Cannabis was legalized in Canada a year ago;
however the production and sale of edibles, in-fused beverages and tinctures,
remained illegal—until now.
first legal cannabis-infused drinks and edibles are expected to hit shelves as
early as De-cember. Many have been designed to produce a high mimicking the
effects of alcohol in terms of onset, intensity and duration.
While the federal government officially legalized edible cannabis
products on Oct. 17, produc-ers still need to obtain Health Canada approval, a
process that industry insiders expect to take a minimum of 60 days.
products will include only CBD, a non-intoxicating compound found in cannabis,
while others will have THC, the psychoactive compound in marijuana that
produces a “high.”
According to a report from Deloitte, the cannabis-infused beverage market will be worth an estimated $529 million per year in Canada, most of which will be on top of existing cannabis spending. Deloitte predicts sales of these beverages will come at the expense of beer, wine and other alcohol as “cannabis-curious” customers experiment with marijuana instead of booze.
Deloitte report notes that alcohol and tobacco companies are looking for
opportunities to enter the legal cannabis industry to avoid losing market
share. Pharmaceutical companies are also entering the market, as consumers turn
to CBD oil and cannabis to self-medicate.
Mild High Aimed at New Cannabis Consumers
Deloitte predicts cannabis-infused beverages will appeal to older, often
female, Canadians who are concerned about the adverse effects of alcohol and
are interested in trying cannabis yet are turned off by the idea of smoking it.
producers of THC-infused drinks are aiming for a formulation that triggers a
high within about 15-20 minutes and lasts no more than a few hours. This effect
is in contrast to most cannabis edibles and oils, which are slower to take
effect and produce a high that can last as long as six hours.
Unlike beer or wine, there’s little risk of a hangover from cannabis
beverages. Some varieties can also boast they are low-calorie drinks, which
could appeal to more diet-conscious con-sumers. Prices are expected to be
similar to that of craft beer; however, the beverages can on-ly be sold at
legal cannabis outlets, not grocery stores or alcohol retailers.
October, Ontario-based Canopy Growth Corp announced the launch of 13
cannabis-infused drinks, some boasting as few as five calories per serving. The
drinks range from pure distilled cannabis, intended to be mixed with sodas or
other beverages, to pre-mixed blends of canna-bis with tonic, ginger ale, cola,
soda and fruit-infused sparkling water.
Unlike some legal producers in the U.S., Canopy Growth’s lineup focuses
on low-dosage bev-erages with an effect similar to that of a single beer or
mixed drink. According to the Ottawa Citizen, while Health Canada allows a THC
concentration of 10 mg per package, 10 of Canopy Growth’s 13 products will have
2.5 mg or less, producing a mild high aimed at appealing to inexperienced
cannabis users looking for an alternative to alcohol.
Truss Beverage Company has also announced it will be ready to release
cannabis-infused beverages in December, including CBD-infused spring water and
THC-infused drinks. Compet-itor Fluent Beverage Company said it would be
prepared to release CBD-infused beverages but is still working on formulations
Push Into Cannabis Beverages
since Canada legalized the sale and consumption of cannabis, big beer companies
have been teaming up with cannabis companies to develop cannabis-infused
Canopy Growth, for example, has benefited from billions of dollars of
investment from U.S.-based Constellation Brands, maker of Corona. Truss
Beverage is the product of a joint venture between Molson Coors and cannabis
producer Hexo, and Fluent Beverage is backed by An-heuser-Busch, who has
partnered with British Columbia-based pot producer Tilray.
June, Bloomberg reported that Molson estimates cannabis beverages will make up
20-30% of Canada’s legal cannabis market. However, a report by Deloitte
estimated drinks make up just 1% of sales by value and volume in U.S. states
where pot is legal.
Marketing, Labeling Restrictions on Cannabis Beverages
If cannabis beverage producers want to steal
market share from beer and wine, they need to overcome the strict limitations
on marketing, packaging, labeling and distribution imposed by Health Canada.
Consumers are thirsty and
they want something new. Increased demand for all things local and unique have
helped pave the way for a surge of craft distilleries across the country. For
those interested in starting a craft distillery today, there is a wealth of
resources available to help navigate the unknown. Many toes have been stubbed
by those who have been through the startup gauntlet and came out successful on
the other side, lighting the path that new distillers can follow. Finally,
let’s look at some of the proven, key attributes of a successful craft
Find Your Niche, Strengths
Every craft distillery is
different. That is what makes this industry so exciting. Every distillery
starts with different goals, aspirations, skill sets, strategic strengths, and
weaknesses. What is your story? What makes you different than the other 900
craft distilleries? If your sales representatives are in front of a new
account, how will you get and keep their attention after they leave? Are you
the first in your area? Is there something special about your grains or
recipes? What does your background and strengths give you as a competitive
advantage? Whether you have a business, marketing, technical, accounting,
tasting, bartending, packaging, or engineering background, identify and
capitalize on your team’s unique skillset to make a lasting mark in the industry.
Understand Your State
Not all states are craft
distillery friendly. Some states permit craft distilleries a great deal more
flexibility than others. Colorado, as example, permits self-distribution and
sales direct to retailers or bars, bottle sales direct to consumers, and sales
by the drink out of the distillery tasting room. Washington State has similar
distillery-friendly legislation. For these reasons, there are more craft
distilleries in these states than any other. States, including some control
states, can have very restricting laws making turning a profit very hard.
Successful distilleries have come from restrictive states but their struggle is
uphill. If you have flexibility in deciding where to open a new craft
distillery, research the laws and find a state and a region that is distillery
Foot Traffic is King
The most successful craft
distilleries leverage their location. Ole Smoky Distillery in Gatlinburg, TN
handles thousands of thirsty tourists each week, all lining up for free
tastings of their flavored moonshines. Port Chilkoot Distillery in Haines,
Alaska has cruise ships dock 500 feet from their distillery that unload 2,000
thirsty passengers right into their backyard. Hotel Tango Distillery is turning
into the hangout bar for locals in downtown Indianapolis, Indiana. Dancing
Pines Distillery in Loveland, Colorado is in the middle of a Denver suburb and
has gained a significant following. Is there a successful brewery or winery
near you that draws a large crowd? A new craft distillery in the area can offer
exciting opportunities for co-branding like bourbon barrel aged beer or a wine
barrel finished rum. Urban distilleries can require expensive real estate but
the opportunities for distribution and loyal foot traffic can lead to big
Quality is the Only Option
First and foremost a
successful craft distillery must have a high quality, great tasting product. If
a consumer is going to spend $35-$70 per bottle on a local craft spirit, it
better taste good. If the spirit does not meet expectations, the risk is a bad
mark on the entire craft industry. Take your time on your formulation. Get
feedback from professional tasters, bartenders, distributors, and consumers
before you release the product. For example, finding the right combination of
gin botanicals does not happen on the first batch. For aged spirits, don’t rush
bottling your product if the spirit is not ready. Time, experimentation,
research, blood, sweat and tears go into a successful brand and it does not happen
overnight. The even harder challenge is making a high quality product in a
process that is scalable to meet increasing demand.
Do the Math on Still Size
The most common question I get asked when consulting on a startup is “How big of a still should I buy?” My answer is, “How much money do you NEED to make?”
Here is a simple example:
Distilling a batch of spirits from grain on a 60 gallon pot still will make you about four 12pk cases a day (about 7-9 Proof gallons), depending on the mash bill. If these bottles retail for $40 per bottle, you can probably sell those bottles to a distributor for $20/bottle. That is a total possible revenue of $960/day.
Assuming a healthy 40% profit margin after Cost of Goods Sold for raw materials, you can net $384/day.
Assuming you distill Monday to Friday for 250 days per year, can $96,000 per year after material costs cover overhead, rent, other expenses, and payroll?
Assuming reasonably similar labor inputs and profit margins on materials, a 600 gallon pot still will produce 10x the spirits in the same number of working days.
At that production level, a distillery can both sell unaged products and lay down spirits for aging. Estimate your revenue needs to cover your overhead and back into how many cases you need sell. Reasonability account for year over year growth and calculate how big your still needs to be to keep up with demand.
Source or Not, but be Transparent
Large distilleries know
they can make vodka from scratch for $15-$35 per proof gallon. They also know
they can buy beverage grade Grain Neutral Spirits (GNS) that can be used for
vodka, gin, liqueurs, or “moonshine” for $1.50-$4.50 per proof gallon. Instead
of aging spirits for years, if available and cost effective, sourcing aged
spirits from established distilleries can allow start up craft brands to add
aged whiskey to their portfolio immediately. Without debating the pros and cons
of sourcing spirits, it is important to follow all labeling guidelines and
regulations. If you take pride in making it from scratch, let the world know.
