drawbacks. Grain that is too moist doesn’t mill easily through a standard roller mill. It also may not develop the right amount of flavor that can only be provided by the drying process and Maillard reactions. So, not enough water and we may lose enzymes, endangering our starch conversion in the mash tun. Too much water and we may not get the right amount of flavor development, and the grain becomes difficult to mill. There must be a happy middle ground. For distilling, you ideally want to see moisture in the finished malt at four to six percent by weight. Generally, standard two-row base malts used in the production of single malts can be dried a bit more and so the lower end of the moisture spectrum is acceptable. After all, if you’ve got a mash of 100 percent malted barley, you don’t have
any unmalted grains that need the barley enzymes to convert their starch. In other words, assuming your mash technique is good, a 100 percent barley mash should have no problem converting itself. However, if you’re using barley malt to convert the starch in a mash with loads of unmalted grains, say in a bourbon mash, then you need a higher level of enzymes. (We’ll discuss those numbers in a minute.) Malt used for these mashes is often dried a bit less than malt destined for single malt production because less drying preserves more of the enzymes. Since the percentage of malted barley in these mashes is usually pretty low, we’re not as concerned about barley malt for its flavor contributions. Therefore, the added drying that may impart more of those Maillard products for flavor isn’t as important.
COLOR Malt color may not seem that important to the distiller. Afterall, we’re distilling the finished beer into a perfectly clear spirit before cask maturation so color should be an afterthought, right? Not really. The chemistry of malt color is complicated. It can be affected by the kiln conditions, but also by grain protein. Consistent color is indicative of consistency in the base grain and the malting process. Color also may indicate flavor potentials in the grain, with darker colors trending towards heavier malt and more roasted aromas.
The darker the grain, the more it has likely been kilned for longer periods. The more kilning the grain undergoes, the lower the resulting enzyme levels will generally be. Color variations between grain batches should be minimal. An extreme swing in either direction will indicate difference in performance in the mash tun. Color is most often represented in North America by degrees Lovibond. Lower values mean a lighter color. Higher values mean darker color. Typical base malt color is often around two to three degrees Lovibond.
EXTRACT Now here’s something virtually everyone can agree is important. For the distiller, it may be the MOST important parameter when judging malt. Extract is simply the amount of available starch that can be extracted and subsequently converted into something fermentable. When it comes to seeing extract represented on a malt specification, you’re going to see a bit of variation between maltsters. You may see extract as “Fine Grind” or simply “FG” as well as “Coarse Grind” or “CG.” Attached to those numbers you’ll see either “dwb” for dry weight basis or “as is.” Because extract is such an important topic, let’s take a few minutes to walk through what these terms mean. When malt labs measure a grain’s extract, they perform what’s called a congress mash. The congress mash is a micro-scale mash that uses 50-gram samples of milled grain (either fine or coarse milled) mixed with four volumes of water. The temperature is slowly raised by steps to mimic traditional European step or decoction mashing (not procedures used by most distillers). The grain solids are 86
filtered out, the liquid cooled, and the resulting wort sugar concentration is tested. The extract can be extrapolated from the sugar value. How the grain is milled is really important here. Using an approved mill for the congress mash, samples are either ground on a coarse setting at 0.7 mm or a fine setting of 0.2 mm. A finer grind means more surface area for starch to be exposed to the water medium during the mash and thus more extract is usually pulled out. However, for single malt distillers using a classic roller mill, the 0.7 mm coarse grind value is more true to real-world applications. If you are using a hammer mill for your whiskey production then the 0.2 mm fine grind is going to be more appropriate to your system. The other thing you have to consider when reading extract specs is whether the extract is represented on a dry weight basis or reported “as is.” The “as is” figure is always more relevant to the distiller since it factors in the resident moisture still inside the grain. However, many malt manufacturers insist on reporting their extract values on a dry W W W . ARTISANSPIRITMAG . C O M
weight basis, which is not as accurate for real world mashing applications. Don’t worry. It’s not too hard to convert the two. dwb x (100–moisture %) = “as is” extract 100 For example, in Figure 1, we see the malt spec for Briess’ 2-Row Brewer’s Malt. On a dry basis, a coarse grind of this malt has an extract value of 80 percent. If we punch 80 percent into our equation to convert to “as is,” we should get the following: 800 x (100–4.2) = 76.6% 100 Our 80 percent dwb malt with 4.2 percent moisture will have an “as is” extract of 76.6 percent. Not too shabby. If you’re producing single malt whiskey, the minimum extract on an “as is” basis should be at least 76 percent and preferably closer to 78 percent or more. However, if you’re working with malted barley primarily to convert the starches in other grains such as corn or rye, then the extract level can be a few percentage points lower.
TYPICAL ANALYSIS Mealy / Half / Glassy ������������������100% / 0% / 0% Plump ������������������������������������������������������� 80% Thru ������������������������������������������������������������ 2% Moisture ��������������������������������������������������� 4.2% Extract FG, Dry Base �������������������������������� 81.0% Extract CG, Dry Base �������������������������������� 80.0% Protein ��������������������������������������������������� 11.0% S/T ������������������������������������������������������������ 42.0 Alpha Amylase ���������������������������������������������� 72 Diastatic Power (Lintner) ������������������������������ 140 Color ��������������������������������������������������� 2.1 SRM
figure 1: MALT SPECIFICATION FOR
BRIESS 2-ROW BREWER'S MALT
F/C DIFFERENCE As you might expect, the fine/coarse difference is closely linked to our discussion on extract. This is simply the difference in extract values between the fine grind and coarse grind congress ash tests. It may not sound important at first glance, but it matters. From our discussion on extract, we would rightly expect that a fine grind will give us more extract due to the increased surface area and starch exposure during the test mash. However, we want the coarse grind to give us something close to the fine grind test. That’s because a low F/C difference is indicative of proper malt modification. As we’ve already mentioned, as malting proceeds, the protein matrix surrounding the starch granules is broken down by proteases. If it isn’t well broken down, then
this can cause all kinds of downstream issues, not least of which would be a potential loss of extract during normal mashing procedures. If the grain hasn’t been well modified, then a 0.7 mm coarse grind will give a lower extract value during the congress mash because this wider mill setting won’t break apart the protein matrix effectively. However, if you set the mill to 0.2 mm, you can fairly easily break apart those interlocking proteins, giving you good access to the starch granules. This explains why lower malt modification can lead to a bigger F/C difference. Ideally, the F/C difference is no bigger than 1.5 percent with 2 percent causing some serious concern on how the malt will actually perform in the mash.
FAN FAN is brewer’s parlance for free amino nitrogen. This is effectively the amino acid content of your wort. These amino acids are largely produced through the malting process when the protein matrix surrounding the starch granules is broken down. They serve as an important source of nutrients for yeast cellular function during fermentation. If the malt doesn’t contain enough FAN, fermentation will be sluggish and some strains of yeast may produce undesirable levels of fusel oils, which can carry over into distillation. Interestingly, many strains of yeast W W W . ARTISANSPIRITMAG . C O M
will also produce too much fusel oil if the FAN levels are too high. Therefore, it’s important to find the sweet spot. Most distillery yeast strains do well with FAN levels of 150-225 ppm. For all-malt worts, FAN is rarely an issue. Even for worts with high amounts of unmalted grain, FAN is not usually much of a problem. If you are unsure of your wort’s amino nitrogen content, get it tested. DO NOT just assume you should add nutrients. You may be adding too much, which can be just as bad as not having enough. 87
SOLUBLE/TOTAL PROTEIN This is another set of parameters that relates back to total malt modification. (Many of these malt specs are interrelated and express different aspects of how well the protein matrix has been broken down during germination.) Total protein is the easiest to understand. It is simply the total nitrogen value of the grain multiplied by 6.25 percent. So, if the total nitrogen in a grain sample is two percent, the Total Protein would be 12.5 percent. Anything north of 12 percent total protein may have runoff issues,
if you’re using a traditional mash tun. Soluble protein is the amount of protein that is soluble in the wort. The soluble protein value allows us to find the S/T Ratio (sometimes seen as the SNR or Soluble Nitrogen Ratio). As the name suggests, it is simply the ratio of soluble protein to total protein. If the value is too low, it may suggest that wort runoff will be slow and problematic. Ideal S/T Ratio values are between 30 and 45.
