Category: General

A Closer Look at Celebrity Brands of Craft Spirits & Beer

Cyndi

By: Alyssa L. Ochs

Actors, musicians and other celebrities love craft beer and spirits just like the rest of us. Yet the difference is that they often have the means, resources and connections to make significant investments in the industry. An increasing number of famous individuals have been getting interested in the craft beverage business and putting their names onto labels of products they stand behind or perhaps have even helped create.

  Here’s what the celebrity craft beverage industry looks like right now, major players in this field and what there is to look forward to in the future.

Celebrity Involvement in the Industry

  Celebrities take a step away from their typical work to get involved with craft beverages for various reasons. Some have a true passion for the craft, while others are in it for the money or just looking for more exposure and additional ways to promote themselves. While some celebrities learn about the production process and engage in making beer and spirits themselves, others do little more than attach their name to a brand for cross-promotional purposes.

  Either way, celebrity-brand craft beverages are often unique because of their higher price tags and limited availability. Some celebrities use their beverage-related profits to benefit charities, and others use their star power to launch tasting rooms for VIP guests. However, there are unique challenges that come with producing, marketing and selling celebrity craft beverages that other beer and spirit companies may not encounter. For example, a beverage brand may suffer when an affiliated celebrity declines in popularity or is involved in a scandal. Meanwhile, a celebrity’s popularity may be affected if the beverage he or she promotes isn’t received well by the public. Some craft beverage fans believe that beer and alcohol belong to them personally and not the rich and famous. Therefore, they might be turned off by the concept of celebrity affiliations and avoid these products entirely.

  But for people who are loyal to certain celebrities or just curious to try celebrity-affiliated beverages, these are accessible products that can often be purchased in stores and online. More popular beverages are usually found in liquor specialty stores, such as Binny’s and Total Wine & More. But you might have to search for more obscure and exclusive celebrity-brand beverages online through sites like Cask Cartel and Sip Whiskey.

Examples of Celebrity Beverage Endeavors

  From musicians across all genres to television personalities and film actors, a diverse array of celebrities have been making their mark on the craft beverage industry in recent years. Some of these examples were limited editions that are no longer sold, while others are ongoing efforts that are changing the industry one bottle or can at a time.

  For example, actor and comedian Dan Aykroyd co-founded Crystal Head Vodka as a way to introduce additive-free vodka and bring more creativity to the vodka industry. Along with his business partner, artist John Alexander, Aykroyd envisioned a new kind of vodka without unnatural ingredients and has a true passion for the product.

  Several years ago, pop music star Justin Timberlake entered into a co-branded partnership with Sauza Tequila to create Sauza 901 silver tequila. The name 901 references the area code in Memphis, which is Timberlake’s hometown. Timberlake said that he developed a love for tequila after visiting Jalisco, Mexico and seeing the craftsmanship that went into each bottle of the spirit.

  Iconic hip hop legend Snoop Dogg partnered with his friend and co-founder of Trusted Spirits, Keenan Towns, to establish his own spirits brand. Known as the “King of Gin and Juice” because of his famous song of the same name, Snoop Dogg developed Indoggo Gin, which mixes seven premium botanicals with all-natural strawberry flavoring. In the past, the musician has also had marketing deals with the Corona beer brand, released his own rosé wine and made investments in the cannabis industry.

  Meanwhile, actor William H. Macy co-owns Woody Creek Distillers, which is based in Colorado and operates a distillery and tasting room just west of Aspen. Not only has Macy invested in the brand, but he has also rebranded himself as Willie Creeks, an alter ego who is a musician and offers life lessons that ultimately promote rye whiskey.

  Another celebrity who has been involved in the spirits industry is actor Ryan Reynolds. He teamed up with Aviation Gin in 2018 after falling in love with the spirit and investing in the company. Since then, Reynolds has become a co-owner of Aviation Gin and driven the creative marketing for the brand. In recent years, and staying true to the aviation theme, he and the brand have teamed up with businessman Richard Branson to serve the gin onboard Virgin Atlantic and British Airways flights.

