A lot of people believe that marketing a brand is an arduous task. Yes, it requires work. But if you hate this part of building a business, you may find yourself in the marketing denial loop. What is this?
It is when brands do extraordinarily little marketing and expect big results. It is when brands put in less than what they desire to receive. This mindset leads to a sense of disillusionment and disappointment. We are sure you have encountered individuals who say running a brand is hard. The truth is, creating and growing a brand requires work. But the work should not be regarded as hard. It is important to eliminate this mindset. Embrace a simple, thought-out marketing plan and strategy whether you are a new brand, a mid-range brand or one of the big guys. Understanding how to market your brand should never be approached begrudgingly or negatively. Last Beverage Master issue, we focused on the “why,” as in why is your brand so unique? Why should consumers purchase your beverage rather than Bob’s beverage? Why is your brand making this beverage? Is there a story? The “why” is your first building block, and this will lead you to the most important phase of your simple marketing strategy — who is this for?
Nowadays, you do not have to look too far to see the dos and don’ts of marketing. You are in a time where the triumphs and tribulations of top-tier brands are well documented. As of late, major marketing blunders have been put to the forefront. The common mistake among all these brands, not just those in the alcoholic beverage industry, is that they forget the most important marketing building block: the “who,” and I’m not referring to the classic and iconic English rock band. In this case, the “who” refers to your audience, the consumer. Understanding their buying decisions and why they select your brand or your competitor’s brand when purchasing beer and liquor should be at the forefront of your marketing strategy.
Who is Your Consumer?
All your marketing initiatives are built from understanding who your consumer is. A concept that seems obvious and basic, yet both new and old brands make it complicated. Since you and your beverage experts are creating the beverage, tasting it and perfecting it, start here. What would appealto you? What would make you run out and purchase your alcoholic beverage over a top-shelf or legacy beverage? Also, what do you wish some of your favorite beverage brands did? How does your brand fill this missing element? A large list is not needed. You are not going to be loved by everyone. Focus on three key features your “who” (consumer) would look for. Look at their lifestyle and how you can highlight that your beverage compliments their personal ethos. Remember, people attach feeling to their purchases. This is why the “why” story is such an essential first step in brand development. It lets you clearly map out how to appeal to and reach the “who.”
There are many ways to find your audience. The above is a simple and effective method. If you cannot sell this magical beverage to yourself or your team, then you will not sell it to anyone else. For those who have an existing brand and are struggling with your brand in a marketing landscape, which has become quite cutthroat with the advent of social media platforms, taking a trip back to where you started and your initial goals will help you zero in on your consumer base. Do not be greedy. Do not strive to be all things to everyone. If your brand has been performing relatively well and you are looking for more brand visibility to boost sales.
Simple changes, more times than not, are needed. Creatively amplifying your existing message can increase your reach and growth. You do not need to burn the building down and start again, so you target a new demographic to buy your beverage. What about the people who have kept you afloat? Your loyal consumer bases? Some brands conduct surveys. Ask the people who have already purchased your drink what you can do better. Or what is on their wish list? Conduct a poll. This will give you some great ideas or help you re-strategize and expand your existing marketing methods.
Should You Reinvent the Wheel?
If you are a new brand, the alcoholic beverage world is truly your oyster. You can be outlandish and try something new. You have leeway to reinvent the wheel. Why? Aside from making a quality beverage, there is no sense in trying to copy the marketing strategy of a legacy top-tier brand. Their consumer is loyal. This does not mean that they will not become a fan of your brand. It is like football; people love the team they love, but when it is the Superbowl and their team has not made the cut, they will root for the team they like second best. Some people drink the beer their granddad drank and pass the love of this beverage on to their kids. It is a staple beer at all family events and their go-to beverage when dining out. Whatever the hook was that appealed to their granddad was passed on to them, and so on. Consider this a legacy brand. Legacy brands must strive to expand the wheel, but they should not reinvent it or break it unless they want to lose a loyal consumer base. Ignoring your “who” so you can reach a new consumer is sloppy marketing and a hasty marketing method often spurred on by newer brands going viral on social media.
You might be wondering how you would know who your consumer is. What other methods can you use to understand them better to build a formidable marketing strategy? This may sound contradictory to what was stated above. Start by identifying three brands that you are comparable to, your competitors. Study them, but do not copy them.
Moreover, analyze them and look for what you do not like first. What would you do better, and what is missing? Make this list small. Next, look at the elements you like and what you would do better from a consumer’s perspective. For example, some beverage brands have made different-size offerings for their beverages. This is a simple yet effective difference that sets you apart and boosts sales. Who does not love those single-serve wines or a small-can imperial stout? Your consumer’s needs are not hard to understand if you start with yourself, assuming you are making a product you believe in, and then look for like-minded individuals with the same sensibility. Stay faithful to your plan, even when no one is looking, because someone looking for what you are offering will eventually turn into a large, loyal consumer base that will tell their like-minded friends to purchase your beverages too.
You’ve secured federal registration for your trademarks and you’ve been building your brand recognition. Per your trademark attorney’s recommendation, you’ve had quarterly searches conducted to find similar marks. Lo and behold, a new entry to the market is using your trademark. Now what? Stop and take a breath; let the initial surprise or anger settle. There is a lot to consider before taking any action.
Take Stock of the Situation
First, take a look at your own trademark. Is it the name of your company or of one of your products? Is it a national brand or one that is distributed in a small geographic area? In what classes of goods and services is it registered (e.g., class 033 for vodka, class 040 for “rectification of distilled spirits for others,” etc.)?
Then look at the competitor’s mark. Is the mark identical to yours or similar? How similar? Is it broadly distributed? Is it used for the same goods and services as your mark? If not, how similar are the goods and services? Are your products marketed through the same trade channels? Are consumers likely to encounter both your products and theirs? Have they attempted to register their trademark and, if so, where are they in that process?
No one question will be determinative in any given case, but on balance, they will help develop a sense of how much effort should be expended to enforce your rights. As discussed below, there are numerous paths, each with its own set of risks and potential rewards. An international brand that is known throughout the industry, like Jack Daniel’s®, must be far more protective of its marks than a small brewery in Oregon that has a registered trademark for an IPA product only distributed in the Pacific Northwest.
First Contact
As the owner of a registered trademark, it is your duty to “police” your mark; that is, to monitor unauthorized use of your mark by others and to enforce your right to exclusivity of that mark. When large corporations learn of potential infringement, their immediate response is generally to have their attorneys send a cease and desist (C&D) letter. For smaller companies, a personal attempt to contact the owner of the infringing business is often effective. Sometimes the other party simply did not know about your mark. If you found their use of the mark before they spent considerable time and money developing it as a brand, they may be willing to simply let it go.
When making these calls, it is important to maintain a demeanor that is both friendly and firm. There is no need to accuse the other side of wrong-doing or of violating your trademark knowingly. However, you should simply let them know that you do have a registration for the mark and that their use is likely to cause confusion in the market as to the source of your respective goods. If you give them a reasonable amount of time to work through any inventory bearing the infringing mark and to rebrand, this can often be the end of the matter.
Cease and Desist Letter
If the friendly approach doesn’t work, the next step is generally a cease and desist letter. This is most effective if drafted and sent by an attorney. The tone of these letters tends to be more matter-of-fact. They identify your trademark(s); explain that you have spent a considerable amount of time, effort, and money to build your brand around the mark; identify the other party’s infringing use; state that the use is unauthorized and likely to cause economic harm and loss of goodwill in your brand; and demand that they stop using the mark within a given time frame.
While these letters can sometimes be effective, especially against smaller companies, they have become so commonplace that often they are simply ignored by more savvy companies who may wait to see if further steps are taken before deciding whether to rebrand. Accordingly, you should carefully weigh all of your options and decide in advance whether you will escalate the matter if your C&D letter is ignored.
Letter of Protest / Trademark Opposition
If the other side has attempted to register their mark, there are two ways to try to prevent the registration. First, you can file a “letter of protest” with the U.S. Patent and Trademark Office (USPTO). The letter simply informs the trademark examiner of the existence of your trademark and the reasons why you feel that registration of the other party’s mark would damage your mark. The benefit of this approach is that it is quick, easy, and relatively inexpensive as it generally only takes a few hours for an attorney to prepare and file the letter. Often filing the letter will prompt the USPTO to issue an office action refusing the registration in light of your trademark, forcing the other side to argue why registration should be allowed. The downside to the letter of protest is that once it is filed, you have no further opportunity to engage in the process. If the other side responds to an office action with arguments as to why registration should be permitted, you cannot respond to those arguments.