If you don’t distill the spirits at your distillery, do not imply as such on
Sales and Marketing
Once you’ve distilled or blended an award winning craft spirit, you have to get the consumers’ attention. The most successful craft distilleries with growing market share know that marketing dollars are key. Tasting events, radio promotions, print advertisements, and social media blasts are not only expensive, but take up your time.
Distributors can be great partners to help open new markets but the ultimate responsibility is on you to provide boots on the ground support for your brand. Convincing brand-loyal consumers to try your product is hard and expensive. Sharing the cost of promotions, samples, and incentives with your distributor is common, especially for new brands, but can take a big piece out of your margins. A rough estimate for a marketing spend budget is 10% or more of your annual revenue.
As a new generation of craft distilleries open, standing on the shoulders of those who opened before them, they have an incredible opportunity to be a part of rapidly growing industry. The path has been lit by history’s pitfalls trying not to repeat themselves.
The time is right to start a new craft distillery while learning from the most successful in the industry. No matter what your background, find your strengths and create your story. Find a location that is both craft-friendly and draws visitors. Make smart business decisions about equipment and marketing. But most of all, embrace your responsibility to ensure your product tastes good and be a positive reflection of the craft community.
There has never been a better time to start a craft distillery. As previously explored, new distillers can stand on the shoulders of established craft distillers who have paved the trail over the last five years. There is an abundance of resources available including online forums, distillers’ conferences, craft-focused trade shows, local distiller guilds, experienced consultants, and a Tax and Trade Bureau (TTB) that has never been more approachable.
However, this is by no
means an easy and well-lit path. It can be a very expensive and frustrating
adventure. What can we learn from others who have successfully accomplished the
startup gauntlet? Hopefully the history of toe stubbing and blindly stumbling
through starting a new craft distillery doesn’t need to repeat itself. Here are
some of the most common pitfalls of starting a new distillery:
1. No Business
Model or Minimal Operations Cash Reserve
This is the most common
issue I have seen. Distillers should ask themselves some fundamental questions
like: What are your revenue goals? How many cases do you need to sell to make
those goals? What are your Costs of Good Sold (COGS) for the raw materials
needed to make those cases? What are your fixed expenses like rent, full time
labor, and loan interest? How much capital investment do you need to start up?
How much cash do you need in reserve to run the business until the distillery
starts shipping orders? An easy to understand business model is invaluable to
setting sales and production goals, getting a loan, or enticing investors.
2. No Chilling System
Distillers will spend lots
of time and money to add heat, steam, and energy to cook their mash and to run
their still but completely overlook the equipment needed to remove that same
heat from the system. Crash cooling a hot grain mash with chilled water can
help to minimize bacterial growth. Having an abundant supply of cold water
keeps your chiller running efficiently. Cold water can also be used to cool
your fermenters to help avoid overheating and stalling fermentation.
3. No Thought to Waste Water
I have seen many craft
distilleries rely on cheap, abundant municipal city water to cool their
condenser but run that water straight down the drain. Many distillers waste
thousands of gallons of water daily. Even if waste water is practically free to
dump down the sewer, that water could be re-used and recycled. Try using the
hot, clean water from your condenser as the water for your grain mashing.
Investing in a cheap poly tank to hold some of the water as part of a recycling
system can save thousands of gallons of water every day.
Understanding TTB Compliance and Reporting Regulations
This issue appears to be
systemic with new craft distillers. Passing the DSP application process is only
one of many hurdles to running a federally compliant distillery. Meticulous
records must be kept and Operations Reports must be filed monthly. Excise taxes
must be calculated correctly and paid on time. It is not a requirement to
memorize the CFR chapter and verse, but a deep understanding of the regulations
is a must to avoid penalties, interest, or even being shut down. Like other
resources, there are systems available to help craft distillers manage their
TTB reporting, operations tracking, and excise tax liabilities to minimize the
learning curve and headaches.
5. Not Involving Local Regulators
A local craft distillery
is not something that most county or city regulators have ever had to license.
If you are the first craft distillery in your area, the odds are your local
zoning, health, environmental, and fire regulators will have to create new
codes to accommodate your operations. Getting the officials involved early on
in your planning and development is key. After completing all your building
renovations is an unfortunate time to discover the fire marshal requires
installing an unbudgeted $20,000 sprinkler system.
6. Difficult Layout, Too Small of a Space
Distillery equipment is
big. Vodka columns can be 20+ feet tall. A 600 gallon pot still kettle can be 8
feet wide. Fermenters, pallets of glass, racks, grain sacks, bottling
equipment, finished goods, mash cookers, storage totes… they all take up space.
Can you access and move everything with a forklift? Are your doorways big
enough to move equipment and materials? Do you have a dock door for truck
loading? Don’t underestimate the space needed to operate an efficient
7. The DJ Dilemma
While sitting in a dark
studio it is very easy for a radio disk jockey to play the music he wants to
hear, even though it may not be the music his audience enjoys. Just because a
distiller wants to make something, doesn’t mean it will sell. I know a
distiller who adamantly wants to make brandy even though the market for brandy
in his area is next to nothing. It is important to be passionate about what you
make but don’t let that blind you from making a solid business decision. Find
the line between running a profitable business and having a hobby.
8. Making Whiskey with No Available Barrels
Whiskey is hot right now.
Brown spirits like bourbon are experiencing double digit growth with record
high shelf prices and consumer demand. But there is a serious problem for new
craft distillers hoping to jump on the whiskey bandwagon. There are no new oak
barrels available. In order to make bourbon, you need a consistent supply of
new, charred, white oak barrels. Although cooperage capacity is slowly opening
back up, the waiting list for barrels is anywhere from six months to over a
year. If you want to open a craft distillery today, white spirits like gin,
vodka, rum, non-grape brandies, corn whiskey, or flavored liqueurs may be your
only options to make for a while.
A common lesson I hear amongst the established craft distillers who survived starting up is, “I didn’t know what I didn’t know.” While there is no way to predict every issue while starting up any new business, these are some of the common obstacles that future distillers can avoid. We are in an exciting period of growth for the craft distilling industry as more and more consumers are seeking something new and different. The first distillers muddled through complete darkness and came out successfully on the other side. We may all stub our toes while wading through the unknowns of beginning a new distillery but learning a few of these cautionary tales will help light your path.
Competition is fierce! With the number of craft breweries
and brewpubs continually on the rise year-over-year, it should come as no
surprise that current bar owners and operators must focus on more than just
word of mouth, radio ads or the occasional 30 seconds of air time on the local
network to create buzz about their business. Developing a marketing plan to
maintain visibility and relevance is key to both the initial and ongoing
success of your business.
But not just any marketing strategy will do.
A robust and diverse digital
marketing plan, one that also leverages
mobile technology, will play a significant role with effectively attracting and
retaining customers. Utilizing loyalty apps and a variety of marketing
automation initiatives will ultimately allow you to spend less time and
money on your overall marketing efforts, while simplifying and maintaining your
path for continued growth and success.
All of this
speaks to the advancement of technology within this space. As such, it should
come as no surprise that the role of technology continues to be on the rise,
both in terms of what is in the hands of you and your loyal customers – on
their phones and through a more personalized interface with your business – as
well as the technology your business may currently be utilizing.
involvement of technology is very much a generational change and one that craft
brewery and bar owners are recognizing as a means to become better and more
productive at what they do. The old saying, “work smarter, not harder” rings
true across the board.
Align yourself with mobile technology and mobile marketing
By 2020, 77% of the US population will be using
mobile technology daily. It’s the go-to technology for personalized
communications. Adding to this impressive statistic is the notion that thirty-five percent of smartphone users are
already claiming to use their phones more than 50 times a day—this is where craft
brewery and bar owners and operators can make the biggest impact. Personal means connecting with customer routines,
moods and of course, discerning taste buds. Data makes it possible—mobile makes
Most consumers expect information to be available at their fingertips. The
vast majority of consumers are searching for information about a particular
business on their smartphone, with 84% of them contacting that
business as a result. An app with your menus, reservation, ordering, payment
and delivery capabilities maintain accessibility and convenience. And
convenience is a big part of the overall experience that customers are looking
for. If too much is being asked of your customers they may abandon your
business before ever stepping through the front door.
Attracting new customers, building
loyalty and running a variety of continuous promotions requires a heavy
investment of time and energy. An automated marketing strategy allows you to
focus on what you do best—providing great craft brews and exceptional service.