  A financial success story in the celebrity spirits industry brings us to the actor George Clooney. The idea behind Clooney’s tequila brand, Casamigos, came about after he and his friend, Rande Gerber, were in Mexico and wanted to find a smooth tequila they could sip all day without the dreaded next-day hangover. This was back in 2013, but the friends still personally tasted every batch of tequila made four years later. The brand exploded in popularity, mainly through word-of-mouth and having Clooney’s name attached to it. In 2017, they ended up selling the brand to Diageo for $1 billion, which made Clooney the highest-paid actor of the year.

  Thus far, celebrities have been more involved in the spirits industry than in craft beer or wine. But to a lesser extent, those markets are also drawing the attention of the rich and famous.

  The late-1990s and early-2000s pop band Hanson, comprised of three brothers who love craft beer (now that they’re old enough to drink it), launched the Tulsa, Oklahoma-based Hanson Brother Beer. They created their own craft beer business in 2013 with their flagship beer, Mmmhops, a 7.5 percent English-style pale ale. Since then, the brothers launched the Hop Jam Beer and Music Festival, collaborated with other breweries to create unique beers and dedicated a portion of their beer-related profits to clean water wells in Africa through a nonprofit organization they created.

  Another celebrity beer collaboration involves The Grateful Dead and Dogfish Head Brewing, based in Milton, Delaware. The psychedelic rock band has been involved with the brewery since 2013 and has worked together since then to create a third version of American Beauty HazyRipple IPA. The band’s “American Beauty” album and famous track “Ripple” inspired the beer, which features the iconic Grateful Dead dancing bear image on the label. However, the band’s involvement with other aspects of the beer production process is limited.

  To show how diverse and widespread the celebrity beverage industry has become, here are some additional examples of celebrities and their affiliated beer and spirit brands:

•    Kenny Chesney – Blue Chair Bay Premium Rum

•    Kendall Jenner – 818 Tequilla

•    Marilyn Manson – Mansinthe

•    Dwayne ‘The Rock’ Johnson – Teremana Tequila

•    Mark Wahlberg – Flecha Azul

•    Curtis ‘50 Cent’ Jackson – Effen Vodka

•    Bryan Cranston and Aaron Paul – Dos Hombres Mezcal

•    Sean “Puff Daddy” Combs – Cîroc Vodka

•    Channing Tatum – Born and Bred Vodka

•    Drake – Virginia Black Whiskey

•    George Strait Código – 1530 Tequila

•    Bob Dylan – Heaven’s Door Whiskey

Considerations and Looking Ahead

  The celebrity-brand beverage industry continues to be exciting because there’s always something new in the works to look forward to. There is always a strong public fascination with rich and famous people, and that trend is not likely to disappear anytime soon. As an increasing number of celebrities enter this industry, the competition increases and drives the demand for superb product quality that goes beyond just a popularity contest of celebrity status.

  Yet there are significant legal considerations that celebrities must keep in mind as they venture into the beverage industry for the first time. Collaborative efforts between celebrities and spirit-makers can take on various forms. These include development deals that give celebrities greater control over the final product and endorsement deals that offer little more than using a celebrity’s name. Other deals involve simply using a famous person’s image to promote an existing brand all the way up to full ownership, in which a celebrity owns both the brand and the means of production.

  Specific state and federal laws separate the roles of beverage producers, distributors and retailers, which can make it challenging for celebrities to navigate if they want to be involved in more than one part of the business. Other issues that celebrities must consider before diving into the beer and spirit industry are background checks needed to obtain alcohol beverage licenses, the age of their target audience, morals clauses in their contracts and endorsement disclosures required by the Federal Trade Commission.

  Alcohol production is proving to be an enjoyable and profitable side gig for numerous celebrities interested in connecting with their fans in new and unique ways. But to get beyond the initial hype and keep craft beverage customers coming back for more, it is time to embrace the spirit of innovation and achieve long-term growth with products able to stand on their own, even without a familiar name and face behind them.