Whether you have filed a letter of protest or not, if the USPTO’s trademark examiner determines that the mark is registerable, it will publish the mark in the Official Gazette. This publication opens a 30-day window for anyone who believes they will be harmed by registration of the mark to file an opposition to the application.
This process should not be entered into lightly. In some cases, simply filing the opposition will be enough to get the other side to give up its mark. But, if they choose to fight the opposition, you will find yourself in a litigious process that takes time, effort, and money to complete. As in civil litigation, the parties to an opposition file motions and briefs, request documents from the other side, take depositions, serve interrogatories that must be answered, and present their evidence to the Trademark Trials and Appeals Board for its consideration.
If the opposition goes all the way to the trial stage, it will generally take at least 18 months from when the notice is filed to when the last brief is due and will cost each side in the tens of thousands of dollars. As with civil litigation, most oppositions do not reach the trial stage, because the parties are able to come to terms and settle the dispute on their own. But, this often does not occur until sometime in the discovery phase, after both sides have spent a considerable amount on legal fees.
It is important to note that the object of an opposition proceeding is to prevent registration of the other side’s trademark and, if you are successful, that is your sole remedy. There are no monetary damages awarded, nor can you recover your legal fees from the other side. Moreover, while they will lose their ability to register their trademark, it does not necessarily mean the other side will stop using the mark on their goods or services. In that case, you would have to file a trademark infringement litigation (see below) to get them to stop using the mark, entirely. In practical terms, succeeding in an opposition will often be enough to get the other side to abandon their mark, because if you were to follow through with a civil litigation, they could be on the hook for treble damages for willful infringement.
Trademark Cancellation
If you discover the other side’s trademark application after the 30-day opposition window has expired, your only option to challenge the mark at the USPTO is to wait until the trademark actually registers and then to file a trademark cancellation proceeding. Though there are some differences between cancellation and opposition proceedings, particularly if the challenged mark has been registered for more than five years, they are similar in most procedural respects.
Trademark Infringement Litigation
As one might expect, filing a trademark infringement case in federal court is the nuclear option. Depending upon the jurisdiction, the time frame for completing a litigation may be faster or slower than an opposition or cancellation proceeding at the USPTO. But, whereas those procedures will likely cost the parties tens of thousands of dollars, a civil litigation will likely reach six figures, or more.
The reason for this higher cost is that there are more issues to consider in these cases. If you are successful in a civil litigation, you may not only obtain injunctive relief, foreclosing the defendant from all future use of the mark, but also may obtain monetary damages associated with the defendant’s past use of the mark, as well as attorney’s fees expended in the proceeding. Moreover, if the defendant is found to have willfully infringed your trademark, they may be required to pay treble damages.
These issues, which are not even addressed in an opposition/cancellation, add breadth to the scope of discovery taken, which increases the cost. Further, whereas most opposition/cancellation proceedings are decided without an oral hearing, a civil litigation generally requires live testimony and argument in front of a judge or jury. These proceedings require a great deal of attorney preparation, dramatically increasing legal fees.
Conclusion
As the owner of a valid trademark registration, you are obligated to police your mark and failure to do so can result in a dramatic diminishment of your rights or even outright abandonment of your registration. But, that does not mean you have to file a civil litigation against every minor infringement. Determining the appropriate path in any given situation requires a careful evaluation of all the circumstances and balancing the risks of action versus inaction. It is critical to engage a knowledgeable trademark attorney, who will properly assess these risks, your likelihood of success, and the most effective course of action in your case.
Brian Kaider is a principal of KaiderLaw, an intellectual property law firm with extensive experience in the craft beverage industry. He has represented clients from the smallest of start-up breweries to Fortune 500 corporations in the navigation of regulatory requirements, drafting and negotiating contracts, prosecuting trademark and patent applications, and complex commercial litigation.
In the 1880s, in Northern Lawrence County, Ohio, James Mullins noticed an abundance of coal mines popping up. The area was rich in coal, and Mullins decided he wanted to cash in on the surging coal mining business, so he purchased a plot of land between the already-operating Beechwood and Oakwood mines to open his own coal mine. However, before opening, he was reminded by his new hires, many of whom were local and in need of work, that it would surely be bad luck to open and operate a coal mine without properly naming the mine, similar to the naming of ships before launch. Mullins’ wife mentioned that their coal mine settled nicely between the neighboring mines, mingling between them. That single comment launched the beginning of the Minglewood Coal & Ice Company that has now, well over 100 years later, become home to the Minglewood Distilling Company, a small-batch micro-distillery located in Wooster, Ohio.
Mullins sold coal from his mine and ice procured from the nearby lake when frozen until 1921, when he added a second building on the property. It was heavily insulated with natural cork and used specifically as an ice factory, providing sanitary or electric ice made from distilled water.
As the years passed, electric refrigerators and natural gas availability sharply reduced the vast need for purchased ice and coal. That demand reduction led to Minglewood Coal & Ice Company closing its doors in the 1950s. An auto repair business took over the smaller building, and the larger, cork-insulated building that once housed an ice factory was transformed into a beer and wine carryout store. The carryout liquor store sustained heavy fire damage in the 1970s and sat in ruin from that day forward, including a massive amount of burnt cork waste. The damage was so bad that the city had plans to demolish the building until current co-owner Mark Morrison purchased the land with the remains of the two buildings included. The city also halted demolition plans on what remained of the damaged buildings providing Morrison would start working on and improving the property immediately. This land purchase began the beginnings of the Minglewood Distilling Company. Morrison opted to keep the Minglewood name out of respect for the area’s history, a trait that continues throughout the distillery, its story and its products.
Carrying on the Minglewood Name
“We still have two buildings on the property,” said Andrew Morrison, son of Mark and now co-owner and distiller. “The larger building is the original 1880s icehouse heavily damaged in the fire. The smaller building had at least a partial roof and some electricity availability, making it the more practical place to start the restorations and renovations. We started distilling in 2016 and opened to the public beginning in 2017.”
“The larger building, the former ice plant, has been under renovation for the last four years. It took a lot longer, not only because of the extent of the fire damage but the cleanup included so much burnt cork insulation waste. It must’ve been at least five feet deep, and we actually began by digging it out by hand,” said Morrison. “Additionally, the pandemic slowed everything dramatically. But in May 2023, we were able to host our first event in the space, and it is now open as an event venue for weddings, get-togethers, parties, corporate events and anything else that would benefit from being held in a private space. The back half of the building now houses our production area, and the smaller building we originally used for production is now a permanent bottling facility. We had been rolling out temporary tables to use as our bottling solution, but now, with updated production facilities and available bottling solutions, we hope to increase production and extend our reach substantially.”
Morrison tells Beverage Master Magazine that patrons will enjoy a rustic, classy space when visiting. The tasting room vibe is reminiscent of the 1940s and 1950s eras, featuring industrial décor with brick walls, concrete floors and exposed ceiling beams.
“I wouldn’t call it trendy or hip,” said Morrison, “But rather, it’s a place with a throwback feel that reflects and showcases our pride in doing things in the older, traditional ways. Our customers can immediately sense they’re in for a quality experience with owners who care about their products and the visitor experience.
The Morrisons currently use a stainless steel, hybrid reflux column pot still with a 500-gallon capacity that feeds into a 12-plate reflux column. Their current production schedule is distilling two to three batches a week from November through April, when the city water temperature is perfect for their needs.
“We use a lot of city water for cooling processes, and in those winter months, the water temperature hovers around 40 degrees, which is perfect for our operation,” said Morrison. “Additionally, our equipment is big enough that, for now, we can make what we need for the year during those months. We generally produce a barrel out of each distillation, which comes to about 50 barrels a year, mostly bourbon and rye, and we distill corn whisky for our flavored whisky products. So, we do have the option to ramp up production rather quickly if and when needed.”
Reigniting the Area’s Historical
Passion with Rye
After the Revolutionary War and in the 1800s, Germans immigrated to Ohio, including Wayne County. They brought rye from Europe with the intent of farming. Rye is a winter crop that fits extraordinarily well with Ohio’s temperature fluctuations and extremes, including the high freeze and thaw rates in the winter months. When a successful harvest came in spring, farmers found themselves with an excess of rye grains and looked for additional uses, leading to small pot stills on the farms to distill the grains and raise extra money. However, during the Civil War in the 1860s, excise taxes became a reality. As you can expect, farmers didn’t want to deal with the taxes, so many became moonshiners while local granaries became distilleries. Morrison also speculated that with the proximity of Route 30, a major thoroughfare running from the East Coast to Chicago, it’s not a far stretch to think that moonshining and moonshine distribution were also lucrative businesses.