ALPHA AMYLASE AND DIASTATIC POWER Alpha amylase is one of the two primary starch-breaking enzymes that occur in malted barley, with the other being beta amylase. Alpha amylase is definitely the dumb brute of the two as it randomly attacks various bond sites throughout the starch chains, minimizing their sizes in the process. For this reason, alpha amylase will not completely convert your mash starches on its own. Where alpha amylase really excels is in making life easier for its brother, beta amylase, by aiding in the solubilization of starch. Diastatic power is a measure of both alpha and beta amylase levels in the grain. If alpha amylase is the clumsy oaf, haphazardly bashing its way through starch molecules, beta amylase is the refined and meticulous sibling, systematically clipping maltose units (two glucose molecules) one by one from the ends of starch chains. Beta amylase is the more important of the two enzymes to distillers as it is the main supplier of fermentable sugar for our system. In order for our mash to convert itself without the addition of exogenous commercial enzyme preparations, we would like to see alpha amylase levels of at least 30 (measured in degrees Lintner, or °L) and diastatic power of at least 50. Note that these numbers are for an average of all the grain components. If you’re using 100 percent malt and it only has a DP of 50, you’ll be fine. It may not be the most fermentable wort in the end, but it will convert completely. However, if you were to take that same malt and try to convert a mash of 90 percent corn and 10 percent malt, you’ll have some problems. The math for approximating your true recipe DP is quite simple. All you have to do is multiply the DP of each 88
grain component by its recipe weight, add them all together, and then divide that number by the total recipe weight. For our example above of 90 percent corn (DP of 0) and 10 percent malted barley (DP of 50), we’ll say that we have 1000 lbs of grain total. Do we have enough enzyme capacity to convert the mash without adding commercial enzymes? (0 x 900)+(50 x 100) =5 1000 A DP measurement of 5 probably isn’t going to cut it and we’ll need to add some enzymes to fully convert all that corn. Most base malts on the market today (that the average distiller would use) will have DP values of at least 80, with some distiller-specific varieties going over 200. Alpha amylase values are commonly north of 50, so self-conversion of all-malt mashes is rarely an issue. The main problems occur with mixed grain mashes as we’ve just seen in the previous calculation. In that particular example, even if we substituted in a malted barley with a DP of 200, the average diastatic power of our grist would still only be 20. Now, realistically, the adage that DP should be at least 50 is more important for brewers. Distiller mashes are a bit more forgiving because we don’t boil our wort (denaturing valuable enzymes that may continue to work during fermentation) and we often use highly enzymatic malt. A more realistic DP value for many systems is likely closer to 30. However, this is really going to depend on your mash system and process protocols so take that number with a big grain of salt.
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R E C I P E F O R M U L AT I O N Understanding how to read a malt spec sheet is important, but how do you take this information and make it useful in your recipe building? More specifically, we want to know how much grain we need to mash in order to reach a desired wort volume with a target specific gravity. Now, if you’re like the majority of distillers/brewers out there, you don’t bother looking at malt and grain specs. Your recipes are locked in stone, and nothing is ever going to change in that department. But let’s say that you are a single malt producer, and you decide to change barley type. Perhaps you decide to switch from Briess’ 2-Row Brewer’s Malt to a Whiskey Malt. The Whiskey Malt has roughly 3 percent more extract than the Brewer’s Malt, which means your starting gravities will likely go up. This in turn changes your fermentation profile. Another way to look at it is that you won’t need to use the same amount of grain to achieve your desired fermentation profile, a financial bonus that your company’s bottom line will surely appreciate. And this is just one example among dozens of situations that can arise when purchasing grain for a distillery. In short: Pay attention to the malt specs. In order to build a proper mash bill, we need to know a few things. First, we need to know which grain(s) we are going to use. And if we have multiple grain types, we need to know their proportions. A discussion on mash bill design is really outside our scope here. Besides, many people already have some basic numbers in their heads that they think will work. The choice on grain proportion is more often more of an artistic, stylistic, regulatory, and/or marketing-related choice. But even if you have those proportions figured out, you still need to know how much TOTAL grain you need to use. So, what else do we need to know? Well, we should have an idea of what our target gravity is for the wash. Starting sugar concentration will have a significant impact on how our yeast performs and the flavors it produces. For single malt folks, the starting gravity is usually around 1.055-1.065 (13.6 – 15.9 °Brix). American whiskey mashes often click a bit higher at 1.065-1.075 (15.9 – 18.2 °Brix). We also need to know what volume of mash/wort we want to produce. This is usually dictated by fermenter/still size so that one is quick to answer. Ideally, we also want to have an idea of our mash efficiency. Mash efficiency is just a metric describing the percentage of total grain fermentables we are able to extract into our wort with our mash equipment. No mashing system will give you 100 percent efficiency (though facilities with mash filters will often come close). For traditional mash/lauter tun systems found in most single malt facilities, efficiencies range from 85-90 percent (some creep a bit higher than W W W . ARTISANSPIRITMAG . C O M
this). In American whiskey where the fermentation is “ongrain” the efficiency is a bit higher, often around 90-95 percent. The problem is that if you’re just starting out, you won’t know what your mash efficiency is. It takes a few months of production to really get that number dialed in for most people. If you’re unsure, I suggest starting with the conservative side of the above ranges for the type of operation you have. This will get you started and you can continue to tweak things as you get used to production on your system. Finally, we need to know a few parameters from our grain spec sheets. The main informational tidbits that are important to us are the extract values, either coarse or fine grind depending on our milling technique, and possibly the moisture content if the extract value is reported on a dry weight basis. To find the amount of grain for a given mash bill, the equation is: Gravity Points x Recipe Volume = Total lbs of Grain Total Extract x 46.31 Let’s break this down. Gravity points are simply the “excess gravity” of the desired specific gravity reading. If you have a specific gravity of 1.070, you have what is sometimes referred to as 70 points excess gravity since it is 1.07 times denser than water. The constant of 46.31 is simply that: A numerical constant. Use this number if you prefer working in English units of gallons and pounds. If you are a metric user (congratulations for joining the rest of the world!), then you will want to substitute in 386.5 instead. Total extract is a little more complicated, but only if you’re using a mix of grains. If you are using a single grain like in single malt whiskey, then it is simply the extract value of whichever milling type your operation is closest to on an “AS IS” basis multiplied by your mash efficiency. So, for our above example using Briess’ 2-Row Brewer’s Malt, we know the “as is” extract for a coarse grind is 76.6 percent. If we’re doing single malt and assume that our mash efficiency is going to be on the low side (because we’re just starting out) at around 85 percent, then we can find the Total Extract by multiplying those two values together in percentage form. 0.766 x 0.85=0.6511 This means that our Total Extract for our proposed system using that particular barley is 65.1 percent of the grain weight. But what if we have a bourbon mash with multiple grains? Things get more complicated, but not too much. The process is similar to what we’ve done thus far. 89
The B2B Cream Liqueur Experts
TYPICAL ANALYSIS Bushel Wt ����������������������������60-pounds Plump ����������������������������������������� 65% Thru �������������������������������������������� 10% Moisture ����������������������������������� 12.0% Protein ������������������������������������� 10.0% Color ����������������������������������� 3.01 SRM Extract FG, Dry Basis ����������������� 77.0%
TYPICAL ANALYSIS Bushel Wt ����������������������������60-pounds Moisture ����������������������������������� 13.0% Protein ��������������������������������������� 7.0% Color ������������������������������������� 2.0 SRM Extract FG, Dry Basis ����������������� 86.6%
figure 2: (TOP) BRIESS SPECIFICATION FOR
UNMALTED RYE; (BOTTOM) BRIESS SPECIFICATION FOR YELLOW CORN
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Let’s assume we want a bourbon mash with the following recipe: 70 percent yellow corn, 20 percent unmalted rye, and 10 percent malted barley. Notice from Figure 2 that both ingredients have their extract reported in a fine grind, dry weight basis. Since we’re making bourbon and probably using a hammer mill to crush our grain, the fine grind value is fine. We just need to convert the extract figures to an “as is” basis to factor in the water in the grain. For Rye: 77 x (100–12) = 67.76% Extract, as is 100 For Corn: 86.6 x (100–13) = 75.34% Extract, as is 100 And for our malted barley since we need to know the “as is” value for a fine grind: 81 x (100–4.2) = 77.60% Extract, as is 100 Next, we need to take our “as is” extract values and multiply them by our mash efficiency. For this example, let’s go with a mash efficiency of 90 percent. And while we’re at it, we will want to go ahead and multiply the extract values by their relative recipe percentages. Rye = 0.6776 x 0.9 x 0.2 = 0.1219 Corn = 0.7534 x 0.9 x 0.7 = 0.4747 Barley = 0.7660 x 0.9 x 0.1 = 0.0698
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We now have the extract contributions from each grain component. Add these numbers together, and we get our Total Extract value that we’ve been so desperately searching for. Total Extract = 0.1219 + 0.4747 + 0.0698 = 0.6664 From there, we can use this value in our recipe calculation. How much Total Grain do we need to produce this bourbon mash? Let’s say we need 500 gallons of mash at a specific gravity of 1.070. The equation would look like this: 70 x 500 = 1,134.12 lbs of grain 0.6664 x 46.31 To find out the necessary weight of the individual grains, simply multiply their recipe percentages by the grain poundage total. Rye = 1,134.12 x 0.2 = 226.82 lbs Corn = 1,134.12 x 0.7 = 793.88 lbs Malted Barley = 1,134.12 x 0.1 = 113.41 lbs Whew! If this all seems like a lot of math, well, it is. You could always revert to using programs such as Beersmith, Brewer’s Friend, and the like, but I’ve found these programs to be less than ideal for distillers. The grain specifications are often out of date and sometimes even missing. Besides, being able to handle these calculations on your own will give you more control of making recipe changes should you receive a batch of grain that falls out of spec. If you’re in the world of making whiskey, one of the best things you can do to produce better juice more consistently is to get a better understanding of your raw materials. Too many people seem to think that all grains are created equal when the reality is that there is wide variability between crops, farms, maltsters, and suppliers. If something changes, you need to understand why and the proper recourse to make sure those changes don’t affect your valuable distillates. And if you’ve reached the end of this piece with nary a change in mind on how you view malt specs, you can always read this to your kids during bedtime. Trust me, they’ll sleep for days. Cheers!