Tröegs Independent Brewing: Not Your Ordinary Brewery

Cyndi
Troegs Scratch Lab sticker signage

By: Nan McCreary

Tröegs Independent Brewing in Hershey, Pennsylvania, is not your ordinary brewery. Situated along a confluence of highways connecting seven million tourists annually to central Pennsylvania, the brewery’s location is a perfect model for generating traffic. But it’s not the locale that truly captivates the visitor, it’s what’s inside. Whether you’re in the 5000-square-foot tasting room enjoying one of Tröegs’ award-winning brews or exploring the menu at the Snack Bar for scratch-made food to complement your beer, you are actually immersed in the brewhouse, with views of open-air tanks, and a glass-lined self-guided tour path that cuts through the center of the facility and allows you to experience — firsthand — the entire beer-making process, from fermentation to bottling lines to barrel-aging. It’s clearly a place for the adventurous and the curious.

  “We’re not a bar, and we’re not a pub,” said Chris Trogner, who co-founded the brewery in 1997 with his brother, John. “It’s a place where people can walk around and discover and learn. Our entire operation is on view, including the fermentation/filtration hall, packaging lines, an art gallery, a general store and our new Scratch Lab, where we experiment with new recipes. This is not just a place to drink beer, it’s where you can come and have a semi-immersive experience.”

  The Tröegs story is one of extraordinary growth and innovation. The Trogner brothers, who were always inventing something new when they were young — from skateboard ramps to homemade cannons — reunited after leaving home and going their separate ways, only to discover that a craft brewery might be in their future. Chris was attending college in Colorado in the midst of the craft beer explosion, and John, at Chris’s urging, joined him in Boulder. John began taking brewing classes and working at Oasis Brewing Company, and Chris went to England to study English brewing techniques. The two then hatched a plan to return to their native central Pennsylvania and open a small brewery in Harrisburg. They decided to name it Tröegs, a combination of their last name with “kroeg,” the Flemish word for pub. John was 25 at the time, and Chris was 23.

  Chris Trogner recalls rough patches during the brewery’s early days. “It was just my brother, John, and me,” Trogner told Beverage Master Magazine. “We started primarily as a packaging brewery, selling only bottles and kegs.” Their first pint sold was a Tröegs Pale Ale, and it helped get the little brewery off the ground. The first keg sold went to a Harrisburg restaurant shortly after the brewery opened.

  Fast forward 25 years — the brewery just celebrated its anniversary in July— and Tröegs has changed dramatically since its humble beginnings. Despite early challenges, Tröegs managed to gather such a large fan base of family, friends and “kindred spirits” that they quickly outgrew their facility in Harrisburg. In 2011, they built a new 90,000-square foot brewery (three times the size of the original) in nearby Hershey. With the craft beer industry booming, the move opened up an entirely new realm of possibilities for the Trogners’ innovative spirit. “As the industry grew, we were able to grow with it,” Trogner remembered. “Each year, as we’d sell more beer, we’d reinvest in more equipment and hire more people.”  Now, Tröegs boasts three brewhouses: a three-barrel brewhouse for experimental brewing, a 15-barrel brewhouse and a 100-barrel brewhouse, which the brewery uses for distribution. Annual production is 118,000 barrels. The brewery employs 250 people, with distribution in nine Mid-Atlantic states, plus Washington, D.C. “We look and feel a lot different than we did 25 years ago,” Trogner recalled, “but we’re still very much a family business. Because we’ve stayed true to our core values of independence and family ownership, we’ve kept the small-brewery DNA we all hold dear.”

  Today, their production focuses on specialty and seasonal beers. Their signature beer, the Perpetual IPA, is the best-selling IPA in Pennsylvania and is brewed with six different hops. Other standard beers include Tröegenator Double Bock, brewed in the German tradition of malty, sweet beers; DreamWeaver Wheat, a German-style hefeweizen; Sunshine Pilsner, a classic German-style pilsner and Haze Charmer, a hazy pale ale. In June, Tröegs released a limited amount of one of its most loved beers, Nimble Giant, described by Trogner as a “big beer that goes down easy.” Nimble Giant is always rated “outstanding” by Beer Advocate and is a fan favorite on Untappd. Equally popular is the seasonal holiday beer, Mad Elf, a legendary ale made from five varieties of tree-ripened cherries. “We’re always adding new beers,” Trogner said. “We try to have something for everyone.”