“Most people don’t remember that the Cedar Valley Distilling Company operated in Wooster between 1862 through the 1940s,” said Morrison. “We like their story and try to keep it alive in our tours with historically accurate retellings. The owner started with a grist mill, purchasing grain from local farmers and hiring additional local farmers and construction workers when other work was unavailable. The distillery was successful enough that they eventually moved to a larger facility, and from all accounts, they could produce 25 barrels a day during their peak production in the late 1800s.”
“That’s simply unfathomable to me,” said Morrison. “If we ran 24/7 here, we could produce two barrels daily. Cedar Valley Distillery only made rye whisky, and they suddenly found themselves with a very large backstock when prohibition hit. They were able to get a license to distribute medicinal prescriptions, so their backstock ended up being distributed through prescription only. By the time prohibition ended, their backstock was dwindling away to almost nothing due to their prescription distribution and likely a bit of bootlegging. So, they started selling a 65 percent Cuban Rum liquor cut with six-month-old rye whisky aged with wood chips. We actually found some of the bottles over the years, and as you would expect, the concoction was horrible and definitely not a money-maker, causing the distillery to close its doors. Cedar Valley’s buildings and memories are now gone, and it’s rare to find someone in Wooster who remembers them, but we want to keep that history alive. Like them, we make our rye whisky using all local ingredients. We enjoy highly communicative and exceptional relationships with our farmers, who have become more like partners than suppliers. Our corn is grown about five minutes away, just outside of Wooster. Our rye comes from about 15 minutes away, in Dalton, which is eastern Wayne County, and our wheat comes from a co-op just north of us in Seville.”
Community and Partner-Suppliers
Are Critical
Mark Morrison originally opened Minglewood Distillery with help from a friend that owned and operated wineries in the region. His son Andrew would work with them when he was available. In 2019, Andrew finished his studies, and when Morrison’s partner wanted to return to his true passion, meaning his wineries, the Morrisons bought him out. From that day forward, the father and son team became 50/50 partners, co-owners and distillers.
“We’ve been using the same farmers for six years since beginning our distillery,” said Morrison. “We are fortunate to have no worries about the consistency and quality of our ingredients or products, and our communication couldn’t be better. Even when our suppliers had a bad year, causing lower overall yields, they told us they had a crop dedicated to us, so we shouldn’t worry. That type of communication and partnership is invaluable.”
The future looks bright and tasty for Minglewood Distilling Company. Morrison tells Beverage Master that they are looking forward to increasing production and bottling capacity thanks to the updated availability of both buildings. They plan to bump up their bourbon production, eventually offering bottled-in-bond bourbon and rye selections and expanding the overall lineup with more variety and premium offerings.
For those following the path to owning a distillery in a state that controls licensing, Morrison says that those future distillers should apply to get their license early. He waited, and because the process was a lengthy one, Minglewood initially was only allowed to distill and provide small samples (one ounce per person, per day, cut into quarter-ounce samples) to their patrons, which wasn’t enough for proper tastings to be held or sell their liquors by the bottle. Morrison said that selling cocktails is critical to the bottom line, so obtaining that serving license is important for customers to get to know your products and want to purchase them regularly. Minglewood Distilling Company’s best sellers have been their flavored offerings, with peach leading the way. It really took off in 2020 and hasn’t slowed. Their upcoming pickle whisky is set to be a hit, and a much-anticipated root beer whisky will be available this fall.
In addition to being able to taste their product lineup at their distillery and tasting room, Minglewood Distillery offers a kitchen and full bar for service and menu offerings featuring meat and cheese boards.
To learn more about Minglewood Distilling Company and its products, visit:
They say money can’t buy happiness, but it can help create peace of mind by alleviating stress in professional life – especially if you’re a business owner! Professional financial freedom means taking control of your finances and amassing enough cash and savings to manage daily operations, handle emergencies, drive growth, expand and maybe even sell the business one day.
For beverage business owners, knowing that payroll can be met, a second location of your bar or location could be opened, staff and vendors can be paid – and there is still enough money set aside for any emergencies can provide stability. We’re all familiar with certain strip malls or vacant locations where different businesses seem to come and go, unsuccessfully. In contrast, towns and cities are identified by the bars, pubs and restaurants that are landmarks, meeting spots and seen as a local staple in their areas.
Financial freedom offers a variety of benefits that go beyond financial control. A recent study by Harvard Business School found that having more money reduces intense stress, brings greater control, and leads to higher life satisfaction. Other benefits of financial freedom include improved mental health, better relationships, more opportunities, an elevated lifestyle and greater independence.
The path to financial freedom. We all want financial freedom so how do you get there?
Become a business owner. Simply becoming a business owner provides an essential freedom that can’t be explained unless you are one. As countless entrepreneurs attest, many people prefer to work for themselves rather than for someone else because they have more control over their future – and their finances. A Baylor University professor found that despite the challenges of business ownership – including long hours and high stress levels – entrepreneurs report consistently higher rates of happiness vs. people who work for others.
Create a budget. Develop and stick to a budget. Outline operating income, receipts, expenses, loans, rent/mortgage, insurance, utilities, payroll, supplies, equipment, etc. Carefully track spending to account for every dollar. Negotiate where possible, switch vendors or gain better rates for your phone and cable services. Determine which of your products are the best (and worst) sellers and adjust stock accordingly.
In addition to tracking budget, there are common questions each business owner should ask themselves to manage their financial health. For instance, do you have outstanding accounts? Do your clients pay on time? Have you spoken with your top clients in the past 90 days? Do you have your documentation prepared in case you need to apply for a loan? Loan Mantra’s financial health checklist is a great tool to monitor ongoing questions that will not only help you track your budget, but your continued success.
Make it “to go” and be in the know. A report released in June 2023 by the National Restaurant Association found that more than half of millennials (62%) and Gen Z adults (52%) would pick a restaurant for takeout if alcohol beverage options were included. Currently only ¼ of adults order alcohol beverages online due to availability or state legislation, but that is changing leaving room for opportunity. It’s also important to know the upcoming industry trends. For example, that same report states that it reaffirms the associations predictions that local experiences would be this year’s hottest trends – 79% of beer drinkers would participate in a tasting event at a restaurant.
Establish authentic customer relationships. According to the US Chamber of Commerce nearly everyone has been affected by Covid Fatigue over the past couple of years leaving people emotionally drained and physically worn out. As a result, consumers want their shopping and dining experiences to be easy, convenient and satisfying. Satisfied customers are repeat customers. In addition, customers are looking for a deeper emotional connection and a personalized experience.
Use digital media. For brands to build and maintain customer loyalty, the digital experience matters but it must not make things more complicated for the consumer. Whether a customer is ordering online or on-site it must be intuitive and easy. People find the new hottest brew, bar or pub on social media so having a presence online is a must. Post images of the business with indoor/outdoor dining space, food and drinks. Post happy hours, specials, trivia nights, special tastings, etc. and publicize them. Encourage satisfied customers to leave reviews. Allow customers to order food or make reservations online. Make services like DoorDash or OpenTable available.
Be frugal. Consider how business magnate, investor, and philanthropist Warren Buffett purchased a $31,500 home in 1958 and still hasn’t moved out of it, even though his net worth is currently $104 billion. He can obviously afford a bigger, more expensive house, but he’s famously frugal. Conversely, controversial rapper and designer Kanye West is known for his extravagant lifestyle. He lives in a $20 million mansion – and rented Madison Square Garden for a stunt with his clothing line – despite being $53 million in debt. In a bizarre move, he asked Facebook founder Mark Zuckerberg for $1 billion on Twitter.
This is clearly an extreme example, but it shows how financially responsible Buffet amassed a tremendous fortune and achieved financial freedom, whereas financially irresponsible West spent money he didn’t have, wound up in massive debt, and begged a tech guru for a financial handout on social media. While you’re likely not in the same tax bracket as mega-successful billionaire entrepreneurs, you can learn a few lessons from them. Don’t spend more than you have. And keep your endgame in mind. It may be easier to save money when keeping your eyes on the prize.
Invest. Go for a long, slow simmer vs. a quick sear. Most investments are like an Italian grandma’s Sunday sauce – they need to simmer for a long time to be any good. Know that you’ll be in it for the long haul. This won’t be a quick sear type of situation, where your money will be tied up only for a short time. While there’s always some risk and market fluctuations involved in investments, putting some of your available funds toward stocks, bonds, mutual funds, Roth IRAs, 401(k)s and other investment opportunities can help grow your wealth and put you on the path to professional financial freedom. Talk to a financial expert about how to build an investment portfolio and choose the investments that will best fit your specific goals.
