Category: Finance

The Impact of COVID on Beer Tourism

Cyndi
tourists having a beer taste test

By: Becky Garrison

As expected, brewery tours were among those hospitality offerings impacted by the ongoing global pandemic. While some experimented with online offerings, others simply closed shop or halted operations intermittently.

  For example, prior to COVID, Abil Bradshaw regularly gave tours of the Seattle-based Pike Brewing Company. Also, the brewery engaged Savor Seattle, a local tour provider, who gave tours daily. However, during COVID, Bradshaw moved to Spokane. Also, Savor Seattle ceased operations. While Pike remains understaffed and not in a position to offer tours, founder Charles Finkel can meet for a special tour at the brewery if given adequate notice. 

  Following are examples from a range of brewery tour operators regarding how they pivoted their operations during the past few years, as well as any plans they have for the future.

City Brew Tours, Portland, OR 

  At the end of 2019, City Brew Tours, a tour operator with operations in over 16 cities, had just taken over the operation of Brewvana Portland Brewery Tours. In this capacity, they operated the Original Portland Brew Tour and the Pacific Northwest is Best Tour, as well as private tours. Their Original Tour ran five hours long, visited four of their brewery affiliates and included a meal and beer pairing. The Pacific Northwest is Best tour is a shorter tour at  3 1/2 hours, with three stops and a craft beer pretzel snack.

  Like many other businesses in the hospitality industry, they stopped running their tours in March 2020 with no idea how long they would have to suspend operations. Also, they were unable to provide adequate employment for their beer guides and full-time staff. Chad Brodsky, the founder & CEO of CBT Group, LLC, reflects on this period of time. “There was no workaround and no safe solution to resume in-person tours during the worst of COVID-19. It took 15 months before we could slowly reopen brew tours in Portland, and even then, we had to take every precaution possible, including the limited number of guests, mask mandates, proof of vaccination and strict sanitation protocols.

  During the shuttering of their brew tours, they pivoted to virtual experiences under the brand Unboxed Experiences. Also, they repurposed Brewvana to be a beer lifestyle brand that offered a beer of the month club that explored a new beer city every month along with beer-making kits. This enabled them to bring their full-time staff back. Also, they were able to utilize some of their beer guides in leading online events, such as beer-making at home, beer and cheese pairings and ice cream float experiences.

  Since resuming operations in the summer of 2021, they’ve been able to reintroduce the two tours they were running before COVID-19. However, at times they had to temporarily suspend one or both of their Portland public tours due to the lingering issues brought about by the rise of COVID variants.

  According to Brodsky, staffing and finding reliable tour vans remain the biggest lingering challenges of COVID-19. He noted, “Our hiring process includes multiple steps and trial runs to ensure that new guides can safely lead a tour and are comfortable with the responsibility. The process takes time, and when potential hires decided it wasn’t for them, it would set us back and affect our ability to operate regular tour schedules. Plus, with a country-wide vehicle shortage, it took a long time to secure another passenger van to run more tours.”

Seattle Brewery Walking Tours, Seattle, WA

  Pre-COVID, Tim Lorang offered walking tours of breweries mostly in Seattle’s Ballard or Georgetown neighborhoods. These tours consisted of visiting three breweries for a guided beer tasting of four beers at each brewery. During this tour, he would talk about the beers and beer styles, along with the history of beers and focus on why Seattle was at the forefront of the craft brewing renaissance.

  Once COVID hit, he experienced a 69 percent reduction in his tours in 2020. Lorang experimented with designing webinars and making guides for beer tastings. However, he found this venture became problematic because he could not deliver beer samples to consumers, as he lacked the needed licenses required to send beer through the mail. Also, most breweries had a much more limited supply of beer on stock, and it proved tricky for him to come to a given brewery so he could film his segments. 

  In 2021, his numbers went up 340 percent from the previous year once breweries opened to the public. While Seattle was still not open to tourism, Lorang found that locals within the greater Seattle area booked his tours as they were desperate to go outside and socialize.

  As a number of breweries closed or changed hands, Lorang found he needed to reestablish a number of connections with breweries, hotel concierges, and other businesses that catered to the tourist trade, as many individuals were no longer working in the hospitality industry. Initially, he was limited to hosting tours outside with breweries, only allowing five people per table. Along those lines, the influx of customers wishing to explore the breweries, especially during the weekends, made it difficult at times to find space to host his tour group. During this time, proof of vaccination was a requirement to go on a tour.

  In reflecting on why he remains in business when so many other tour operators have closed shop, Lorang notes that one of the key reasons he survived is that he is a solo entrepreneur. “I don’t have a lot of overhead. I don’t have a van. I don’t have a lot of employees. I’m semi-retired. This is just a passion for me.”

Pedal Bike Tours, Portland, OR

  Since 2008, Pedal Bike Tours has combined two of Portland’s favorite activities by offering pub crawls on a bike. A typical three-hour bike tour would travel five miles and feature a tour of three breweries with a taster tray of six beers offered at each brewery. During the tour, the guide would talk about the history of the microbrewery movement in Portland.

  During COVID, they had no business in 2020, though they could resume business as usual in 2020 with only one of the breweries they frequented remaining closed. They gathered outside where there were no COVID requirements other than the occasional need to mask to go inside the brewery. Also, during this time period, they ceased doing scenic van tours in the Columbia Gorge area after losing their van. 

  At present, they are back to full operations. They do not plan on resuming van tours, choosing instead to focus on their cycling tours. Moving forward, they just added electric bikes, though the tours will not expand the distance they cover. At present, their biggest challenge remains the price of tours, as they had to raise their prices due to the cost of beer.

BeerQuest Walking Tours, Portland, OR

  Pre COVID, they offered a brewery tour and haunted pub tour and would average five to seven public tours a week. In addition, they offered private corporate tours. Once COVID hit, their sales were down by 80 percent. They had to shut down their brewery tour altogether after two of their partners went out of business. Also, those partners who remained open reduced their hours and days of operations. 

  Since COVID hit, their private tour business with corporate clients remains non-existent. Also, they struggle to find employees and remain low-staffed. At present, they offer three or four public tours per week. In particular, they could offer a lower-priced shorter version of their haunted pub tour, which appears to work better for their customers. 

Santa Rosa Beer Passport, Santa Rosa, CA

  In 2016, Visit Santa Rosa created the Santa Rosa Beer Passport as a way to explore and celebrate the world-class craft beer scene in Santa Rosa. While Sonoma County is best known for producing world-class wine, a band of brewery brothers and sisters began pioneering the production of artfully crafted local beers. As a result, this city evolved into a mecca for microbrew maniacs.

  Based on the massive popularity of Russian River Brewing Company’s annual two-week February release of Pliny the Younger, Visit Santa Rosa launched FeBREWary. This venture was a way to promote Santa Rosa’s brewing heritage, showcase artisan producers in the craft beer industry, educate the greater public and unite those who make local beer with those who love it during an otherwise slow time for tourism in Santa Rosa.

  Participation in the self-directed Beer Passport program is simple. At their leisure, craft brew lovers can take their passports to each of the participating 14 breweries and receive a stamp. After collecting at least 11 brewery stamps during the entire month of FeBREWary, participants receive a custom-designed, commemorative oversized Santa Rosa Beer Passport bottle opener medal and lanyard.

  This model proved to be a low-cost way to introduce visitors to the local brewery scene and a tool to inform potential consumers of the changing developments.

How to Get a Grant to Support Your Craft Beverage Business

Cyndi
grant contract paper

By: Alyssa L. Ochs

Starting a brewery or distillery can typically cost anywhere from $250,000 to $2 million, which is a lot of money to raise if you’re starting your new endeavor from scratch. Craft beverage businesses often need money from outside sources to launch and continue operations, and one potential source to look into is grant money.