  In their never-ending quest for flavorful beers, the Trogners established the three-barrel Scratch Lab so that a dedicated team of tasters could meet weekly to test new flavors, equipment and brewing techniques. Beers are not given a name, but rather a number. Today, there are over 450 varieties in the Scratch Series, and in fact, many signature brews started in the scratch tanks. “We’re into getting to know the whys of our beers, where the flavors come from and how the process affects the flavor,” Trogner told Beverage Master Magazine. “We try around 100 new recipes a year. The recipes may not all become beers, but the experiments can make us more knowledgeable and help us become better brewers.” The Scratch Lab at Tröegs is on the self-guided tour and the Guided Production Tour (named in 2020 by readers of USA Today as the Best Brewery Tour in America). Here, visitors can have a ringside seat to see what the staff is doing and enjoy that same learning experience.

  While the Trogners are always seeking innovation in the Scratch Beer Lab, they’re just as inventive in providing refreshments to their visitors. Soon after opening, they added a Snack Bar to offer foods as original and interesting as the beer. The menu ranges from soups to salads, sandwiches, sweets and even a kids’ menu, with the majority of food made from scratch using local ingredients. “We develop our Snack Bar menu items much like we do beer recipes with our Scratch Series,” Trogner said. “We’ve thought long and hard about not just what food pairs with our beer, but why. We’re not out to tell you what to eat, but to inspire you to create pairings that perfectly suit your own palate.” For those who want to try a new food and beer adventure, Tröegs offers regular beer dinners with local restaurants, complete with tasting notes and recommendations on what hops variety may pair well with fruit or cheese, for example. “It’s our way of constantly experimenting and moving forward,” Trogner stated.

  Clearly, the Trogners’ desire to create is the heart and soul of their operation. Not only is this evident in the Scratch Beer Lab and the Snack Bar but also in a distinctive feature of the self-guided tour, the Art of Tröegs Gallery. “Artwork is important to us,” Trogner explained. “As brewers, we express our creativity with ingredients, tastes and flavors, but we enjoy what others are able to do, whether it’s making art with our bottle caps, labels and cans — anything that will give a sense of what’s in the bottle or the keg.” Every year Tröegs sponsors a contest and narrows the submissions down to the top two dozen for final judging. The grand prize artwork is featured in the gallery, and the winner receives a limited-release beer label created in honor of their artwork by Tröegs’ in-house artists. Over the years, entries have included a video game, a Smurfy miniature of the Hershey brewery, a multi-tiered cake, a hand-embroidered jean jacket and custom Tröegs sneakers.

  While the Trogners are committed to providing visitors with a unique experience at their brewery, they also focus on remaining active in their local community. Every year, they participate in local activities, whether it’s a large, organized event like a mountain biking ride or a fly fishing contest, or a simple beer tasting set up by a local distributor. Every year, the brewery also donates to more than 150 nonprofits involved in animal advocacy, arts and culture, education, health services and more. Additionally, the brewery buys more than 225,000 pounds of local grain, honey and fruit for use in their beer and seasonal fruits and vegetables for their Snack Bar.

  As Chris Trogner looks back on his 25 years in the craft brewing industry, he has witnessed many changes. “When we opened, there were fewer than 2,000 craft breweries in the country,” he said. “Today there are close to 10,000. There’s more innovation and more diversity. Now is one of the best times to be a beer drinker.”  Trogner is equally optimistic about the future of Tröegs Independent Brewing. “We’re young and we have a lot of gas left in the tank. We’re making long-term investments to increase capacity and improve infrastructure to set us up for the next 25 years. And, with good geography — Baltimore, DC and Philly are only two hours away, Pittsburgh is three hours away— we’re right in the sweet spot, distribution-wise.” 

  Undoubtedly, the Trogner brothers will continue to be driven by adventure and a sense of curiosity. With creative brewers like them, it is indeed a good time to be a beer drinker.

For more information on Tröegs Independent Brewing, visit www.troegs.com

Enhanced Single-Serve and Ready-to-Drink Markets Need Updated Point-of-Sale Systems   

Cyndi

By: Gerald Dlubala

Whether online ordering for pick up, requesting additional items to-go or purchasing single-serve containers from a local market, these options reflect the alternative and increasingly essential revenue streams for craft beverage producers. Additionally, they have proved to be a popular and effective way for craft producers to get their products into the hands of new and potential consumers. According to data supplied by Arryved, a leader in Point-of-Sale (POS) systems for food and drink businesses, many of the consumers that participate in the online and to-go craft beverage markets are different than those that choose to frequent brewpubs, tasting rooms and taprooms in person.