Capture your guests at every touch point with pre-scheduled communications,
photo push messaging, social media posts and more. Utilizing a robust app for your business allows you to
capture more first-time guests, make your regular guests feel like insiders and
remind customers who haven’t visited with you in a while why they should
Utilizing technology does not necessarily equate to an
entirely new business plan. However, it does mean that you now have an option
to execute your current plan better, while also being able to expand and grow
them quicker. An example of this is identifying those efforts that you may
currently be doing with email, paper punch cards or in-house only promotions
and taking that to a mobile and digital platform as a means to obtain more
control and visibility for everyone involved – customers and owners alike.
An app has the ability to
act as your personal, day-to-day assistant. If you don’t have the time or money
to hire and manage another employee, it might be time to look at technology as
the employee that never gets tired. With it you can send your loyal customers
birthday wishes, offers and alerts, giving them the personalized experience
they prefer and deserve. With an automated marketing strategy, you can create a
series of push notifications triggered by their activity. Notifications can be
sent right away, pre-scheduled or programmed to be delivered in certain
scenarios. Either way, it communicates why your business is the perfect option
for that moment.
with your media
Customers love to see what is offered
before deciding where to go. Show them, don’t just tell them. Instagram and
Pinterest are fantastic options for enticing people with tasty-looking and
thirst-quenching photos. It’s also beneficial to develop short, unique videos –
such as a quick recipe or a behind-the-scenes look at your brewery. And don’t
forget to use trending hashtags to increase post visibility. For example,
include #happyhour, #newbrew, or #foodielife, along with the name of your craft
brewery or bar. All of this will help keep your establishment top of mind with both
your regulars and first time customers.
Your customers are always
looking online to get ideas when thinking about visiting a new business. To
ease this process, make sure that all of your social profiles are up to date
and easy to read, as well as portray your business with the correct ambiance. It’s
not uncommon for new customers to be hesitant about visiting the unknown. Your
social presence needs to provide a compelling reason for them to engage with
you. However, never sell your business through a clouded social media lens. Customers
expecting one experience based on how your business is represented on social
media, only to walk in to something entirely different, will likely result in
negatively affecting your business as a whole.
Your social media
promotional efforts should also be backed up with an engaging customer-facing
website in order to complete the experience. This will further provide your
customers with an even better idea as to what they can expect when choosing
your business over the competition. Think of a great website as a first
handshake, before they commit to visiting your business for the first time.
Your website must be mobile friendly so that it can easily be viewed from your
phone without distorting the message or making the experience inferior in any
here to stay
trend in technology is a strong reflection as to how business owners are
looking to maintain their operations with their distributor – online,
expedited, quick-to-answer and respond and capable of addressing all of your
needs through a variety of technological channels and initiatives. It would be
unfair and, quite frankly, unacceptable, for a distributor to suggest that you
engage with your customers through the advancements of technology if they
themselves are not capable of providing the same level of service to meet your
day-to-day business needs. Technology will continue to impact and affect buyer
behavior. This can be seen both from the customers that frequent your
establishment, as well as the way that you engage (or want to engage) with
Consumer preferences are changing
faster than ever, dictating how your business must respond. The distributor
that you have chosen to partner with should be in the business of delivering value.
When they deliver on value, it demonstrates an understanding of what is truly
important. A distributor capable
of delivering value and unforgettable experiences is infectious, and it will help
you, in turn, deliver unforgettable experiences to your own customers.
A thoughtful and in-the-know distributor should always have the pulse
of what consumers want as a means to help you innovate and continually reinvent
yourself in order to remain relevant in a highly competitive landscape. When
they can adapt and respond with speed and agility, they help you to keep pace, stay
relevant and often outpace your competition. Ultimately,
their business should be dedicated to helping you succeed with yours, utilizing
non-traditional methods to better serve your needs through more interesting and
engaging uses of product management, technology and education. While it’s true
that people do business with people they like, they also look to do business
with the people that are committed and able to execute. Finding a distributor
that can serve you better and become a comprehensive, go-to resource for all of
your business needs is the end game.
Technology is advancing faster than ever before and it’s here to stay. As a business owner, your digital media strategy should be flexible to more easily respond to what does and doesn’t work. Discover how your customers found out about you to gauge where they’re spending time online in order to maximize those platforms. Cross-link all of your online profiles and link your website to your mobile app and social media pages. In doing so, you’ll be able to strategically cover more ground while building a base of followers on their preferred platform. The end result will likely translate to an increase in new traffic, while also building upon an established foundation of regulars.
It’s hard to deny that this past summer was the summer of hard
seltzer. In fact, it was a summer that saw hard seltzer grow to more than $1
billion dollars in sales. In just the week of July 4 this past summer, White
Claw and Truly seltzers combined sold over 100,000 barrels of product. That’s
enough to put them in the Top 50 Craft Breweries for production over the whole
year. It’s no surprise that craft breweries large and small are looking to tap
into the apparent gold mine that is hard seltzer, but how they approach it
doesn’t quite seem to stand up against the segment’s largest competitors, and
that’s worth thinking about. At a recent industry panel in Charlotte, NC,
several craft brewers who make seltzers spoke about their perspectives on this
new slice of the industry.
This might seem fairly
obvious with the sales numbers that hard seltzers are putting up, but a closer
look at the craft beer industry tells a slightly different story. Recently in
an interview, the senior vice president of marketing for Mark Anthony Brands
(the makers of White Claw) noted that though White Claw has incredible
penetration in grocery stores and liquor stores nationwide, only about 20 percent
of bars and restaurants are currently selling hard seltzers. For the average
small craft brewer, the opposite is true – while the limited shelf space of
grocery is locked behind the arcane process of distributor-led Planograms,
inaccessible to most small breweries, they are nearly ubiquitous on draft
systems in bars and restaurants eager to serve local beer. So, why chase a
segment which shows so little relevance in their primary market?
“After the surge of
LaCroix in the non-alcoholic market, we took a hard look, and it’s what our
market research showed our customers wanted,” said Colleen Quinn, of Craft Beer
Alliance (CBA). Their market research showed something else interesting – that
while most hard seltzers are marketed specifically toward young women, their
targeted demographic tended to skew almost 50-50 male-female. It led to CBA’s
decision to package their multiple seltzer brands in regular 12 ounce cans,
rather than slim cans like their competitors.
“I’m looking for one more
reason to keep the customer in their seat,” says Mike Rollinson of Joymongers
Brewery, a brewery that enjoys two taproom locations in Central North Carolina,
but no off-premise distribution. “I don’t see it as craft. I’m not making a
seltzer for beer drinkers. I’m making a seltzer for the one person in a group
of 5 people who will pressure the group into leaving if there’s not something
for them to drink.” Rollinson just started making seltzers this year as he saw
the trend grow, noting that one of his business partners is on a Keto diet and
now drinks his seltzer almost exclusively – as a healthy alternative to beer.
Clear or Colored – the Question of Craft
While the two major market
players, White Claw and Truly, are both crystal clear beverages, two of the producers
on the panel noted that color helped them differentiate. Both Brian Quinn of
Town Brewing Company and Lindsay Sprick of NoDa Brewing Company pointed to
their process as an advantage over the big seltzer makers.
“I can guarantee that
nobody at White Claw was sitting down last week processing a ton of raw
ginger,” Quinn noted with a smile. “We’re small enough that we can use natural
ingredients as a base for these seltzers.” Those natural ingredients come with
their own colors and – he thinks – customers want to see the presence of those
ingredients in the product when they’re ordered. “When you get something that’s
wild cherry flavored and it’s clear, you ask yourself: where’s the cherry in
Sprick, of NoDa, shared a
similar feeling: “We stand out because we’re using the same ingredients that we
use make our beer.” She felt that it was more true to the brand and brewing
ethos of NoDa Brewing Company than a clear, sparkling beverage. NoDa’s Brizo
Seltzer, unlike other seltzers represented on the panel, is barley-based, which
lends even more color to the finished product than the others.
Rollinson had a different
take at Joymongers. “When I see a color, like red or blue or purple in a glass,
that reads ‘sweet’ to me, and that’s not what this is.” He mentioned that
because his primary customer is not one that’s seeking this for a fruit flavor,
but rather as an alternative beverage or a more healthy choice, that the
neutral color was a better choice. “The only people who have complained about
it being clear were bartenders because they throw it out by mistake because
they think it’s water.”
seltzers fall into a slight grey area of regulation from both the Trade and Tax
Bureau (TTB) and the Food and Drug Administration (FDA). Hard seltzers are the
product of fermenting sugar into alcohol and fall under the manufacturing umbrella
of a brewery, but labeling considerations vary based on what sugar base is used
as the basis of fermentation. A brewer who uses a barley base – even a very
light brewer’s malt – still falls under the definition of a beer, requiring a
pre-market Certificate of Label Approval (or COLA) and is restricted by certain
advertising laws. A brewery who uses sugar as the base for their seltzer is not
required to obtain TTB approval as it is not a malt beverage. However, they do
fall under FDA labeling guidelines which require a nutrition panel and a list
While it might seem
attractive to a brewery to skip TTB approval and jump straight to FDA labeling
because the FDA does not have pre-market approval requirements, it’s important
to know that FDA labeling is required to be in compliance before sales and that
manufacturers can be held liable to both financial and regulator consequences.
