Spirit of the Rising Sun

5 Japanese whisky

By: Tod Stewart

Japan is synonymous with many things: electronics, cars, origami, sake, sushi, intricate art, Sumo wrestling and architecture. Now, if you’re willing to wait out a significant chunk of your day for it, cheesecake.  But whisky?

  Even after seeing Lost in Translation many years ago (a movie featuring Bill Murray as Bob Harris, an aging movie star visiting Japan to promote Suntory whisky), the connection between Japan and whisky still didn’t really register with me. Thankfully that has since changed, and I’ve had the pleasure of enjoying numerous different Japanese whisky expressions, both at home as well as in Japan.

  Today, these drams are becoming increasingly difficult to find, and when you do find one you might experi-ence a bit of sticker shock. However, as with most things Japanese, you do get what you pay for (and here I’m primarily talking about the items I have tried: sake, sushi, Japanese knives, etc.). The Japanese whiskies I’ve sampled have invariably been top-notch. And much to the chagrin of the Scots, they’ve actually been stealing accolades from the world’s top drams.

  A few years back, in his World Whisky Bible 2015, industry expert Jim Murray crowned the Yamazaki Single Malt Sherry Cask 2013, from Suntory, “World Whisky of the Year.” As it turns out, nary a Scottish whisky made the top five. Since then, Japanese whiskies have continued to bag metal at competitions across the globe (in fact, they were garnering “best of” accolades as far back as 2008). If there’s any consolation to the Scottish distillers now adding tears rather than water to their tipples, it’s that, had it not been for the Scots, the Japanese would likely not be where they are today in terms of distilling.

  Japan has a distilling history that may reach as far back as the 1700s. Yet it wasn’t until after the Second World War that Shinjiro Torii along with Masataka Taketsuru, established the Yamazaki Distillery, which would eventually become Suntory, near Kyoto. In 1918, Taketsuru journeyed to Scotland. He enrolled in the University of Glasgow, becoming the first Japanese person to study the art of whisky making and apprenticed at a number of famous Scottish malt distilleries before bringing his knowledge (and a wife) back to Japan.

  In 1934, Taketsuru branched out on his own, establishing the Nikka Whisky company with a distillery located in Yoichi, on the island of Hokkaido, in the northern part of the country.

  This area seemed, to him, to most closely replicate the Scottish landscape. Japan’s “whisky country” however, is less differentiated than those of Scotland.

  “Although Japan may look like a small island on the map, if you compare it with the map of Scotland at the same scale, you will notice that the nation is much larger and is spread from North to South,” notes Naoki Tomoyoshi, International Business Development Representative for Nikka Whisky. “The climate can vary from the famous skiing resorts in Hokkaido to the beautiful beaches of Okinawa. Within this country, Nikka’s founder Masataka Taketsuru headed north in search for the ideal place for his whisky. He found the land of Yoichi to be the perfect place, a seaside location with a cool and humid climate along with an ideal water source. Then, in 1969, he founded his second distillery, Miyagikyo Distillery, in the mountainous valleys of Miyagi Prefecture, located in the northern part of Japan’s main island. His aim was to create a different style of whisky than that of Yoichi Distillery. The surrounding environment plays an important role in the maturation process, and when that is combined with the different production methods between the two distilleries, the variation of the flavors that can be created is countless.”

  Gardner Dunn, Senior Brand Ambassador at Suntory Japanese Whisky, notes that rather than defined re-gions, the elevation of the Suntory distilleries and the subsequent differences in temperature have more of an impact on the final products.

  “Yamazaki, outside Kyoto, sits at around 160 feet above sea level,” he points out. “Hakushu is one of the highest distilleries, at roughly 2,313 feet in Yamanashi prefecture. The difference in temperature between the two dictates the use of certain sized barrels to optimize maturation.” Dunn explains that as the temperature drops, the rate of maturation slows. Therefore, spirits matured in warmer climates – rum, for example – devel-op more quickly than northern spirits, largely due to the rate of evaporation.

  The proximity to the sea — just a kilometre from the Sea of Japan — and the influence of the salty ocean air, appreciably contributes to maritime tang of Nikka’s Yoichi line of whiskies. I recently sampled a dram or two of Nikka Yoichi (No Age Statement) Single Malt, which seemed to combine the warm, toffee, malt and hon-eyed tones of a Highland malt with the smoky, lemony and in this case, rather intensely briny notes more typ-ical of something like Bunnahabhain’s Ceobanach — a peated offering from a distillery that typically doesn’t use peat.

  The peat used in Nikka’s whiskies was sourced locally until the 1970s. Today the distillery uses imported barley peated to the required levels. Dunn confirms that Suntory, as well, imports barley from Scotland that has been peated to a specified degree. As well, both Nikka and Suntory strive to use the purest water available.

  “The main source of water for Nikka’s Yoichi Distillery is from the mountain springs and surrounding rivers, in particular the Yoichi River,” Tomoyoshi points out, adding that water for the Miyagikyo Distillery is sourced from the Nikkawa River. Dunn reveals that both of Suntory’s distilleries use unique water sources. “Our beau-tiful, soft water is optimal for producing [our] style of whisky.”

  In terms of casks, Suntory and Nikka have somewhat similar approaches. “We both import and make our casks,” informs Tomoyoshi. “We have a cooperage in each distillery maintaining casks of different sizes and types of wood. We also source various types of casks from around the world, including ex-bourbon and ex-sherry casks. All refurbishing and re-charring of the casks are done in-house in our cooperages.”

  Suntory uses a range, from ex-bourbon to American white oak and Spanish oloroso sherry casks. The company’s in-house cooperage also fashions barrels from Japanese Mizunara oak. “It is a very tight-grained oak that only grows in the North Island,” Dunn explains, noting that it matures very slowly and imparts notes of oriental incense, spice and coconut to the finished whisky.

  When it comes to whisky, distillers know that the shape and size are crucial in forming the character of the finished product. The copper pot stills used by Nikka Whisky were crafted in Japan and are of varying sizes. “All stills are slightly different from each other, which enable us to produce a wider variety of styles,” informs Tomoyoshi. “In general, the stills at Yoichi Distillery are smaller, with a straight neck and descending line arm. The stills at Miyagikyo are larger, with a bulge neck and ascending line arm.”

  Suntory operates two sets of eight distinctly shaped stills. As any distiller will attest, the size and shape of a still significantly impacts the spirit it produces, and the varying sizes employed by Nikka and Suntory no doubt play a role in crafting the unique character of the individual whiskies.

  While Japan’s whiskies have experienced a spike in popularity, the industry itself, like those in other countries, has weathered ups and downs. The whisky boom of the 1970s and early 1980s gave way to a slump in domestic whisky sales by the late ’80s, resulting in the closure of several distilleries. However, the international acclaim Japanese whiskies have since garnered has led to a resurgence in interest. A lot of interest, in fact. In the case of Nikka, a few factors combined to create the perfect storm surge of popularity. A surge so strong that it resulted in the discontinuation of age-statement whiskies.

  “We delisted most of our age-statement expressions in 2016,” confirms Tomoyoshi confirms. “This was due to many factors, such as the Nikka 80th anniversary in 2014 along with strong – yet organic – growth in foreign markets. Above all, the most impactful factor was the domestic Nikka fever caused by the NHK TV series Massan. This was unpredictable and sudden.”

  Massan was an Asadora – a “morning drama” – that ran from September 29th, 2014, until March 28th, 2015. Based on the lives of Masataka Taketsuruand and his Scottish wife Jessie Roberta “Rita” Cowan, it detailed the creation of Nikka Whisky…and landed a huge audience not only for the series, but for Nikka’s whiskies as well.

  Though they may currently be a little scarce in some international markets, Japanese whiskies are worth pursuing. They offer the best qualities of their Scottish counterparts — including complexity, harmony and great depth of character — along with certain exotic aspects that distinguish them as unique, different, and worthy of the accolades they have garnered both in the Far East and around the globe.

The Charismatic Spirit: The Heat of Jamaican Rum

4 appleton jamaican rum

By: Hanifa Sekandi

It is a warm summer night in Montego Bay. The sound of the ocean, the harmonious steel drums, sand beneath your toes, and laughter allow you to forget your worries while you clutch your cocktail in one hand. You have most likely never given much thought to that velvety smooth texture and golden color, the fermented by-product of sugarcane. It’s the drink that is unequivocally the life of the party. So infamous it deserves a special place in your holiday baked goods: rum. There is no better way to describe Jamaican-made rum than simply sublime.

  For some, it is the best accompaniment for plantain, callaloo, ackee and saltfish. Perhaps you prefer it while you dine on curry goat or spicy jerk chicken? It is the spirit that is bar-none, best sipped on the rocks. You feel the heat of this distilled spirit immediately pulsing through your entire body with just one sip. Rum, a Jamaican classic spirit with deep historic roots enlivens you and exhilarates you. You can fuss with it, add a little this or a little that but, rum revelers know it’s simply good just the way it is. What makes Jamaican rum so good?

  As you sample your way through the best of Jamaican rum you will learn quite quickly that each rum carries its own secret. This is why so many bar carts around the world carry more than one from a few of Jamaica’s acclaimed rum estates.