Focus. Focus on factors you control. Over the past few years, we’ve seen headlines about banks collapsing, an impending recession, plummeting stocks, and other doomsday stories about how our financial futures are in crisis. Don’t panic. Everything that’s happening today is just part of the normal economic cycle. There will always be recessions, wars, and fluctuating interest rates. Take a deep breath. Unemployment is down. Banks are protected. There’s been recession chatter for years, and it hasn’t happened. Prices and the stock market will fluctuate over time, which is out of your control. Focus on what you can control on your path to professional financial freedom: creating a budget, saving money, and investing.
Have an emergency plan. Create an emergency plan, ensuring that you have enough savings to cover daily and unexpected business expenses. Without adequate funding in place for emergency expenses (the air conditioning breaks, the plumbing isn’t working, the roof leaks), as well as for the inevitable periods of higher spends (e.g. extra products and staffing around the holidays, etc.), you’ll get stuck in a cycle of borrowing to fund necessary operating expenses or to repair what has been damaged, rather than using capital to look ahead to the future.
Find financial partners. Who is your banker, attorney and loan officer? Does the banker have a vested interest in your community? What are the financials? Does the bank have good leadership? Do you have an attorney in case you need legal advice, or someone should make a claim against your business? What about a loan officer or provider? If you need assistance with funding to cover the business in a pinch, to handle an expansion or to keep you aware of current government subsidies that you might take advantage of.
Having the right partners in place before you need them can mean the difference between a quick phone call and financial mayhem. Find a financial team that will be trustworthy, provide insight and are available when needed.
You should have complete confidence in their knowledge, experience and capabilities. Talk to them about your business financial status and goals and create a financial plan to help you achieve financial freedom and long-term financial health.
“For business owners, becoming financially free is a desirable – and achievable – goal,” Tulshan explained. “It takes dedication, determination, and consistency, but follow these tips and you will be well on your way to financial independence.”
About the Author
Neeraj (Raj) Tulshan is the founder and managing partner ofLoan Mantra, a one-stop FinTech platform that democratizes the loan process by providing corporate sized services and access to new entrepreneurs, small and medium sized businesses.
Many beverage businesses start off with the owners or the founders serving in production manufacturing and in sales roles. As the business grows it is no longer feasible for the founders to serve in many of these roles as the needs of the business change with growth. One of the challenges many founders face in scaling their business is maintaining consistent manufacturing practices when they are no longer the person who is responsible for those practices. Training for new employees in small businesses can sometimes be inconsistent or informal. When training is not implemented cleanly enough that a newly hired employee can fulfill their responsibilities fully it can be frustrating for all involved. Lets take a look at some easy to implement solutions that can help your employees do the best job possible.
One solution to this problem is creating Standard Operating Procedures (SOP). When you detail in writing each step of the manufacturing process in a document that is readily available to those performing the task, you should get more consistent results. Standard operating procedures can be tedious to create but will save you time in the long run and give your employees the confidence to perform complex tasks with ease. In the process of beverage manufacturing there are many complex steps. Without a set of standard operating procedures it can be extremely difficult for a new hire to fully grasp their roles and responsibilities.
The optimal steps in training a new hire are the following. Create a written set of operating procedures that are clear and easy to follow. Review the SOP with employees and discuss the steps with them as well to confirm understanding. Once an employee has a basic understanding of the operating procedure the person training the employee along with the new employee should go through the process detailed in the SOP together. By having the trainer first complete the process while following the SOP it will fully demonstrate for the employee how the steps are done. This on hand training will often bring up questions from the employee being trained that might not otherwise come up. Once the employee being trained has seen the process completed following the SOP it is best for them to then complete the procedure outlined in the SOP in the presence of the trainer. It is critical at this step that the trainer does not work hands on with the new employee but is there to only observe and answer questions. If the trainer at this point feels that the employee grasps the SOP and is able to complete it then it is time to move on to additional training. Although this method of training can feel arduous and redundant for an employee, training like this will build their confidence in performing a task that may seem difficult for them. Training this way will also ensure that the manufacturing process will continue to be performed to the correct standards. Implementing a training of this type for all complex tasks will give the creator of the SOP trust in the individuals tasked with completing the process in the SOP.
Let’s take a look at what a standard operating procedure looks like for a process in a business and talk about some of the key points that you will find in an SOP.
Let’s go through the practice of generating an SOP:
1) Go through the process yourself of completing the task that needs a SOP.
2) Write down all steps and processes required to complete that task.
3) If there are certain measurements critical to completing the task such as volume temperature or time, include this info in the steps.
4) If there are complex controls or tools in the process include pictures to help further clarify the written steps.
5) Place notes in the SOP if there are any hazards in the process or safety concerns.
6) If there are many steps it can be helpful to add a checklist to accompany the SOP.
7) Once the SOP has been written, seek feedback on it. Have another person read the SOP ask if they could perform the task.
8) If the feedback is positive implement that SOP by training your employees.
9) Put the SOP in a binder or place where it is nearby the location where the task is performed.
This process of putting in the work to create easy to follow operating procedures, will make work better for everyone. An SOP will guide your employees as they do tasks and give them the confidence that will require less oversight by you. This does not mean that an SOP can replace a manager. The true purpose of an SOP is to provide a resource to ensure complex activities can be done correctly by all who perform it. As a business grows and scales new employees will need to learn how to do their job. The better SOP program you have the faster a new employee will be able to work independently.
As the craft beverage industry continues to grow, many tech companies are focusing on the needs of breweries and distilleries around the country. There are many benefits to incorporating software into a beverage production business, including reducing human errors, automating repetitive tasks, getting staff organized, harnessing the power of data and ensuring quality control. Software is available for accounting, inventory, packaging, purchasing and scheduling. Breweries and distilleries also use software for sales, quality control and legal compliance. Mobile app software is an option in this industry, as well as all-in-one management software that takes a comprehensive approach and handles various functions. Meanwhile, some producers embrace a more manual process and rely basic spreadsheets and paper recordkeeping.
So, what are today’s breweries and distilleries using for software, and how are those products working for them? Representatives from two breweries and two distilleries weighed in on this topic and told Beverage Master Magazine about their experiences with software.
BOSQUE BREWING CO.Albuquerque, New Mexico
One brewery that Beverage Master connected with on the topic of software is Bosque Brewing Co., which has multiple New Mexico locations in Albuquerque, Bernalillo, Santa Fe and Las Cruces. With a history dating back to 2012, it is one of the largest brewing companies in the state and has grown from a small startup producing 350 barrels the first year to more than 10,000 barrels annually.
Bosque’s production manager Tim Woodward told Beverage Master Magazine that his brewery uses Ekos for inventory and production management. He also uses a few self-built spreadsheets for forecasting, sales and analysis. The brewery handles accounting with separate software not directly tied to Ekos functionality.
“Bosque has been using Ekos since 2015,” Woodward said. “At the time, it was very affordable and relatively simple to use. The tools in Ekos addressed what we needed most: inventory management. We are able to track inventory, manage orders, invoice sold product, track costs, review pertinent data and oversee production steps with relative ease.”
But while fully functional, Woodward said he often runs into little “Ekos glitches” that can be frustrating, such as the services being laggy.
“Cleaner, more functional report systems with intuitive interfaces would be wonderful,” Woodward said. “I pull a lot of data from Ekos on a daily basis, and sometimes manipulating the report parameters to pull accurate data can be cumbersome. Ekos has done a wonderful job developing product planning calendar with drag and drop features, which is very lovely. They have other modules, such as order hub and keg asset tracking, which we do not use or have not found to work with our particular business model but are helpful pieces. Another offering which would be nice is perhaps a more robust server system to support software operation.”
ALVARIUM BEER CO.New Britain, Connecticut
Nick Palermo, the head brewer of Alvarium Beer Co., told Beverage Master about the software programs his team uses in New Britain, Connecticut. Alvarium launched New Britain’s first microbrewery, founded on the principle of creating an inclusive and communal taproom while revitalizing a historical city.
On the brewhouse side of things, Alvarium Beer Co. uses Beersmith to fine-tune recipes and DIY templates on Google Sheets for its calendar and brewing schedule, individual brew sheets and inventory of raw materials and packing materials. Alvarium uses Google Drive to store nearly everything related to production, from brew logs to SOP’s, manuals, inventory and supplier contact information.
“Beersmith is one of the founding tools that many brewers have used in a homebrew or production setting, allowing quick integration and easy ways to edit recipes with something that is fairly familiar and quick to learn,” Palermo said. “We ended up choosing to use Google Sheets and Drive because of the ability for company-wide visibility and editing capabilities.”
“We are an increasingly growing brewery in Connecticut, and such quick growth over the last couple of years has led to use needing to be able to combat the ebbs and flows of this industry,” he said. “Whether we need to make a quick change to the schedule, edit a recipe from home or have different departments be able to access information without complication, we found our method has been working really well as we expand.”