Matt Strickland is the Master Distiller (he hates that title) for Distillerie Cote des Saints in Quebec where he focuses on single malt production. He has a Master's in Oeonology and Viticulture from Oregon State, is a faculty member at Moonshine University, and is the only American to sit on the Board of Examiners for the Institute of Brewing and Distilling in the UK. His spirit spirit is Peruvian pisco and he does not believe that listening to Journey has to be done ironically. W W W . ARTISANSPIRITMAG . C O M
RAISING SPIRITS in the FINGER LAKES Written & photographed by George B. Catallo
n the edge of state-protected land in Naples, New York, with a gorgeous natural view sits one man's realized dream, Hollerhorn Distilling. Hollerhorn is so much more than a grain-to-glass farm distillery, it is also a hyper-local farm-to-table restaurant, music venue, and home to a vintage whiskey list that you will have a hard time finding anywhere else. Born and raised in Naples, Hollerhorn founder Karl Neubauer is an artist of many talents. He studied sculpture at Alfred University and eventually taught there for six years as well. Neubauer also studied Alternative Design and Building and opened his own business as an architect and furniture builder. After doing that for north of two decades, Neubauer and his wife Melissa, an art teacher and chef in Naples, decided to dedicate their lives to realizing a long time dream of opening a distillery. As a lover of single malts hailing from Scotland, Neubauer set out to follow in the footprints of many talented and influential distillers by apprenticing at the Springbank Distillers in Campbeltown. Many years in the making, Hollerhorn was built from the ground up an ideal location. On the distillery grounds is an old stone spring that has exceptionally pure water. The building is energy-efficient and heated in the winter by the still itself. The entire campus is a fine combination of modern innovation and rustic charm, one that’s amplified by the generous use of reclaimed timber. In the words of Neubauer it’s a “space with history...” 93
The vision for Hollerhorn’s product line is Scotch-influenced single malt, heirloom grain whiskies, and even a vogelbeere, which makes use of Neubauer’s full scale equipment that includes: a 750 gallon three-in-one mash tun, lauter tun and stripping still, 350 gallon pot still with gin basket and 18 plate 12’ column, 750 gallon fir wash back, 750 gallon jacketed fermentor, two 350 gallon jacketed fermentors, 30 gallon “Swiss army knife” brandy still that can be assembled with up to 8 plates, and three 30 gallon fermentors that have all been custom made by or in the guidance of Neubauer. Prior to installing the robust distilling systems, Neubauer used a much smaller alembic pot still acquired from another distillery to tide himself over. On this small scale test still he was able to craft a spirit that the TTB doesn’t quite have any definitions for, so it is labeled as “spirits distilled from Finger Lakes maple syrup.” And the base for the spirit is
fairly simple — water, syrup, yeast. Where the complexity lies is in Neubauer’s approach to distilling it. Instead of taking one cut from a run of distillate, he takes multiple, precise hearts cuts at different periods around when his desired flavor congeners are emerging. To do this, he knows what times and temperatures to watch for. He produces four different versions youngest to oldest: Silverleaf, Seedling, Sapling, and Old Growth. Silverleaf is unaged in the style of an eau de vie, while the others have seen time in used bourbon barrels and take on characteristics akin to reposado tequila or rum. Some of Neubauer’s lesser-known spirits include unaged fruit brandies such as Erdbeer (strawberry), Kirsch (cherry), and Wassermelon (watermelon). These are all done in an eau-du-vie style that lets the fruit they are made from shine through in their purest form. These products again are simple in their
ingredients: Fruit, water if needed, and yeast. No flavorants or colorants used. On the aged side there is a Calvados-style apple brandy aged in used bourbon barrels that was made in collaboration with a New York cidery, as well as a Riesling-based grappa that is partially aged in rustic cherrywood casks. Taking such old-world styles and making them in a contemporary manner is both an honor to tradition and a beautiful new expression. Even Neubauer’s flavored whiskey is not what you would expect from the category. Devil’s Bedroom is a honey- and habanero-infused peated single malt whiskey, with the honey coming from a Finger Lakes apiary and the entire habanero crop from a Naples farm. Neubauer has also developed a culinarily inspired, cardamom-forward gin. Unfortunately, when he was ready to begin gin production, his full-scale equipment had not yet arrived, and his small alembic pot was unable
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to rectify a gin. Where to turn? To his friends and Gin Guild Warden Rectifiers Jason Barrett and Jeff Fairbrother at Black Button Distilling in Rochester, New York. Neubauer developed his recipe and collaborated with Barrett and Fairbrother to make it a reality using their equipment and facility. The sense of community and collaboration in the craft distilling world is a godsend for distillers who find themselves temporarily without a still. The Neubauers’ vision for not only a distillery, but a place to celebrate art is very much alive in their tasting room, bar, restaurant, and music venue. Not only is it a delightful celebration, it is a revenue generator for the distillery. Having live music every week draws lively and large crowds. But even when there is no live music, the restaurant, with a hyper-local focus, also puts food on the table. Everything from the grains in the bread to the beef in the burgers are from in or around Naples. The Scottish longhorn cattle used in the burgers are raised only four miles from the distillery. Due to COVID, live shows at the distillery 96
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have been put on hold. However, where there is pause, there is opportunity. Neubauer, in between the chaos of bottling hand sanitizer and reopening to the public, launched an Indiegogo campaign to raise money for an outdoor music stage and space. Not only will this outdoor space be able to accommodate people in the last legs of the pandemic, it will increase indoor seating capacity for the restaurant. In addition, Neubauer is building a subterranean dunnage warehouse that will have capacity for a few hundred barrels of whiskey. Neubauer has also built an outdoor barrel warehouse underneath his deck, and has a sizable metal shipping container that has also been bonded for barrel storage. This diversity of warehousing environments gives way for placing different spirit types in the best possible microclimate. In celebration of this successful crowd-sourcing campaign, Neubauer released his first single malt whiskey — Malt in Motion. Everything about this whiskey is New York. The barley used was grown organically by Neubauer and his farmer-neighbor and then malted using peat and cherrywood. After distillation, it was bottled from one single barrel that was transferred meticulously through three different barrels in sequence — a New York State (NYS) four-grain bourbon barrel, a NYS port-style wine barrel, and a NYS peated bourbon barrel. The resulting whiskey displays Neubauer’s experience at Springbank, his creativity as a distiller, and a colorful palette of what New York’s beverage and agricultural world has to offer. After being able to open again to the public under strict restrictions and guidelines, Hollerhorn resumed restaurant service as well as hosted spirits-pairing dinners. Neubauer himself hosted these dinners, which offered multi-course meals paired with themed whiskies. One such event highlighted the fabled bourbons of the Buffalo Trace Antique Collection and Pappy Van Winkle lines, while another offered attendees the opportunity to expand their horizons into Japanese whiskies including some old enough to vote. These dinners offered an experience that people drove to Naples from all over Western New W W W . ARTISANSPIRITMAG . C O M
York to attend. These events, especially being hosted by Neubauer, worked beyond simply offering a fun sensory experience — but it exposed many to Hollerhorn for the first time. Most attendees didn’t simply enjoy their pairings, listen to a presentation about them, and go — they interacted with Neubauer and discussed distillation, Hollerhorn, and so much more. And these same people took this opportunity to both taste and take home Hollerhorn’s own spirits. There is a great level of care and attention
to detail in everything that is done at Hollerhorn. Be it the plating of a meal or the fact that the stoppers and labels on the maple spirits are crafted from maplewood. That level of care is a large factor in why Neubauer has no aspirations to become a giant in the spirits world. While he wants his business to thrive, he refuses to sacrifice quality, locality of ingredients, or artistic expression. Neubauer asserts that, “Sex, food, booze. Those are the three [best things in life]. Music and art are a close fourth.”
Hollerhorn Distilling is located in Naples, New York. For more information visit www.hollerhorn.com or call (585) 531-2448. 97
HOUGHTS on WHISKEY
Written by Stephen Gould
he last few years have seen a massive growth of Irish whiskey, making it currently the fastest-growing brown spirits category in the world. This has resulted in a lot of discussion about what Irish whiskey is, and how it relates to Scotch whisky, American whiskeys, and other types of whiskies. As with anything in the spirits world, there is a lot of information out there, some of which is accurate, some inaccurate, some partially correct, and a lot that is just pure misconception.
In the beginning… Whiskey was likely first distilled in Ireland during the 12th century, making Irish whiskey one of the earliest documented examples of a grain-based distillation. One common belief is that the techniques to produce this early whiskey were brought to the island by monks returning from travels to southern Europe or the Middle East. Another possibility is that Irish participants in the Crusades brought the art of distillation back with them. We will never know if either of these are fact, or if the art of distillation made its way to Ireland some other way. What we do know is that by the end of the 12th century, Irish distillers were producing potable spirit made from grain (aka whiskey), though this spirit would not have been “aged” as we know whiskey today. Rather, these spirits would have been flavored with herbs, spices, and botanicals and primarily used for medicinal purposes, at least at first. Any influence of wood on these early Irish whiskies would have been from wooden casks and containers used to store and transport them. These early “whiskies” were known by a variety of names, the oldest of which is “Aqua Vitae,” which appears in the Annals of Clonmacnoise in 1405. In 98
Scotland, the first recognized reference to any sort of a “whisky” doesn’t appear until 1494, almost 90 years later. By the 1550s, however, so much whiskey was being produced in Ireland that the English crown tried in vain to regulate it. It is likely that the Scots were also, by this time, producing increasing volumes of whisky.