The Beginning of Jamaican Rum

  It was Christopher Columbus, in 1494, who brought sugarcane to the shores of Jamaica. This birthed an industry that although not as robust in size as it once was, still thrives today. With all things good, there is another side that is not as sweet. The production of rum in Jamaica began in 1655. It was brought over by British colonialists who imported the art of rum-making from Barbados. Under British rule, rum was made by the hands of enslaved labor. The mass production of rum during this time in Jamaica led to its popularity around the world. There were approximately 148 rum distilleries in Jamaica in 1893. When slavery was abolished in the 1800s the free and now finally autonomous rum laborer, was free to live as one should. This emancipation led to a decline in rum production.

  Where is rum today in Jamaica? In 1893 approximately 31, 555 acres of sugarcane was cultivated by sugar estates that housed and operated distilleries. Even with the reduction of the scale of production and rum mills, Jamaica produces 50 million liters of rum yearly. With only six remaining rum distilleries sugarcane, the oldest running industry in Jamaica is still a predominant labor source with the employment of over 50,000 people. Jamaican rum makers produce large and diverse varieties of rum that are distributed around to world to more than 70 countries. The six remaining rum distilleries are Worthy Park Estate, Appleton Estate, Long Pond Distillery, Clarendon Distillery, and Innswood Distillers Limited. The later three distilleries are owned by the National Rums of Jamaica.

Making Jamaican Rum

  Who knew sugarcane is the key ingredient to this deep rich spirit? With no sweetness on the palate when sipped that one would discern if they chewed on sugarcane. The process of making Jamaican rum is quite intriguing. Molasses, partially responsible for rums golden color is a sweet syrup with a thick consistency. Perhaps you have used it as an alternative sweetener. Blackstrap molasses is full of minerals and vitamins. With that said, a shot of

rum is not your new multivitamin replacement! This rich thick sweet syrup comes to life when sugarcane juice is boiled until it is crystallized and then fermented. In the case of gold-hued rums, the color begins to take hold by using oaken casks to age the clear liquid which turns color due to the tannins from the oak. On average Jamaican rums age close to seven years. A process that differs when making another popular spirit, white rum.

  Deeper-toned rums are made from the dunder or skimmings from vats used to boil the sugar and molasses. What makes each rum unique are the expertly blended elements that will determine the flavor profile and aromas. For example, the addition of caramel when aging commences creates a silkier and darker liquor. It’s these little nuances that create a vast difference between one rum to another although they may appear similar in appearance.

  A full-bodied rum is aged in casks that have great depth and are large in size. These casks, “puncheons”, can hold approximately 111.6 gallons. The difference between light and full-bodied rums is fermentation. In the case of full-bodied rum, slow fermentation is required, and this is referred to as wild fermentation. Light-bodied rum mostly produced in the Virgin Islands and Puerto Rico undergoes a process called cultured fermentation where yeast is derived from raw material. The aging period for these lighter-colored and dry rums is under four years. In some cases, light-bodied rums are aged for only one year.

Who Is Joy Spence?

The First Woman Master Blender?

  Appleton Estates is the oldest sugar estate and one of Jamaica’s six thriving rum distilleries. It is where Joy Spence, their Chief Chemist since 1981 and the first woman Master Blender, has been

making her incomparable mark in the global rum market. She has a Masters’ degree in Analytical Chemistry from Loughborough University. Spence was under the helm of the previous Appleton Estates Master Blender, Owen Tulloch for over 16 years who mentored her. During this time, she was able to use her passion for chemistry to become a world-renowned blender.

  In 1997 Spence, unbeknownst to her at the time, became the first woman master blender. At this time, there were no other women designated with this accolade. This show-stopping rum that Spence has been creating for over 35 years draws its sweet soft taste from the limestone-filtered spring water it uses from the Black River, the longest river in Jamaica. This distillery is located in a favorable area with limestone hills and an ecological system that works perfectly to nurture the abundance of greenery. Due to this natural irrigation sugarcane is easy to grow.

  Joy Spence is credited for masterfully blending two rums that made Appleton famous. The 8-Year-Old Reserve and “50-Year-Old which is according to Appleton Estates “the world’s oldest barrel-aged rum that has been bottled and sold. “The Appleton Estate 8-Year-Old Reserve, a full-bodied rum is probably one of the most recognized rum brands at your local liquor store. You have most like experienced its robust aroma and flavorful smooth notes. Sold at a price point that will make your jaw drop, something this good does not come cheap, the Appleton Estate 50 Year Old — Jamaica Independence Reserve rum by Spence will have you singing the best I ever had.

Notable Jamaican Rums

Appleton Estate 12-Year-Old Casks

Did you know the number on the front of the bottle is the number of years the rum has been aged? Yes, this is true. With so much variety offered by Appleton selecting your favorite rum is not an easy task. Once you have been introduced to one of their rums you will find yourself wanting to explore the entire repertoire. This 12-year aged rum has a smooth dark chocolate flavor and the sweet smell of almonds; you may catch hints of caramel. Best enjoyed on ice or just on its own. When you sip on one of these rums you are stepping into the magical world of Master Blender Joy Spence.

Worthy Park Single Estate Reserve

Rum-making began at this estate in 1741. Most people describe this rum’s flavor as earthy, citrusy, and spicy. An interesting combination that also includes other notes such as toffee, cinnamon, and cloves. Although it serves well on its own, it proves to be an excellent carrier of cocktails since it cuts through without overpowering other ingredients. Worthy Park Estates is a distillery that honors tradition and as a result, distill their rums in a traditional Jamaican Pot.

Hampden Estate Pure Single Jamaican Rum

Wild fermentation is the method used to make Hampden’s pure single rums. There is no sugar added during this process. Their Pure Single Jamaican rum aged for eight years carries a lot of heat. Its strong spicy, earthy herb-like taste with a touch of citrus, banana, and caramel strikes the palate with tremendous strength and also warms the senses. Serve over ice and sip slowly. This is the best way to go with this rum.

Long Pond Distillery — 18-Year-Old 2000 Mezan

Hopefully, the price tag does not scare you away from this vintage 18-year old Jamaican rum. This rum slowly ages and matures in a bourbon oak cask. As you can imagine, a lot of rich flavor and aromas embody this spirit. Its sharp ginger and tropical fruity notes along with a warm and spicy base create a nice finish.

How Breweries Give Back

crowd of beer enthusiasts
Scenes at the 2017 Colorado Brewer’s Festival in downtown Fort Collins Saturday June 24, 2017.

By: Calvin Obbaatt

Long has been the notion that breweries are about making and selling beers, thus profits; but pause a minute, think of that one picture in your gallery or on your social media account holding a beer, buddies around you, genuine smiles captured so perfect, and tell me you believe a thing about the notion.

  Breweries aren’t simply a major aspect of a region’s culture and identity. The community has always been at the heart of the craft beer movement. Breweries are part of the fabric of their towns, serving as meeting places where people may enjoy a drink and a chat. Many small brewers have discovered methods to make a real influence on their communities beyond just manufacturing and selling beer – through philanthropic donations, sustainability initiatives, community fundraisers and partnering with small local startups. Breweries are also a significant hub for the entertainment and leisure industry, nurturing talent and growth by collaborating with local artists and musicians.

Community Fundraisers

  From time to time, a brewery will create a beer that allows customers to drink while supporting a good cause. Whether through sales of a limited-edition brew or a yearly series of charity beers, breweries often organize community fundraisers that raise money for specified purposes. The fundraisers attract more customers to the brewery and help beer lovers connect to their communities.

Collaboration with Local Startups

  They say no brewery is an island, and we couldn’t agree more. Since time immemorial, breweries have supported local businesses by providing a market for local farm produce used in brewing. Breweries collaborate with the local culinary industry, allowing restaurants, food trucks and other startups to sell their local delicacies during events hosted by the breweries.

Philanthropic Donations

  Financial aid has been one of the most straightforward ways through which breweries give back to their communities. We have been privileged to get to hear about some of the most generous brewery owners that, apart from quenching the thirst of beer lovers, have gone an extra step to make the world a better place through their philanthropic missions.

  Save the World Brewing Company’s story might be worth narrating even in a staunchly “non-alcoholic” church. Under Dave Rathkamp’s leadership, the Texas-based brewery dedicates 100% of its profits to philanthropic causes, supporting numerous organizations including Feed My Starving Children, Meals on Wheels and Habitat for Humanity. Save the World Brewing Company is the first local brewery in the United States to be entirely charitable, with all earnings going to charity.

  Langford, British Columbia-based V2V Black Hops Brewing is among some breweries in Canada that have taken a huge step towards helping challenged groups. The brewery donates a chunk of its income to assisting veterans in settling into the community. Inspired by its veteran founder, the brewery also makes direct donations to fund veteran PTSD therapy programs.

Sustainability Initiatives

  Pollution has hit record highs in the 21st century, and brewers are doing their part to alleviate some of the impacts. Sustainability is a priority in the brewery industry, and several players have been keen to make the world cleaner, better and more ecologically friendly. Many brewers have discovered that reducing their environmental effect may be accomplished in methods other than raising awareness or making donations.