  Grants can be hard to come by in this industry, but they do exist and can be worth the time and effort of applying for a sizable sum of no-strings-attached cash. If your brewery or distillery is looking for funding to get off the ground, keep going or make an expansion, a grant may be precisely what you need to achieve your goals.

Common Needs and Financing Options

  There are many reasons a craft beverage business might seek grant money, such as upgrading a brewing or distilling system, building or expanding a taproom or increasing production capabilities. Grants can also be helpful if you are looking to hire more staff, invest in more eco-friendly approaches or save a struggling business from having to close its doors. During the COVID-19 pandemic, the food and beverage industry saw an increase in grant opportunities to help brewers and distillers stay in business despite public gathering restrictions and government-mandated closures. However, those opportunities were somewhat short-lived and not intended to sustain these types of businesses long-term.

  However, grants are just one of the many ways a brewery or distillery might support itself during challenging times. It is possible to solicit donations or loans from family and friends, tap into savings accounts, apply for a Small Business Association loan or connect with professional investors for funding. Mainvest is an example of a specialized investment platform for professional craft brewers. At the same time, crowdfunding campaigns are still popular options for businesses with good outreach skills and a solid social media following. Yet grants are a preferred source of funding in many instances because they do not require repayment but likely just a follow-up report in the future to prove that grantees are putting the funds to good use.

Examples of Craft Beverage Grant Opportunities

  Grantmakers typically make their awards in cycles that occur once or twice yearly. The opportunities are ever-changing, so it is up to brewery and distillery owners to keep up with what is available and the relevant deadlines. Some funders offer grants annually, while others are more responsive to urgent needs and step up to help during times of emergency.

  For example, the Washington Department of Agriculture Relief and Recovery Grant for Wineries, Meaderies, Breweries, Cideries and Distilleries was a response to COVID-19 and intended to support businesses disrupted by the pandemic because they primarily rely on in-person sales. The money for these $15,000 grants came from a Disaster Response Account managed by the State of Washington Office of Financial Management. Aside from government organizations, some corporations award grants in this industry as part of a commitment to the local community. Yelp recently awarded $25 million in total relief to support independent and local restaurant and nightlife businesses impacted by COVID-19, Amazon started a $5 million Neighborhood Small Business Relief Fund to help small businesses in Seattle with fewer than 50 employees or less than $7 million in annual revenue and Facebook launched its Small Business Grants Program that awarded $100 million in grants and ad credits for up to 30,000 small businesses in over 30 countries. The Restaurants Act was part of the American Rescue Plan Act of 2021 and allowed alcoholic beverage trade groups to specifically include tasting and tap rooms in the definition of establishments that were eligible for grants.

  However, one of the best grantmakers to know is the Brewers Association, which regularly awards Craft Beer Research and Service Grants with priorities that include hop and barley research, draught beer quality studies, sustainability-related projects, supply chain programs and applied research opportunities. In a recent year, the Brewers Association awarded 13 of these grants, totaling nearly $400,000. The Brewers Association also awards Diversity, Equity and Inclusion Mini-Grants to support a more well-rounded and welcoming craft beverage industry through media productions, educational trainings and special events.

  Meanwhile, breweries and distilleries may benefit from the USDA grant program that the USDA’s Agricultural Marketing Service administers and that supports research projects to improve marketing, transportation and distributed-related services. The USDA’s Value-Added Producer Grant Program is an opportunity for farmers that grow products for distilleries in rural parts of the U.S.

  Also, on the distillery side of things, there is the Spirit Hub Independent Distillery Preservation Fund that supports independent distillers and the American Distilling Institute Distilling Research Grant. The Kentucky Distillers’ Association Lifting Spirits Foundation and the Nearest & Jack Advancement Initiative offer additional spirit-related funding and resources.

  Early in 2022, the Michigan Craft Beverage Council recommended $335,000 in grant funding for 13 projects related to research and education to advance the efforts for craft beer, spirits, hard cider and wine. The council’s priorities included climate change impacts, pest and disease management, sustainable water use, wastewater discharge projects, new hop varieties and soil health. Meanwhile, Bottleshare Grant Programs has provided emergency assistance to the craft beverage industry for at least 29 breweries, six state guilds and 175 individuals. Bottle Share Inc. is a charitable organization founded by Christopher Glenn and based in Kennesaw, Georgia that supports industry workers and businesses facing adversity and hardship. Other resources to bookmark for potential funding needs in the future are the Michael Jackson Foundation for Brewing & Distilling and the Pink Boots Society New Mexico State University Course for Brewing & Distilling in Belgium and the Netherlands.

Pros and Cons of Grant Funding

  Many breweries and distilleries are unaware of grant opportunities that exist due to limited promotion and public awareness but could very well be eligible to submit an application. Yet there are benefits to seeking a grant rather than pursuing other funding avenues. First, grants do not have to be repaid, which is a significant advantage over applying for a loan. However, grant applications can be time-consuming, and eventually getting the money in hand can take a substantial amount of time. Grants don’t typically cover overhead, indirect and administrative costs, yet each opportunity is unique and may focus on a specific project or equipment upgrade. There are not nearly as many grant opportunities in the craft beverage industry compared to the nonprofit sector. But applying for grants can get your business onto the radar of major corporations and foundations, thereby boosting your networking power with local community leaders and influencers.

  Some of the biggest names to know for brewery and distillery grants are the Brewers Association, distilling associations like the American Craft Spirits Association and American Distilling Institute and the USDA. State departments of agriculture and restaurant organizations also provide grant funding for the industry, as well as private donors who have personal interests in craft beverages and major corporations with a commitment to niche philanthropy.

Applying for a Brewing or Distilling Grant

  A basic internet search can lead you to current and open grant opportunities for breweries and distilleries, although the funding pool is limited, and the competition can be tough. Craft beverage producers should consider getting involved with industry associations and subscribing to publications and mailing lists to be among the first to know about grant opportunities and deadlines.

  Aside from funding in response to disasters and emergencies, one of the biggest trends in craft beverage grantmaking is encouraging diversity. These grants often help educate and employ women, people of color and members of the LGBTQ community in this industry. Promoting sustainability and eco-friendly practices is another current funding trend among grantmakers that care about craft beer and spirits.

  Although some grants have rolling deadlines and chances to apply at any time of the year, most opportunities have a series of established dates that require applicants to pay close attention. Look into the times when grant deadlines occur before your business even needs funding, just for informational purposes, and mark deadlines on a calendar in case an unexpected need should arise.

  If your business is eligible for a grant, read the guidelines closely, including the best ways to contact the funder for follow-up after you submit your materials. As you review grant proposal guidelines, important details to pay attention to include the budget year dates, duration of funding, funding policies and submission process. Use online applications whenever possible to expedite your application, and be specific in your application concerning the project budget and how you will meet measurable goals. In many instances, it is best to introduce your business and an initial description of what you need to a funder before submitting any official paperwork, either by telephone call, general inquiry email or by scheduling an in-person meeting. And if your business is fortunate enough to secure a grant, keep up with reporting requirements in good faith to set yourself up for potential support in the future if and when you might need it.

  Grants are just one piece of the puzzle to keep a brewery or distillery operational and successful, but they are oftentimes an underutilized asset that might be just what you need to get by or take a new direction with your beverage business.

A Key Metrics Dashboard Just for Beer Wholesalers

Cyndi

At last, a key metrics dashboard, just for beer wholesalers.

Beer Business Finance and GP Analytics have combined forces to create a new software tool that takes the guesswork out of which key metrics to track to achieve your financial goals.