Grain & Distillation Historically (pre-1930), both Irish and Scottish whiskies were distilled using whatever grain they could get cheaply. The further back you go, the more the mash bills would vary. This meant that barley, corn, wheat, rye and oats were all commonly used in both countries. Green (i.e. unmalted barley) was used in both countries, but over time became more prevalent in Ireland for a variety of reasons (mostly tied to the cost and availability of malted barley). Distillation began in both Ireland and Scotland on small alembic pot stills. These would have been used initially by monks, alchemists, and apothecaries, but were quickly adopted by others. These stills were simple pot stills made up of a boiler, a vapor W W W . ARTISANSPIRITMAG . C O M
duced from it, much of which prior to line, and a condenser of some sort. the 1960s/1970s were blended with They would be recognizable today grain spirit. Many of those blends by any distiller and are not dissimstill exist today ( Johnny Walker, ilar to many modern whiskey stills. Dewars, etc.), but Scottish single Both countries used triple dismalts continue to grow in popularity. tillation, initially to clean up spirit One more factor here, Scottish single made from lower quality grain. This malts were a “thing” as early as the became more common in Ireland 1820s, but not like they are today. It over time as it allowed the distillers depended more on what grain the to buy whatever they could get to distillery had access to. It was only meet the rapidly growing demand in the 1960s that their popularity for Irish whiskey globally in the began to grow significantly. 1800s. Triple distillation produces Peat was used as a heat source hisa cleaner, lighter spirit. I currently torically to malt grain in both counproduce both a double and triple tries. Where it was used depended distilled version of a single malt more on where the peat bogs were, with the extra pass through the still as it was initially used because it was being the only difference… and cheap fuel. In certain places, distillthey are very different whiskies. ers found that this smoke added flaScottish and Irish immigrant vor characteristics to their whiskies distillers brought the practice of that customers liked. For examusing multiple grains to the Unitple Islay in Scotland, where peat ed States and Canada in the 1700s smoke has a briny-oily character and 1800s. Again, largely due to (due to its proximity to the sea the availability of different grains, and types of vegetation), is they created the multi-grain whisknown for distinct, heavily kies we see today. Those styles have peated whiskies. The use of persisted and are what we now call peat first as fuel and then bourbon, rye, and Canadian whisfor flavor became more key. As we all know, there’s great Image from the author’s collection, dated 1568. prevalent over time, and now is variation within each style. primarily considered as a Scottish thing, By the mid-1800s, at the peak of the though some Irish distilleries use peat in their whiskeys. Whiskey British Empire, the most common brown spirit worldwide was Irish producers in other countries also use peat and other smoke inputs whiskey. That remained the case until the early 20th century, when the in their whiskies. Irish pushed for independence. In retribution, the British enacted an After the collapse of Ireland’s whiskey industry in the wake of the economic embargo of Ireland, followed by a trade war between Enembargo/trade war, a few major producers survived and prospered. gland and Ireland shortly after independence. The Irish whiskey indusA few years ago, there were only a handful of distilleries operating try was crushed. in Ireland. Most of the whiskies they produced were, and still are, a On the British side, they began not only sourcing more whiskey from blend of “pot still” and grain. I won’t go into detail about the Irish Scotland, but actively working to grow Scotland’s industry to meet the technical file here, but pot still is a whiskey made with malted barglobal demand that had previously been met with Irish whiskey. The ley and green barley, perhaps with other grains. It is defined in use of malted barley as a major ingredient became more common in Irish law (the Irish Whiskey Technical File), which is heavily inthe UK, again due to a variety of commercial and political factors. fluenced by one large producer and the subject of much debate A note here about barley and Scottish single malt whiskey: Barley currently. Under the current technical file, much of what was has two (of many) factors that make it good for distilling. First, its getraditional pot still during the height of Irish whiskey’s populatinization temperature is lower than most other grains, meaning that larity in the 1800s and early 1900s can’t legally be called pot you can use it (mash with it) without having to “cook” it like other still today. grains. Second, many variants have higher levels of enzyme then other Today Ireland is seeing a renaissance in whiskey production. grains (this is true of both wild and commercial strains). These two facWhile the vast majority of Irish whiskey on the global market tors, coupled with what crops were being grown in the UK at the time, is produced by one of six or seven distilleries that own made it ideal as a primary grain for Scottish distillation. hundreds of brands, there are now well over 50 permitted While it was not the only grain used in the UK, it became more distilleries in Ireland and more than 20 that are in production and more prevalent, as did “pure malt” and “single malt” whiskies proW W W . ARTISANSPIRITMAG . C O M
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with more coming on-line every month. Today the vast majority of Irish whiskey is mostly made up of light, easy drinking whiskies that are a blend of pot still and grain. There are also a growing number of double-distilled single malt whiskies produced in Ireland with new entries into that category coming. Waterford is a great example. Due to Ireland’s rapid growth in the distilling industry, distillers from other countries, most notably Scotland and the United States, are finding their way to Ireland to fill the growing demand for trained and skilled distillers. These distillers are both bringing back styles of distilling and production techniques that were historically used in Ireland, but aren’t typical of what has been used in the last 100 years. This means that more Irish products are coming to market that are heavier, more complex whiskies harkening back to those produced in the late 1800s and early 1900s. While brands like Jameson will still dominate the category, the breadth and variety of Irish whiskies will continue to increase in the next decade. On the Scottish side, what we now consider as traditional Scottish blends and single malts will continue to hold significant market share, but there is also an increasing number of smaller distilleries looking to produce multigrain whiskies, such as Arbikie’s Highland Rye. Elsewhere in the UK more new single malts and multi-grain whiskies are being produced, though the bulk of those, as in Scotland, are lautered (as opposed to being distilled on-grain). Around the world distilleries are taking note of these “traditional” Irish production techniques and producing whiskies that either follow the current Irish technical file for pot still or follow older, traditional pot still mash bills and production techniques. Some of these are also triple distilled. An excellent example is Colorado’s Talnua If you are interested in Distillery, which is learning more about making an American Irish whiskey’s history, single pot still whisa good place to start is key following the Irish Fionnan O’Conner’s technical file. book A Glass Apart. Sláinte! Stephen Gould is the Founder and Master Distiller of Golden Moon Distillery in Golden, Colorado. “As a working master distiller with three decades of experience, I have trained among other places, in Scotland. I run my own distillery in Golden, Colorado, and for the last several years have worked part time in Ireland as a consulting master distiller. My Colorado distillery also prototypes whiskies for folks in Ireland and elsewhere.”
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FOUNDATIONS of CRAFT DISTILLING WRITTEN BY GABE TOTH
s the American craft spirits world grows, new and would-be distillers do not always have access to the best information on the fundamentals of distilling. What worked for grandpa in the woods, or a friend’s methods on their garage still, don’t always translate into making the best possible product for a commercial operation. To that end, we hope to provide some basic foundational distilling knowledge for new craft distillers and those who have not been formally trained in a series of articles that cover the key components of distilling at a craft level. While the principles laid out in the READ FOUNDATIONS subsequent articles are not always hard and fast rules, there are often OF CRAFT DISTILLING 1: MASHING good reasons that they have become guiding principles. Rules can be broken, but one should learn the rules in order to know best how to break them. We will attempt to explain the reasons for these principles or best practicREAD FOUNDATIONS es as much as we can, but given the OF CRAFT DISTILLING space constraints of a magazine, this 2: FERMENTATION will not always be possible. This article, Distilling, continues and builds on the contents from the Mashing and Fermentation articles in previous issues of Artisan Spirit.
The Equipment of Distillation Finally, we get to the actual distillation. With some luck and plenty of practice, the distiller has a wash or mash that has fermented to between five and ten percent ABV and contains the desired level of other flavor compounds, whether from raw materials or yeast/bacteria metabolism. It’s time to fire the still. We’ll focus here on batch distillation — filling and running the still for a batch, then dumping it and possibly refilling — primarily using a pot still, and then briefly discuss the use of a column still with plates. W W W . ARTISANSPIRITMAG . C O M
A pot still is composed of a few common sections. The pot itself contains the charge for distillation and the heat source. Just as with fermentation space, the pot will have a gross volume indicating total capacity, and a net volume that may be 20 to 30 percent less to account for foaming, especially during stripping runs. Directly above the pot is the helmet, which connects to the pipe — known as the lyne arm — that runs to the condenser. All three primary pieces of the still can vary in shape. The helmet often follows tra-
ditional Scottish designs: straight to the lyne arm, ball-shaped, or a wide-at-the-bottom and slowly tapering lantern shape. The lyne arm can be short or long, angled up, down, or horizontal. Craft whiskey stills are commonly designed with shorter necks, but exceptions exist. The unusually tall stills at the Glenmorangie distillery in Scotland are a well-marketed aspect of their operation. Because of its durability and ability to be cleaned with strong chemicals, stainless steel often constitutes a large part of the still. How101
ever, the presence of a high percentage of copper is critical to the chemical reactions that take place in distillation. Copper is known to bind up sulfur compounds, and it can catalyze esterification reactions in the vapor. It is commonly used for the helmet but can also be part of the pot, lyne arm, or condenser. To produce spirits requires phase changes: Energy (heat) must be added to the fermented media to create vapor, and energy must then be removed from the vapor to create condensate. Heating can be done via steam or direct-fire. Modern craft-scale stills generally tend toward steam heating (often via jacketing, but also potentially through an internal coil) because of the efficiency and ability to control the heating, though there are some small distillers who also use direct fire. The concept of direct fire can have a romantic appeal, but if not carefully designed and managed it can lead to uneven heating and scorching in the pot, not to mention the consideration of having an open flame directly beneath a vessel filled with flammable vapor. Internal electric elements are also an option at the very small
end of the spectrum. While more affordable than installing a boiler to provide steam, electrical elements are limited in the volume they can heat and can tend towards scorching if not used carefully. Cooling is done in the condenser, using cold water or glycol to condense vapor back to liquid. This is most commonly done with a shell-and-tube condenser, where the product flows through a series of parallel tubes surrounded by a chamber of cooling liquid, transferring heat from the vapor to the cooling medium. If water is used for cooling, it can be reused for an upcoming mash, as cleaning water, or any other purpose that hot water can serve.