  Many breweries across the world are undergoing significant transformations that aid in curbing environmental pollution. New Belgium Brewery is an excellent example of the rapid transition in the brewing industry to embrace sustainable production. The Colorado-based brewing company has intensified its efforts towards sustainability with active recycling measures dating back as earlier as 2017. The brewery reuses wasted grain, sorts recyclable waste to keep it out of landfills, and composts organic waste. The brewery currently generates enough revenue from the sale of cans, bottles and packaging to recycling factories to cover the wages of four employees.

  Beau’s, an Ontario-based brewery, considers the impact of carbon emissions and the need to track carbon footprints. Inorganic food is currently one of the most significant contributors to emissions, and that is why consuming organic products is at the brewery’s heart. Beau’s Local Organic is Canada’s first beer certified as both organic and carbon neutral. The beer is brewed on renewable energy and uses pure Ontario hops and 100% Quebec malts. Consumers selecting Beau’s Local Organic can rest assured that they are helping combat climate change and lowering their carbon footprint.

Nurturing Art & Music Talents

Through Social Events

  Social events are a place to go and have a good laugh and create memories, but they can also nurture talent. Think of the local jazz band, standup comedian, designer and other talents in your community. It might be surprising that some of them realized their abilities at the local craft brewery. Some found they could sing during that particular karaoke night; another discovered he is good at comedy when he got up during open mic; one came out in an outstanding outfit she made herself that no one could take their eyes off. In one way or another, the brewery has opened numerous opportunities to talented people.

Beer Collaborations

  Beer collaborations bring breweries from different areas together for the common good. The movement has seen these enterprises play an integral role in alleviating social problems. Even during the COVID-19 pandemic, breweries continue working together to make one-of-a-kind, limited-edition beers. Some brewers are now collaborating to have a more considerable effect, pairing up to create a beer that helps local charities.

  Aurochs Brewing Company in Emsworth, Pennsylvania and Richbarn Roasters is one such collaboration dedicating a portion of its income to good causes in the community. The renowned coffee maker and brewery teamed up to make the Boondock Sláinte Irish Breakfast Stout to fund good causes in the community. Twelve percent of sales of the brew, made from a blend of American oak chips, custom Brazilian coffee brew, vanilla, millet and buckwheat, goes to a program offering free coffee to homeless shelters so they may utilize their finances for other causes.

  In 2020, as racial abuse and police brutality aimed at people of color reached soaring heights, Weathered Souls Brewing led a nationwide beer partnership to raise awareness about the injustices that people of color experience in the U.S. The brewers inspired others in the industry to each create a version of the “Black is Beautiful” stout and contribute all the profits to organizations that advocate for police reforms or inclusion and equality. The movement surpassed everyone’s anticipation, seeing more than 1,000 breweries, both large and small, from all 50 states and more than 20 countries join the collaboration. This resulted in significant contributions to local, national and worldwide organizations as well as public acknowledgment and commitment to racial justice from thousands of brewers.

  There is an irrefutable trend in the brewing industry that breweries have gone beyond simply serving their beers to serving communities in other ways. Not all breweries achieve this in the same way, however. Some are actively involved in providing relaxing ambiances, promoting local talents through events, collaborating with local startups and advancing the local culture. Others choose the philanthropic route, working alone or in collaboration to make a difference. But, it doesn’t have to be through charitable donations alone to establish that breweries are giving back. Prioritizing sustainability, racial justice, equality and diversity within the brewery walls can have just as positive an impact. The great players above prove that sustainable and profitable businesses that promote good in society can thrive.

Re-Opening After the Pandemic

By: Donald Snyder, President/Consultant, Time & Tasks

For the first time as an author, I hope this article does not age well. With a bit of luck, you are reading this article in a post pandemic world where these concerns are a thing of the past. That said, as I write this, the world is slowly recovering from a pandemic that had a devastating impact on the hospitality industry including craft distilleries large and small. As you begin to welcome visitors and bring back staff, here are some important and helpful tips when planning your reopening.

Advice from Distillers who have Re-opened

  Throughout the pandemic, the Center for Disease Control (CDC) published fluid and ever-updating recommendations for operating a business to keep both employees and patrons safe. Suggestions like contactless payment, outdoor and reduced seating, staff and customer mask use, and social distancing were mandated to help reduce the risk of COVID-19 spread to keep businesses open, if only at a lower capacity. (https://www.cdc.gov/coronavirus)

  However, the ultimate decision of whether a tasting room could re-open to the public was in the hands of local regulators. Every state had a different set of requirements for operating a business during the pandemic. Some states, like Florida, reopened and removed capacity limits very early in the pandemic as compared to New York City where most hospitality restrictions were not rescinded until the summer of 2021. Soon after the nation-wide lock down in the spring of 2020, some distilleries were able to re-open under various restrictions.

  Cardinal Spirits Distillery in Bloomington, IN was able to open in 2020 under pretty tight restrictions. The distillery opened for carryout bottle, food, and cocktail mixes only.  Additionally, they re-configured their front entry area into a curbside drive-by for order pickup. The state of Indiana did not permit cocktails-to-go so Cardinal Spirits developed hand labeled bottles of mixer kits that people could use to make cocktails at home. Using social media and on-line platforms, they maintained and increased customer engagement with distillery tours, cocktail classes, and even virtual tastings. They hope to fully re-open in Spring 2022 although they have recently re-opened their restaurant for in-distillery dining. Jeff Wuslich, co-founder and President of Cardinal Spirits, recalls his concerns with reopening. “We are most worried for our staff. We do not believe they should have to enforce mandates and safe behavior, but we know it will likely happen. It keeps me up at night. I believe that with our air circulation, safety protocols, and distancing we will all be safe, but I hate to think about our staff having to argue with customers.” Jeff offers this additional advice for distilleries thinking about their own re-opening. “Think of the customer and what experience you would like them to have. Then, work backward from there.” 

  Smooth Ambler Distillery in Maxwelton, WV was also impacted by COVID-19. At the beginning of pandemic, the entire distillery closed public-facing operations, including their gift shop and tours for about a month. During that time, they re-allocated their labor and resources into making hand sanitizer to be donated to front line workers across the country. Once they had a better understanding of the virus, they slowly reopened their production facility with a new set of rules that included social distancing, segregated teams, masks wearing, and frequent sanitization. Smooth Ambler’s continued priority is the safety of their employees and guests.

  They were cautious about reopening the tasting room. Many of their customers were from out of state so they initially re-opened to the public with curbside pickups only. A few months later, they opened with limited capacity and slowly increased indoor occupancy as the guidance from the state permitted. Masks, temperature checks, and hand sanitization were available for all guests. So far, the re-opening has been successful for Smooth Ambler as more and more people are beginning to travel again. Travis Hammond, Operations Manager of

  Smooth Ambler, cautions distillers not to be too hasty or rigid during their public reopening. “The past year has been very difficult on everyone – the best advice I can give to other distilleries that are about to reopen is to be patient and flexible.”

  Reopening slowly and cautiously with the appropriate safety protocols in place has given many distilleries across the country a beacon of hope that things can return to a sense of normalcy. However, even with the best precautions, there still can be issues. Asymptomatic employees and customers that spread the virus can be a serious risk to all parties involved. For those in the beverage industry, contracting COVID-19 can be especially dangerous as a possible long-term loss of taste and smell could impact a distiller’s ability to make and blend high quality spirits. In addition to transmission risks from reopening, there are also risks from patrons fighting required safety protocols.

  Golden Moon Distillery in Golden, Colorado experienced that firsthand when a customer refused to wear a mask and retaliated by shoving an employee. Physical altercations with employees about safety policies or verbally abusive customers are real risks that distillers need to consider when planning for a full or limited re-opening. Stephen Gould, Proprietor and Master Distiller of Golden Moon Distillery has made employee training a pivotal part of his re-opening plan. “We’ve coached our team members to be extremely polite and courteous when asking folks to wear masks. Our main concern is the safety of our staff and customers. Having said that, the one piece of advice I can give folks that are reopening is that they need to work hard to make both their staff and their customers feel safe.”

  Another consideration for reopening is how to deal with heavy foot traffic as people continue to feel more comfortable traveling. Large tourist areas like central Tennessee have many craft distilleries that offer tours, tastings, and spirits for every palate. Pigeon Forge, TN is in the gateway to Smoky Mountain National Park that sees over 10 million visitors per year. In the spring of 2020, when everything shut down, the owners of King’s Family Distillery in Pigeon Forge were understandably nervous. Like many distilleries, by taking advantage of small business loan programs and pivoting production to hand sanitizer for local consumption, they were able to stay afloat. Cara King, Owner of King’s Family Distillery, is starting to see the light at the end of the tunnel. “When our state began lifting restrictions in 2020, the people flooded back in.

  More than before, even. We took precautions, put up plexiglass, and welcomed the tourists, masks, and all. Our distillery has reached the other side of this epic world event bigger than we were before.”

Capital Investments and Infrastructure

  Safety protocols, standard operating procedures and thorough employee training are critical to a successful re-opening. However, some additional capital investment may be required. Dalkita, an engineering and architecture firm that assists distilleries with design, safety, and construction, was instrumental in helping businesses re-open.