Consult your lawyer for best practices.
None of the panelists
chose to share which path they had taken from a regulatory standpoint.
What’s in the Mix
Clearly, there are as many
ways to approach making hard seltzers as there are reasons to make it.
Fermenting white sugar seemed to be the preferential approach to creating a
fermentation base for hard seltzers. Of the panelists, NoDa was the only one
Most of the panelists
spoke of these seltzers as good gluten-free alternatives to beer and marketed
their seltzers as either gluten-free or gluten-reduced. NoDa used ClarityFerm
from White Labs to reduce gluten content in their barley-based seltzer but
others simply brewed on their normal equipment directly after “CIP day” in
order to guarantee no gluten would be present in the final product. Quinn of
Town Brewing shared that lab results showed no traces of gluten in his
From there, the small
producers all had a similar strategy of using whole ingredients to flavor as
they would for any flavored beer, whether that’s the addition of aseptic fruit
puree or hand processing ginger for additions during fermentation. They seemed
to feel that the use of “real ingredients” was a way to stand out versus large
scale competitors from a flavor standpoint as well as an ethical one. They
appeared to share the belief that it “felt more like craft.”
Yeast was a large
differentiator between the producers. While Rollinson at Joymongers used ale
yeast to ferment his seltzer, making a note that harvested yeast seemed to
perform much better than a fresh pitch, Quinn of Town used Distiller’s Yeast,
seeking a strong, healthy fermentation that would get as dry as possible. Both
mentioned the need for high amounts of yeast nutrients. “As it turns out,”
Rollinson joked, “yeast doesn’t really like to digest straight glucose.”
Where It’s All Going
All of the panelists
agreed: hard seltzer is a trend that is doing nothing but growing, and they all
agreed that their futures had more and varied seltzers in it. Each of them was
excited to experiment in the market and push the bounds of craft’s involvement
in the segment.
The question remains for
you – will we continue to see on-premise growth in a meaningful way that the
craft market can take advantage of, or will hard seltzer grow only in larger
and larger stacks in grocery stores? We’ll have to wait for the next White Claw
Summer to find out.
Three beverages are the most consumed in the world: water, tea…and
beer. Regional breweries, brewpubs,
microbreweries, and contract brewing companies all experienced growth in 2018.
In the United States, 219 breweries closed, but 1,049 opened last year. In
Canada, there was a slight decline in domestic beer production last
year—3.4%—and only a scant increase in sales—0.3%. Nevertheless, 178 breweries
Producers and consumers
alike want the diverse selection, high quality and community connection craft
brewing provides. This makes entering the industry an enticing option. So to
answer some brewery start-up questions, we’ve compiled a few experts to share
their acumen. They include:
• Jeffrey Gunn, president and CEO ofIDD Process & Packaging, based in Moorpark, California. IDD is a family-owned corporation that provides the consultation, design and manufacture of complete brewery and beverage plant systems.
• Lindsay Johnson, operations manager, and Shawn Johnson, head brewer, Birds Fly South Ale Project (BFS) and tasting room in Greenville, South Carolina. Named one of 2019’s Top 10 Breweries by the U.S. Open Beer Championship, BFS specializes in Farmhouse and Saisons, along with sours, funky IPAs, barrel-aged brews, and range of wild and traditional styles. BFS is also on the 2019 Thrillist “Most Underrated Brewery in Every State” list.
• Ben Parker, CEO, Scan American Corporation, located in Kansas City, Missouri; and Aubrey Dyer, business development manager, Flavourtech, represented by Scan American in North America. Flavourtech is a global technology manufacturer that specializes in aroma recovery, extraction and evaporation solutions for the food, beverage and pharmaceutical industries.
• Christian Riemerschmid von der Heide, president and CEO of theSiebel Institute of Technology (SIT) in Chicago, along with John Hannafan, vice president and director of education. SIT is a for-profit vocational school for brewing education and brewing services. Founded in 1868, it’s oldest brewing school in the United States and home of the World Brewing Academy program, offering campus and web-based courses jointly developed with Doemens Academy of Munich.
The three primary start-up
takeaways they want you to remember:
time to learn. Whether it’s refining your processes or understanding how to scale
up, knowledge is power.
equipment wisely. Everyone makes different choices—research and compare to make the
right decision for your business.
patient, young Jedi. Slow, budgeted growth and the right partnerships make more sense
for long-term sustainability and adaption to trends.
These experts provided
much more valued insight than print space allows, so we’ll highlight some of
the top aspects.
Take Time to Learn
The Johnsons were a Coast
Guard family for more than 20 years, all the while gradually expanding their
brewing and business knowledge. “We invested sweat equity first,” Johnson said.
“We started home brewing while in Alaska. As we lived in different locations
with the Coast Guard, Shawn was able to volunteer at several breweries,
learning different aspects of business.”
In 2016, Shawn officially
retired from service, with a year or so of professional brewing experience as a
contract brewer for Thomas Creek Brewery, also in Greenville. “This provided us
an opportunity to test the idea and see how we wanted to proceed with a brewery
buildout,” Johnson told Beverage Master Magazine. “This period of time
made it simpler for us to find funding through investment, as we were an
established brand and gained some national level recognition early on.” BFS has
since received top medals in the Best of Craft Beer Awards, the Great American
Beer Festival and the North American Beer Awards.
Contract or nomadic
brewing often reduces start-up risks. Some craft producers try the industry on
for size, like the Johnsons. Others do it to gain gradual packaging and
distribution knowledge and capital—a wise idea, since a full-scale packaging
operation averages more than $300,000.
Some brewers develop
contract partnerships because their current facilities are out of capacity, but
budget or geographical constraints prevent expansion. In rare circumstances, a
contract partnership with a local brewery happens when someone only has
interest in running a taproom.
“We anticipated being
small and niche and allowing the education and evolution of our products to
happen slowly and organically,” Johnson said. “However, we quickly grew past
all our projections and expectation models, and continually have to be
extremely agile as our product line expands and as trends in the industry
change. Our production model hasn’t found a ceiling yet.”
Hannafan/von der Heide
believe that every good brew begins with one key ingredient.
“’First, you add
knowledge’ is one of our favorite tag lines. A producer should begin their
journey with education, and not after they run into issues,” Hannafan/von der
Heide said. “Hopefully they come to us sooner than later to avoid many of the
common pitfalls experienced by others. The same process applies brewing theory
and understanding the ‘why’ of brewing. It’s not enough to open this valve or
turn that pump on—there’s far more to brewing than the equipment side.”
SIT creates viable paths
for new producers through extensive courses on everything from the art and
science of brewing to the nuts and bolts of business operations.
“We share our knowledge by
having assisted in numerous start-ups and real experience, not just theory. We
offer a consulting arm which assists with recipe formulation all the way
through to test batches and evaluating the product,” Hannafan/von der Heide
said. “We assist with brewery start-ups and build-outs, supplier evaluation,
business case review and staff training. We like to think that the art and
science of brewing beer makes lifelong learners out of all in the brewing
Hannafan/von der Heide
said there are relatively short courses that can dramatically enhance your
probability for success. These include the two-week “Siebel Concise” course,
“Start Your Own Brewery” and “Executive Overview.”
SIT also provides another
valuable service: yeast banking. “Selecting the right yeast strain can be a key
differentiator for better flavor profile, product innovation and brewery
capacity utilization. Yeast banking, strain profiling, yeast propagation,
fermentation optimization—you can never know enough about yeast,” Hannafan/von
der Heide said.
Choose Your Equipment Wisely
Evolution in trends,
products and other aspects of the brewing industry greatly influence how to
source equipment. Spend time to evaluate options based on your ultimate goals
and budget—not necessarily what everyone else does.
“For too many years, craft
brewers grew up with the idea that the two-tank combi-brewhouse doing
three–to–four brews in 24 hours was the only way to brew beer,” Gunn said. “As
the industry grew, the systems expanded to four or five vessels, but were still
stuck in the four–to–seven brews in 24 hours process, with low efficiencies in
malt extract, water, energy, labor, effluent and so on.”
IDD specializes in
high-efficiency brewing systems, or HEBS. “HEBS mash filter brewhouses were an
unknown entity to most and misunderstood by many that were aware of them. It
continues to be an educational project, because it’s difficult for many to
believe the efficiencies we publish and the misnomers perpetrated by
conventional lauter tun brewhouse manufacturers,” Gunn said. “With HEBS capable
of 95–to–98% extracts, up to 40% overall more efficiency and up to three times
faster than a combi-brewhouse, there’s such a high ROI for a start-up or
expanding craft brewer. Obviously, size has to be adjusted down from a
conventional system because of the reduced turnaround time per brew. But
12–to–15 brews in 24 hours are the norm for HEBS.”