The Science of Distillation The actual distillation process is based on the fundamental differences in evaporation temperatures between the various components of the fermented medium. A mixture of compounds with different boiling points will boil at an intermediate temperature that
depends on the constituents and their concentrations in the mix. In the case of beverage alcohol distillation, the primary components are water, which boils at 212 degrees Fahrenheit (at sea level); and ethanol, which boils at 173 degrees. The point at which vapor will start to come off is between those two points, depending on the percentages of each. The azeotrope of ethanol, the chemical upper limit that can be reached via distillation, is just over 97 percent ABV, but that doesn’t mean that when you run an alcoholic mixture through a still that’s what you get. Just as the vapor temperature is a factor of the chemical makeup in the pot, so is the ABV. Ethanol has a lower boiling point than water, but the ABV of the distillate being collected is also a mixture. Because of the higher volatility of ethanol versus water, the ethanol will concentrate in the vapor while more of the water is left behind in the pot. This allows the distiller to go from between five and ten percent alcohol in the fermenter to about 30 percent in the low wines (first distillation) to 70-some percent ABV in high wines (the second distillation). This similarly applies to the fraction of a percentage of other fermentation compounds, known as congeners. Some have lower boiling points than ethanol, some have similar boiling points to ethanol, some are closer to water, and some aren’t volatile and will be left behind in the pot. As the ratio of water and ethanol changes during the distillation, the temperature in the pot rises, and the various congeners that run off during the distillation will evolve and change hand-in-hand with the pot temperature. There are potentially thousands of congeners in the complex fermented media, but the primary ones are various alcohols (including but not limited to methanol, propanol, butanol, amyl alcohol), fruity-tasting esters, and aldehydes such as acetaldehyde. As the distillation proceeds, the lightest components (those with the lowest boiling points) will volatilize first, proceeding gradually through increasingly heavy compounds. This procession of lower-boiling to higher-boiling compounds is the foundation of making cuts in the distillate. The lightest compounds, those that come off of the still early on and are separated, are known as the heads. As the distillation continues with the W W W . ARTISANSPIRITMAG . C O M
ethanol volatilizing disproportionately compared to the water, the ABV in the pot — and concurrently in the distillate being collected — will gradually drop. The middle of the distillation, known as the hearts, will contain most of the ethanol, along with congeners whose volatility overlaps with ethanol. As the ABV in the pot drops to a certain level, more heavy compounds with higher boiling points, such as fatty acids and fusel alcohols, begin to carry over into the distillate. Just as the distiller won’t get pure separation between ethanol and water, the heads and tails flow will be more of a continuum that peaks and ebbs. Small choices in heads and tails cuts can make dramatic differences in the final product. The goal is to reduce or completely minimize congeners in neutral spirits and balance the correct amount for other spirits. Most craft distillation is done on a batch basis; that is, the still is filled, run, and emptied one batch at a time. (This is compared to a continuous still, which requires a constant feed of distillate at a stable flow rate and ABV. A continuous still can be used for stripping or for single-pass distilling, going from mash to spirit in one distillation.)
Stripping Run A distillery might use the same still for stripping and finishing spirits such as whiskey, rum, or brandy, or there might be a stripping still and a finishing still sized to work in tandem. In the first case, multiple stripping runs are done to collect enough low wines for at least one (and possibly multiple) finishing runs, followed by a cleaning of the still and then the finishing runs. In the case of a system where the spirit still (finishing still) is sized according to the stripping still, a batch might be stripped one day and finished the next. Whiskey or other spirits can also be threetimes pot distilled. The most well-known example of this is traditional Irish-style potstilled whiskey, which is made with both malted and raw, unmalted barley and requires additional distillation to produce a properly balanced whiskey. A stripping run is generally run until the distillate being collected drops to at least 10 percent ABV, though some distillers go all W W W . ARTISANSPIRITMAG . C O M
the way down to one percent. At ten percent, there is roughly one percent ABV remaining in the pot. At a certain point, which varies based on the cost of materials and the cost of heating the still, it becomes more expensive to heat and reclaim the last bit of alcohol than to mash and ferment more. In a stripping run, the distiller may yield between a quarter and a third of original volume and jump from less than ten percent to about 30 percent ABV.
Making Cuts Cuts are not made on stripping runs, but are done on finishing runs. An ABV of 25 to 30 percent contains a high enough proportion of congeners to make good cuts, while a higher ABV would lead to increased bleeding of heads and tails into the hearts. The head fraction includes large proportions of acetone (nail polish remover), methanol, aldehydes, and other volatile compounds, some of which will flash off into the atmosphere. (When distilling fruit, it is important to make the heads cut so that enough methanol is removed. Pectin degradation during fermentation can result in elevated levels of methanol, so fruit distillations may require deeper heads cuts than a whiskey or rum distillation.) Many of the compounds that come over in tails can be rich and flavorful, but others can be bitter and unpleasant. Tighter cuts (larger removals of heads and
tails, with a smaller hearts fraction) will give a cleaner initial spirit, while looser cuts (more heads and tails in the spirit) can be appropriate for a longer aged spirit. Over time, the small amounts of heads and tails congeners will interact with oak compounds and micro-oxygenation that penetrates the barrel. A batch of whiskey destined for short aging in five or ten gallon barrels needs to be very clean, because these secondary flavors will not have time to develop. Whiskey that has time to clean up and develop complexity in the barrel over years can contain more of the volatile heads fractions and the heavy, late tails compounds. To determine the correct moment to make a heads or tails cut, the distiller tastes what is coming off the still, using their judgement based on experience and the needs of the distillery. Temperatures and ABVs should be recorded when making cuts and can be used as general guides, but no analytical or technological solution is as good as a trained palate. A demisting test can be carried out on the early part of a run, prior to making the heads cut, to verify that the oily late residues from a previous run have been fully flushed out of the still. This test involves collecting some of the early runnings and blending it down with an equal amount of water. The oils left over from the end of a previous run will be soluble in the high-ABV heads fraction, but when water is added they will come out of solution 103
and the sample will become milky and cloudy. The practice of recycling heads and tails from one run into the next run of the same product is common. It allows the distiller to collect and reclaim some of the ethanol that would otherwise be lost. Recycling heads and tails also helps to even out small inconsistencies that occur when making cuts. If, for example, the heads cut is made late on a batch,
removing a larger proportion of low-boiling compounds from the hearts fraction, those heads and possibly early hearts compounds will wind up in a higher proportion in the next distillation, likely increasing the amount that makes its way into the hearts fraction on the next batch. As the vapor transits from inside the pot just above the liquid level, through the still, and out the condenser, it does not move in a straight line directly out. It will condense on the sides and top of the pot, in the helmet, and in any vertical piping leading from the helmet to the lyne arm (and in an upward-sloping lyne arm, as well). As it condenses, some of the heavier compounds will drop back into the liquid distillate and the lighter compounds will evaporate again. This continuing process of condensation and re-evaporation, known as reflux, produces a cleaner and more refined spirit. The aforementioned tall stills of Glenmorangie, by nature, create a more delicate whiskey than a short vapor path.