  Colleen Moore, Director of Marketing & Operations for Dalkita, kept up to date with all the CDC recommendations, re-opening phases, and safety recommendations. Dalkita kept the distilling industry updated with recommended and required re-opening procedures via regular webinars and blog updates (https://www.dalkita.com/news/).

  The group quickly became aware that each state and jurisdiction had varying requirements for re-opening protocols, social distancing rules, seating capacity limits, and mask requirements.

  In terms of physical and capital improvements to the distillery’s public spaces, Colleen Moore from Dalkita has been advising distilleries what they should consider. “With COVID-19 in mind and trying to reduce the likelihood of a lockdown situation due to a highly communicable airborne disease from recurring, I would suggest upgrading ventilation inside buildings. Any feature that would increase the amount of outdoor air you can bring into a building such as window walls, roll-up glass garage doors, and new increased air handling units with better filtration media and filters.

  If cold, rainy, or snowy weather put a stop to your outdoor activities, consider adding flexible open courtyards or structures with roofs and no walls for use during inclement weather. Anything that can increase the health of the people using a facility is a good investment.”

  As I write the article, I fully acknowledge that regulations are still changing. I began writing this article in March of 2021 before the mass availability of COVID-19 vaccines while most distilleries were under 30-50% occupation and seating capacity. It is now July 2021. Some states are open 100% with no restrictions but the Delta variant is growing. The article will be published the Fall of 2021 and who knows how much the world will change by then.

  For distilleries reopening or increasing capacity in 2021 or early 2022, connect with local authorities for the latest restrictions. Make every effort to keep employees and guests safe. Then again, by the time you read this, hopefully the pandemic and social distancing will be just a distant memory as we all return to normal.

Legal Implications of Playing Music at Your Brewery

man in pirate hat

By: Tarah K. Remy, Dinsmore & Shohl, L.L.P.

Visiting a brewery is meant to be an experience, and customer engagement plays a large role in creating a great one. As the owner, you know your brews are unparalleled, and your goal is not only to share them, but to keep customers coming back. One way to do this is to establish an inviting atmosphere. In most cases, that involves music.

  Music and beer go way back. In 1800 B.C.E., the Sumerians composed the “Hymn to Ninkasi,” which served as not only a song of praise to their goddess of beer, but also as an ancient recipe for brewing.  So, it is safe to say when a customer walks into your brewery, they’ll expect to hear music playing over the loud speakers, or even to see a live band. However, there are serious intellectual property considerations every brewery must take into account when choosing music to create that perfect experience.

What the Copyright Act Protects

  As a general matter, the Copyright Act lays out the basic rights of a copyright owner. Among other things, it protects a songwriter’s and their publishers’ (the copyright holder) musical composition or written work, also known as a musical work. When a musical work is performed or broadcasted in a public space, the copyright holder is entitled to receive a performance royalty, which is the money paid to the copyright holder in exchange for the right to publicly perform their musical work.

Why Your Brewery Needs a Performance License to Play Music

  Copyright is a form of property, and once music is written down or recorded, it is copyrighted. The copyright holder is the owner of that copyright and is granted a performance right to the copyrighted materials. If you want to publicly perform a musical work, you need to pay a performance royalty to the copyright holder. The performance license acts as written permission to play a copyright holder’s musical work in a public space.

  Doing so without a performance license, (without legal permission) places your brewery at risk for litigation. Though the Copyright Act limits the award for copyright infringement to between $750 to $30,000, it is within the court’s discretion to award between $200 to $150,000, not including attorney’s fees and costs. Whether the court can increase or decrease the award depends on whether you knew you were violating copyright law. No matter the circumstance, if you violate copyright law, you will be required to pay, and the gamble of just how much is not worth the risk. Acquiring a license removes the guesswork and allows you to maintain control over your brewery’s finances.

When You Need to Consider Acquiring a Performance License

  You will need a performance license or permission from a copyright holder under at least the scenarios below:

1.  The musical work is played in your brewery using Spotify, Amazon music, Pandora, Apple Music, or any other streaming service. Though you are covered bunder your personal subscription to play music for yourself or in very small spaces, once you plug your device into a loud speaker to be played in a large space where a substantial number of people are present, this triggers the performance license requirement.

2.  The musical work is played in your brewery using CDs, records, or anything similar. Buying the CD or record does not count as obtaining a performance license. Once you decide to play your favorite CD or record inside your brewery to be heard by a substantial number of people, in most cases, you must obtain a performance license.

3.  A live band is hired to play covers of music originally written by a third party in your brewery. In this case, the venue, not the cover band, is required to acquire the performance license.. If you hire a band to play in your brewery and they plan to play covers, make sure your brewery has a performance license covering the songs on the band’s set list before hiring. Keep in mind, however, this generally does not apply if the band is playing music it has composed or is playing music in the public domain.

How to Obtain a Performance License

  Contact a Performance Rights Organization (PRO):  You can obtain a performance license through a Performance Rights Organization such as BMI , ASCAP, and SESAC. These entities function as middle men between the copyright holder and the entity acquiring the performance license. Given the rate at which music is played and experienced around the world, it is virtually impossible for copyright holders to keep track of performing rights. Acting as facilitators, PROs acquire rights from these copyright holders and grant a performance license covering their entire music set to businesses and requesting parties. So not only do PROs simplify the process for copyright holders to receive their performance royalties, but business owners no longer need to contact individual copyright holders to acquire performance licenses.

  Each PRO covers specific musical works by various copyright holders. By obtaining a performance license through just one PRO, you are limited to that PRO’s specific list of music. Be sure to review each list covered by each PRO to determine whether you need a license from one or all. You can also consider acquiring a blanket license that covers all three of the main PROs (BMI, ASCAP, and SESAC) to reduce the chance of potential copyright infringement claims from these organizations. A blanket license is convenient, as it likely covers a large list of music, which in turn reduces the need to carefully review a cover band’s set list and further gives you the freedom to stream music without a second thought.

  Sign Up for a Streaming Service Business Account:  Some streaming services, like Spotify and Pandora, offer business accounts. Simply by signing up and paying a subscription fee, business accounts provide access to fully licensed songs. Via their business platforms, these streaming services have obtained performance licenses from PROs on your behalf, and in most cases, they have performance licenses from more than one PRO, which broadens your music list options.

How much a Performance License will Cost

  The cost of obtaining a performance license through a PRO may vary depending on various factors, including how many breweries you have, the square footage of your brewery, your brewery’s customer capacity, how often music is played, whether the music is recorded or live, and more. The costs start at $500 and increase from there. Streaming service business account costs can be found directly on their websites, where they periodically provide discounts. At the end of the day, though obtaining a performance license may seem pricey or a low priority, the costs of arguing a copyright infringement claim are significantly higher. Budgeting in the cost of a performance license will save your brewery money in the long run.  Here is a link to help you learn more. https://www.bmi.com/digital_licensing/more-information/business_using_music_bmi_and_performing_rights

  Finally, keep in mind the Copyright Act covers exceptions to the performance license requirement, meaning it’s possible your brewery may not require a performance license. So before you sign up or register for anything, we always recommend reaching out to an attorney to review the performance license agreements and your circumstances. Additionally, if you are not sure whether your business meets the requirements, or whether your business might be exempt from the performance license requirement, for peace of mind, reach out to your attorney or the Dinsmore Beer, Wine and Spirits team. We are here to help!

Craft Malt with a Conscience

hands holding crushed crop

By: Erik Lars Myers

Sebastian Wolfrum, the German-born owner of Durham, North Carolina’s Epiphany Malt, wants to do the right thing.

  Wolfrum’s epiphany came in 2012, while he and his wife attended a meeting for local farmers about how they could get involved with North Carolina’s burgeoning craft beer industry. The problem, however, was that at the time, there were very few options for farmers to sell the crops they might grow. North Carolina’s one malt house at the time, Asheville’s Riverbend Malting, was still nascent and small. Wolfrum, drawing on his background in brewing and malting education at Ayinger Brewing near his hometown of Munich, and his experience at Natty Greene’s Brewing Company in Greensboro, North Carolina, started Epiphany Craft Malt in 2015.

  Epiphany has a lot of disadvantages to cope with, like any other small manufacturer, primarily driven by scale. They are tiny compared to national and international malt providers like Rahr, Briess or Weyermann, and they lack the economy of scale that allows them to produce high-quality malt at competitive prices. It is a trade-off that brewers must be willing to make when using a local maltster. You will pay more for the product—in some cases a lot more—but that money goes to support the local economy, and you are potentially buying a product with more of a local “terroir” or “maltoire.” In some cases, like Epiphany, it means supporting even more than just a local economy.

  Wolfrum says that evening out the environmental impact of the business is considerably more difficult at a small scale. Large maltsters have the personnel and resources to dedicate toward reducing a carbon footprint, but a three-person operation like his must find another way.

  Enter Indigo Agriculture, a company that provides farmers financial incentives to practice regenerative agriculture—a method of farming that improves soil health, builds ecosystem biodiversity and closes the “carbon cycle.” Wolfrum was first made aware of regenerative agriculture in his Ayinger days while working on their Regional Impact Study back in 2002.

  He describes farming as having essentially three modes:  The first he considers “the old way,” what he deems “exploitative.” In short, it involves farming a piece of land until all of the available nutrients are gone and extracted, then moving on to a new plot and beginning again.