If you’re planning a
low-alcohol or non-alcoholic line, your equipment choice is even more specific.
For example, Flavortech uses spinning cone column (SCC) technology to enhance
flavor, efficiencies and budget.
“The day-to-day operating expenses of the SCC are low, as it’s
very energy efficient. The first two years of maintenance are also included, so
these don’t need to be budgeted for until year three,” Dyer/Parker said. “The
other main cost is dealing with the alcohol removed from the beer. Disposal can
be expensive—however, it can be a valuable income stream if re-concentrated, or
could potentially be used to fortify other products in the portfolio. It’s
important to work through this part of the equation in advance to maximize the
ROI of the system.”
allows producers to test all its equipment. “We can teach the customer how the
system works and showcase the different outcomes. A beer trial can be run with
as little as 60 gallons of product,” Dyer/Parker said. “After each trial, we’ll
complete a product tasting to see how it responds to the process. Typically,
these trials are proof of concept.”
Gunn noted an interesting
trend that influences equipment choices. “Smaller, more efficient breweries and
cans. HEBS, for example, have gone from 20–to–40 Hl brew capacity systems to 5
and 7.5 Hl brew capacity systems. This reflects on the matured craft brew
market reverting back to brewpub/restaurant and taproom style operations: local
market supply through their own establishment,” he said.
BFS took a completely
different approach to equipment. “Budgeting a brewery start-up is difficult.
We’re so capital heavy,” Johnson said. “Don’t rush into purchases. A lot of
times you see a deal, but it’ll come back. Some producers are better off
sourcing used equipment when applicable.”
Hannafan/von der Heide
offered this important reminder. “If you don’t know about equipment or sizing or
space planning, hire a seasoned, independent consultant. Don’t let your
emotional side pick the equipment suppliers. There’s a lot of unsafe,
poorly-designed equipment that will haunt your day-to-day operations and
Be Patient, Young Jedi
Our experts offered
numerous tips for new producers—here are just a few.
“We always advise the
producer to focus on employing a good industry experienced general contractor,
experienced industry-related architect, an experienced industry equipment
supplier and themselves doing their due diligence,” Gunn of IDD Process &
Packaging told Beverage Master Magazine. “The four parties working together can
achieve the best system, the right location and within budget.”
“Our initial vision was
quite different, or I’d say 60-70% different,” said Johnson of Birds Fly South
Ale Project. “We call ourselves an ale project because we’re constantly
exploring new styles, techniques and flavors. Our process is unique in that we’re
continually blending, and our beer has a chance to evolve through different
“We knew from the
beginning we wouldn’t have a ‘set’ product line,” Johnson continued. “This can
cause some educational issues when first entering into a distribution
partnership. Our brands slowly became a steady product line, but patience was
key in our relationships with distributors and retailers. So be patience in all
aspects, from hiring and budgeting finances to decision making. We like to say,
‘The beer takes two weeks or more to make—let’s give ourselves an extra hour
before we make a decision.’”
“My advice to someone
coming to us with a new product idea would be for them to sit down with us and
work through the processing details to make it a reality. The next step is to
book some time in our pilot plant and produce some product,” Dyer/Parker with
Scan American/Flavourtech said. “We have a great team of engineers with a real
depth of knowledge and can assist with the practical realities of turning ideas
in successful products.”
Dyer/Parker also pointed
out two exciting trends. “One is the move towards much higher-quality beers. I
was in Brazil last month, and the local beer we were served was so good that we
cancelled our wine order and continued to drink beer with our meal!”
Dyer/Parker said. “Parallel to this trend is the development of the
zero-alcohol segment. This fits really well with the SCC, as we enable
zero-alcohol products to meet exact quality requirements.”
The educators from the
Sieble Institute of Technology offered two final thoughts. “Create a realistic
business plan. Then, have others with industry knowledge challenge and build
your plan,” Hannafan/von der Heide said. “The craft and brewing industry is an
amazing place to be creative and excel in entrepreneurial activities. It is,
however, a place for the long run, despite the hype—there are no quick
sustainable wins. Product and process knowledge reigns.”
While both Scotch and American single malt whiskey possess some
similarities in terms of taste, their origins are quite different. Scotch is a
spirit born of tradition and known for its heterogeneity and consistency, with
brands distinguished by their geography (the Highlands, the Lowlands, the Isle
of Islay, Campbeltown, and the Speyside). Furthermore, the majority of Scotch
distillers are distributed by four companies: Diageo, Pernod Ricard, William
Grant and Sons, and Bacardi. A similar vibe besets its cousin Irish whiskey.
single malt whiskey possesses a more pioneering spirit and is distinguished
more by the style of whiskey than any particular geography. While the TTB has
not formalized strict criteria for what constitutes an American single malt,
the American Single Malt Whiskey Commission, founded in 2016, established a
standard of identity for American single malt. Currently, over 140 distilleries
have signed on as member producers of the ASMWC.
For a distiller to use the
term “American single malt” to describe their whiskey, the ASMWC recommends
that the spirit fit the following criteria:
• Made from 100% malted
• Distilled entirely at
• Mashed, distilled, and
matured in the U.S.
• Matured in oak casks of
a capacity not exceeding 700 liters.
• Distilled to no more
than 160 (U.S.) proof, or 80% alcohol by volume.
• Bottled at 80 (U.S.)
proof or more, or 40% alcohol by volume.
While the ASMWC has not
issued a specific recommendation on maturation time, producers are aging their
American single malt whiskeys in barrels at a variety of ages, from three
months to 10 years. Some American distillers get creative with the maturation
process by experimenting with used casks from breweries, wineries and other
Terms like “handcrafted”
and “produced” may be found on a bottle by those distilleries engaged in
producing mass-market spirits. Unless the bottle contains the word “distilled,”
the product cannot be considered a product made from grain to bottle by a
Before prohibition, one
could find thousands of distilleries and breweries in the U.S., particularly
along the Eastern seaboard. During this period, rye whiskey emerged as the
dominant dark spirit. After prohibition, the whiskey movement took off in Kentucky
and Tennessee, where bourbon became king.
While bourbon is part of
the whiskey family, this product differs from American single malt in several
ways. In addition to being made with at least 51% corn, the mash is distilled
using a column still. The barley mash distilled for American single malt
whiskey is typically done with a pot still, though a few distillers use a
Through consolidation and
mergers, the quality and production of all American whiskey resembled that of
mass-produced beer. However, the advent of the global food revolution in the
1950s and 60s, coupled with federal legalization of homebrewing in 1978, led to
the implosion of the craft brewing industry. Concurrently, Americans became
acquainted with beers, wines, and spirits hailing from Europe and the UK thanks
to pioneers such as Charles Finkel, co-founder of Seattle based Pike Brewing
Company, who introduced these products into the United States market.
Many distillers of
American single malt, like Christian Krogstad of Portland, Oregon-based House
Spirits Distillery and Jason Parker of Copperworks Distilling Company in
Seattle, came out of this craft revolution, beginning their careers as brewers.
Both distillers use a hundred percent malted barley and brew their wort using
the same technique employed in brewing beer.
While Krogstad waited for
his whiskey to mature, he became known for distilling Aviation Gin. The first
bottle of Aviation Gin came out in 2000, well before their first bottle of
whiskey was released in 2008. In 2016, House Spirits Distillery sold Aviation
Gin’s distribution rights so they could devote their energies to producing
Westward American Single Malt Whiskey.
Parker, Co-Founder and
President of Copperworks Distilling, followed a similar trajectory of
distilling gin and vodka until their single malt whiskey was ready for release.
For the past three years, they’ve produced whiskey from single farm, single
variety, and single vintage malts. Each batch is given a unique number and has
a slightly different taste from other batches.
Traditional Scottish Style American Single Malt Whiskeys
Other brands like
McCarthy’s Single Malt Whiskey and Westland American Single Malt Whiskey are
distilled using a traditional Scottish style. This style requires that the
whiskey be made from a mash of malted barley, distilled at a single distillery
using pot still distillation, and matured in oak casks.
After a damp trip to the
Isle of Islay where he visited several local distilleries as a way to avoid the
rain, Steve McCarthy returned to Oregon where he had the distinction of being
the first distiller to bring an American single malt to market. His whiskey,
distilled in 1993 using 100% peated barley from Scotland, was released in 1996.