This new analytical tool is custom developed exclusively for beer distributors.

It provides real time data on the most important numbers of your beer business.

This tool will allow you to link key metrics from every department to top line company financial objectives. This creates alignment and synergy, so that everyone is driving the business towards the same financial outcomes.

Do You Need a Financial Metrics Dashboard for your Beer Wholesaler Business?

We are accepting a limited number of Founding Members to help us beta test and develop this new software tool.

Founding members get first access to analytical tools, may provide input to guide the future development of the dashboard tools, and a receive a Founding Member Discount off the standard price, which is good forever.

Are you interested in learning more about this new analytical tool? Email me at Kary@BeerBusinessFinance.com to book a time to talk.​

The Data Problem

Wholesaler business data lives in many different places: route accounting system, payroll software, Excel spreadsheets, etc.

It is difficult and time consuming to extract, combine and analyze the information in order to make timely business decisions.

The Data Solution

Our software solution aggregates data from multiple platforms and automatically combines it into an easy-to-read dashboard.

Track only your most important members in real time with simple dashboards. Metrics that align department KPIs to the overall company financial and operational objectives.

How it works…

The software integrates seamlessly with your other applications to aggregate data in real time.

The key metrics dashboard utilizes historical performance along with industry benchmarks to provide a 360-degree view of the financial results your business.

The beer wholesaler dashboard includes our standard set of key metrics for sales, gross profit, operating expense, and profitability, along with inventory, accounts receivable, and cash flow metrics.

You’ll get real time data for only the most important numbers of your beer business.

Ready to get started?

We are accepting a limited number of Founding Members to beta test the new wholesaler dashboard software.

Founding members get first access to analytical tools, may provide input to guide the future development of the dashboard tools, and a receive a Founding Member Discount off the standard price, which is good forever.

Tracking, measuring, and monitoring the most important numbers in your business will transform your financial results.

The Indemnification Clause: A Lease Landmine?

Cyndi
man typing lease agreement contract
Lease Renting Contract Residential Tenant Concept

By: Brian D. Kaider, Esq.

Most breweries and distilleries are built on leased property.  Negotiating the lease can be a daunting task, as these contracts are commonly over fifty pages long and full of dense legal language that can be difficult to understand.  Additionally, many landlords have “standard” leases to which they expect the tenant to agree with minimal changes.  Aside from definitions of rent and the duration of the lease, many tenants simply accept the remainder of the lease, as is.  More savvy tenants may negotiate issues such as the right to penetrate walls or ceilings for equipment ventilation, the use of outdoor space/common areas, or the state to which the premises must be restored following termination of the lease.  But, there is a section in virtually every lease that is typically ignored and has important consequences: the “indemnification clause.”

What is an Indemnification Clause?

  In the simplest terms, an indemnification clause identifies who is responsible if a third party (e.g., a customer) is injured on or around the leased property.  Most often, the injury refers to a physical injury, such as when a customer slips and falls on a wet floor.  The language of the clause typically provides that in such a case, if an injured customer sues the landlord as a result of the fall, the tenant agrees to compensate the landlord for any expense associated with the claim.  This makes sense, because the landlord cannot be expected to supervise every action of the tenant and if the tenant allows a hazardous condition, like a wet floor, to exist, the landlord should not be held responsible for the tenant’s negligence.  Of course, circumstances are often not as simple as this example and there is a lot of gray area in these clauses that may not be immediately apparent.

  After reading this article, it may be tempting to try to negotiate taking the indemnification clause out of the lease entirely.  First, it is unlikely any landlord would agree to the deletion.  Second, it would actually cause more problems that it solves.  Absent the indemnification provisions of the lease, the landlord could still file a legal claim against the tenant under a variety of legal theories to recover any damages they suffer as a result of the third-party claim.  The better course is to negotiate the terms of the indemnification clause to minimize exposure of the tenant and ensure that the terms are clear and unambiguous.

The Guts of an Indemnification Clause

  The typical indemnification clause is composed of very long sentences with multiple subparts that make it difficult to even read, much less understand.  The following is a breakdown of some of the key terms.

  Definition of the Parties – “Landlord Parties” and “Tenant Parties,” or similar terms are defined to include each respective company along with their owners, officers, directors, shareholders, affiliates, agents, employees, representatives, etc.  In other words, if an injured customer sues the owner of the landlord company, this definition includes the owner as an indemnified party, just as if the customer had sued the landlord company, itself.

  Required Actions – Every indemnification clause will use some or all of the following terms: “indemnify,” “defend,” and “hold harmless.”  While at first glance these terms would appear to mean the same thing, they are very different and which terms are used has important consequences.  In particular, “indemnify” and “hold harmless” seem similar and, in fact, the differences between them varies from state to state.  In general, “hold harmless” means that the landlord will not be held liable for any injuries or damages caused by the tenant.  In other words, if the tenant is sued by an injured customer, tenant will not blame the landlord or try to bring the landlord into the case as a separate defendant.  “Indemnify,” on the other hand, means that if the landlord is sued by the injured customer, the tenant agrees to reimburse them for costs incurred as a result of the lawsuit.  “Defend,” however, means that tenant is responsible for defending the landlord from lawsuits.  That word in the clause should then trigger other questions, such as, who chooses the counsel to defend the landlord? Does the landlord have the right to approve the proposed counsel?  And what happens if there is a conflict of interest between the landlord and tenant being represented by the same counsel?  Those issues should all be addressed in the indemnification clause.  If the word “defend” is not in the clause, though, that means the landlord is free to choose its own counsel to represent them and tenant is still responsible for the landlord’s legal fees, meaning tenant may be paying two different law firms to fight the same case.

  Scope of Covered Claims – The clause should have some description of the types of expenses that are covered.  In some cases, it is extremely broad, such as “any and all costs suffered by or claimed against landlord, directly or indirectly, based on, arising out of, or resulting from tenant’s use and occupancy of the premises or the business conducted by tenant therein.”  The description may be limited to only physical injury, death, or damage to property.  In some cases, it may refer to “reasonable claims.”  Of course, what is reasonable is a subjective question and likely to spur additional legal battles.  In some cases, the lease may require the tenant to warrant that they do not and will not infringe on another party’s trademark rights.  The tenant should always try to limit the scope of such terms to only “knowingly” infringe or infringing “known” trademark rights.  Otherwise, it would impart on the tenant an obligation to scour the earth for all trademarks that could possibly be asserted against it; an impossible task.

  Scope of Covered Property – It should be clear exactly what property is covered by the indemnification clause.  Often a lease will make a distinction between the “Premises” and the “Property.”  Premises usually refers to the actual unit that the tenant is renting, whereas Property refers to the entire parcel of real estate owned by the landlord, which may include other rented units and common areas.  Obviously, a tenant should not be required to indemnify the landlord against something done by another tenant in a separate unit.  But, common areas are much more tricky.  Often, either explicitly in the lease or by oral agreement, a landlord will permit a brewery tenant to occupy common areas, including parking lots, to serve beer and/or allow customers to eat and drink.  If someone drops a glass in the parking lot and the brewery does not clean it up promptly and a customer is cut by the broken pieces, the indemnification clause should protect the landlord if the customer sues.  But, if the landlord is responsible for snow removal in the parking lot and fails to adequately perform its obligations and a customer slips and falls when getting out of her car, the tenant will want such incidents to be outside the scope of indemnification.  If the clause is not worded carefully, that distinction may not be recognized by a court.