  The second he deems “contemporary” or “conventional.” It is farming land and using additives or practices that maintain soil health, allowing the farmer to continue using the same plot each year without degeneration. Those practices may involve crop rotation or artificial soil additives to maintain soil health and keep it at the base level that the farmer needs. It might also take the form of supplemental fertilizers and nitrogen additives that take energy—and thus carbon—to produce and disseminate.

  The third is regenerative, an ethos that encourages building and improving soil health, increasing water retention and biodiversity and significantly reducing carbon emissions during farming and cleansing the atmosphere of CO2. Regenerative practices include implementing crop rotation and cover crops, no-till farming, reducing fertilizer and pesticide use and increasing soil biodiversity through compost additions and well-managed livestock grazing practices—ideally, many of those tactics working together in concert.

  It’s not really reinventing the farming wheel. These practices have been around for decades or longer, but using them together is the goal. Unfortunately, a commercial farmer doesn’t always have the financial incentive to invest in natural soil additions, plant a non-harvested cover crop in a field that could generate income or take the short-term risk of not using pesticides.

  Wolfrum was put in touch with Indigo Agriculture through Dogfish Head Brewery in Rehoboth, Delaware. A chance meeting at the Brewers’ Association Craft Brewers Conference had him talking with the lead brewer at Dogfish Head’s small-batch/brewpub facility, and they found their interests aligned. Together, they worked on a project released in September 2020, Dogfish Head’s “Re-Gen-Ale, the first traceably sourced beer to address climate change.” With the help of Indigo Agriculture’s grain marketplace, Dogfish Head purchased raw regeneratively farmed wheat, hops from several local farms on the East Coat and barley from Epiphany. In doing so, they created a traceably sourced beer with a small carbon footprint. Dogfish Head also committed to purchasing carbon credits to offset the production of brewing the beer.

  When Wolfrum learned about Indigo’s regenerative programs, he immediately got in touch with his local growers. In 2020, three of Epiphany’s farm sources began working with Indigo Agriculture, farming regeneratively to provide a carbon-neutral, or even carbon negative, source of barley for Epiphany’s malting operation. It hasn’t been a difficult sell. “Talking to these farmers, no matter where they are—in eastern North Carolina or Virginia—you don’t need to explain it to them. They live it. They know that it’s not going to get easier to grow anything without some work,” he says.

  Other farms they work with provide heirloom corn and rice as well. So far, it’s a small sliver of Epiphany’s output—in 2021, the entire crop of regeneratively farmed malt is spoken for by just two of his customers—but his plans do not end there.

  Wolfrum has started to build financial incentives for farmers into his own business plan, paying more per pound of grain to incentivize his farmers to add at least one regenerative practice into their operation. As Epiphany grows, he plans to create a contract with each grower that requires them to add regenerative farming practices into their operation but also ensures that they’re compensated for doing so. “We will pay for it,” he says, “We’re going to pay a little bit more because we expect you to do the right thing.”

  He hopes that he can also convince brewery and distillery partners to do their part to reduce their carbon footprint in freight and their day-to-day operations as well.

  According to Epiphany’s Three-Year Resilience Plan, in 2020, “each pound of malt produced by Epiphany produced 0.93 lbs of CO2,” so the company bought carbon credits to offset all 421 metric tons of CO2 produced, officially making Epiphany Craft Malt a carbon-neutral craft maltster.

  Epiphany’s virtuous cycle doesn’t end at carbon credits, however. In 2020, they started working with two farmers who grow heirloom and ancient grains—both corn and rice. Wolfrum recognizes, however, that some of these grains have complicated pasts.

  The origin of the heirloom corn that Epiphany sources can be traced back to Native American tribes of Virginia, and the heirloom rice was first brought to the Americas and flourished as part of the Transatlantic Slave Trade. “If we want to help create beers that incorporate these grains,” Wolfrum says, “we have to turn our attention toward understanding the injustice at their roots.”

  Because of that, Epiphany donates a portion of the sales of each of these grains to appropriate organizations. For the corn, the American Indian Science and Engineering Society, which helps to increase the representation of Native Americans in STEM. For the rice, Epiphany donates to a local charity, the Southern Coalition for Social Justice.

  “At the moment, it’s really small scale, and we’re not a very big player,” Wolfrum says. “Could I use those couple thousand dollars we spend on [incentives, carbon credits, and donations] for something else? Sure. But you have to start somewhere. That’s my perspective. It’s not perfect, but it’s the right thing to do.”

  Learn more about Epiphany Malting, the grain and malt they offer and read their Three-Year Resilience Plan at www.epiphanymalt.com

  Learn more about Indigo Agriculture and its grain marketplace at www.indigoag.com

  Erik Lars Myers is an entrepreneur, author, professional brewer, and lover of beer. He currently works as an independent consultant in the brewing industry in Durham, NC where he strives toward innovation in fermentation through a wide variety of projects.

An Ingredient For Success: Adding a Business Coach to Your Craft Beverage Company

bartender preparing drinks

By: Chris Mulvaney, President, CMDS Marketing Agency

So, you think you have it all. A great product, niche location, rockstar staff … ultimate success will no doubt come knocking at your door to order one of your specials. Right?

Well, maybe.

  Hard truth. When it comes to craft beverage marketing and branding, making those delicious bevvies is only half the battle. Many craft beverage companies that failed also had a great product, perfect location, and an awesome staff. So … why did they fail?

  For one, planning. Part of a craft beverage business is, well, the business. And while that part may not taste quite as good, it’s still a huge part of running and scaling your company so that it thrives for years to come.

  Planning your craft beverage business takes into consideration some very important components. Branding is one of them. If you don’t have solid branding, then you’ll have a tough time standing out in today’s crowded craft drink market.

While there was a time that breweries and distilleries could succeed without strong branding, much has changed. Today, statistics show that a new brewery opens up almost every day. That means crazy competition, and as a result, you really need strict branding and positioning in order to stand out. Without that, even the best product can get lost in the mix and drown into a drain of obscurity.

The What, The How, and The Why

  Simon Sinek familiarized the concept of the “What,” the “How,” the “Why” in his book, “Start with Why.” The concept is about having three layers to your brand story.

  The “what” explains what your business is in simple terms (“My business offers locally produced cider”).  The “how” is how you do it (“we use on-site fermentation and locally-sourced apples”).

Unfortunately, while most craft beverage companies may be able to explain the “what” and the “how”, they tend to lag in the “why”. And the “why” is usually the most interesting part of the story because that is where the emotion comes in (“my partner and I both have celiac and were not able to enjoy a traditional brewery experience, so we wanted to offer a delicious beer alternative for gluten-sensitive customers and those who want something a bit different”).  The “Why” is key because it draws people in and creates a deep emotional connection, which is more compelling.

Your brand is the perception of your company by your customers. It is the heart of your message and it’s how your customers will portray you on social media. The emotional connection with your customers is what drives the purchase. It is your “why”.

  This is where it also gets tricky. You can’t forget about the product. Above all else, your customer has to like the taste of what you sell, so quality is also vital.

  Therefore, branding involves defining key concepts, creating emotional attachment, and differentiating yourself from your competition, all while keeping a great product offering. It can be a challenge to balance it just right, and that’s where a business coach comes in.

  Typically, business coaches are experienced entrepreneurs and business owners who then decide to use their talents for building and growing a business to help other business owners reach their goals.

  They can provide far more valuable and personalized advice than any found online. They are essential to success – and are used by most humans across the board in other areas, yet the same principle often fails to apply to a business’ growth.

Take sports or music. If an athlete wants to improve their skills, the best thing they can do is join a team with a great coach. Likewise, a musician will hire a teacher to help them reach rock star  heights.

  Essentially, having a business coach is like having a trusted coach or teacher, and they can prove essential to your brand’s ultimate success.

Why Every Craft Beverage Businesses Should Enlist a Business Coach

  In simple terms, business coaching is a process used to take a business from where it is now to where the business owner wants it to be.

If a business owner has tough questions or runs into problems along the way, their coach will be able to help them navigate their issues in the most effective way possible.

Getting Started

  A good business coach will ask you to list your core values and help you figure out what will make you stand out from your competition. Your customers have to understand your brand and concept to immerse themselves in the experience. You will also be asked how you would like to grow in a manner consistent with your brand.

  The hiring process should include a discovery period between yourself and the potential business coach to make sure you are both aligned and should include the following:

1.   Answer detailed focus questions so your business coach gains insight of what you want to accomplish.

2.   Review their coaching/consulting package thoroughly, so you’ll have a good idea of features, benefits, time alloted and pricing.

3.   Schedule a 20-30 minute discovery call to talk through the project and determine if you are a good fit to work together.

  A Business Coach should also address focus questions. These can include the following:

•    What do you need help with? Be as specific as possible about the problem you need to solve or opportunity you want to tackle.

•    What is the ideal outcome or result you want to achieve? What does it look like?

•    How urgent is this project? How important is it to tackle this (1 to 10)?

•    What’s your timeframe for this project/goal: 1) ASAP, 2) within the next few months, 3) sometime this year?