“I’d say the biggest challenge we face with our method is the need to manually enter all of our data and make changes in the templates as we see fit,” Palermo said when asked about challenges with Alvarium’s current software. “Lack of auto-entered data does take up a little more time when it comes to keeping track with inventory and can lead to some mistakes.”
In the future, Palermo would like to see more flexible software plans for different brewery sizes and needs, with costs to match. He said that having a method to integrate software programs more easily into companies with a system in place or smaller staffing structures would also be helpful.
Cherokee Robbins, the director of sales for Alvarium, told Beverage Master Magazine about software this brewery uses for other purposes.
Robbins said that Alvarium uses Google Business software, such as Gmail and Google Drive for recordkeeping, Google Sheets for reporting and inventory and Google Docs and Google Calendar for events, appointments and employee schedules. She says these pieces of software are user-friendly, easy to access and meet requirements for digital storage. Alvarium uses Untapped for Business to store information about brewed beers, to allow customers to view beers and check in and to use the menu board to list available products. Robbins said this software is user-friendly and great for keeping track of customer reviews, archiving past beers and helping other businesses find products.
Alvarium uses Square POS in the taproom for on-premise and online transactions. The team likes this software because it is easy to add, customize and categorize items with an online store that is set up as an extension for customers to shop. However, she has noticed that sometimes items can “disappear” in Square POS, or if they are intentionally hidden, customers can still find them online and order something that is no longer available. After experimenting with various email marketing platforms, the brewery uses Mailchimp for analytics and to monitor communications with its customer base. However, sometimes these emails have ended up in spam folders even after the team has certified and legitimized its domains.
After interviewing approximately nine different CRM/ERP-related software companies, InSitu hit the four major categories of importance for Alvarium’s sales and distribution team: QBE integration for accounting, inventory management, mileage tracking and logistics for sales routes and customer relations.
“This is a relatively newer software for us, as we started using this in February of this year,” Robbins said. “There is much to learn with all of its functions, but there are times when we may have delayed connectivity issues with its integration to our QBE. Our account representative has been great with staying in communication and finding resolutions for us when we need help, so that is a huge plus. Sometimes support teams with software can be hard to get in touch with when you need something fixed right away.”
Other types of software the Alvarium team uses include Adobe Illustrator for signage and labels, Canva for business cards and marketing and QuickBooks Desktop Enterprise for accounting and payroll. It uses Prolific as its delivery-routing software to optimize routes for delivery drivers with self-distribution, Eezycloud’s remote desktop for multiple users to access QBE and Workable and Glassdoor for job postings and recruiting.
When asked what she would like to see in future brewery software offerings, Robbins said, “It would be ideal if all of the platforms we use can be lumped into one software for a brewery our size, especially because we have a hybrid business model with the taproom, self-distribution and now working with a wholesaler. I know there are options like Encompass or Lily Pad available, but those can be pricey and are geared more towards larger distribution networks. I have also heard of a few software platforms that other breweries have worked on creating themselves in the past few years that fit close to what we ideally would need, but there seems to be an important element missing such as integration to QBE, delivery routing software logistics or the CRM portion for our sales force.”
MUDDY RIVER DISTILLERYBelmont, North Carolina
Caroline Delaney, co-owner and CFO of Muddy River Distillery, told Beverage Master Magazine how her company approaches software in Belmont, North Carolina. Muddy River is the oldest rum distillery in the Carolinas and launched in 2011 with 500 square feet of space in an old textile mill before growing its production from 35 bottles per day to more than 1,200.
Delaney said that her distillery uses QuickBooks for accounting and payroll and Square for POS and retail sales. She noted that QuickBooks is straightforward for day-to-day accounting, and Square has the lowest credit card processing rates without a monthly fee. She was familiar with QuickBooks from previous companies and says while it can be limiting, the next step up in accounting software is much more expensive, and most offerings require contracts.
Yet running sales reports with multiple customers, states and distributors can be tricky and lengthy, she said, plus QuickBooks raised its payroll fees this year.
“It seems like once you are signed up with Whiskey Systems or similar systems, they have all your data and it would be hard to switch back or to another software,” she said. “And the monthly fees are quite a bit higher than POS systems, so that will add up. Since we were pretty limited here in North Carolina, we weren’t able to sell unlimited bottles and cocktails until late 2019. We are under construction on a building where we will actually have a bar and event space, so I am looking into changing payroll and POS systems.”
Delaney shared that Muddy River Distillery does not use distilling software for federal reports but that her husband, Robbie, developed his own system for that purpose and is still using it with the distillery’s production manager.
“I know he has spoken to some of the companies, but has not made the switch because of the monthly fees and not wanting to get into a system and get stuck with them,” she said.
STILL 630St. Louis, Missouri
Another spirits producer that shared details about its software usage with us is Still 630, which makes award-winning, handcrafted spirits in downtown St. Louis, Missouri. David Weglarz, the owner and distiller of Still 630, uses as many organic, local ingredients as possible in his spirits, with an old-world double distillation method that captures all the flavors while consistently embracing the adventure of experimentation.
Weglarz told Beverage Master Magazine that he uses Google software for his distillery’s spreadsheets and recordkeeping. He chose this option and still likes it because it is free and not localized to just one computer that could be damaged.
“It allows us to edit simultaneously from different locations, and since it’s not based on one physical computer, it’s more safely guarded against a catastrophic loss,” he said.
However, Weglarz acknowledged that Google Docs and spreadsheets are not specifically built for distilleries, so challenges have inevitably occurred while using this strategy.
“It’s just an excel-type format so I had to build my own spreadsheets to make it work correctly,” he said. “But I did that, and now I have my own personal distillery software. It’s certainly not as fancy and sleek as the pre-packaged software solutions, but it works and the price (free) is right!”
In the future, Weglarz would like to see more cost-effective software options offered in the distillery industry. He says that his distillery is priced out at the moment, something many craft beverage producers can likely relate to.
Conclusions and Opportunities
Based on our conversations with craft beverage producers across the U.S., a few things stand out about what is working for software and where improvements can be made. In general, craft beverage producers are pleased with user-friendly software that offers multiple applications, features analytics to optimize processes and gives multiple users access to shared data. Affordability is paramount for craft beverage producers, and if software seems too costly, they often settle for free solutions that require more manual entry and monitoring despite the extra labor and risks.
There is a need and demand for software for small breweries and distilleries with limited budgets and modest distribution networks. Many current solutions cater to large operations and are financially out of reach for smaller and emerging businesses. Integration is important to brewers and distillers, yet many of these businesses feel that they understand their needs better than what any software provider could provide and prefer to take a DIY approach, creating their own internal systems to get the job done internally. Therefore, there are significant opportunities for software companies to focus on the basics and adjust their offerings with tiered options to connect with breweries and distilleries in mutually beneficial ways.
How Start-Up Distilleries Can Get It Right the First Time
By: Cheryl Gray
Starting a new distillery can be a daunting task. Failing to do it properly will inevitably cost the owner time and money.
The industry is flush with experts to guide start-up distilleries in the right direction when it comes to equipment, building, layout, local health regulations and environmental requirements – virtually everything to consider when launching a well-tooled distillery.
Few companies know better what a start-up distillery requires than VITOK Engineers, headquartered in Louisville, Kentucky. The global consulting engineering firm, launched in 1967, offers a singular source for multiple engineering disciplines and targets a wide range of chemical plants and manufacturing facilities, including distilleries.
In its early days, VITOK Engineers was local. Still, its engineering expertise was far-reaching, with a client list that the company says included the United States Navy, for which VITOK designed and built CO2 scrubbers for the Navy’s nuclear submarines. By the mid-1980s, new leadership at the company introduced the distilling industry to VITOK, which already had a solid foundation for the design of a complete chemical processing facility. In the 40 years since, VITOK touts a solid reputation for designing and optimizing every aspect of distillery production, with more than 500 distillery projects sprawled across the United States, Canada, Mexico, the Caribbean and Africa. The projects range in size from small craft distilleries to more established facilities and some of the world’s largest and most recognized distilleries that manufacture up to 50 million proof gallons per year.
CJ Archer is Vice President of Marketing for VITOK Engineers and has been with the company for nearly two decades. As an electrical and controls engineer licensed in more than 20 states and the Caribbean, Archer points out what sets VITOK apart from its competitors.
“What sets VITOK Engineers apart from other companies is our ability to serve all engineering disciplines within our organization,” he said. “Continuity and flow of information between engineering disciplines is important for the successful completion of a large project.”
Archer says that with distillery start-ups, it is important to gather critical information up front, beginning with what kind of spirits the distillery will produce and the proof gallon output the client desires.
“Our engineers will then produce a Process Flow Diagram (PFD),” he said. “This helps to determine the vessel sizing, pump sizing, still size, boiler size and chillers.”