Choose Your Own Adventure Once the distiller is comfortable with the general process, then a variety of other choices present themselves, levers that can be pulled to impact the flavor of the spirit. Running paddles or agitators in the pot during a finishing run can increase the level of conge-
ners in the vapor, so is often avoided. However, agitation is necessary to strip on-grain fermentations, otherwise the grain solids can cake and scorch on the surface of the still, impacting flavor and slowing down the distillation by reducing heat transfer into the pot. All other things being equal, grain-on distillations will also produce a more robustly flavored spirit compared to distilling a lautered fermentation. (At the end of stripping an ongrain spirit, the spent mash — stillage — can be pumped out to a receiving tank for farmers to use as-is for feed, it can be allowed to settle so the liquid can be decanted off prior to becoming feed, or it can be pressed to expel much of the moisture, creating a more stable feed product known as dried distillers grain.) To a limited degree, running more heat to the still will speed up the distillation and potentially push more congeners into the distillate; while running slowly and allowing for increased reflux will create a slightly lighter spirit. Running the still too fast can result in entrainment, where high vapor flow actually carries some liquid through the still and out into the distillate, negatively impacting the flavor of the spirit. The fill level of the pot will also impact the character of a pot-distilled spirit. A more full pot will produce a richer, heavier spirit, while the increased space for reflux in a less full pot will produce a slightly lighter spirit. There are a variety of still designs that have been created to increase or decrease reflux. Plates are also an avenue to increase reflux and raise the ABV of a distillate. Stacked up, a series of plates makes a column. There are
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a couple of primary design types: the bubble cap and the sieve plate, but both operate the same way. Vapor is allowed to travel into the plate from below, condense, and then the lightest components of the mix evaporate again as more heat energy and more heavy compounds come in from below. Downcomers, pipes that drop from one plate to the next one below, allow the heaviest fractions that condense and remain behind to overflow down into the lower plate. When enough plates create enough reflux, with the ABV increasing slightly at each plate, a distiller can produce a neutral spirit of 95 percent ABV or higher, which is required for vodka. This type of batch column system takes a principle already mentioned — that a slow, gentle distillation will allow for more reflux and produce a more refined spirit — and relies on it as a fundamental requirement. A column, with each plate effectively providing an additional level of distillation and refinement, only works if the vapor flowing into the column doesn’t run so fast that it disrupts the balance in the system. If the column is charged slowly and allowed time to equalize, the distiller will have very clean fractions of separate congeners coming off the still. If the column is filled quickly and expected to run off without taking time to stabilize, or if a lot of heat is suddenly pushed into the system after the column has reached equilibrium, then the spirit coming off of the still will be a lower ABV and will have fractions that bleed together. Gin is generally produced by redistilling neutral spirit with juniper berries and other
botanicals. This can be done in a number of ways, including a maceration (steeping) of ingredients in the neutral spirit, straining out solids (or not), and finally proofing down and redistilling the infused spirit. Ingredients can also be added just before distillation, either directly into the liquid distillate or suspended in the vapor path where the ethanol vapors will extract a more delicate spirit. Ingredients can be distilled together for efficiency or separated into multiple distillations and blended back together to optimize the flavor profile of each ingredient. A very short and incomplete list of common gin botanicals includes citrus or citrus-y ingredients (orange, lemon, coriander); spic-
es such as pepper, clove, or cinnamon; and roots, including angelica, licorice, and orris. The potential variety of gin ingredients is limitless, though, ranging from rose petals to animal dung, and the balancing of those ingredients is a careful art. We will finish with aging/packaging in the following issue. The content laid out in these four articles will form the core of a future publication that will more fully explore and elaborate on these and other essential topics, so any omissions, errors, or questions are welcome and we will work hard to make this material as thorough and accurate as possible.
Gabe Toth is lead distiller at The Family Jones Distillery in Denver and Loveland, CO. A former craft brewer, his passion for fermenting and transforming ingredients also extends to sausage and meat curing, cheesemaking, and pickling. He can be found up in the mountains or at email@example.com.
1946 - 2021
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DRNXMYTH’s Engineering Innovation and Bartender Partnerships Disrupt a Key Drinks Sector WRITTEN BY RICH MANNING /// PHOTOS PROVIDED BY DRNXMYTH
ack in 2016, DRNXMYTH founders Brandon Schwartz and Lawrence Cisneros had an idea that came with its own conundrum. The duo — the former an entrepreneur, the latter a lawyer — were enthusiasts of the Los Angeles craft cocktail scene and wanted to create a portable potent potable they could enjoy at home. At the same time, they didn’t want to create some watered-down facsimile of the real thing. “We were essentially wondering how we bring the bar to a bottle and honor the bartender,” Cisneros said. Their solution? Create a bit of bottle tech that previously didn’t exist. Engineering isn’t usually associated with cocktails, but it’s an essential component behind the nearly 30 bottled cocktails that make up DRNXMYTH’s lineup, and it will continue to be essential as the Los Angeles–based company’s product line expands. There are several other components that make DRNXMYTH’s bottled adult beverages a major player in today’s ever-growing world of canned, to-go, and DIY at-home cocktail options, like the use of high-quality ingredients and collaborations with bartending talent across the country. Yet DRNXMYTH’s bottle design particularly makes them a unique market outlier. “When you pick up one of our bottles, you immediately know why it’s different,” said Cisneros, who now serves as the brand’s CEO. “You know that it’s special.” To understand why, we must get a little nerdy.
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BEHIND THE BOTTLE TECH DRNXMYTH’s bottles contain two separate chambers. The top chamber holds the spirit, which can range from local craft spirits to bigger brands plucked from the larger portfolios of Diageo or Pernod-Ricard. “It really depends on the supply and what we can access,” explained Schwartz, currently the brand’s President. The locally sourced juice and the cocktail’s other fresh ingredients fill the bottle’s bottom chamber. After the chamber gets capped, it gets cold-pressed, a process that pressurizes the liquid under 85,000 pounds per square inch (PSI). This step allows DRNXMYTH to protect the natural structural integrity of the liquid. “Cold-pressing brings the microbial count to near zero,” said Schwartz. “This means that we don’t have to chemically alter the juice or subject it to heat pasteurization.” The empty top chambers are pneumatically pressed on the bottom and filled with the spirit of choice, and then the whole bottle gets chilled at a crisp 41 degrees. While the two chambers rest on each other, the liquids inside each remain separate until the consumer twists the bottle’s bottom to combine the two chambers and gives the bottle a good shake. Then and only then do the liquids interact with each other — right when the drink is ready to pour and serve, and not co-mingling for days or weeks within a can. This process is much more than a cool engineering feat. It allows DRNXMYTH’s cocktails to remain fresh and natural, free from the need to introduce shelf-extending chemicals or additives into the mix, which is a crucial metric for the brand to meet. “I don’t want ingredients that I can’t pronounce in my drink,” Schwartz said. “Why would our customers?” The fact that the liquids don’t meet each other until they absolutely have to also enables the drinks to replicate the flavor, freshness, and integrity of the cocktails served up at their favorite craft cocktail bars. This innovative process carries a unique ripple effect that isn’t seen in canned cocktails. “Our product has a shelf life,” Schwartz said. “They have to be consumed within five months of bottling, or they’ll go bad. But that’s what happens when you use fresh ingredients with no additives. It’s a natural element that makes it such a high-quality product.”
A LITTLE HELP FROM THEIR FRIENDS DRNXMYTH’s cocktail collection covers an ample swath. Classic drinks like the Jack Rose, clover club, paloma, and several margarita iterations are present. So are modern riffs on classic drinks like the eastside and the ginger drop, which spin off the southside W W W . ARTISANSPIRITMAG . C O M
and lemon drop cocktails, respectively. Unique creations like the mezcal-based Smoked Watermelon with lemon and spiced honey or the tangerine bomber cocktail with hops-infused vodka are also on hand for guests looking to deviate. The development of these drinks aren’t formulaic builds lifted from some random three-by-five index card. Each cocktail recipe comes from a stable of talented bartenders willing to share their skills to a broader audience, a constantly growing roster Cisneros currently estimates to be around 20 people. Cisneros and Schwartz began building this list by recruiting some of their Los Angeles bartending friends. As DRNXMYTH grows, they’ve welcomed mixologists from New York, Austin, Indianapolis, and San Francisco into the fold. These partnerships enable the duo to execute the brand’s other mission, one that directly ties to Cisneros’ and Schwartz’s deep adoration of the bartending community. “We wanted to provide a way for bartenders to share their knowledge and passion with a wide market,” Cisneros explained. “These drinks can allow them to preserve their legacy.” Each drink idea goes through a careful research and development phase to make sure they can retain a high level of integrity within DRNXMYTH’s intricate bottle design. There have been a couple of misfires discovered through this process — “There was a coffee drink with almond milk that we tried that didn’t work,” Schwartz said — but most concepts pass the stage without any red flags. This process has enabled the duo to play around with a few natural options that ultimately make their cocktails even more market-friendly, such as the creation of low-ABV sangrias and using vegan-friendly aquafaba as an egg white substitute. According to Cisneros, these experimentations aren’t ever done at the expense of whatever origin story a drink may possess. “We do look at trends, but we’re also very mindful of a cocktail’s history,” he said.
GAINING VALIDATION DRNXMYTH’s 2020 launch occurred right before the pandemic, which meant it hit the shelves just prior to lockdowns and the concurrent need for people to drink their mixed drinks at home. They built their growth strategy around these conditions, channeling a healthy dose of energy into the e-commerce market while gradually landing choice off-premise accounts. As the company brings more bartending talent aboard to craft new drinks to imbibe, all signs point to their strategy working. The company has also built a steady amount of acclaim for their drinks and their bottles since their debut. In December, BevNET’s Best of 2020 Awards recognized the brand twice, once for Best New Spirits Product and a second time for Best Packaging Design. While these accolades are terrific, perhaps the most impressive endorsement they’ve received comes from the liquor they use for their Jack Rose beverage. The cocktail features bottled-in-bond applejack brandy from Laird & Company in Eatontown, New Jersey, renowned for being the oldest distillery in the United States. “Ours is the first product outside of Laird’s itself to bottle their applejack brandy, a spirit they’ve been making for over 200 years,” said Cisneros. “We’re incredibly honored to feature them.” The collection of support, accolades, and endorsements DRNXMYTH received in their young existence demonstrates their engineering-fueled twist on at-home cocktails isn’t just a fluky gimmick. It may also make it tempting to coast on the knowledge that something innovative was made. According to Schwartz, that’s not an option. “We’re still somewhat of an underground, incognito brand,” he said. “We’re just now starting to rise up to the surface.” For more info on DRNXMYTH visit www.drnxmyth.com or call (310) 294-8792.