  In addition to evaluating strengths and weaknesses, it’s also important to define business goals. For some people, the goal is the freedom to do what they want. For others, it’s financial security. When setting goals, make sure they are specific, optimistic (but realistic), and offer both short- and long-term plans so you can evaluate your progress. 

  Throughout this entire process, business coaches serve as an invaluable source of personalized information and advice, providing business owners with specific industry navigation tools and assisting in setting attainable goals.

  Coaching Packages will reflect just how much time and assistance your business will need and a coach will work with you regarding budget and timelines.

A good business coach understands that exponential success does not happen overnight. That is where their coaching and development services come into play. A great thing about a business coach is that you can hire one at any stage and scenario of your business, whether you are just starting out, your business is struggling and you need a way to revive it, or you are an established name looking to take it to the next level. There will always be a need for a business coach to provide you with considerable entrepreneurial insights, expertise and innovative business ideas at any level. The benefits of having one cannot be overstated.

Large vs Smaller Businesses

  In many cases, the challenges and goals of small businesses may differ from those of large businesses.

  For example, a start-up brewery in a more localized setting, looking to attract more local customers, will have an entirely different set of goals and strategies than a large establishment that caters to multiple locations and ships on a large scale.

With that said, most business coaches will be experienced in working with small or large businesses since a big part of their job  is to learn as much as they can about each company and owner that they are working with, and developing a strategy that is uniquely suited to the specifics of each situation.

In other words, a high-quality business coach will likely be able to help you regardless of budget, company size or how large you want it to grow.

The Last Gulp

  The most important rule of self-evaluation and goal-setting is honesty. Going into business with your eyes wide open about your strengths and weaknesses, your likes and dislikes, and your ultimate goals lets you confront the decisions you’ll face with greater confidence and a greater chance of success.

  Look at the coaching experience through honest eyes and know that the purpose of a business coach is to make the life of the business owner less stressful and their business more successful, which in amongst itself is something to raise a glass to.

  If you need help on where to start, Chris Mulvaney has been providing Business Coaching Services to business owners and fellow entrepreneurs for over 15 years. His marketing agency, CMDS, can be a great compliment to these services. Feel free to reach out for a consultation and you will be put in the right direction by someone who can take your business to the next level of craft beverage success.

Best Practices: Beer Wholesaler Agreements

lone beer glass

By: Kary Shumway, Craft Brewery Financial Training

The wholesaler agreement can be a point of contention between breweries and wholesalers. Before any beer is delivered, the agreement must be reviewed, negotiated, and signed.

  The challenge with many agreements is that both parties want the terms to be in their favor. Breweries want options to get out of the agreement, and freedom to move their brand if the business relationship isn’t working.

  Wholesalers want the brewery to be committed to them indefinitely. From the wholesaler perspective, they invest millions or tens of millions, in infrastructure and want to be sure that brands stay on the trucks to pay for all the investment.

  Both parties want the advantage, but at a minimum, neither party wants to get taken advantage of in the agreement.

  With so much emphasis on the wholesaler agreement, what steps are you taking to ensure you get the best arrangement possible?

  Below are five steps you can take to improve your agreements, and contractual relationships.

Five Steps to a Better Agreement

1.   Seek first to understand (Basic agreement structure and terms)

2.   Know your state laws

3.   Do your research, ask questions, determine the wholesaler options

4.   Play a game you can win (Develop your own standard agreement)

5.   Self-Distribute (Enter into an agreement with yourself)

  Since we’re talking legal contracts, here is the important disclaimer: I’m not an attorney, and this is not legal advice. The guidance here should be used for informational purposes only.

Basic Agreement Structure and Terms

  As any business textbook will tell you, the primary purpose of agreement law is to enforce an agreement between parties. In this case, the parties are the wholesaler and craft brewery. For there to be an agreement, an agreement must exist, and the parties must have freely intended to be legally obligated. A breach occurs when one party breaks a big promise in the agreement.

  The requirements of a legally binding agreement are: 1) offer, 2) acceptance, 3) consideration, 4) obligations by parties, 5) competency and capacity, and 6) a written document.

  In other words, a wholesaler offers to distribute the beer of a craft brewery, and the brewery accepts. The brewery agrees to brew beer and sell it to the wholesaler. The wholesaler agrees to pay for it. The brewery is obligated to make a saleable product, and the wholesaler is obligated to sell it.

  Both brewery and wholesaler state they are competent and have the capacity to fulfill these obligations. All this is then wrapped up in a written agreement.

  The wholesaler agreement contains a variety of clauses and terms that you should understand: Trademarks, Terms of Sale, Assignment, Transfer, Ownership Changes, and Termination to name a few. A typical wholesaler agreement can be 20 pages in length and contain a dozen or more different clauses. It’s a lot to understand, but very important to do so.

  To begin, read over the agreements that you already have in place. Highlight any items that you don’t understand and start asking questions. What you don’t know can hurt you in a contract situation.

Know Your State Laws

  Thanks to the 21st amendment, we have 50 different sets of laws related to alcohol distribution. Many of those laws are difficult to understand and a giant bore to read. Get a lawyer and get a commonsense interpretation of what your state laws are. Specifically, know your rights and obligations.

  The Brewer’s Association does a nice job in summarizing the various state laws. However, the summary only scratches the surface of what you’ll need to know about the rules of engagement. Know the rules, use them to your advantage, and build them into an agreement that works best for your brewery.

  Agreements and State Laws: Agreements and state laws are often intertwined. There may be sections of the wholesaler agreement that refer to the applicable state laws. For example, ‘wholesaler or supplier may terminate this agreement in accordance with applicable state laws.’ An understanding of the state laws in combination with a working knowledge of agreement rules will give you a leg up when negotiating your wholesaler agreement.

  Lastly, there is a common assumption that the agreement really doesn’t matter that much because the state law will over-ride the agreement anyway. For instance, in a case where an agreement says one thing and the state law says another, the state law wins.

  I’m not a lawyer, but I’ve hired lawyers to deal with this issue. What I’ve found is that the question doesn’t have a clear answer. Bottom line – the agreement still matters.

Do Your Research

  When opening up new sales territories do your homework to find the best wholesaler partner. Talk to other craft breweries, talk to retail accounts (on and off premise), and of course meet with prospective wholesalers. Do your research to find your best match. There’s no point in learning about agreements and state laws if you wind up with a lousy partner.

  Many of the larger craft breweries hire consultants to conduct market research in advance of opening a new territory. The consultants talk to retailers, learn the nuances of the market, and find out who the best wholesaler is. Then they gather information and report back to the brewery with a recommendation.

  Key Questions to Ask Your Wholesaler:  You may not have the resources to hire a consultant, but you can do some leg work yourself. Below are sample questions to ask wholesalers during the research phase:

•    How do you assess opportunities for my brands at retail?

•    What is a recent example of a brand launch success?

•    What are the demographics and tourism of the market?

•    What is the pricing landscape?

•    What did you do for craft beer week?

•    Tell me about your draft line cleaning process and personnel. If line cleaning is not allowed by state law, ask what they do to ensure lines are cleaned (surveys, education) and to determine if they are cleaned (logs, vendor, and frequency of service)

  Invest the time upfront and do you research on your wholesaler options. An agreement helps define a partnership. It’s up to you to find the best wholesaler to partner with.

Play a Game You Can Win

  A wise friend once told me: “always write the agreement.” In other words, if there is an option, don’t let the other side present you with the agreement. Do it yourself.

  Writing the agreement ensures you have control over what gets included or excluded. It allows you to shape the language and create an agreement that works best for your brewery. Have your lawyer develop your own standard agreement. Talk with them about what’s important to include and what isn’t. Use your working knowledge of agreement law and state laws to shape an agreement that works.

  Use Your Leverage: When you meet with a wholesaler, simply present the document as a matter of fact: “This is our standard agreement.” They may negotiate certain points, or counter with their own standard agreement, but they might just sign what you give them.

  Many craft breweries have their own agreement these days, even the smaller guys. Craft breweries have leverage with wholesalers. If you have a brand that multiple wholesalers would like to have, they will make concessions on the terms of the agreement to ensure they get your brand.

  Recognize and understand where you have leverage and use it to your advantage. Develop your own standard agreement, include the terms you want, and insist that it is used to govern the wholesaler relationship.

Self-Distribute: Enter into an Agreement with Yourself

  Another option related to wholesaler agreements is to avoid them altogether and self-distribute your own beer. State laws will dictate whether you can do this, and what the guidelines are.

  There are many advantages of distributing your own beer: you keep the gross profit that normally goes to the wholesaler, you control where and how the brands are presented at retail, and you ensure the brands get 100% focus and attention. Despite best efforts, a wholesaler with hundreds of brands can’t possibly present your beer during every sales call. But you can.

  There are many challenges with self-distribution: increased capital costs for trucks and warehouse space, more people needed to sell and deliver the beer, and a new business model that you need to learn. Nothing wrong with learning, but it can be expensive.

  The fundamental question to ask is whether self-distribution can be profitable. To answer the question, check out the short guide on creating a financial pro forma for self-distribution. This will walk you through the steps of putting together your sales projections, expected margins, operating costs, and capital investments needed.

  Research your state distribution laws, do the financial analysis, and determine if self-distribution is the right move for your brewery.