While the mash used in most Scotch is distilled twice, the type of still they
use allows them to reach desired proof in a single pass. That still is often
referred to as a “hybrid pot still” or “eau-de-vie still” as it has a short
multi-chambered column above the traditional pot.
According to Steve Hawley,
Director of Marketing for Westland Distillery, their distillery was founded in
2010 with the ambition to add a new and uniquely American voice to the world of
single malt whiskey. “When we began, we adopted the same basic processes used
for generations in the whiskey-making of the old world, but we don’t simply
seek to replicate the results. Instead, we work to create whiskeys that reflect
the distinct qualities of our time, place, and culture here in the Pacific Northwest.”
Developments in American Single
According to Adam Foy,
Vice President of Business Development for Skagit Valley Malting, “Barley grown
for yield is about sameness, whereas, we grow barley for distinction by
searching the globe for unique and distinct barleys that provide varietal
nuances.” Connecting the origins of the barley used in the mash to a single
farm or variety adds another dimension to the term “single malt.”
Copperworks partner with Skagit Valley Malting and other like-minded companies
to craft what Parker refers to as non-commodity malts. “Instead of measuring
our efficiency from farm-to-bottle, we measure the flavor from unique malts to
bottle, and share these flavors as different whiskeys, rather than a standard
Currently, Copperworks is
maturing whiskey that was produced using locally-grown malt from the Skagit
Valley and infusing it with smoke from Washington-sourced peat. They brewed the
malt into a beer with no hops, distilled, and matured in new, charred American
Oak barrels with a number one char, the lightest of chars, so as not to
overwhelm the peat flavors.
Currently, Westland is
working with partners on a holistic barley program that focuses on flavor and
includes breeding unique varietals suited to the Pacific Northwest region.
“We’re malting them using innovative new technologies, and building a
sustainable—both agriculturally and economically—model for bringing those
barleys to market for use in distilling,” Hawley said.
A few distilleries have
begun to experiment with imparting smoke instead of peat into their barley
through the use of cherry wood, mesquite, or scrub oak. In particular, mesquite
lends a natural smokey and spicy flavor without adding artificial flavorings
found in commercial cinnamon whiskey.
Then comes Wanderback
Whiskey Company, a distillery with a unique production focus. They partner with
various single malt producers in the United States to make their whiskey using
a bespoke grain bill that’s grown in the Pacific Northwest. Then they age,
blend, and bottle small batch releases on their family farm in Hood River,
Pushing the Boundaries with Innovative Cocktails
While Scottish tradition
maintains that one should drink Scotch neat, adding only a drop or so of water
to help bring out the flavor, some American distillers are blazing new
territories by creating craft cocktails. At events, such as PROOF: Washington
Distillers Festival, participants can sample a range of single malts, as well
as unique cocktails while sitting in on educational sessions. A trek to Tankard
& Tun, Pike Brewing Company’s Seafood Restaurant, features beer cocktails
made with spirits from Copperworks Distilling. Historical tidbit: Parker was
the first brewer for the Pike Brewing Company when it opened in 1989.
In addition to offering
tasting flights, House Spirits Distillery serves up a range of cocktails
including a Boulevardier (a Negroni for whiskey lovers). Also, during their
repeat appearances at Feast Portland, they showcase their traditional side by
featuring Westward at one of Feast’s signature BBQ events, Smoked. But then
they’ll display their more flamboyant side by demonstrating how a quality
spirit can enhance the cocktail experience. For example, at Smoked 2019, they
featured a S’Mores Old Fashioned made with Westaward American Single Malt
Whiskey, graham cracker honey, chocolate bitters, and toasted marshmallow.
As members of the ASMWC continue to win
national and global awards and competitions, this commission continues to push
for the formal establishment of a “single malt whiskey” category. Already, the
American Distilling Institute has established the “American single malt
whiskey” category for those whiskeys made according to ASMWC’s proposed
statement of identity.
When Meghann Quinn’s great-grandparents planted their first acres
of hops in 1932, little did they know that their great-grand-daughter would be
responsible for the business side of what is now Bale Breaker Brewing Company,
a family-owned enterprise ranked last year as the fifth-largest independent
craft brewery in Washington state.
At Bale Breaker Brewing
Company, women play an integral role in nearly all aspects of the business,
from the farm to the tasting room. It is
a tradition that Quinn traces back to her great-grandmother, Leota Mae Loftus,
the namesake of the brewery’s Leota Mae IPA.
“It never occurred to
Leota that there was a job she couldn’t do,” Quinn said. “If an irrigation
ditch needed to be dug, crops needed to be picked, or workers needed to be fed,
she was the lone woman on the crew beside—or in front of—the men, getting the
job done. In fact, throughout the 1940s,
she was the only woman hop drier in the Yakima Valley.” In those days, Quinn
says, hops drying was done by hand.
Fast forward to the 21st
century. Bale Breaker Brewing Company operates out of a 27,000 square foot
facility housing a 30-barrel brewhouse. The brewery’s tasting room is right in
the center of Hop Field #41, part of roughly 2,200 acres of the family farm in
the heart of Washington’s Yakima Valley, where Quinn and her three brothers
“My dad always says that
when you grow up among them, hops become part of your DNA,” said Quinn. “I
guess my brothers and I are pretty good examples of that.”
Quinn earned a degree in
Business Finance from the University of Washington. She now handles all things
business at the brewery, including finance, accounting, reporting, marketing,
public relations and the like. However, she proudly points to the team of women
whose expertise gives Bale Breaker Brewing its competitive edge.
our Quality & Sensory Manager. She has a degree in microbiology from
Northwestern, has developed a robust in-house sensory program from scratch, and
makes sure all of the beer we send out is up to our high-quality standards,”
said Quinn. “Erin Schlect and Shayna Koch are two young moms who run our
accounting department. Our marketing
department consists of Danika Norman (Marketing Manager), Sara Gottlieb (Social
Media Manager) and Marguerite Washut (Marketing and Events Coordinator). These three women are essential to driving
our brand forward and effectively communicating to and connecting with our
Quinn also said three of
the company’s four-person outside sales team are women. Sara Verdieck covers
western Washington, Kat Finn handles Oregon, and Justine Malland tackles
eastern Washington and northern Idaho. “These women are the face of Bale
Breaker with our distributors and accounts throughout our distribution footprint.”
Pink Boots Society
Quinn and members of her
team at Bale Breaker Brewing are among the more than 2,000 women worldwide who
network through The Pink Boots Society. This nonprofit organization, founded by brewing pioneer Teri Fahrendorf,
supports women engaged in the brewing profession and, in particular, the craft
brewing industry. The group, which began in 2007 with fewer than 20 members,
helps women brewers connect with mentors and advance their brewing knowledge
through education. Educational opportunities receive support through
scholarship money the group raises to help women advance in the industry. There are Pink Boots Society chapters across
the United States and global chapters in Canada, Europe, Asia, South America,
New Zealand and Australia.
Bron Yr Aur Brewing Company
Be it a global enterprise
or a blossoming start-up in the U.S., women have come into their own in the
craft brewing industry. Bron Yr Aur Brewing Company is among the latter, a
fast-rising brewery and restaurant owned and operated by the Hatton family, who’ve
called Yakima Valley home for seven generations. Annette Hatten, whose husband,
Mike, had been a homebrewer for more than a decade, decided to turn an old
fruit stand into a brewery with a restaurant. Bron Yr Aur Brewing Company
opened for business in 2013 and the Hatten children, Zach, Amanda and Trevor,
gave up their day jobs to pitch in and contribute to the brewery’s success.
They’ve focused on capturing space in the competitive craft beer market by
combining its brewery offerings with innovative restaurant fare, ranging from
its popular pizza varieties to its beer brownies.
Annette Hatton is involved
in day-to-day operations, brewing recommendations, as well as recipe
development for the kitchen and distillery. Daughter Amanda, co-owner and Operations
Manager, was recently awarded the Yakima Valley Tourism Ambassador of the Year
Award. She sees to it that Yakima Valley produce gets featured on the
restaurant menu. She also manages the brewery’s community outreach, creating
innovative partnerships with local organizations and small businesses. Amanda says that the opportunity to work side
by side with her mother is a gift.
“Not only do I get to
spend time with her every day, but we get to collaborate on many great ideas
and have a ton of creative energy flowing, which I love.”
Cowiche Creek Brewing Company
Maria Nordberg worked side
by side with husband Derrick to build the Cowiche Creek Brewing Company, which
opened for business in 2017. What started as a homebrewing project evolved into
a full-fledged business plan to launch a brewery that’s products would showcase
the citrusy, piney, and tropical hops varieties of Yakima Valley. Nordberg has
a background in food safety management from her position at Yakima’s Green Acre
Farms, a fourth-generation family operation with a vineyard, orchard and
hopyard, as well as row crops. Cowiche Creek Brewing gets much of their hops
from Green Acres, although the Nordbergs also grow and use their own varieties
To keep a firm hold on
construction costs, The Nordbergs built the brewery’s 20 barrel brewhouse and
taproom by combining their own sweat equity with their skilled tradesmen
friends who knew how to do tile work, plumbing and other construction trades.