  The good news for craft beverage producers is that participation in the single-serve, ready-to-drink and to-go markets continues to grow. Consequently, it makes sense to nurture those relationships and make the off-premises consumer experience an event that provides value and enjoyment while enhancing your bottom line. The proper POS system can do that.

Your Business, Your Point-of-Sale System: Arryved

  “Of course, there was a sea of change beginning with the pandemic,” said Nancy Trigg, chief people officer for Arryved. “It seemed like, over the course of one night, the brewpubs, wineries and taprooms all had to scramble and pivot business models to come up with a functioning online and to-go ordering system, as well as a safe and viable delivery or customer pickup option. Point-of-Sale systems had to evolve and quickly match that change in direction. In haste, many businesses simply installed a separate system for this newfound revenue stream. It all seemed good until the businesses realized that, in reality, they were using two separate systems pulling out of a single inventory base, causing supply confusion and accountability problems. Point-of-sale systems, like Arryved, that looked at the situation and responded in a more business-sensitive, proper way were the ones that not only helped their clients survive but also helped them grow their consumer base during the uncertainty and shutdowns.”

  Trigg says that a proper POS system is one of the most crucial tools a craft producer has to understand and analyze for how they are doing business, and she urges owners to approach their businesses with that exact mindset.

  “If you have the proper POS system set up for all of your revenue streams, including on-premises, single-serve purchases and online ordering with customer pickup, you will immediately receive valuable insights into what you are selling, when you are selling it and how your products are being used,” said Trigg. “Are some products more popular at certain times, like lunch or dinner? Are some being consumed more with food? Which beverages are more popular at which times? Are they being sold in smaller pours? Larger pours? Are certain products more popular for carryout over in-house consumption? For flight purchases? So much data related to your specific craft products concerning single-serve and online-ordering revenue streams can be harvested from the right POS system.”

  Trigg told Beverage Master Magazine that the applicable laws about these types of sales will generally stick around because of the great work from the guilds, communities and cities to help food and drink businesses remain afloat during the height of the pandemic. Now, craft beverage producers must have a POS system that integrates these transactions into their daily business practices by highlighting and providing data tailored to their specific products, customer profiles and unique business situations.

  “When craft beverage producers start packaging their products, the inherent level of their risk rises, if only based on the costs of packaging,” said Trigg. “That little extra risk can be just enough to inhibit the creative experimentation that makes up the backbone of what a brewpub, taproom or tasting room is supposed to be. But with the right information derived from an inclusive and detailed POS system, that risk is minimized. Now they can offer the right products to the right consumers at the right time, including single-serves, ready-to-drink varieties or a wide range of to-go flight-type options or mix-and-match packs tailored to specific tastes. Unfortunately, not many POS systems properly provide these types of flight tools or pick-six options within their makeup. Arryved does just that, providing the craft producer meaningful insights into what is and isn’t working, and when.”

  Trigg said that Arryved is a POS system genuinely built to care for an all-inclusive beverage program, including those that, either now or in the future, want the option to offer food sales. In addition, Arryved enhances brewpub or tasting room atmospheres by allowing its customers to order drinks to-go, online or in single-serve, ready-to-drink options.

  “There are always developing options within the single-serve and ready-to-drink markets that craft beverage producers need to stay aware of,” said Trigg. “This includes the growing popularity of flight options and different sizes of mix-and-match take-home packs that the customer can customize. Craft producers need a POS system that recognizes these trends and supports mobile guests just as well as it does with on-premises guests. Arryved supports craft beverage producers in all facets of their revenue streams, while featuring unmatched support for the industry. In addition, we stay engaged in the business sector and always have someone available to speak with directly.”