Wrap Up

  The wholesaler agreement is important, and it’s important that you get it right. Understand the agreement terms and know the state laws. Do your research on the market and the wholesaler options. Create your own standard agreement and use your brand leverage to get the wholesaler to sign it. Lastly, explore whether a self-distribution option makes sense for your craft brewery.

  It’s up to you to find a great wholesaler partner. It’s up to you to ensure you have a good agreement that governs the relationship. Use the steps outlined here, talk to other craft breweries, and consult your attorney. A good wholesaler agreement is within your power to achieve. Now, go and get it.

For more information please visit…

https://craftbreweryfinance.com

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Lawson’s Finest Liquids: A Hophead’s Nirvana

lawson's finest liquids

By: Nan McCreary

In the small town of Waitsfield, Vermont, an iconic brewery looms large among visitors. It is Lawson’s Finest Liquids, producer of world-class IPAs and unique maple beers and, according to many, a benchmark for hoppy beers among the nation’s beer drinkers.

  “I’m a hophead,” owner Sean Lawson, along with his wife, Karen, told Beverage Master Magazine. “I’m a fan of hops in a big way.” This love of flavorful beers has been a driving force in Lawson’s life since he first started making homebrew as a college student at the University of Vermont. “In the beginning, I was making five gallons at a time,” Lawson said. “My friends loved it. I couldn’t make it fast enough.” 

  After graduation from college with a bachelor’s degree in environmental studies and a master’s degree in forestry, Lawson pursued a career as a scientist and outdoor educator but continued to hone his brewing skills. The art and the craft of making beer were in his genes.

  Finally, in 2008, with increasing demand for beer from his friends, Lawson and his wife, Karen, got a beer license and built a 280-square-foot nano-brewery in a shed next to their house. Lawson brewed his beer one barrel at a time, producing 31 gallons—or 10 cases of beer—all while keeping his day job. 

  “I worried that if I turned my hobby into a full-time job, it would end up being a drag, but the opposite happened,” he said. “It really sparked my passion. I loved coming up with new recipes, and I really enjoyed the whole process from start to finish. I would walk into the brewhouse and make things up as I went. I had a lot of ingredients, so I would look at what I had and say, ‘Umm, what do I want to brew today?’”

  As Lawson’s passion grew, so did his customer base. “From day one, we didn’t have enough beer to go around,” Lawson said. At the time, he was making a few maple-infused beers —this was Vermont, after all—but the core of his business was IPAs, which were flying off the shelves. In mid-2008, Lawson decided to quit his day job and make his “hobby” a full-time vocation. He expanded the brewery to a seven-barrel system, which he thought was a big leap but, in fact, still wasn’t enough to keep up with demand. 

  “The beer kept going away faster than I could make it,” Lawson told Beverage Master Magazine. “I could only do two batches a week because it was a small building, and I’d stuffed in as much equipment as I could.” 

  In the meantime, the accolades kept coming and coming and coming. In 2010, Lawson’s Finest Liquids became the smallest brewery ever to capture an award at the World Beer Cup, winning the Bronze medal with their Maple Tripple Ale in the specialty beer category, followed in 2012 by a Silver medal win and another Silver medal in 2016.  Lawson’s beers were also a big hit at the American Craft Beer Festival in Boston, the largest beer festival on the East Coast.

  “People were impressed with the quality and flavor of the beer,” Lawson said. “Skiers and tourists would come to Vermont, buy the beer and take it home and share with friends. ‘You gotta try this beer,’ they’d say.  There was a lot of ‘word of mouth’ success for our products.”

  All along, Lawson’s goal was to “produce beer of the highest quality with outstanding freshness.” Lawson strongly felt that to retain that freshness, the beer needed to be kept cold during the entire journey from the brewery to the customer.

  “When I started in 2008, it was a challenge to get the local distributor to keep it cool in the warehouse,” Lawson said. “But once the brand caught on, I made it a prerequisite: keep it cold in the warehouse, on the truck and while on display at the retailer.”

  Lawson’s persistence paid off. His “home run” beer was Double Sunshine, a double IPA packed with juicy, lush fruit character and herbal aromas with an 8% ABV. With the increased capacity of the seven-barrel brewery, this beer—and other specialty Lawson’s Finest Liquids—created a sensation in Vermont and throughout the Northeast, such a sensation that demand continued to get further ahead of supply. Clearly, Lawson needed to produce more beer. “I read about a brewery in Stratford, Connecticut—Two Roads Brewing Company—that offered contract services, so I decided to consider this option as a way to expand without investing in more equipment or employees,” he said. 

  From the beginning, Lawson was very particular about his requirements. His reputation was on the line, and he was adamant that this beer meet his and his fan’s expectations. “The first thing I wanted to know was if the chemistry of their water would meet my standards for making quality mash,” Lawson said. “As it turned out, the water they used for brewing was nearly identical to what we used in Vermont.”

  Lawson also wanted to differentiate this beer from what he brewed in Vermont, so he created Sip of Sunshine, inspired by Double Sunshine but lighter in color and easier on the palate, and still at 8% ABV. Expecting some trial and error in creating a new brew, everyone was surprised—and delighted—that the first two batches were hugely successful. They hadn’t even packaged the beer yet, so they sold it on draft. “It took off from day one,” Lawson said.

  Over the next three years, inspired by the continuing popularity of his beers, Lawson increased production at Two Roads, with its 100-barrel capacity, while making specialty beer at his brewery at home. He also began expanding his footprint with distribution in Vermont and Connecticut and eventually to Massachusetts, Pennsylvania, Maine, New Hampshire, New York, Rhode Island and New Jersey. Sales skyrocketed, and, ultimately, the Lawsons were able to realize the culmination of their original business plan: To build a large production facility of their own and have a taproom where they could welcome the public. In 2018, that “dream” became a reality when the Lawsons opened their 40-barrel facility and timber-framed taproom in Waitsfield, located in the heart of Vermont’s Mad River Valley. The taproom is open year-round and features 10 to 12 beers on tap, as well as a food program with an emphasis on local fare. Lawson’s Finest boasts 41 full-time and 17 part-time employees. That’s a far cry from the mom-and-pop operation that began in an outbuilding on their property.

  Today, after a 20-plus year journey, Lawson’s Finest Liquids is recognized as one of the best breweries in the Northeast, especially among hopheads. The brewery produces dozens of beers, some year-round and others as special releases. Year-round beers include the flagship Sip of Sunshine; the Super Session series, brewed with the same malt base and specialty malts but each brewed with a different single-hop variety; and Little Sip, a cousin to Sip of Sunshine but with 6% ABV. Sip of Sunshine and the rotating Super Session series are brewed at Two Roads, and the rest at the Waitsfield Brewery. Lawson keeps one barrel in his brewhouse for experimenting with new flavors. If he likes the beer, he will create small-batch productions on his original seven-barrel brewery. “We’re always looking for new flavors,” he said.  “That’s where we have our fun. These are specialty beers that are only available in the taproom.”

  While Lawson’s Finest Liquids has enjoyed phenomenal success, Sean and Karen have not forgotten one of the core values that inspired their journey—to give back to the local community and communities where they do business. “Even when we were very small, we’d give a portion of our proceeds to non-profit organizations here in the Mad River Valley or Central Vermont,” said Lawson. 

  Today, this mission is organized under their Social Impact Program. The SIP includes six initiatives that support healthy communities, food and economic securities, natural resource protection and sustainable recreation in the Green Mountains. One of these initiatives is a “no-tipping” policy that offers a living wage and generous benefits to all employees. In lieu of tips in the taproom, Lawson’s Finest Liquids invites guests to donate to the Sunshine Fund, the heart of SIP. 

  “It has been wildly successful, way beyond our dreams,” Lawson said. “In the first year, we raised over $380,000. Even with COVID, donations continued with our drive-thru retail store. From October 2018 to present, we have raised over $575,000 just through the Sunshine Fund.”

  In 2020, the Lawsons received the Outstanding Vermont Business award in recognition of the brewery’s employment growth, success in the marketplace, company expansion and community involvement. The award is sponsored by the Vermont Chamber of Commerce and Vermont Business Magazine.

  As Lawson looks to the future, he said the plan is to “grow the business to thrive and not to sell.”  They hope to accomplish this by optimizing capacity and continuing the use of Two Roads to produce their flagship beers and Waitsfield for specialty releases. While they continue to increase points of distribution within the Northeast, there are no new market expansions planned in the near term. In the meantime, Lawson remains modest in his attitude toward his achievements.

  “A lot of people make great beer,” he told Beverage Master Magazine. “Why have I been successful compared to others? Maybe a sprinkle of magic.” That, and creating a nirvana for hopheads.

For more information on Lawson’s Finest Liquids, visit their website at www.lawsonsfinest.com

Exploring the Variety of Spirit-Based Canned Cocktails

4 assorted can cocktails

By: Becky Garrison

Over Memorial Day 2014, Bronya Shillo launched the Fishers Island Lemonade, a signature cocktail that originated at her family’s bar, The Pequot Inn, on Fishers Island, New York.  She refined their decades-old recipe and canned the premium distilled vodka, whiskey, lemon and honey cocktail. The drink is one of the first craft cocktails in a can, making Shillo and her brand a leader in the ready-to-drink market. Fast forward to 2021, and she’s expanded her portfolio to a full family of vodka and whiskey lemonade canned cocktails, as well as a fun and innovative frozen Fishers Island Lemonade spirit popsicle.