Marketing strategies for
Cowiche Creek include electronic gift cards available online, as well as
business partnerships with restaurants, bars, hotels and casinos in the Yakima
Valley area that feature the brewery’s products. Maria says that at the end of
the day, it’s the customers ‘ appreciation for the brewery’s offerings that
“All the hard work is
worth it when you see a smile on someone’s face and knowing you helped put it
Like a Lady Boss
Women who don’t directly
brew craft beer have still found a way to incorporate it—or its ingredients –
into their businesses. A prime example is HopTown Wood-Fired Pizza, which
features pizzas sprinkled with hops from Yakima Valley. Co-owners Lori Roy and Carrie Wright serve
wood-fired fare, showcasing fresh-from-the-farm ingredients paired with local
craft beers, wines and ciders. “We celebrate the hop heritage of our community
with our award-winning pizzas and our local brews,” said Wright.
There are also the women
who keep the taproom flowing, responsible for everything from managing staff to
operations. Such are the responsibilities of Rachel Verhey-Goicoechea, Taproom
Manager and Cellar Assistant at Varietal Beer Company, located in the Yakima
Valley community of Sunnyside, the second-largest city in Yakima County. Varietal, which opened last year, joins an already crowded field of craft beer
establishments in the Lower Yakima Valley area but is holding its own as a
popular gathering place. It’s headed by Verhey-Goicoechea, who not only runs
the taproom but also assists in the cellar CIP, transfers, dry hopping, kegging
and other related duties.
In addition to the Pink
Boots Society, women are teaming up for special events that champion women in
the craft brewing industry. Last year, Atlanta, Georgia was host to Dregs and
Dames, a festival aimed at empowering women in craft brewing by presenting
beers brewed by women and discussing community, business, brewing and legal
issues affecting women’s success in the craft brewing world. There is also a
push for more diversity as minority women enter into the craft brewing scene.
For all of recorded
history, women have played a role in craft brewing. The earliest civilizations
considered brewing beer a “woman’s job.”
Today, according to an Auburn University study, women comprise 29% of
beer industry workers. Women who have been in the business the longest say that
mentoring is the key to sustaining and expanding the number of women who own,
operate and work in the field of craft beer brewing.
Listen up, fans of wine, beer and spirits: there’s a rising star
in the beverage universe, and it’s taking the market by storm. It’s hard
seltzer, a ready-to-drink cocktail made from three essential
ingredients—carbonated water, fermented malt or sugar, and fruit. Described as
light, crisp and refreshing, the drink has become so popular that beverage
pundits named this past June, July and August “the summer of hard seltzer.”
While seltzer has been
around for years, hard seltzer first bubbled up in 2013 when a brand called
Spiked Seltzer—now known as Bon & Viv Spiked Seltzer—hit the market. The
drink was such a success that other popular brands followed, and the industry
exploded. According to Nielsen, from March 2018 to March 2019, sales of hard
seltzer totaled $585 million. This represents a 200% growth, with 164.3%
happening in July alone. Some analysts predict sales could expand to $2.5
billion by 2021.
So, what’s with all the
buzz? It’s really pretty simple: hard seltzer is low in sugar and alcohol,
usually gluten-free, relatively inexpensive, sold in convenient cans, makes a
great mixer and, oh yes, tastes good. With today’s health-conscious millennials
as a key consumer demographic, that’s a definite formula for success.
Let’s start with the better-for-you
benefits. Hard seltzer is almost always made from fermented sugars, while beer
is made from fermented barley and other grains. During the fermentation
process, most of hard seltzer’s sugar converts into neutral alcohol, as opposed
to grain-fermented spirits which don’t wholly ferment, leaving behind more
sugar and, of course, more calories. Typically, hard seltzers contain 100
calories or less per 12-ounce can, with only 4-5% ABV, about the same as a
light beer. With no barley or wheat, hard seltzers are also gluten-free.
Besides being lower in calories, spiked seltzers come in many
fruit flavors, offering a refreshing alternative to beer, wine or cocktails.
White Claw, currently the dominant player in the market, owned by Mark Anthony
Brands, has six flavors: black cherry, ruby grapefruit, natural lime,
raspberry, mango, and Pure, the latter made to mimic a vodka soda.
White Claw’s primary
competitor, Boston Beer’s Truly Hard Hard Seltzer, produces four styles of 13
hard seltzers: four berry, four citrus,
four tropical styles, and a Rosé, described as “delicately sweet with a hint of
California Chardonnay grapes.”
The flavors in hard
seltzers come from extracts, natural flavors, real fruit juices or
concentrates. For the brewer, experimenting with flavors of sparkling water is
a blank canvas; while with beer, pushing the limits with fruit or botanicals
can upset the flavor of the malt base.
While hard seltzers can be
delicious in themselves, the beverage is very versatile and mixes with just
about anything to make an outstanding drink. Some mix it with classics like
vodka soda and tequila soda, which adds depth and complexity to the drinks.
Others replace the nonalcoholic seltzer in any cocktail with an alcoholic one.
Another option is to create a spritzer by adding white wine to your favorite
hard seltzer. For all of these drinks, ingredients can be adjusted to each
person’s tastes. While the mixes will be a little more “boozy,” they’re still a
low-calorie alternative to a cocktail.
Hard seltzers are
especially appealing to those with an active lifestyle because they are
portable. The 12-ounce cans are ready-to-drink and ideal for camping, beach
outings, boating, stadium events, or any destination where glass is not allowed
or discouraged. Like canned wine and canned cocktails, they also offer the
advantage of no mixing and, in the case of wine, no corkscrews. Plus, aluminum
cans are shatterproof and easier to maintain and transport than glass.
Hard seltzers offer one
more advantage: they are often cheaper than craft beer and certainly less
expensive than a mid-range bottle of wine or spirits. A 12-pack of White Claw
12-ounce cans sells for about $15, which is the same price as a domestic light
beer and an average cost for a bottle of wine. Canned cocktails retail for $12
to $15 for a four-pack of 12-ounce cans, while a four-pack of 250 ml canned
wines averages at $16.
With all of these
benefits, it’s no wonder that hard seltzers are having a moment. Plus, with
craft beer sales going flat, brewers are turning to alternatives to expand
their sales. Today, there are dozens of brands of spiked seltzers on the
market, with the numbers growing by the day. Even big beer is jumping on the
bandwagon. Anheuser-Busch acquired Bon & Viv Spiked Seltzer in 2016,
Constellation Brands owns Svedka Spiked Premium Seltzer, Diageo touts Smirnoff
Spiked Sparkling Seltzer, Oskar Blues has Wild Basin, and MillerCoors has
Henry’s Hard Sparkling. In August, Pabst Blue Ribbon announced the release of
its first spiked seltzer drink, Stronger Seltzer, at 8% ABV. Four Loko, known
for its colorful cans of high-alcohol malt beverages, is releasing a spiked
seltzer with a 14% ABV. They’re describing the product as the “hardest seltzer
in the universe.”
Of small breweries
entering the market, one of the more noteworthy is Braxton Brewing Company,
whose nationally acclaimed seltzer, VIVE, was just named “Official Hard Seltzer
of the Cincinnati Bengals.” Based in Covington, Kentucky, Braxton is the
region’s first brewery to release a hard seltzer. The spiked seltzer has only
100 calories and two grams of carbohydrates per 12-ounce can. It’s available in
four naturally flavored varieties; mango, lime, dragonfruit and grapefruit. In
honor of its partnership with the Bengals, the brewery recently released a
Tailgate Variety Pack that includes four flavors: blood orange, cherry, peach
and black raspberry.
For Braxton Brewing,
described as “a place where ideas are born and fermented,” entry into the hard
seltzer market in 2018 was a natural extension of the entrepreneurial spirit of
brothers Evan and Jake Rouse, who founded the craft brewery in 2015.
“We pride ourselves in innovation, and we like to create products that our customers really want to drink,” Jake Rouse told Beverage Master Magazine. “Hard seltzer plays toward the health and wellness trend that is sweeping the country, so we wanted to offer a low-calorie alternative to beer and a ‘better-for-you’ beverage.”
Braxton Brewing has enjoyed success with its hard seltzers similar to the explosive growth it experienced when the brewery first opened three short years ago. “VIVE has been very successful because of the quality of the product,” Rouse said. “It’s all-natural, and we’re using real fruit. It tastes like water with fruit in it, and that flavor profile works really well in competition with the big producers.”