The next steps, Archer says, are evaluating current infrastructure, such as available sewage, water and power, to help determine any additional power distribution equipment, water treatment or RO requirements that may be needed.
“This PFD and supplemental infrastructure equipment will reveal the size, scale and types of equipment. From there, our staff can calculate and perform a Total Installed Capital Cost Estimate for the facility.
VITOK Engineers can design and optimize every element of the beverage distillation process, from the receipt of raw materials to the proofing and bottling. Our staff can design the process, specify the equipment, design the building, define classified areas, specify and design instrumentation and controls and program the controllers, even tablets. We can also help you with the intricacies of environmental permitting.
Our depth of experience enables us to provide clients with an expansive overview of projects, as well as a unique, cross-disciplined perspective on the design process. As an employee-owned company, the staff members of VITOK take a vital interest in building loyal client relationships. We are constantly striving to improve our services and technology while providing cost-effective solutions for project challenges,” he said.
Archer points out other equipment and protocols distilleries can deploy to optimize production. Examples include automated control instrumentation, which serves the dual purpose of standardizing the process and freeing up labor. Another factor to consider is achieving maximum energy efficiency, which saves money. Archer explains that this means distillers will want to know if they can achieve an energy benefit from chillers, versus a cooling tower or aquifers. Examining the mash cooling systems and techniques are also on the checklist. Distillers may want to look at introducing solar to enhance so-called “green” branding, which Archer says is not a significant increase or decrease to the overall cost of implementation.
Another point Archer mentions is installing power efficiency equipment to help save on energy costs. The power efficiency equipment helps distilleries coordinate with utility and correct for any apparent power overages. Also, comparing continuous operation, versus batch operation, as potential energy savings is another area to consider. Finally, Archer says that examining the number of shifts, timing and staging process of operations can help improve energy efficiency.
Another expert company that assists distilleries with installing equipment for both short- and long-term use is Trench Drain Systems, which manufactures and distributes drainage systems for distilleries, wineries and breweries. Engineer Michael Schroer started Trench Drain Systems in the basement of his home in 2004, selling only about three products. By 2017, the company had purchased a 10-acre property with office and warehouse space large enough to service a clientele that now spreads throughout all 50 states, Canada and the Caribbean. Schroer explains why his firm is different from others in the industry.
“When buying a drain system for your distillery, winery or brewery, you will most likely have to go through a distributor who interfaces with a manufacturer,” he said. “Your distributor usually won’t have the knowledge base to cover all the particularities of the drain and its installation. Trench Drain Systems is both a distributor and manufacturer of drainage systems. We have a full understanding of all brands of drainage systems. We can make custom drains when needed. We have a full engineering department and provide drawings for your installation, something that a distributor doesn’t do. In short, we are specialists in drainage systems. We have the flexibility to handle many product lines while being able to customize your drain when needed.”
Schroer describes what key steps his company takes in helping new distilleries make the right choices when it comes to installing a drainage system that meets specific needs.
“I like to start this discussion by asking who owns the property where the project is being done. The reason being, if that facility is rented, the process is going to be a five-year project, and if the owners see themselves going to another location that they will own, the trench drain can be downgraded a bit. There will be differences in the drain channel chemistry, in general, when we are speaking about the drains of beer vs. wine vs. distillate manufacturing.
However, if you have a five-year lease on a building and have to foot the bill for the trench drain, consider a drain that will last as long as you need it. When you get into phase two of your project, where you own the building, it makes sense to have a longer vision for the drain design. That includes having a system that will handle the rough and tumble start-up period when construction equipment may be involved. It also is good to look at your future development when you may want to showcase your process and change your look from something industrial but practical to something more commercial or customer-friendly and aesthetically pleasing.
After that detail is revealed, we need to consider the temperature and chemical demands of the process on the trench drain system. Breweries are the most demanding on drains, as they have high-temperature solutions and a wide range of chemicals that are put into the drain. And breweries will have differing drainage needs in different parts of the facility, depending on how the consumer will interface with the operation. Wineries and distillates don’t see the high volume of daily cleaning and temperatures as does a brewery. They generally don’t need drain systems that have high-service demands. Generally, these facilities have a lower drain budget unless the owner is going for an aesthetic, which costs more,” he said.
Yet another company that helps new and existing distilleries make critical equipment choices for the long and short term is Della Toffola Group. Headquartered in Italy but supported in the United States by Della Toffola USA in Santa Rosa, California, the company positions itself as a global frontrunner in designing and manufacturing state-of-the-art technology solutions for a wide range of beverage products. Della Toffola recently entered the distillery market by acquiring Frilli Srl, another worldwide company founded in 1912 that specializes in designing, building and refitting distilleries and distillation systems.
Experts agree that careful equipment planning is the key to a successful operation, no matter the size of a distillery or whether it is a start-up or a more established production house. Those experts also agree that success begins with a thorough consultation with a company that respects a distillery’s immediate needs and what it will take for the operation to expand.
The craft distilling movement is growing larger every day in North america. In 2003 there were approximately 60 operating distilleries in the USA. Fast forward to today and there are over 2200 active distilleries. When it comes to starting a distillery one daunting challenge every business owner faces is equipment selection. Selecting equipment is often done by forecasting demand. Without any sales history this forecast is tricky to create. Most folks go about deciding what equipment to buy based on budget and what kind of quantities of spirits are expected to be sold. If you ask almost any distillery owner if they are using the same size equipment they started on they would tell you no. Nearly every established distillery has needed to add on additional equipment or sell their existing equipment to bring in larger equipment to meet demand. Selecting the right size equipment is a critical decision, which I would like to help you make. To better inform you let’s explore common equipment sizes and examples of distilleries expanding.
The first question often asked by a new business in planning is how large of a still do I need?
The answer to this question will not be the same for any two people. Instead of trying to provide a definitive answer let’s talk about the potential output of different size stills. To first define the potential output it is essential to decide on product line up. The still used to distill rum is very different from that for vodka production. If you are planning to distill gin, you certainly do not want to use the same still for distilling whiskey. What I can tell you with certainty is that you will outgrow a homemade 50 gallon still before you even open the doors of your distillery to the public. Let’s also explore the potential output of stills to compare and contrast their potential capacity.
A 100 gallon still often much less expensive than larger stills and is the size selected by some start up distilleries that are starting lean. A still of this size can only produce small quantities of distilled spirits at a commercial scale. Further a 100 gallon still requires considerable time spent in labor operating it with not very good returns for the labor. Although a 100 gallon still is going to be less expensive than bigger stills, it is likely that demand for spirits will outstrip the capacity of a still of this size quickly.
A 500 gallon still has the capacity to produce a solid amount of distilled spirits. In fact a 500 gallon pot still is one of the most common size stills you will find in new craft distilleries. A still this size has the capacity to produce 2 barrels of whiskey per day if well managed. This is plenty of whiskey for a startup distillery. Depending on your business model a 500 gallon still may provide plenty of capacity for several years. A strong successful distillery will likely outgrow the capacity of this still within 5 years.
Continuous column stills are measured based on column size diameter For simplicity we will call them column stills in this paper. An 18 inch column still will process 9 gallons per minute of wash. This means on a given work day this still has the capacity to produce up to 25 full size barrels of whiskey in a single day. As you can gather, this is vastly more efficient than a pot still.
For a column still to operate it will take a sizable quantity of mash to produce this much whiskey and therein lies the largest challenge for a small distillery. To grow into running a continuous column still requires immense resources in capital and real estate compared to a column still. A distillery running a column still will need much larger, cookers, fermentors, heating and cooling capacity then is commonly utilized when operating a pot still.
For many established distilleries who are selling a decent volume of spirits the addition of another pot still may not be the best choice to increase the production of your distillery. For many whiskey producing distilleries the logical leap is to grow your production by adding a continuous column still. If the intent of your distillery is to be a regional or multistate distributed business a column still might be your best choice.
Lets Look at Two Examples ofGrowth in a Distillery
At Grand Canyon Distillery they launched their business in 2017 with a single 250 gallon still. With goals to produce grain to glass bourbon, single malt whiskey, vodka, rum and gin. These ambitious plans and diverse portfolio quickly stretched the limits of their production capacity very early on. Within 9 months of launching their spirits the distillery worked out a large distribution deal that landed them in nearly every liquor store and grocery store in Arizona. If the distillery was going to meet their growing demand for white spirits there would be almost no room to distill whiskey to age. With whiskey being the primary long term goal, an expansion of equipment was needed. To increase capacity Grand Canyon added additional distilling equipment far sooner than anyone expected. With the addition of a 500 gallon still to support the demand for production, the folks at Grand Canyon got back on track to be able to distill enough product to meet demand. Only 3 years after the second still was added to their equipment Grand Canyon added a 3rd still to increase capacity even further.