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Where to look for distilling-related information Written by Paul Hughes, Ph.D.
or those of us who want to learn more about all things distilling-related, we need access to information. This can be word-of-mouth/experiential, in a classroom, or from self-learning, the latter which has the fancy term of autodidactic. We live in an online multimedia world which has revolutionized how learning can be achieved. Platforms such as Coursera and edX offer free online university-level courses. Ted Talks and the often less-formal alternatives such as YouTube are valuable in their own right, not least because it broadens approaches to learning beyond the traditional “chalk-and-talk.” Historically the most valuable learning resource has been in the form of graphics and text. Indeed, traditionally university students in the UK when asked what they were studying would often reply “I’m reading biochemistry,” implying a clear link between reading and knowledge. (Indeed the old joke “I’m reading books” reaffirms this connection.) So where does a distiller, nascent or otherwise, find information? Here we review the various information sources available to the distiller, with a focus on printed text. There is an implicit human processing step required when reading, which is the reader’s evaluation of the quality of the information contained. Is it true, accurate? If personal decisions will be made based on information that is read, then assessing the quality of reading matter is vital.
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Some important published monographs with a focus on distilled spirits
Current Developments in Malting, Brewing and Distilling, Aviemore, Scotland
Proceedings of the Aviemore Conference on Malting, Brewing and Distilling, Aviemore, Scotland (four conferences)
1986, 1990, 1994, 1998
Worldwide Distilled Spirits Conference, Edinburgh, Scotland (six conferences to date)
2002, 2005, 2008, 2011, 2014, 2017
Bureau National Interprofessionnel du Cognac
Elaboration et connaissance de spiriteux, recherche de la qualité, tradition et innovation
Independent Stave Company
International Barrel Symposium [A selection of papers from various the 5th, 6th and 7th symposia]
Institute of Brewing/ Institute of Brewing and Distilling
Some important contemporary, technical, distilling-related texts
Rose, A. (ed.)
Economic Microbiology, vol. 1, Alcoholic beverages
Piggott, J.R., Sharp, R., Duncan, R.E.B.
The Science and Technology of Whiskies
Lea, A.G.H., Piggott, J.R. (eds.)
Fermented Beverage Production (two editions)
2nd ed. 2003
Jaques, K.A., Lyons, T.P., Kelsall, D.R. (eds.)
The Alcohol Textbook (six editions)
1995 – 2017
Russell, I. (ed.)
Whisky: Technology, Production and Marketing (two editions)
Buxton, I., Hughes, P.S.
The Science and Commerce of Whisky (two editions)
The Cooperage Handbook
Cooperage; A Treatise on Modern Shop Practice and Methods; From the Tree to the Finished Article
Malts and Malting
Nykanen, L. and Suomalainen, H.
Aroma of Beer, Wine and Distilled Alcoholic Beverages
Piggott, J.R. (ed.)
Distilled Beverage Flavour: Recent Developments
Piggott, J.R. (ed.)
Flavour of Distilled Beverages: Origin and Development
Piggott, J.R. (ed.)
Alcoholic Beverages: Sensory Evaluation and Consumer Research
Alcohol and Its Role in the Evolution of Human Society
Gray, A. (late editor)
The Scotch Whisky Industry Review
The Scottish Whisky Distilleries
Willkie, H.F. and Prochaska
Fundamentals of Distillery Practice
Institute of Brewing
Brewing Science and Technology, Series II, Volume 4, Engineering (including distillation)
Boulton, C. and Quain, D.
Brewing Yeasts and Fermentation
Buglass, A.J. (ed.)
Handbook of Alcoholic Beverages (two volumes)
The Terroir of Whiskey
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A selection of some historically important distilling-related texts
Author (publication year)
Shannon, R. (1805)
A Practical Treatise on Brewing, Distilling and Rectification
Freely available online
Duplais, P. (1871)
A Treatise on the Manufacture and Distillation of Alcoholic Liquors (English translation)
Facsimile copies available
Barnard, A. (1887)
The Whisky Distilleries of the UK
Valuable historical resource. Some excellent facsimiles available
Lancaster, H. (1908)
Practical Floor Malting
Reprinted by White Mule Press
Stopes, H. (1885)
Malt and Malting
Highly detailed volume, focused on beer production
Nettleton, J.A. (1913)
The Manufacture of Whisky and Plain Spirit
Reproduced by Craft Expressions in 2009
In academic terms the highest level of information sources is considered to be peer-reviewed papers. The authors of peer-reviewed papers must submit their papers to a journal of their choice, and the editor then circulates the paper to peers familiar with the subject matter for opinion and review. In this way, the hope and expectation is that inaccuracies and personal bias can be eliminated. It is not perfect, as demonstrated by the publication of Fleischman and Pons’ cold fusion paper in Nature, one of the most respected scientific journals worldwide and which required Nature to publish an eventual public retraction. For distillers there are few peer-reviewed journals available, although the Journal of the Institute of Brewing, established in 1887 as Transactions of the Laboratory Club, has historically carried distilling papers (the Institute of Brewing and Distilling have generously scanned and uploaded all of their papers freely available online at https://onlinelibrary.wiley.com/ loi/20500416). The American Society of Brewing Chemists is also developing an interest in publishing papers focused on distilling. The newly-formed Society for Distilling Science and Technology (SDST) is, though, about to launch a dedicated journal, the Journal of Distilling Science, as perhaps the first journal dedicated to peer-reviewed, distilling-related research. Beyond these three journals, distilling-related papers can be found in other cognate journals, such as the Journal of Agricultural and Food Sciences, sensory journals such as Food Quality and Preference, and other subject-specific journals that focus on specific disciplines such as microbiology, chemistry, biochemistry and chemical engineering. There is a need for caution though. The online world has prompted the growth of online journals and “special editions,” of which many are reputable. However, some of these virtual journals can be unclear as
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to their publication policy and can carry hefty charges to publish, so caveat emptor. However, good quality information is not the exclusive preserve of peer-reviewed journals. Many conferences and symposia publish papers presented in the form of proceedings or monographs, with submitted papers often subjected to editing rather than peer-review. While this might indicate information of lesser quality, monographs can be valuable resources, and the papers can be of peer-reviewed quality. The list in Table 1 of distilling monographs is not extensive but they can be challenging to acquire. A book is distinct from a monograph in that it contains information that was generally known before and can therefore be considered to be a secondary source. For instance the information may have been derived from peer-reviewed papers and so book content has undergone additional interpretation by the book author. The tone of books can vary widely, from erudite treatises such as Sarah Bowen’s “Divided Spirits — Tequila, Mezcal and the Politics of Production,” to the highly readable Ian Buxton texts such as “101 Whiskies to Try Before You Die.” Whilst not exhaustive, the list in Table 2 indicates some important contemporary distilling-focused texts. We should not ignore more venerable texts, which have become much more accessible as libraries and other organizations increasingly digitize their collections. Additionally, as these texts are out of copyright, increasing numbers of reprints are found for sale online. The quality can be poor but there are exceptions, such as Ian Buxton’s opulent reproduction of the historically important Nettleton tome “The Manufacture of Whisky and Plain Spirit” and the reproduction of Lancaster’s “Practical Floor Malting” by White Mule Press (Table 3).
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There is another category of texts that should not be overlooked, which are those written for the layman distilling aficionado. Here books such as Emmons Book of Gins and Vodkas, the books in the Edible series that focus on spirits and, exceptionally, the sumptuous Nathan-Maister absinthe text are all worth perusing. Indeed David Wishart’s Whisky Classified is to me pleasantly disingenuous. At first it presents as a highly readable text that groups Scotch whisky into one of 10 categories. However the author happens to be a highly qualified statistician and the methods used to sort Scotch into categories are sophisticated and as such this book seems to hide its light under a bushel. Finally it is worth noting that there are some potentially valuable web-based resources provided by individuals, companies, trade associations and the college/university sector. Indeed, distillers themselves can have interesting insights and resources for their own processes and products. The American Distilling Institute, The American Craft Spirits Association and the Institute of Brewing and Distilling all provide excellent web resources, some of which are freely available. There is also a blossoming distilling education sector, with numerous institutions offering courses in distilling-related areas. Such institutions include ourselves here at Oregon State University, the London-based Wine and Spirits Trust and the Institute of Brewing and Distilling, Kentucky’s Moonshine University and the Alcohol School. The information resources for distilling-related disciplines are a wealth of data and information, which is being continually added to. Perhaps one last aspect to consider is going off-piste in searching for information in cognate disciplines, such as food science, process engineering and sensory science. Ultimately the successful production of distilled spirits is multidisciplinary and there is always one more paper, book, or website to peruse!
Paul Hughes, Ph.D. is assistant professor of food science and technology at Oregon State University in Corvallis, Oregon. For more information visit www.oregonstate.edu or call (541) 737-4595.