  Carve-Outs for Landlord’s Activity – This raises the broader issue of carve-outs in the indemnification clause for landlord’s activity that contributed to the injury.  For example, if the landlord was responsible for the build-out of the premises and was negligent in the installation of the electrical system, then if a customer is electrocuted, the tenant should not be required to indemnify the landlord against such latent defects.  Even then, the choice of wording in the clause is important.  Some leases only carve out “gross negligence,” “recklessness,” or “willful misconduct.”  In that case, if the injury is caused by landlord’s “ordinary negligence” that does not rise to the level of gross negligence, the tenant would still be required to indemnify the landlord against such claims.  It is worth noting, however, that some states hold such clauses to be against public policy, void, and unenforceable.  Those cases, however, often turn on whether the part of the property in question was under the exclusive control of the tenant.

Conclusion

  Landlords generally provide the first draft of a commercial lease and, not surprisingly, they are drafted heavily in favor of the landlord.  While a tenant’s focus may be on maximizing building improvement allowances and minimizing rent, they should review the entire lease thoroughly, and preferably with assistance from an attorney knowledgeable about the beverage industry.

Often, the landlord will be in a position with greater bargaining power than the tenant, but the law will view both parties to a commercial lease as being sophisticated enough to negotiate the terms of the agreement they consider important.  A court is unlikely to be persuaded that the tenant did not understand the terms or had no choice but to accept them.  The indemnification clause should clearly set forth the responsibilities of each party in clear and unambiguous terms, including: the covered property, the scope of covered claims, what actions the tenant is required to perform in the event of a complaint, and what landlord activity is excluded from the indemnification.

  Brian Kaider is the principal of KaiderLaw, a 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.

Move Over Scotch, Here Comes American Single Malt

Cyndi
2 glasses filled with whiskey

 

By: Kris Bohm: Distillery Now, LLC  

Just about anyone you meet who says they like whiskey has probably heard of single malt whiskey. When it comes to whiskey in America, bourbon is the undisputed reigning champion in sales, with Canadian whiskey right behind it. There are many craft distilleries making bourbon and rye whiskey, but there are not nearly as many distilleries making single malt whiskey. American single malt whiskey is a lesser known subcategory of whiskey and is growing quickly in popularity. American single malt whiskey, or ASMW, is a unique spirit made in America from malted barley. ASMW presents an opportunity for distillers to show creativity with a whiskey whose flavor profile is far different from the wood dominant flavor profile that most American whiskies exhibit. Let’s explore what ASMW is by examining the rules that define the spirit and how it is typically made. With this understanding, let’s meet the people who are leading this newly emerging spirit category. By developing an understanding of ASMW we hope to give you the confidence to consider making malt whiskey and joining this new spirit category.

Redefining Single Malt

  The average consumer of spirits logically assumes that single malt whiskey is just another phrase for Scotch whiskey. In liquor stores and bars, Scotch is the predominant malt whiskey that people see. While Scotch is malt whiskey, not all malt whiskey is Scotch. Malt whiskey is defined by the ingredient used in production, malted barley. And to further specify, malt whiskey that uses only whiskey from one distillery is known as single malt whiskey. While it is beneficial to the distillers and producers in Scotland to imply their region is what makes Scotch, well, Scotch, it is in fact the ingredients and production methods that make a great malt whiskey a single malt whiskey. American single malt whiskey strives to break away from Scotch whiskey and become a separate, recognized category.

Defining the Spirits

Malt whiskey is defined by the TTB in The United States as a whiskey that is made from at least 51% malted barley and aged in new American oak barrels. This definition does not meet the expectation of most consumers or distillers of malt whiskey. This standard of identity has held back the potential for malt whiskey made in America to be the best whiskey possible. Most malt whiskey made outside America is made from 100% malted barley aged in used barrels. American single malt whiskey does not have a legal definition. This is a hurdle to the spirit becoming an accepted category of whiskey. Several American distillers and their respective distilleries have banded together to form the American Single Malt Whiskey Commision in 2016. The mission of ASMWC is to establish, promote, and protect the category of American single malt whiskey. Prior to 2016 there were already distilleries producing malt whiskey in America, but most distillers felt the TTB standard of identity was outdated. The goal of establishing the commission was to define a unique standard of identity and type to allow ASMW to be the best whiskey possible. The ASMWC set forth and created new standards of identity for American single malt whiskey and is working with the TTB to incorporate those standards into federal guidelines.

AMERICAN SINGLE MALT WHISKEY COMMISSION

NEWLY PROPOSED STANDARD OF IDENTITY

MADE FROM 100% MALTED BARLEY

________________________________________

DISTILLED ENTIRELY AT ONE DISTILLERY

________________________________________

MASHED, DISTILLED, AND MATURED IN

THE UNITED STATES OF AMERICA

________________________________________

MATURED IN OAK CASKS OF A CAPACITY

NOT EXCEEDING 700 LITERS

________________________________________

DISTILLED TO NO MORE THAN 160 (U.S.)

PROOF (80% ALCOHOL BY VOLUME)

________________________________________

BOTTLED AT 80 (U.S.) PROOF OR MORE

(40% ALCOHOL BY VOLUME)

  These proposed standards of identity are thoughtful with specific intent, laid forth by the distillers who wrote them. This new proposal came together to allow for creativity in the hands of those producing the whiskey within this standard of identity.

How is ASMW Made?

  For the sake of discussing single malt production methods, we will give an overview of the traditional method of distilling malt whiskey as it is done in Scotland.

  Malted barley is crushed by a mill and mixed with hot water. This hot water and barley mixture is mixed in a vessel called a lauter tun. This lauter tun separates the sugary liquid (called wort) from the barley. As the wort is drained away from the grain it is cooled off and transferred to a fermentation vessel. The fermentation takes place and the sugar in the wort is consumed by yeast to become alcohol and carbon dioxide. This now fermented beverage is referred to as distiller’s beer or wash. The alcohol content of the wash will vary but can be as low as 5% to upwards of 12%. The wash is pumped to a still where the alcohol is distilled out of it. This alcohol, also known as white whiskey, is then placed in barrels to age. The ABV of the whiskey entering the barrel will vary for some folks as low at 50% to upwards of 75% ABV. This process is a very general overview. There are many different ways to go about producing malt whiskey, and most distillers all have unique processes that produce amazing spirits.

The Folks Behind ASMW

  Steve Hawley is the vocal individual who is leading the charge of the American Single Malt Whiskey Commision. Steve, who is the president of the commission, had much to say about ASMW. On the growth of this newer whiskey category, Steve credited the distillers producing the spirits and working to grow their brands as the primary force growing the ASMW category. Hawley went further to talk about the future of single malt, saying he believes that for single malt to grow and reach the levels of popularity of other whiskies that single malt producers must be unified in the language of how they promote their spirits. Being a member of the commission is a great step for distilleries to be a part of this new category. Hawley also pointed out that the key to unlock more category growth is for distilleries to focus and educate the consumer on what ASMW is.

  In the state of Oregon and beyond Rogue Ales and Spirits is well known for their beer and whiskies. In a discussion with Jake Holshue, the Head Distiller for Rogue Spirits in Oregon, Holshue had the following to say. American single malt is best kept simple. Good base malt makes exceptional single malt whiskey. Holshue has years of experience producing single malt whiskey and has learned many things the hard way through experimentation. “Don’t add chocolate malt and definitely do not add hops,” says Holshue, “These unnecessary ingredients can ruin the magic of good whiskey made from malted barley.” Jake’s perspective on producing a wonderful ASMW is summed up well, “You should keep it simple.”

  One of the pioneers that started production of ASMW early on is the founder of Santa Fe Spirits, Colin Keegan. Santa Fe Spirits opened in 2010 in New Mexico and produces a whiskey called Colkegan. Their particular ASMW is made from malted barley with a portion of the malt being mesquite smoked. This whiskey is reminiscent of a smokey Scottish whiskey, but their smoke carries flavors of southwest mesquite instead of traditional Scottish peat. Colkegan is firmly rooted in the traditions of Scottish single malt production, but the use of mesquite smoke and dry New Mexico climate has created a whiskey that is truly unique.