At Finger Lakes Distilling they launched their distillery in 2008 with a single Holstein pot still.
Only 3 year after launching the distillery had outgrown their capacity to produce enough whiskey to meet demand. Finger Lakes took a big step up in production and added a 12” column still new cooker and larger fermentors to their equipment lineup. With the addition of this still Finger Lakes Distilling had increased their capacity 10 times. In the 10 years since they added this column still the distillery has consistently been able to meet demand with a much lower labor cost per proof gallon produced. In this example the addition of a column still allowed Finger Lakes to gradually increase their production without the limitations that come with a pot still.
As new distilleries move from establishing their foothold in local markets to growing state wide and beyond. A strong growth in demand will often follow this growth in territory. In many instances especially with whiskey the demand will outstrip supply and action must be taken to increase production. For anyone who has been to any of the bigger distilleries in Kentucky or Tennessee, you would have seen that every big distillery operates a continuous column still for whiskey production. A continuous column still is vastly more efficient on many levels. Continuous columns have much larger output per labor hour and use much less energy than a pot still per proof gallon produced. Stepping up from using a pot still to a continuous column still is a logical evolution and is a step that nearly every whiskey producer will make at some point when they reach a certain size.
In the overly social world that we now live in, it can be hard to stand out. How does a brand become noteworthy? What makes a brand worth talking about?
While you diligently craft your new alcoholic beverage, with hopes of becoming a formidable brand, it is important to remember as good as it may taste on the palate, it must also be as memorable to the imbiber. What do people see when they think of your brand? What feelings are evoked beyond an inebriated mind? Will people run to their local liquor store to purchase it? Now that production has finished, you know you have made a quality product. It is time to build a brand that is indeed something to talk about.
Fortunately, you have access to millions of people worldwide in the palm of your hand. One social media post can turn your brand into an overnight success. The truth is it does not happen overnight. There are strategies implemented before top-tier brands disseminate their marketing campaign to the masses. But, with just one post or compelling article written by a reviewer, a brand can quickly become a household name. Should you consider influencer marketing? It is an effective tool, but it is not necessarily the only way to spread the word. Instead, consumer reviews and testimonials are part of a long-term marketing plan for sustainable growth. View your customer as a micro-influencer who will host parties at their home, for example, and share your beverage with guests. They will also share photos and videos with their family and friends on social media. It is up to you to guide them, so let’s get started.
Build a Sustainable Strategy
What most brands learned once social media became a tool to advertise is that it can be quite exhausting. Let us be honest; it is a free advertising tool that can yield impressive results when used wisely and innovatively. But guess what…social burnout is a thing! Most brands hit the ground running only to find out that they have run out of stamina and, more importantly, marketing content. It is important to build the ship before you set sail. Further, you must be building marketing materials that can be used for the entire year! If you are fortunate to hire an editorial or marketing manager, they will help you plan and execute marketing strategies that are viable daily, monthly and yearly. The biggest mistake that new and old brands make in modern marketing is thinking they can build as they go or create limited marketing resources. Remember, view your brand as a ship. Would you set sail with holes in your boat or without life jackets? Would you trust a captain who just goes where the wind blows or someone with skills, expertise and instincts? Of course, you will have to take risks, but your ship should still have an anchor.
So, how do you build a sustainable brand? Your first task is to discern the “why”? What makes your alcoholic beverage unique? Is it premium gin? Does your brand use sustainable production methods? Is it a family-owned business? You need to build the story to draw a connection to your brand. White Claw is a notable example of a low-cal RTD beverage that jumped in front of the line from what seems like out of nowhere. Their brand is built around a health-conscious consumer who enjoys drinking without worrying about the scale. They found their “why” and then focused on reaching their targeted consumers. Some consumers gravitate toward brands that have a compelling story. Some brands have attached their beverages to an impactful cause, pledging that a portion of their profits will go towards it. Back Country Brewing, a brewing company located in Squamish, BC, has effectively incorporated giving back to the community as part of its brand ethos. They have also effectively created a brand built off creatively thought-out branding. The continuous colorful and playful references to the outdoors are displayed on beer cans and paired with names that complement the brand’s rustic outdoors theme. Damn Alligator Just Popped and Don’t Cross the Streams are great beverage names that stand out but are in alignment with what their consumer would expect.
Once you have figured out the “why” and what makes your brand unique, you can start to build marketing materials around this. It will also help you design a logo and select colors that you will utilize throughout your marketing initiatives. This stage is just as important as the product development stage. The same amount of care you put into ingredients, quality and taste must also be applied now. So, you are ready to get started. What is next? Consistency!
Stay Consistent
Stick to your plan and only make minor adjustments. The foundation of your marketing strategy should be solid. It is okay to make minor variations, but your goal should be to build and evaluate your initial plan. It is easier said than done because this is a competitive industry. Do not forget your “why.” Focus on who you believe would enjoy your beverage and stay laser focused. Devise a marketing plan that includes a calendar that you religiously follow. Always be two steps ahead. What does this mean? Some months of the year have holidays or special days like National Pancake Day. When creating marketing materials with images, blogs and videos, mention and highlight these designated days.
Unfortunately, there are no days off. There is nothing worse than looking up a brand online to find that they have not posted on their blog for a year or last posted on their social media a week ago. Curate behind-the-scenes features that allow your consumer to see how the beverage is made. You can also give them a glimpse into the trials and tribulations of your business experiences. Do you label your bottles by hand? Share this! It is easy to get discouraged initially. The idea that no one is looking will cross your mind several times. What you do not see during this time is the opportunity to push boundaries and try things that are out of the box before your consumer has an attachment to your product, and then there is little room for change. If you decide to build a blog to support your alcoholic beverage, view it as a mini-magazine and schedule a feature at the same time every week. Be sure to include it in your newsletter along with new product launches or sales.
As you build a consumer base, predictability is the only way to stay afloat. As stated above, White Claw appeals to the wellness consumer, and Back Country Brewing the outdoors consumer. There is no need to reinvent the wheel. Expand and elevate your initial marketing strategy. Add new elements or products that complement it. This will help you stay consistent, give you more time to engage with your consumers and build a brand that is not a one-hit-wonder.
Imagine Your Brand in the Future
Where do you see your brand five years from now? Ten years from now? Do not get caught up in current trends. This is why a sustainable strategy and consistency are the gold standard. You may have wondered why that blush wine in the odd shape bottle still does well with little marketing. This is what long-term, effective brand development looks like. This vineyard’s goal was to design a bottle that was aesthetically pleasing to the eye so it would be a great decor piece, while at the same time elegantly displaying the wine. This is a brand that understands that it appeals to a consumer who likes the finer things in life. Consumers will stay loyal to a product because it is consistent and because they feel connected to the brand’s mission.
Will the consumer tire of your product in the summer? Or are you a lifetime brand, like many exemplary legacy brands built around sports or music? If you would like to be the go-to campfire brewer, keep an eye on this consumer’s changing habits and desires to grow with them.
TAKEAWAYS
Strategy: A solid blueprint will steer you toward success.
Consistency: Keep going even when no one is looking.
Located in the arts district of Los Angeles, the Greenbar Distillery operates in a historic brick building built in 1905 and positioned in the same diverse neighborhood that houses iconic residents like Warner Brothers Music, Soho House and Hyperloop. Intermingled with high-end coffee shops, trendy barbershops and homeless tents, husband-and-wife team Melkon Khosrovian and Litty Matthews transformed an old strip club into the Greenbar Distillery in 2011.
“Our space is colorful, modern, vibrant and warm,” said Khosrovian. “It is multicultural and optimistic, invoking the classic positive vibe of LA, where people come to fulfill their dreams, whatever they may be. There are giant windows overlooking our production floor, so customers can see and understand what we’re all about. We were the first distillery in Los Angeles since at least the Prohibition Era. For the true cocktail lover, Greenbar Distillery was the only exposure to the industry for at least a decade, so we wanted to make sure that if cocktail lovers found us, we did the best possible job to make their cocktail experience positive and up to all of their expectations, while showing them what goes into running a distillery.”
Khosrovian tells Beverage Master Magazine that the distillery came about out of necessity to keep up with the demand for their homemade spirits beginning in 2004. Neither Khosrovian nor Matthews had any actual distilling or spirits experience. They met in graduate school, and their experience with spirits was only from the consumer side of the bar. But within two years, their home distilling hobby blossomed and became more work than a hobby.