Hard seltzer, with three
simple ingredients, may seem like a simple beverage to produce, but in fact,
“getting it right” is a challenge, according to Rouse. “It’s really difficult
to make a great hard seltzer because you’re creating a product that tastes like
water,” he said. “While you need to have that 5% alcohol flavor, you don’t want
it to taste like there’s a bunch of alcohol in it.”
Rouse explained that their
process for making hard seltzer is a proprietary process developed during
beer-making. “The result,” he said, “is a product that’s clear and easy to
drink and flavorful without that alcohol sting to it. All brands have their own
processes, so they’ll all be different.”
Hard seltzer’s popularity
is rising in the beverage industry and showing no signs of abating. Experts
note that consumers of all ages and genders are counting calories and watching
their alcohol consumption, giving hard seltzer a leg up in the search for a
good tasting, low-calorie, low-alcohol drink. Beverage professionals predict
that big beer will seek more opportunities for hard seltzers, and even small
breweries will try to lure local customers with a better-for-you alternative to
beer. Braxton Brewing Company, which already distributes to three different
states, told Beverage Master Magazine that they are seeking opportunities for
greater distribution of VIVE, and are considering adding new flavors to their
With these trends in mind,
it seems that there only one place for hard seltzer to go—and that’s upwards!
Canning has become an increasingly popular way to package craft
beer, and more breweries than ever before are either exclusively moving to cans
or incorporating cans alongside their traditional bottle offerings. Many
brewers prefer canning over bottling because of the increased protection from
light and oxygen, cost, portability, recyclability and freshness. However, a
brewery needs the right type of canning system in its space to make this form
of production profitable and efficient.
Smaller and newer craft breweries may start off with manual canning systems that have a two-head filler and that can fill about 10 cans per minute because of these systems’ affordability. An upgrade from this is a micro-automated canning system with a three-head filler and capacity for 25 cans per minute with multiple can size options. Meanwhile, automated canning systems may have up to 10 head fillers and be able to fill more than 70 cans per minute. To operate a canning line, a brewery may also need to purchase blank or printed cans, can ends and lids, PakTechcan carriers, shrink sleeves and corrugated case trays.
One canning machine
company based in San Luis Obispo, California, XpressFill, manufacturers affordable
table-top machines that are used by craft breweries to fill both cans and
bottles. Rod Silver, the marketing coordinator at XpressFill, told Beverage Master Magazine that his company has experienced a significant increase in can
fillers from its brewery customers this year.
“Our counter pressure
fillers fill the cans in a pressurized environment to maximize the CO2 in
solution,” Silver said. “Our open fill units have become increasingly more
popular due to the lower cost and faster fill rate. Controlling filling
conditions are critical in achieving optimum fills using either system. Both
units purge the can with CO2 prior to the fill cycle.”
Another relevant company
that breweries will want to learn about is Ska Fabricating, which is based in
Durango, Colorado and has over 700 customers worldwide. Matt Vincent, a partner
in Durango’s largest and most award-winning craft beer brewery, told Beverage
Master about Ska’s primary and most popular product called the Can-i-Bus Can
Depalletizer. It is paired with either a water twist rinser or ionized air
rinse and is an industry-leading depalletizer and rinser combo that covers the
speed range of 30 CPM up to 400+ CPM.
“It allows for the
opportunity to grow as your production grows, due to the wide range of speeds
that it can handle,” Vincent said. “It also is a necessary part of a canning
line because it eliminates the need for hand-loading cans onto a filling line,
allowing operators to focus on quality by eliminating menial tasks.”
Vincent also said that Ska
Fabricating offers an extensive line of conveyance solutions, date coders,
handle applicators, can and bottle drying equipment and machinery integration
to assist in the post-fill needs of the brewery.
Meanwhile, Neil Morris of OneVision
Corporation in Westerville, Ohio told Beverage Master Magazine how OneVision
“manufactures and markets inspection systems that empower beverage canners and
food canners produce quality double seams.” This company’s expertise includes
double seam evaluations, inspection systems and training and support at system
installation, as well as electronic and phone support after installation to
prevent seam leaks and keep products fresh.
Ben Anacker, who manages
sales and services for OneVision in the western U.S. and Canada and who is an
expert in can manufacturing, said that OneVision arguably provides the most
cost-effective craft brew system and support to empower brewers to have
confidence in their canned products.
“Evaluating double seam
overlap and tightness is imperative to comprehensive analysis of seam
integrity,” Anacker said. “The OneVision SeamMate® Inspection System, in
combination with the Mini Drive Seam Stripper System, is unparalleled in
performing the destructive seam dissection to allow close examination of these
Important Features of Canning
Overall, canning systems
feature a complex set of machines that share some similarities but are also
very different in many ways. These differences lie in their speed, efficiency,
size and other capabilities, such as low DO pickup, 15-20 ppb, dual cam driven
seamers, nitro with a widget or no widget and monitors. Considerations to keep
in mind are oxygen and light penetration, seamers, reliability, the ability to
upgrade later and integration with your current system.
Silver of XpressFill said
that the most important features to consider are “cost, fill consistency,
oxygen uptake, user-friendly, reliability, ease of cleaning and sanitizing and
support by the manufacturer (both pre-sale and after).”
Vincent of Ska Fabricating
said that first and foremost, the most important factors for making a canning
machine decision are identifying the proper speed line that works well with
your budget, batch size, labor pool and desired level of automation. He said
that the second priority is to make sure you understand the differences in the
fillers and what level of quality you can expect from them.
“In the end, you get what
you pay for,” Vincent said. “Rotary fillers tend to provide a higher level of
fill quality than inline fillers, but they are typically four to five times the
“All businesses evaluate
the cost-competitive options when procuring capital assets to support their business,”
said Anacker of OneVision Corporation. “For the craft brewery industry, there
are many options for these canning investments. Sustainability versus initial
investment cost is widely overlooked and should be evaluated more closely.”
Questions to Ask Before Buying a New Canning System
There are many questions
to ask before buying a new canning machine, either for the first time as a new
brewery or to upgrade existing equipment. Here are some initial questions to
• Is the machine the right size for your needs?
• Will you use printed cans or labels?
• Are pneumatic seamers your best option?
• How easy is it to clean the machine?
• What other accessories are needed to operate the machine?
• What are the financing options?
Silver of XpressFill said
that while many craft breweries are shifting to cans instead of bottles because
of customer demand, switching production from bottles to cans is a significant
undertaking that should not be taken lightly.
“Canning lines and mobile
canning could be prohibitively expensive depending on the initial scope of your
production,” Silver said. “Table top units, like the XpressFill fillers, can be
a cost-effective initial effort to meet the initial demand. Questions should be
asked regarding the production capacity of the equipment, ability to upgrade,
sell-back policies and warranty information to ensure a prudent investment.”
Vincent of Ska Fabricating
said that the most important questions to ask are about the machine’s cost,
level of support offered, how many people it takes to operate the line
efficiently and what level of dissolved oxygen the filler can maintain while
Anacker of OneVision
Corporation recommends looking into the track record of the supplier company as
well as the actual system being considered. He said to ask about if the system
can be upgraded to match future growth and to check references of actual users
with at least three years of experience using the system. How a “micro-canning”
system compares to larger commercial canning systems and whether the system has
the same fundamental function and repeatability to have confidence in long-term
production capability and integrity are other considerations that Anacker
Expert Advice About Canning Machines & Lines
With all of this
information in mind, you may decide that now is the right time to start looking
at new canning machine options, or it may be best to hold off for a while until
you have fully assessed your needs. However, it seems that canned craft beer is
here to stay and will only continue to increase in popularity in the future.
Vincent of Ska Fabricating
recommends that breweries do their homework in researching canning line
equipment and identify reputable vendors that will provide the levels of
customer service and project management that your brewery needs.
“Budget for the suppliers
to do the installations and training for their machinery,” Vincent said. “Many
mistakes are made and inefficiencies are created without proper installation
and training on the machinery. We have seen many customers that try to do the
installations on their own and it ends up creating more problems in the long
run, resulting in down time and/or machinery that doesn’t operate as well as
In terms of advice for
craft breweries, Anacker of OneVision Corporation said,” Contract or employ
resources with canning experience to help make procurement choices, develop
production layout, oversee the production to get this business phase started
well and develop other resources for sustainability.”
Silver of XpressFill
recommends finding other breweries that have worked with the particular machine
and manufacturer that you are considering and asking them about the machine’s
reliability and overall satisfaction with the canning equipment.
“Also, search online for
reviews of the equipment,” Silver said. “Real world experience is the best
insight into what can be expected with purchasing and operating a new canning