  When it comes to whiskey in America there is no question that ASMW is a fast growing category with many new entrants. While there are many craft distilleries making bourbon and rye whiskey, there are not nearly as many making ASMW. This category of whiskey has big opportunities for a distillery that does not necessarily exist in other categories of spirits. As more brands become established players in the whiskey business ASMW and the demand for it will continue to grow. We highly encourage you to join the American Single Malt Whiskey Commision to help be a part of the collective voice of distillers. If you are just considering making single malt whiskey and not sure where to start you can contact the author for more info. There is no doubt that ASMW is the next big trend in whiskey. Are you ready to be a part of it?

  The author of this article is Kris Bohm, owner of Distillery Now Consulting LLC.  When Kris is not helping distilleries he can often be found seeking out adventures on two wheels, or defending his beer mile record.

10 Ways to Maximize Beverage Sales Through Every Spring & Summer Holiday

Cyndi
people drinking and celebrating

By: Raj Tulshan, Founder of Loan Mantra

The arrival of spring means sunshine, warmer temperatures, gatherings and lots of drinking. This often involves celebrating with a cold pint of beer, glass of wine or festive cocktail. Special days are a great time to attract crowds planning to connect with family and friends at area restaurants and pubs and to increase beverage sales.

  More than 335,000 gallons of tequila are consumed in the U.S. during Cinco de Mayo fiestas. An estimated 92 million Americans take their moms out for a meal for Mother’s Day, making it the most popular day for restaurant dining. People don their big hats and spring finery, while sipping Mint Juleps at Kentucky Derby-themed parties. Then it’s time to toast to dads on Father’s Day, celebrate graduations, for bachelor and bachelorette parties and bridal showers. So, how can you maximize beverage sales all throughout these warm weather celebrations? Here are 10 tips:

1.   Spring into Theme – Jump into action with some tropical themed drinks. Serve a refreshing Cherry Blossom, Tequila Honeysuckle, or a Lemon Drop for festive seasonal celebrations and, of course, don’t forget a Mint Julep for Kentucky Derby parties. Source fresh ingredients whenever possible and use fun garnishes, like edible flowers. For a Spring Fling, use sorbet as a drink ingredient, with fancy glasses and pastel cocktail napkins. Get patriotic with red, white, and blue themed drinks for Flag Day, and consider garnishing the drinks (or the tables) with cute little sparklers. Throw a tropical party and encourage employees and guests to wear Hawaiian shirts and leis, with mai tai or pina colada specials. Have a taco and tequila party for Cinco de Mayo and decorate with bright colors and a cactus or two. What about hosting an ice cream party with boozy milkshakes on a hot summer night social? The possibilities are endless, so be creative!

2.   Partner with the right vendors – Many beer, wine and liquor vendors will provide plenty of marketing materials to help restaurants and bars drive beverage sales. They’ll often give you free table tents, branded coasters, and other materials to promote their brands. Some vendors will go a step further and provide give-away items, like branded pint glasses, t-shirts, or baseball caps for customers that order their products. This is an easy way for you to boost excitement and sales – and a fun incentive for your guests to enjoy.

3.   Get your financing in order – Restaurants and bars have, understandably, had a tough two years, due to the COVID-19 pandemic. And now the COVID fallout includes a trifecta of major challenges, including soaring prices on food and beverage supplies, ongoing supply chain disruptions and continued staffing shortages. Be sure that your financing is stable enough to sustain your operations, especially amid this turbulent period and as you recover from the pandemic hardships. If you need a business loan, talk to an expert that can advise you about which path to take. There are many viable options available to help your business through the short-term or for your longer-term needs.

4.   Get the funding for your marketing needs – You might have the most amazing place that serves the best food and drinks in the area, but if people don’t know about you, you won’t maximize sales, profits and other key metrics. Elevate your marketing efforts to generate awareness and excitement and drive traffic and sales. Be sure to have a professional, easy-to-navigate website with updated menus, drink lists, and specials. Become more active on social media and buy online ads that target your priority populations. Host special events and tastings. Send out emails about upcoming events and other incentives. If your budget is strained, consider a loan to boost your marketing efforts and attract more attention.

5.   Host VIP tastings. Boost customer loyalty with VIP tastings – Valued customers will feel special to be part of an “elite” event, so make these tastings feel exclusive and important. Send out VIP invitations. If your budget allows, you can go all-out with a red carpet and champagne. Or create a different vibe with beer flights, a wine tasting or a sampling of different types of whiskey. Ask your vendors to provide experts to discuss their products and educate your guests about the types of beer, wine, or liquor they offer. Your vendors might provide VIP gift bags or other SWAG, as well.

6.   Create a comfortable atmosphere – Be certain that your guests feel comfortable at your establishment, whether that means continuing to social distance during higher COVID transmission periods or keeping plastic partitions up for a while longer. Guests want to see “proof” that your restaurant or bar is still following strict cleaning and sanitation protocols, so place hand sanitizer dispensers around the facility and continue to sanitize tables, bars and other high-touch locations frequently. Have comfortable seating that will make people want to linger and have another drink. Use appealing soft (not harsh!) lighting and play fun music. Also, consider what would appeal to your target demographics. Men will want the big game on your TVs. A bachelorette party will want a fun waitstaff that will dare them to do shots. And guests appreciate some creative decorating for the holidays, whether that’s flowers and champagne flutes for Mother’s Day, or big hats and roses for Derby Day (also called The Run for the Roses).

7.   Provide outdoor seating – One of the silver linings of the pre-vaccination landscape was that many restaurants and bars added outdoor seating, which customers loved. Now that spring is finally upon us, people will welcome the opportunity to eat, drink and celebrate outdoors. Set up tables and chairs outside. Consider adding fire pits or offering blankets on chilly evenings. Offer boozy popsicles or milkshakes to boost beverage sales when the weather gets warmer. String up pretty lights. Plant colorful flowers. Make your outdoor area feel lovely and inviting.

8.   Offer special incentives – Promote special deals around the spring holidays, like “Moms drink for free on Mother’s Day” or “Dads get a free beer for Father’s Day.” Promote specials on tacos and margaritas for Cinco de Mayo. Offer Mint Juleps and tiny sandwiches for a Kentucky Derby watch party. Offer discounts on your special spring drink menu. Consider discounts on beer buckets for the spring or 2-for-1 drink specials on a typically slow weekday.

9.   Train your staff about the drink specials – Make sure your staff are educated about your drink specials and encourage them to upsell to your guests. This is especially important when you add new seasonal cocktails to your menu or if you’re having special holiday-themed drinks. Be sure your employees know what each drink tastes like, how it’s made, and what it pairs well with. Your staff are your best ambassadors. The way they describe your menu and drink specials will matter. In fact, it will have a direct impact on your sales.

10. Be active on social – Social media can be a very effective way to incentivize your events, spotlight drink specials, and highlight fun plans and celebrations for the season. Post about what you’ll do to treat soon to be brides well for bachelorette parties (Champagne toasts! Bloody Mary specials!), so they’ll come to your establishment instead of your competitors.’ Feature different staff members raving about their favorite spring drink or talking about the upcoming events or parties that you’re hosting. Share photos of beautiful spring drinks garnished creatively. Showcase that your place is the place to be this summer, for any seasonal celebration.

  Spring is in the air and there are so many opportunities to celebrate. There are also so many opportunities to promote your establishment, drive traffic and boost your beverage sales. Try these 10 tips to increase traffic to your establishment, customer loyalty and profits.