“We were engaged and doing the normal family circuit, meeting each other’s families, relatives and friends,” said Khosrovian. “For us and our heritage, that meant hosting big gatherings with big meals and frequent toasts featuring our homemade, fruit-based, high-proof alcohol. Litty is a trained chef and foodie with an educated palette, and she considered our homemade alcohol to be slightly medicinal and, frankly, not very good. She would politely pick up her glass for the toast but set it down again without drinking. That was awkward for me, so I set out to make something she would enjoy by incorporating the same culinary skills and techniques she used to produce her amazing food. Additionally, we took trips to the farmers’ markets to find ingredients to add in different ways and improve our alcohol’s flavor and aroma. We had some success, which we quickly bottled for future family gatherings using homemade printed labels. The ultimate feeling of success was when family and friends asked for more, and then friends of friends started requesting bottles of our product.”
Khosrovian said that interest in their homemade spirits sparked a serious conversation about which direction to take their success. Luckily for all of us, they chose to start distilling on a larger scale. The first step was renting a small space in a nearby town that allowed a slightly larger scale of production to satisfy the demand from friends and relatives but also allowed them to be able to connect with and supply some of the local bars, hotels and restaurants that had an interest in using their products.
“This was pre-pandemic when 80 percent of our business was related to being used as a bartender brand in restaurants, bars and hotels,” said Khosrovian. “We had tried to gain the home drinker’s interest by putting recipes on our labels, setting up stands at stores with recipes that they could make at home and hosting classes and tastings to try and see where we could improve our marketing and increase bottle sales, but nothing seemed to work. Actually, the reverse happened, even though our drinks received rave reviews. We were totally baffled but finally realized the only way to pursue our dream of showing customers how to drink better and more interesting things using our products was to make it easier for the consumer and provide ready-to-drink (RTD) cocktails.”
So, Greenbar started offering three spritz cocktails in cans, and as Khosrovian would later admit, that timing was crucial because shortly after, the pandemic closed the bars, hotels and restaurants, literally all of their income sources.
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Pandemic Problems Lead toSuccessful Solutions
“The pandemic took away our revenue stream, and since we already found that consumers were unwilling to put in the work to make our cocktails at home, our only choice at this point was to can our cocktails and provide them as additional RTD options,” said Khosrovian. “Initially, we made everything in-house, including vodka, but now our base alcohol is made to our standards off-site. We use the base alcohols to ferment things like rum and whiskey on site and then redistill things like gin, liqueurs and amaro using our unique flavorings. We initially made and carbonated our RTDs in-house and used mobile canners for packaging, but it became very costly and difficult to get on their schedule and adhere to their specified run sizes. Forecasting our needs that far in advance was also a challenge, so about two and a half years ago, we invested in a medium-speed canning line that allows us to do 100 cans per minute in-house, on-site. With a two-million-dollar investment in additional accessories, we can do everything in-house, from creating the spirits to creating carbonated beverages to packaging.”
“Today, the RTD market remains about 75 percent of our business, and surprisingly, most of it is in the NA (no alcohol) market,” said Khosrovian. “That fact initially humbled us, but as we began to work with markets, who were quite literally our lifeline to the public, we saw that they were getting a lot of questions about NA or LA (low alcohol) options. Those markets were rapidly growing, but consumers wanted something different than only the juice additives or normally available seltzers.”
Khosrovian said they dove into the NA topic to see if it was a legitimate option because the idea of cocktails without alcohol was unfamiliar to him.
“We needed to know what the consumers were really after in these types of drinks,” said Khosrovian. “So, we talked to consumers who either drank alcohol minimally or not at all and found the qualities consumers were after in these types of cocktails were related more to the experience of drinking the cocktail than the actual effects of the alcohol.”
• They wanted something that changed their mood. With proper flavoring and layering, consumers will respond to NA cocktails in the same ways they do to complex, layered, alcohol-based cocktails.
• Consumers wanted something that reengineered their brains and jolted them out of work mode and into a more social mode, similar to the vibe that alcohol-based counterparts do.
• They wanted something they could drink comfortably and slowly, changing the tempo and brain function to initiate a slower pace to their mental state and social interactions.
“We began to ask ourselves if we could provide these things with NA cocktails and have them function and deliver the overall experience similar to their alcohol-based counterparts. The answer was obviously yes, because consumers are looking for more of these types of options. As a result, NA cocktails can be enjoyed more often and in more situations without the limitations or consequences of alcohol consumption.
Organics, Sustainability andOne-Bottle-One-Tree
Khosrovian tells Beverage Master Magazine that sustainability wasn’t a primary goal of Greenbar Distillery but rather an accidental, fortunate outcome of their business philosophy. In California, where the growing season is year-round, Khosrovian always requests the best aromatic and flavorful produce from partnering farmers. When he inadvertently received a harvest from a certified organic orchard without his knowledge, a batch of chocolate orange vodka was noticeably different. It was better, as in more aromatic and more flavorful, but different. That experience from a grower growing organic to make sure his farm would be a lasting legacy for future generations made such an impression because of the increased flavor and aroma that Khosrovian and Matthews immediately decided to use only organic ingredients from that day forward. But they also researched and learned more about implementing organic and sustainable practices in other production areas.
“We applied this same way of thinking to our packaging, including bottles, printing, labeling, capsules and so on,” said Khosrovian. “We traditionally used heavyweight bottles with laminated labels on virgin paper that would last 100 years. But who would actually want to keep these things that long? We continually asked ourselves what else we could do to help. Both of our heritages have a tradition of planting a tree for every baby born in the family, and in a way, these bottles are our kids. So, we started a program to plant a tree for every bottle we sold, and the Greenbar name was born. It just felt right to give back for our success. We communicated this to all of our customers, and it sounded noble, but no one knew what it actually meant. We needed verifiable results, so after the first year, we hired agencies to determine what effect this action of planting high-canopy trees in return for bottle sales really had on our carbon footprint. In consumer terms, the results showed that if the average American drinks one and a half ounces of our spirits in a day, they are carbon negative for that day. It’s a little thing, but eventually, it adds up and makes a difference. Since 2008, we’ve planted over a million trees, equating to 10 to 12 million carbon-neutral people daily.”
“So, now we ask, what has your drink done for you?” said Khosrovian. “We’re not revolutionizing or stopping climate change, but it’s something for the consumer to consider. We still have to deliver on our promise of drinking better and more interesting things with great taste, but if the consumer has a choice between products that give them the same or better experience, then maybe they can look towards products that go beyond the spirit and help out in other ways.”
Staying Within Yourself
“I would tell anyone starting in this business first to get to know yourself and be true to your feelings because, in the end, that’s what you’ll end up doing,” said Khosrovian. “Don’t shortchange yourself or your possibilities because you don’t have to follow anyone’s footsteps in distilling. Grab your chance to be creative, and whatever you do will work and be satisfying. Some will like it, some won’t and that’s okay, but fakes usually don’t last. We’ve evolved over 18 years from helping restaurant, bar and hotel industries serve those who prefer to drink better outside of the home to helping customers drink better wherever they want to consume our products. We’ve learned things the hard way, but frankly, we got lucky on many business fronts as well. We are very good at manipulating and layering flavors to make our products delicious, flavorful and interesting to the consumer. In return, they appreciated and wanted more. Our love and passion come through in our products, so much so that as a loving gesture to my wife, Litty, there is a heart on nearly every one of our products, signifying how we got all of this started.”
Khosrovian and Matthews also look for that same creativity, passion and willingness to play and learn in their employees. The freedom to express oneself and occasionally screw up is part of being a Greenbar Distillery employee. Khosrovian says mistakes happen and are okay because that learning experience will lead to improvements and ultimately result in happy customers.
Consumers Drive Future Goals
“We will be going more towards the whole cocktail as our product versus only ingredients,” said Khosrovian. “This includes looking at RTDs in every format available, versus only base spirits. Our experience has opened our eyes to how much the customer is willing to embrace cocktails outside of the bar atmosphere, provided we can give them a similar experience and level of comfort. As happy as we are that the restaurant and bar world has returned, regularly going out to a bar can be inconvenient and expensive. We provide the best of the bar experience for consumers in every format possible, wherever they choose to drink better and more interestingly to enjoy our products”.
Greenbar Distillery now makes the most extensive portfolio of organic spirits globally. Joining their TRU Vodkas are CRUSOE Rums, IXA Tequilas, SLOW HAND Whiskeys, FRUITLAB Liqueurs, CITY Gins, GRAND POPPY and GRAND HOPS Amari and BAR KEEP Bitters.
“As a craft distiller, we always strive to meet the consumers where they are to ensure their craft cocktail experience is better, easier and more interesting.”
For more product information, or to learn more about Greenbar Distillery, visit or call:Greenbar Distillery, 2459 E 8th Street, Los Angeles, CA 90021, (213) 375-3668, www.greenbardistillery.com