Ready-to-Drink, Single Serve and To-Go Markets Thriving

  The ability to try and enjoy craft beverage products off-premises was, and still is, a game-changer for many craft brewers, winemakers and distillers. For the past couple of years, these markets have helped many establishments remain open and proved they could be a robust, new revenue stream. Breweries have traditionally offered their products in growlers and crowlers so their consumers could enjoy the beer at home. Additionally, the popularity of individual can seaming devices, like those offered by Oktober Can Seamers, gives craft beverage producers more flexibility in to-go offerings and allows consumers more flexibility in how and where they choose to use the beverage.

  In its primary function, can seamers allow craft beverage producers to get their product out the door and into the hands of consumers for off-premises enjoyment. But Dennis Grumm, CEO and lead engineer for Oktober Can Seamers, told Beverage Master Magazine that many clients realize additional untapped revenue possibilities by canning beer, mixed drinks and specialty cocktails for to-go orders. Brewpubs, distilleries, and wineries can all use a can seamer to offer their beverages, unique brews and house cocktails on a to-go basis. It’s an economical and very effective way to get new customers to try your products while satisfying your current customer base. Distillers have had great success canning their best-known, ready-to-drink cocktails, but canning is also an effective way to offer seasonal or limited-release drinks and cocktails.

  Pouches are another way to get your product in the hands of consumers that would not normally spend time in your place of business or would just like to take your crafted offerings with them on the go. Pouches range from those in the refrigerator for individual pours of wine to the single-serve cocktail and wine pouches that resemble the child-friendly juice pouches. The benefits of using pouches include offering a resealable, portion-controlled package that reduces packaging weight by up to 94 percent and can be shipped and packed using fewer resources.

Enhancing the Single-Serve and Ready-to-Drink Market: O-I Glass

  O-I Glass, based in Perrysburg, Ohio, is looking to elevate the single-serve, to-go and ready-to-drink markets to better reflect the on-premises, brewpub and tasting room experience. Megan Henry is the global marketing communications business partner for O-I Glass. She told Beverage Master Magazine that they are transforming the to-go, single-serve and ready-to-drink markets by offering a new glass packaging alternative called the Drinktainer™ for these markets.

  “In an increasingly common world of to-go packaging, we feel that it’s time for craft beverage producers to elevate that part of their business and the consumer experience,” said Henry. “Growlers and crowlers are great, but they have limitations. As soon as you open them, you’re under a time constraint as to how long that product will be good. Using our wide-mouthed Drinktainer™, you’re promoting a sustainable packaging option with the recyclable glass and RipCap® closure, and you’re allowing the consumer to enjoy your products as if they were in your brewpub, taproom or tasting room.”

  Henry said that capacity and shortage concerns still affect many industry players, but those worries are not an issue with Drinktainer™, which is currently available in inventory.

  “We know that many beer aficionados prefer to consume their beer out of a glass, straight from the tap,” said Henry. “Offering to-go, single-serve options in a recyclable glass container is just a naturally better way to enjoy beer and craft beverages in general. Glass packaging provides great flavor retention in any environment and allows producers to feel more comfortable offering their consumers different types and combinations of products without the fear that alternative packaging, like plastics or pouches, will taint their beer, cocktails or wine. In addition, with the wide mouth (42mm), consumers get the deeper flavor and more robust aroma experience as if they would be drinking from a glass on premises.”

  Sustainability is a significant issue of consideration in every phase of craft beverage production, and the Drinktainer™ is a fully sustainable product, available in clear that is customarily used for beer and in a flint tone that highlights the color combinations of cocktails and other beverages. It’s sealed using a RipCap®, an easily applied and highly secure closure that O-I Glass believes brings a nostalgic feel to the products. Drinktainer™ has been successfully used to offer pick-six trial packs and beer flights, and it requires no other glasses or barware to enjoy as the beverage maker intended.

Find more information on the Drinktainer™ at www.o-i.com

TANK & TANK SYSTEMS: Streamline Production and Maintenance

Cyndi
2 huge brewing machines

By: Cheryl Gray

The tanks and tank systems that support the production of the brews and spirits of the craft beverage industry work to keep the quality and safety of those beverages on target.

  No matter the size or brand of the tanks involved, craft brewers and distillers want optimal results and a minimalistic cleaning and maintenance routine to ensure productivity goes uninterrupted. Some companies cater to the industry to provide multiple options.