  Neeraj (Raj) Tulshan is the Founder and Managing Member of Loan Mantra, a financial advisory firm with best-in-class and proprietary FinTech, BLUE (Borrower Lender Underwriting Environment). Loan Mantra, Powered by BLUE, is next-level finance: a one-stop-shop for business borrowers to secure traditional, SBA or MCA financing from trusted lenders in a secure, collaborative and transparent platform. Clients turn to Raj because they know he will always pick up the phone and offer unparalleled financial counsel in a remarkably human—even friendly—way.

About Loan Mantra

  Loan Mantra is a financial services company that helps level the playing field for small and medium businesses to gain financing by providing a one-stop portal, paperless application process and personal service. With offices in New Jersey, Charleston, SC and New York, our only success is through your success. This means that our attention, purpose and intention are all focused on you, our client. We are your ally to overcome obstacles, bringing peace through uncertain times to achieve your highest goals and aspirations. Your friendly, responsive agent will listen respectfully and service your account actively through one of three locations in. We speak your language whether it’s English, Spanish, Hindi, Bengal, Hospitality, Laundry or Manicure, let us help you today. Connect with us at www.loanmantra.com, 1.855. 700.BLUE (2583)

Boosting Brewery & Distillery Business with Entertainment and Lodging  

Cyndi
2 guitarists jumping

By: Alyssa L. Ochs

With thousands of craft breweries and distilleries in operation today, it’s no longer enough to simply produce amazing beers and spirits. Brewers and distillers are quickly learning that to thrive and stand out among the competition, they need to build a unique brand and expand their reach to a broader customer base.

  Some of the best ways to achieve this are to offer entertainment and recreation opportunities for everyone to enjoy and onsite lodging that makes an evening out safer and more convenient. With the right event-planning strategy, you can keep consumers coming back to your business even after they’ve sampled everything on the drink menu multiple times.

Types of Entertainment and Recreation

  In recent years, both breweries and distilleries have gotten very creative with the types of entertainment they offer. You’ll regularly find local establishments offering board game nights, yoga classes, musical concerts and karaoke nights. Trivia, open mic comedy nights, painting and crafting events and book club meetings are also held at breweries and distilleries.

  Low-key options, such as yard games and photo booths, are easy options to add, as well as professional networking events, poker tournaments and sport-themed events for big games. Breweries and distilleries can become more involved in their communities by partnering with other businesses to promote local products, nonprofits to support important causes and artists to display pieces of original artwork on the walls. Meanwhile, it’s fun to host holiday-themed festivals, offer educational brewing or distilling lessons and highlight new beverage releases in a way that entices people to walk through the door.

  Dana Koller, the president of Kaktus Brewing in Bernalillo, New Mexico, told Beverage Master Magazine that his brewery’s most successful events have been celebrating Oktoberfest, St. Patrick’s Day and other cultural events. Kaktus always has a full lineup of exciting events on the brewery calendar and offers small-batch brews, organic bites, and a refreshingly chill atmosphere.

  “I think what makes them successful is that we are genuine about the celebration and not just there to make a quick buck,” Koller said. “Although we may not be the most authentic option, we make sure that we have a blast doing what we do and show our appreciation for those wanting to celebrate.”

  On the distillery side of things, Sledge Distillery in Tolar, Texas, has been adding lots of events to its calendar lately, including tastings, tours, food, retail offerings and live music. Sledge Distillery specializes in hand-crafted spirits based on a World War II family moonshine recipe.

  “Private shopping nights for new releases have been very successful,” said Susan Sledge. “Also, we have found that the addition of live music adds to the atmosphere. Our clients are looking to re-engage with us and bring their friends along. We consider their repeat business a huge honor.”

Onsite Lodging Options

  Another unique idea for breweries and distilleries to consider is adding lodging near the taproom to welcome overnight guests. Some craft beverage producers have locations in historic buildings that can be renovated to include accommodation in an adjacent space.

  Alternatively, producers can purchase or build a separate building that provides lodging on the same property. Not only is this a good way to keep customers safe from drinking and driving, but it’s an opportunity to make your business a true weekend destination rather than just a quick stop along the way.

  One brewery that has added lodging to its offerings is Riff Raff Brewing Company in Pagosa Springs, Colorado. Founded in 2013, Riff Raff operates in a historic, Victorian-era house in the downtown area and offers flagship beers, seasonal taps and eclectic twists on favorite foods. Visitors can currently rent apartment units above the downtown brewpub through Airbnb.

  “The building that houses Riff Raff Brewing Company is registered on the Colorado State Historic Preservation roll and has been used and repurposed multiple times since it was built in 1898,” said Jason Cox, founder and CEO.

  “When we purchased the building and opened the brewery in 2013, the upstairs housed apartments with long-term rentals,” Cox said. “We underwent a major remodel in 2015 and converted to short-term rentals because of the fact that there was a brewery downstairs. We thought it would be a type of beer-and-breakfast kind of offering!”

What Consumers Want Right Now

  There is a high demand for entertainment options at breweries and distilleries because people are looking for fun ways to get out and experience their communities in different and social ways. Breweries and distilleries have emerged as ideal destinations for date nights, family-friendly fun and free things to do that don’t require a big commitment. Many businesses are finding success with inclusive events that are pet-friendly and welcome children. You can give consumers what they want by keeping participation costs low or free, offering something different from what they can find anywhere else in town, providing fun photo opportunities and maybe even selling specialized merchandise to mark the occasion.

  “I think what people are looking for is true community, a place and time to connect without expectations,” said Koller. “The music and events are the excuse to get out and socialize for them.”

  “Our customers are looking for a way to relax and take a break from the pressures of life,” said Sledge. “Our distillery is located in the country and gives our guests a feeling of truly ‘getting away.’” 

  “I can’t speak directly to data or analytics, but I do know there are several experiences where lodging is packaged with craft breweries, and it creates a more complete experience,” said Cox. “Our friends own a brewery in northern New Mexico that allows camping on the premises, and they have lots of concerts, so it provides an opportunity to have an immersive guest experience. We aim to do the same type of thing with our lodging above Riff Raff Brewing Company.”

Considerations for Breweries and Distilleries

  Planning events may seem overwhelming to some brewery and distillery owners because it’s just one more thing added to the to-do list and budget. It often pays off in terms of business sustainability and professional satisfaction in the long run. Events, recreation, entertainment and lodging provide fun opportunities in relaxed environments to build your brand and get people engaged with what you’re doing. It’s an effective way to make personal connections with your customers and perhaps even raise money for charitable causes.

  There are many things to think about when planning a new event, type of entertainment or onsite lodging. Cost tops the list since some things will inherently cost more than others. If the event requires renting or buying extra furniture, party supplies, or sound equipment, you’ll need to budget ahead. Although it may be an initial goal to make extra money from an event, it might be worth it to break even for the sake of outreach and exposure. Breweries and distilleries with large spaces may be able to rent out entire sections of the building or property for private events and make extra income in that way.

  Regarding onsite Airbnb offerings, Riff Raff’s Cox sees significant benefits in breweries entering the lodging business.

  “We rent more than 325 nights a year in each of the two rentals, which include a three-bedroom, two-bath unit and a one-bedroom, one-bath unit,” Cox said. “We do see people who book because it’s above a brewery, and they definitely want that experience. Sometimes I conduct VIP tours and add other offerings for guests who stay upstairs.”

Event Planning Tips

  When considering hosting an event, make sure to see what else is already scheduled in the community so that there are no conflicts that would prevent someone from attending what you have planned. In general, it’s best to keep the event size manageable so that the lines for beverages don’t get too long or the spaces too crowded. Fun themes will catch people’s attention, while free and low-cost ticket prices will make your events more accessible to everyone.