  Convenience remains the most touted selling point in the growing RTD market. According to Nielsen IQ, in 2019, annual sales in this segment were up 574%, and malt-based cocktails now account for $4.7 million in annual sales. Spirit and wine-based RTD cocktails are generally available in smaller packages; they’re also more established and generate larger sales—$62 million and $83 million in annual sales, respectively, according to the May 21, 2019, Nielsen IQ. One factor that may be influencing some of these sales from growing even higher is that in con-trol states such as Oregon, spirit-based cocktails can only be found in liquor stores instead of grocery stores in non-control states.

  In 2020, consumers in lockdown sought ways to savor their favorite spirit-based cocktails once enjoyed at a bar or restaurant. Establishments responded to this demand by offering cocktails-to-go. Depending upon state laws, these to-go packages contain all the ingredients needed to make a given establishment’s signature drinks or all the items sans the alcohol.

  This to-go trend looks to continue as the world opens up post-COVID, with customers looking for convenient ways to consume their favorite cocktails while on the go. Molly Troupe, Master Distiller for Portland-based Freeland Spirits, speaks to the appeal of canned cocktails. “Canned cocktails are great for those who like convenience and don’t want to make their own cocktails at home. Cans can go much easier than a bottle to the lake, on a hike or wherever adventure may take you.”

Carbonated Canned Cocktails

  The majority of spirit-based cocktails appear to be carbonated and designed for easy sipping with a low ABV. Ali Joseph, co-owner of Portland, Oregon’s Wild Roots, commented about their 2021 foray into the RTD market. “We always recommend simple two-ingredient cocktails to our fans and wanted to take that idea one step further. There’s nothing easier than cracking open a can.”

  According to Tuan Lee and Hope Ewing, co-founders of Los Angeles-based Vernet, they launched their line of sparkling craft cocktails when they observed the market was dominated by bulk spirits made with flavoring agents. Ewing said, “We really wanted to make something high-quality that we would drink ourselves. Tuan’s dream was to share his love for LA’s immigrant cultures through food and drink, and ready-to-drink cocktails felt like a great vehicle for this. We wanted to package in cans for convenience—being pool-friendly, beach-friendly and lightweight —and because aluminum is the most recyclable packaging around.” She added that their goals in producing these products were twofold. “We wanted to showcase the awesomeness of LA’s immigrant food cultures by using ingredients we loved from local farms and markets and to make something as complex and high-quality as I was used to making in craft cocktail bars.”

  Canned vodka cocktails like those produced by Wild Roots differentiate themselves by using natural ingredients instead of “natural” flavorings often found in canned vodka products. Wild Roots’ canned cocktails are made using their top-selling raspberry, blackberry/marionberry and peach spirits. They also added lemon to the lineup because they often use citrus in their Wild Roots cocktails. Spiritfruit is a ready-to-drink canned vodka soda made using all-natural ingredients, a splash of real fruit and five-times distilled corn-based vodka.

Gin & Tonic Canned Cocktails

  In the spirit-based RTD market, taste and innovation are already proving to be key market differentiators. Take, for example, the different ways three distillers produced a canned classic gin & tonic.

  Melissa and Lee Katrincic, co-founders and co-owners of Durham Distillery in Durham, North Carolina, launched their Conniption canned cocktails in 2018 and were among the first distilleries in the U.S. to add them.

  “We saw the increasing popularity of malt-based seltzers and with them mimicking cocktail flavors and/or names. We wanted to bring authentic, delicious spirits based cocktails in the convenience of a can,” Melissa Katrincic said. They chose rosé spritz, cucumber & vodka and gin & tonic because they found that these seasonable flavors are perfect for the warmer months in the southeast United States. Their gin & tonic emerged as the fan favorite.

  Durham’s canned cocktails must be prepared in large batches of approximately 5,000 cocktails. This process involves ensuring that the precise amount of ingredients are measured and pumped into their 450-gallon tanks, then mixed and carbonated. They have an automated canning line for getting the product into containers, whereas their spirits are hand bottled. The canning line is made of hundreds of working parts that are finely tuned but can sometimes be problematic if out of adjustment. Carbonated products can also be prone to “misbehaving,” leading to the final product being foamy or difficult to get into the cans at the right volume.

  Freeland Spirits added canned cocktails to their lineup following the success of the kegged ver-sion of their Gin and Rose Tonic, which they offered in their tasting room. They launched their canned version in 2019, followed in 2020 with the French 75. The latter is a collaboration made using women winemakers and distillers and features Freeland Gin, Chehalem Chardonnay, lemon and simple syrup.

  According to Troupe: “While canned cocktails add an additional step to spirits production, play-ing with carbonation levels and different cocktail ingredients is a lot of fun.” Also, stability is a more significant issue because these canned cocktails are lower-proof than their bottled spirits.

  As the makers of Aria Portland Dry Gin, Martin Ryan Distilling Company in Portland, Oregon, is known as a gin house. So rather than develop another product in a different spirit category, a G&T seemed like a natural extension of the Aria Portland Dry gin brand. Ryan Csansky used his background in the bar and restaurant industry to create an in-house tonic using a proprietary blend of lime, bergamot and lemongrass, hints of allspice, orris and star anise, a flavorful tonic that complements the classic London Dry style of Aria Gin. The result is a G&T canned cocktail made using all ingredients with chemicals or artificial sweeteners and one of the lowest sugar counts of any tonic on the market. Since a canning line is an expensive system to purchase, they work with a mobile canning company that brings their system and operating crew to them as needed.

Other Non-Carbonated Bartender Inspired Cocktails

  Drnxmyth, a collective of drink makers with a shared interest in bringing fresh craft cocktails to people everywhere, invented an ingenious bottling technology that, in their estimation, unlocks the freshest cocktails ever produced. Each drink created is a collaboration between them and a bartender, drink maker or drinksmith, who shares in the sales profits for this particular drink.

  The TTB licensed Drnxmyth’s factory to handle bulk spirits and fresh cold press juicing, batch-ing and filling. A patent-pending bottle separates the spirits from the fresh ingredients, since al-cohol alters the sensorial nature of juice and freshness over time. Then the drinks are pressurized at 85,000 psi, which brings the microbial count in the juice close to zero. After that process, the beverage will remain fresh for five months while refrigerated and unopened.

  Through his work in the music festival industry, Neal Cohen, co-founder of Atlanta-based Tip-Top Proper, saw demand growing for quality cocktails, though in his assessment, the category had yet to deliver the quality and convenience for classic, spirit-forward, non-carbonated cock-tails in high volumes. “We fantasized about creating a world-class cocktail in an easy-to-serve vessel, thinking maybe we could help solve a problem for venues, events, restaurants, bars, air-planes and regular folks at home on the couch. Eventually, we stopped fantasizing and started actually doing it,” Cohen said.

With that mindset, Tip Top Proper was founded in 2018, focusing first on the trifecta of bitters-forward, stirred, high-proof cocktails—Old Fashioned, Manhattan and Negroni. Next, they gravi-tated toward a “Shaken Line”—Margarita, Daiquiri and Bee’s Knees—all cocktails that allow for warm weather, outdoor consumption. Their products come in 100ml sizes, which Cohen said is the appropriate single-serve size for a cocktail.

  In 2016, The Perfect Cocktail began offering classic cocktails—Old Fashioned, Manhattan and Negroni—packaged in mini bags. Their “made in Italy” production process and functional and sustainable packaging are patented to ensure the best mix of convenience and flexibility.

  Alley 6 Craft Distilling in Healdsburg, California, first came out with their canned Old Fash-ioned in 2019 in response to consumer demand for a portable version of the drink made in their tasting room using rye whiskey or apple brandy and candy cap (mushroom) bitters. A bottle didn’t seem to fit their purposes when compared to a canned cocktail that could be enjoyed while on the go, traveling or adventuring.

  Oregon-based 503 Distilling offers their canned Mt. Hood Old Fashioned, a blend of their rye whiskey, hazelnut bitters and maple syrup. This canned cocktail follows their first release, the Wicked Mule, along with other offerings—Blood Orange Greyhound, La Vida Mocha, Five-O-Tea and Huckleberry Lemonade.

  For a Brazilian twist on the Old Fashioned, Novo Fogo is launching a Brazilian Old Fashioned Highball hybrid that features tropical flavors of orange and vanilla. Their initial foray into the canned cocktail market was their Sparkling Caipirinha, a canned version of Brazil’s national cocktail available in three flavors found across the Brazilian food and drink spectrum—lime, passion fruit and mango.

  Finally, for consumers looking to savor a hot, after-dinner hard coffee that’s easy to make, Cask and Kettle produces small-batch hard coffees in flavors such as Irish, Mint Patty, Hot Blonde or Mexican Coffee, and a Spiked Cider in a k-pod. The k-pods, packaged and distilled by Temper-ance Distilling in Temperance, Michigan, contain liquid distilled spirits, concentrated coffee and flavorings, and can be placed into any pod home brewing system or poured into hot or iced water.