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A TASTE OF
VIRGINIA WRITTEN BY RICH MANNING
/// PHOTOS PROVIDED BY CLARK + HOPKINS
TWO HEAVYWEIGHTS OF VIRGINIA CRAFT FOOD AND DRINK GET TOGETHER
randon Clark, the owner of the Stephens City, Virginia, hot sauce company Clark + Hopkins, emailed me a couple of videos touting his most recent collaboration. The first video pans up from an empty bottle of Catoctin Creek’s Roundstone Rye and captures two guys funneling a thick, light brown liquid into a barrel emblazoned with the award-winning distillery’s logo and an outline of Virginia. The second video offers a slow peek into the barrel’s unstopped top. The liquid rests inside, soaking up the essence of the rye that once occupied the space. The liquid will eventually transform into Clark + Hopkins’ rye-infused take on their acclaimed Virginia hot sauce. It’s not the first time I’ve seen a collaboration between a distiller and a craft food, but it is the first time I’ve seen such a collaboration in progress, before it reached the finished product phase. It somehow makes the craftsmanship more visceral. “The batch went into the barrels in May,” Clark said. “I’m hoping that it will hit shelves in September.” Even if Clark’s projections weren’t accurate, one thing that’s certain is that Catoctin Creek will carry the results of the collaboration at their Purcellville, Virginia, tasting room once it does hit the market.
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A STATE’S LEGACY IN A SAUCE Clark + Hopkins’ Catoctin Creek–kissed Virginia sauce is not just a collaboration. It’s an expression of Virginia. This rests at the base of the partnership, as each party uses the finished product to promote their state. “It’s as much of a mutual cooperation of expression as it is a collaboration,” explained Catoctin Creek Master Distiller Becky Harris, who also serves as distillery co-owner with her husband Scott. “Whether you’re distilling a spirit or making a food product, you have the chance to bring people together and tell a story through regional food and drink. Working together allows us to tell the story about Virginia, and it’s an important story for us to get out in the market.” There is much to tell. Take the partnered concoction, for instance. It riffs on Clark + Hopkins’ original Virginia sauce, which itself has roots in the state’s rich culinary history. “The original sauce is based on an old Virgin-
ia barbecue recipe from the 1850s,” Clark stated. “It’s got local peaches in there, local peanuts in there — it was designed to go with Virginia-style barbecue, which is pork-based like the Carolinas but slightly different.” This factoid packs the power to surprise those outside the state, who may not even be aware that Virginia-style barbecue is a thing (guilty as charged). It also provides insight into Clark’s passion for Virginia’s culinary history and ingredients. It’s a devotion that the Harrises picked up on when the idea of a collaboration started getting kicked around. “We’re all about promoting all things Virginia,” Scott Harris said. “We saw how Brandon was making his sauce and how he was using local Virginia ingredients, and we thought it would be a natural fit to work with him. Besides, barbecue and whiskey go great together.”
A PARTNERSHIP OF PROMINENCE It’s fair to call this collaboration a partnership between craft titans. Clark + Hopkins’ line of globally inspired sauces has snapped up several awards from prominent groups like the Specialty Food Association since they hit the market in 2017. Catoctin Creek has won more awards than any distillery in Virginia, and as president of the American Craft Spirits Association, Becky Harris is the heroine the craft distilling industry needed during the pandemic, thanks to her advocacy regarding the federal excise tax reduction and the reversal of the FDA’s proposed hand sanitizer fee. The lofty perch both occupy in their respective fields naturally commands a mutual respect. For Catoctin Creek, the collaboration gives them a chance to view spirits in a manner that’s not typically done. “Spirits and cocktails are a huge part of food culture, and we view distilling as making local food,” Scott Harris said. “This collaboration allows us to tap into that viewpoint by supporting other local foods.”
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The collaboration also provides them significant clout while crossing over into one market from another. “Cross-pollination brings people in front of each other’s brands,” Scott Harris explained. “It’s important, because it’s a great way to get people to stop and say, ‘I haven’t seen that brand before’.” On a deeper level, the collaboration affords Catoctin Creek the opportunity to potentially clue more people into the ongoing challenges facing the distilling industry. “Groups like the ACSA are working to chip away at the stigma surrounding spirits, but even so, the craft spirits world can sometimes be an echo chamber,” Scott Harris said. “A collaboration like this can be a great way to get our message of reform beyond us and out to parts of the public that may not know about what’s going on.”
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THE BEAUTY OF THE BARREL Nobody can precisely remember the specifics of the collaboration’s origins. Clark vaguely recalls it happened around 2017 or 2018. And even though Scott Harris recalls being impressed with Clark’s worldly sauces — “They were nicely branded,” he said — he’s not sure who reached out to whom. The process of making the sauce is a different story. A former chef, Clark guides the barrel-aging process from barrel hot fill to bottle hot fill at Hatch Kitchen, a sprawling culinary campus in Richmond that provides space for craft food producers to do their thing. Yet he’s hesitant to take much credit for anything that happens between the first and last step. “When you taste that sauce, it really hits you what a barrel can do,” he said. “I can’t claim the flavor, but the barrel can.” What he and the Harrises can claim, however, is a collaboration that captures the essence of Virginia craft and creativity in limited-edition bottles. It’s also one that Clark hopes will keep going, even as the world’s slow return to normal may make connecting a bit of a challenge. “Things are getting back to being busy again and getting the chance to catch up with each other is not going to be an easy task,” Clark said. “But there have been such great vibes through our past collaborations, I’m looking forward to continuing this partnership with them in the future.” Visit www.clarkandhopkins.com or www.catoctincreekdistilling.com for more info.
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DOWN to the CORE
The Rise of the Simplification of Product Lines Written by George B. Catallo
e have always been told to diversify our portfolios; there is more opportunity and less risk. We hear it from every angle. From our financial advisors, economic professors, news media analysts, billionaires, and even rap great GZA told us to diversify our bonds in an episode of Chappelle’s Show. It has proven to be sound advice. But is it ideal for your portfolio of products? Well, yes and no, but also no and yes. Having a great diversity of products in your arsenal is a double-edged sword. On the one hand, you are more likely to have something for everyone, and more opportunities to squeeze something onto a shelf in stores. This positions you to be appealing to a broader audience and gives you a much broader growth potential —
provided all products are successful and profitable. The tradeoff of this is much higher risk. The statistical probability that all of your products are commercially viable is relatively low, even if they’re all well crafted. This is also extraordinarily expensive. You have to buy a greater variety of ingredients, pay for the approval and printing of more labels, pay more filing fees, and face the issue of convincing your distributor to take all of the products. Producing numerous products also ties up your production space. You can’t run two things through the still at once. You only have so many fermenters, and so many hours in the day. Being low on inventory on multiple products and under a time crunch could harm you in a big way. Backorders are usually not your friend. While the negatives are daunting, they shouldn’t deter you
Having a great diversity of products in your arsenal is a double-edged sword. 116
if you’re logistically capable of handling them. As attractive as the positives are of having a diverse portfolio of products, there are some notable shifts away from this model. Examples of this can be seen by the Dingle Distillery in Dingle, Ireland, which has changed from a batch-to-batch release of their single malt whiskey to a core standard single malt. This has also been observed at the Westland Distillery in Seattle, Washington. Westland consolidated their three single malt expressions into one single core American Single Malt. Why are brands doing this? We can speculate on a number of reasons for this, or focus on what we know — the benefits of a more concise product line. Logistically, streamlining means you’re able to allocate your resources more efficiently. Fewer ingredients, labels, filing fees, and no competition between products for your production space. Fewer W W W . ARTISANSPIRITMAG . C O M
ingredients needed allows for deeper purchasing of what you need for your remaining products, thus increasing your profit margin. For whiskey, fewer releases means more barrels available for blending your batches and having a more consistent flavor profile. Another area of efficiency is in sales. The ability to fully back and push to market a smaller variety of products makes it much easier to have your brand fully represented in more establishments. If you have a dozen products, the likelihood of all twelve making it into the same establishment is nearly zero. Six products? Still very low. But one to three? Much better odds. Especially since the more products presented in a sales pitch, the harder it is for retailers to decide what they do or don’t want. And it’s more stories to tell for the salesperson. Clear and concise always wins the day. The drawbacks of a smaller portfolio are simple. You may not have something W W W . ARTISANSPIRITMAG . C O M
Logistically, streamlining means you’re able to allocate your resources more efficiently. for everyone, and you have fewer chances to make an impression. And a narrower, though not necessarily smaller, growth potential. This is an area where there is no right or wrong answer, just what is right for you. However, you can’t argue with the success of some single-product brands out there. Tito’s is probably the best example. One single product, just in different sizes, became the top-selling vodka in the country, beating out less expensive corporate brands with billions of dollars in backing and large numbers of SKUs. Of course there was much more to it than keeping things simple, but the simplicity undoubtedly aided these brands’ ability to focus on their rapid growth and success. Before deciding what to do with your
existing or prospective portfolio, weigh all your options. Make the decision that best suits your goals and vision. There is no problem with making twenty kinds of cordials and eight whiskies if you can make that viable. Just act in a way that ensures the health of your business. The art of distillation may be what many are most passionate about, but the business aspect is what feeds the artistry. George B. Catallo is the “Whiskey Guy” and Floor/Social Media Manager at Parkway Wine and Liquor in Rochester, NY. He has been in the beverage industry since he turned twenty-one and has worked as the Bar Operations Manager of a wine bar, an Assistant Distiller and Supplier Rep for a craft distillery, and has even hosted a spirits review web series on YouTube under the moniker 'Just One Dram.' 117
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