  Recurring events, such as activities that happen on the same day each week, make scheduling events easier and allow more people to participate when it works for their schedule. It may also be worth inviting another local brewery or distillery to co-host your event.

  Koller from Kaktus Brewing said that one of the most important things to plan for when hosting events is “making the numbers work so that you are not understaffed since this is always a major challenge.”

  “From the moment a guest arrives on property, we want them to feel welcome,” said Sledge. “Signage has been strategically placed, so people know where to go and the options they have for entertainment, food and beverages. Our employees are intentional about greeting guests and orienting them to the facility and events.”

What’s Next for Craft Beverage Entertainment?

  Producers are just getting started with what they have in mind to entice craft beverage enthusiasts.

  “For Kaktus Brewing, we have been working on plans to expand parking to host larger events with games, a new stage, more shade structures and outdoor cooking,” said Koller. “This will allow us to do full weekend events instead of just evening events.”

  “We are programming smaller, more intimate events where people share a particular interest,” said Sledge. “For example, we are doing a three-event women’s workshop called ‘Feel Good Fridays’ where the group has drinks with a licensed therapist who facilitates a group session on various topics.”

  Meanwhile, Cox recommended that any brewery looking to add short-term lodging should check with the local planning or zoning department to understand rules regulating short-term rentals.

  “Depending on the type of zoning district, it may or may not be allowable for a brewery to offer lodging,” Cox said. “After that, I would put myself in the shoes of a guest to understand the entire experience. For example, some of the equipment that a brewhouse uses runs 24/7, and the noise could have an impact on the lodging, depending on the configuration. Beyond that, I would say to create a great experience for the guests and make it happen. Remember, it’s all about the craft beer and having fun with it.”

How Beer Wholesalers Can Use The Ansoff Matrix to Grow Sales

Cyndi

The Ansoff Matrix is a tool that can help you build a sales growth strategy and identify opportunities to increase revenue.

The matrix was originally developed as a device for businesses to think about revenue diversification.

Since then, it has been used as a quick and easy way to build a sales strategy while considering the risks of growth.

The matrix breaks down the drivers of sales growth into these categories:

  1. New markets (accounts)
  2. Existing markets (accounts)
  3. New products
  4. Existing products

The matrix then combines these four categories and assigns a relative amount of risk to each approach.

The Ansoff's Matrix

For example, building a sales strategy to focus on improving market penetration with existing customers and products is low risk.

Whereas, diversifying into new products in a new market comes with a higher risk.

How can you use the Ansoff Matrix to Grow Beer Sales?

Use it to ask strategic questions:

  • How can we sell more of our current products to our existing customer base?
    • Could we do better with e-commerce options? Can we improve our marketing (social media, traditional media, events, etc.)?
  • How could we enter new markets with current products (or add new accounts)?
    • Are there opportunities to acquire brand/territory rights or purchase another distribution business?
  • How could we develop existing products or services?
    • In other words, could we market the products differently, could we provide more sales training, could we hire a specialized sales person?
  • How could we move into new markets with new products (or services)?
    • For example, could you sell non-alcohol products to non-licensed accounts (a new market)?

The Ansoff Matrix is a simple and easy way to think about sales growth strategy and find new ways to increase revenue.

Use the matrix to brainstorm ideas and ask difficult (but profitable) questions.

Yours in Sales Growth,

Kary

P.S. Take advantage of the Spring Special and save 33% off the Beer Business Finance Subscription. Use Discount Code SPRINGCLEAN at checkout.

Your subscription includes access to the library of online courses, back issues of the Beer Wholesaler Financial Newsletter, webinars, podcasts, tools and resources to help you drive sales and profits in your beer business.

3 Spring Cleaning Tips to Make Your Wholesaler Finances Sparkle

Cyndi

Spring is the perfect time to clean up your wholesaler finances and make ready for the summer selling season.

In this post, we’ll share 3 Spring Cleaning Tips to Make your Finances Sparkle:

  1. Organize your corporate documents: Use the checklist to scrub your important papers
  2. Count your inventory: Borrow the process to keep your inventory records nice and tidy
  3. Review the balance sheet: Download the White Paper and learn how to keep your financial statements squeaky clean

Spring Clean Tip #1: Organize Wholesaler Corporate Docs

If you’re like most wholesalers, you have corporate records stashed everywhere. Some are tacked to the wall, others are in your desk drawer or saved on your laptop.

Corporate records are important because they show that you have the proper licenses, filings and legal standing to operate your wholesaler business.

Corporate records are critical to maintain your ‘corporate’ status and the liability protections this provides.

Examples of corporate records include:

  • Articles of Incorporation
  • Bylaws
  • Stock certificates
  • Stock ledger recording each stock issuance or transfer
  • Minutes of meetings of the directors
  • Corporate seal

If you don’t have the time or patience to locate and organize your corporate records consider hiring an attorney to do it for you. They won’t be cheap, but they will make sure all the necessary docs exist and are properly filled out.

Corporate docs are super important to preserve the ‘corporate veil’ and protect you from liability.

If you plan on borrowing money, banks need to see this information. If you plan on bringing on an investor, or eventually selling, investors / buyers will insist on complete and accurate corporate docs.

If you want to do it yourself, use the Corporate Docs Checklist as a guide to get started. Spring is a great time to locate, organize and clean up those corporate documents.

Spring Clean Tip #2: Count your Inventory

Counting inventory can be difficult, time-consuming and un-productive. But these things only happen when you do it the wrong way.

Use this Inventory Counting Checklist to count the right way.

You’ll find it takes less time and will get you the results you want: accurate inventory on the books. Everyone wins.

Spring is a great time to clean up your inventory. Use the process, and make it count.

Spring Clean Tip #3: Reconcile the Balance Sheet

Your balance sheet reports on your assets, liabilities and equity. It shows what you own, what you owe, and the net worth of your business.

Unfortunately, the balance sheet is often filled with financial mistakes.

Assets may be listed on the balance sheet that don’t exist any longer. Lost kegs anyone? How about that old inventory you haven’t written off yet?

Prepaid expense is another hiding spot for balance sheet errors. Items get booked here and never removed. Prepaid hops or prepaid insurance are common items that get stuck in here.

Need some guidance on how to get started with the balance sheet clean-up? Check out this post and podcast: How to Fix These Common Wholesaler Financial Problems​

Wrap Up + Action Items

Spring is the perfect time for a financial clean-up. Start with a purge of your old financial records. Throwing things away feels good.

Use the document retention guide to identify what can be tossed out. Hire a shredding company to do the dirty work.

Next, do a full physical count of your inventory. You wouldn’t dream of delivering inaccurate customer orders, don’t operate your business with incorrect inventory records.

Finish the spring clean-up with a review of your balance sheet. Lots of financial mistakes get stuck here and need to be scrubbed clean.

Warm weather, sunshine, and increased sales are on the way. Now is the perfect time to make ready with a financial spring clean-up.

Yours in Financial Spring Cleaning,

Kary

P.S. Take advantage of the Spring Special and save 33% off the Beer Business Finance Subscription. Use Discount Code SPRINGCLEAN at checkout.

Your subscription includes access to the library of online courses, back issues of the Beer Wholesaler Financial Newsletter, webinars, podcasts, tools and resources to help you drive sales and profits in your beer business.

Future of the Liquor & Spirit Industry: Based on the Integration of the Metaverse

Cyndi
corporate person typing

By: Rohan Doodnauth, Co-founder — OpaLink

In late October of 2021, Mark Zuckerberg announced his company’s intention to rebrand from Facebook to Meta and build an immersive platform fueled by augmented and virtual reality (AR/VR). This platform — the Metaverse — will further blur the boundaries between our online digital lives and our more tangible, physical ones. In his 2021 Founder’s Letter, Zuckerberg remarked how the Metaverse “will touch every product we build,” and will allow users to socialize, attend events, create, work, shop, and more in ways that transcend how we think about the internet and digital technology.

  If the past few years have shown the liquor industry anything, it’s that staying on top of emerging technologies and shifts in consumer trends is vital to the success of our brands and businesses. Look at the growth of omnichannel marketing and sales, for example. Between December of 2019 and November of 2020, retail wine sales at multi-outlet stores in the US grew by some 11.4%. For some businesses in the industry, this operational pivot spelled the difference between surviving or closing during the initial stages of the pandemic.

  With these notions in mind, it’s difficult for us not to consider how the Metaverse could impact the liquor industry as a whole. According to Zuckerberg, the Metaverse aims to become a new central hub of e-commerce and consumer activities. As such, brands in the liquor industry will be forced to rethink how its integration into their operations, marketing, and sales will reshape the future of their business, those of their competitors, and even their consumer markets. Furthermore, brands and businesses must possess the capability to remain agile as they integrate more deeply within the Metaverse, and take notice of how this integration might spur shifts throughout the liquor industry.

Unique VR Dining Experiences

  Within the Metaverse, customers won’t be confined by geographical distance or other physical limitations in exploring the dining or drink options available to them. Rather, upon entering the Metaverse, they will have the availability and opportunity to talk with chefs, foodies, and beverage makers all around the world in the palms of their hands. This will inevitably create a deeper integration of and connection to other cultures, as customers will be able to connect and chat with anyone anywhere in the world at practically any time, and open the door for businesses to provide them with truly unique dining experiences.

  For instance, imagine logging into the Metaverse and browsing a list of restaurants you wouldn’t normally be available to visit in person. Upon selecting a restaurant, you and your party can enter that restaurant’s virtual space within the Metaverse and begin browsing menus for the dishes or drinks you’d like to have. Once your orders are selected and placed, the restaurant’s e-commerce sales system will automatically register the items ordered and be able to virtually send them to you and the others in your party, even without any of you being physically present. Additionally, this method of sales could be utilized for those guests who may not want to show up in person, but still want to try food or drinks they otherwise wouldn’t be able to.

  This blend of convenience and experience, fueled by the AR/VR technology the Metaverse is founded upon, will grant brands the ability to offer customers a truly personalized, customizable experience. Through integrating their sales platforms into the Metaverse, businesses can not only reach a far larger range of customers directly, but also indirectly by allowing their customers to send meals and drinks to family or friends who cannot be physically present with them.

  Because such integration of businesses’ operations with the Metaverse will allow them to provide each individual customer with a one-of-a-kind dining experience, this will inherently create greater competition between brands. Much like we saw with the rise of omnichannel sales during the pandemic, those brands and businesses which are able to capitalize on such value earlier on will be far better positioned to outperform their competitors. Likewise, as the technological capabilities of the Metaverse continue to evolve, the businesses that are better able to remain agile to those evolutions and pivots will likely be the ones who see the most success from their integration with the Metaverse.

Adapting to a Hybrid World Amidst Growing Competition

  Whenever a new technology or trend emerges that impacts our business, it brings with it new sources of competition. This is simply the nature of business. Liquor and beverage industry brands seeking to integrate with the Metaverse will need to take note of how this hybrid digital space could affect their initiatives and create new competitive advantages both for them and their competitors.

  For example, dining experiences in the Metaverse will likely become a blend of futuristic physical features of restaurants and high-tech interactive technology. Knowing this, one method businesses could use to stand out from the competition is by making customers part of this immersive and interactive dining experience. Perhaps a craft brewery or small distillery might offer customers a VR-led tour of their facilities to learn more about their business, its history, and its available products. Maybe a gastropub offers new customers a coupon for a certain percentage off of their first purchase in the Metaverse, or offer them a redeemable code that customers can use to virtually send food or drinks to others. Because our appearance in the Metaverse will be one not of our physical selves, but instead a VR-generated avatar, another possibility might be for businesses like these to offer a free side dish or drink to customers whose avatars are sporting their brand’s logo on a piece of their avatar’s clothing. These are just a handful of examples of how businesses in the liquor and beverage industry could remain agile in adapting to growing and emerging consumer trends after integrating with the Metaverse.

  As a virtual universe that is speculated to become a converging point of consumer activity and e-commerce, it can be assumed that the AR/VR technology used to explore and interact with others will inevitably expand the possibilities businesses have to innovate. Although there is still much we don’t know about the Metaverse — and likely won’t know about for the better part of a decade, at least — this should not stop businesses from forming strategies to implement once they are more deeply integrated into the Metaverse itself.

Implementing a Metaverse Strategy

  Consider for a moment the ways in which the emergence and subsequent growth of social media platforms have impacted business over the last decade. If your own business was in operations prior to the rise of Facebook, Instagram, TikTok, or other social media platforms, it’s safe to assume that the way your business functioned then is vastly different compared to its current strategies and initiatives. When thinking about how your business can integrate successfully with the Metaverse, it’s likely that there will be similar variances — albeit to different degrees or extents — between its current strategies and those used in a realm driven by AR/VR technology.

  For starters, contemplate the initiatives your business has implemented for its marketing strategy. You might be paying for ads on social media to cast a wider net to rein in a greater amount of potential customers, or targeting existing customers with regular email newsletters to alert them of upcoming events or deals you might have. In the Metaverse, those paid ads might transition from sponsored posts on users’ social media feeds into a virtual brand ambassador traveling throughout different e-commerce sectors in a VR-driven environment to offer exclusive tastings or VIP events. Likewise, your business’s email newsletters could transmute into a kind of exclusive membership program for customers to use solely within the confines of its virtual establishment in the Metaverse.

  As another example, look to your business’s current strategy for handling reservations or private parties for events. When integrating these operations into a fully-virtual space, the tickets or codes used for referring to reservations could become their own kind of non-fungible token or NFT; a digital token representing a reservation. If your business boasts a signature dish or beverage, each sale of this item to a VIP member could come with a transferable NFT that could be redeemed at a later date for additional rewards like a free entree, bottled spirit, or customized apparel for their avatar in the Metaverse. Eventually, it may even be possible for chefs or brewers to mint the dishes or beverages they create as NFTs themselves, offering them greater creative freedom and additional means of providing (and earning) value from niche sectors of consumer markets.

  Each aspect of your business in its current state will need to eventually evolve to integrate with the Metaverse. Whatever that means or looks like will be subjective for each liquor and beverage brand seeking integration with the Metaverse, but nonetheless must be made if you wish to remain relevant and competitive in this next iteration of the digital world.

Final Thoughts

  Regardless of how far off we truly are from integrating our businesses and lives into the Metaverse, its influence has already left a lasting impression on markets and industries the world over. Though selling virtual drinks, beverages, food, or other consumables to customers sounds like a counter-productive initiative better left to the realm of science-fiction, the Metaverse’s projected capacity to blur the lines between our digital lives and physical ones could easily turn this into reality in a matter of years.

  Indeed, the Metaverse is perhaps the most literal representation of a “Brave New World” if there ever is one. The potential for brands integrating their business with this new frontier of virtual reality to experiment with marketing, e-commerce sales, and communication with customers will be essentially limitless. In turning passive consumption into active participation with their brand, the first round of businesses in the liquor and beverage industry to successfully integrate with the Metaverse are bound to set new precedents for the industry’s next generation of innovative technologies and tools.