  Among them is Quality Tank Solutions (QTS), headquartered 35 miles outside of Milwaukee. The company, founded a decade ago, is a stainless-steel tank manufacturer. Jimmi Jean Sukys is the

company’s owner.

  “We are about 100 employees in size and we serve the brewing, food and beverage, dairy and pharmaceutical industries,” Sukys said. “Aside from manufacturing, we also install and repair stainless steel vessels. Our talented engineering team helps you refine your process by increasing efficiency, quality and cleanability.”

  QTS provides a wide range of complete stainless-steel tanks and tank systems for craft breweries, whether it is a start-up or an established brewery. This includes custom-built brewhouses with two to four vessels of 3-1/2BBL to 100BBL in size. The systems are configured to accommodate any height or space restrictions. Standard construction offers features that include either manual or fully automated operation and either steam or direct fire. QTS also supplies brewhouse equipment, such as boilers, chillers, keg washers, bottling lines and walk-in coolers. Sukys explains what additional innovations set QTS apart, including the top-priority use of high-quality materials, efficiency and cleanability.

  “Our QTS cellar tanks are versatile and are completely customizable to meet your specific needs,” Sukys said. “The tank system industry has been around for some time now. What QTS has brought to the table, in just 10 years of service, is consistent and trustworthy results with emphasis on quality standards. Our tanks are engineered and manufactured in Wisconsin, USA using only U.S. stainless steel. Tank longevity is a priority. QTS is with you every step of the way. Even after you receive your tanks, we can help you install, repair or expand. Our expert team members offer amazing customer service.”

  Solid customer service and buying American-made products are among the reasons behind Potomac Distillery’s decision to buy tanks and tank equipment from Idaho-based Corson Distilling Systems, Inc. The Washington D.C.-headquartered distillery is the home base for Thrasher’s Rum, which takes its moniker from owner Todd Thrasher.  “I worked with Corson because I wanted to source American-made products,” said Thrasher.

Corson Distilling Systems is a family-owned business founded a little over a decade ago by brothers Josh and Tory Corson. Today, the company hand-builds each system from materials that include raw stainless steel and copper. The firm also turned to SOLIDWORKS Premium 3D design software to boost its output, streamlining the process of creating models and drawing files while supporting automatic configurations of equipment designs within the SOLIDWORKS products family. Combining the productivity of SOLIDWORKS with another technology solution, COUNTERPART ERP, shaved off a considerable workload and further streamlined processes for the team of draftsmen responsible for the products sold by Corson Distilling Systems, Inc.

  Breweries count on a variety of tanks and tank equipment to get their products out. That includes brew kettles, lauter tuns, mash tanks and more. 

  QTS brew kettles feature what the company describes as a steam-driven Omega Heat Transfer Surface Jacket. The company touts this feature as one that allows precision boiling designed to eliminate over-boiling, which can negatively affect the final product. In addition to some of the other features that are standard on QTS products, its brew kettle standard features include a vent stack with DMS drain, flanged and dished top head, shallow cone bottom and a vortex breaker. 

  Options include a combination brew kettle and whirlpool, so-called “China-hat” assembly, direct fire and vent stack installation. The company’s whirlpool tanks can either stand alone or be combined with other functions. They are customized to handle a brewery’s system capacity. Standard features incorporate many of those offered in other products by QTS, along with a feature known as Trub Guard. The whirlpool tanks can be customized to combine the functions of a whirlpool tank with a brew kettle.

  The company also offers steam-driven calandrias designed to achieve boiling point temperatures without using a heat transfer surface jacket. The calandrias are made of a cylindrical shell and a tube design that is custom-sized to meet the requirements of breweries of virtually any size. The calandrias feature an insulated shell and tube design, accessible flanged ends, a square tube frame with adjustable feet and an optional flexible design to fit a brew house.

  Mash tanks by QTS include standard features such as flanged and dished top head, turbine agitation, glass stop manway, tank light, side wall baffles, shallow cone bottom, NORD gear drive, removable CIP assembly, steam jackets and, of course, 3-A standards. Options include a combination mash and lauter tun, a hydrator and a knife gate.

  The company’s lauter tuns incorporate a tight wedge screen wire fit at the bottom of the vessel, which is designed to eliminate the possibility of the screen bending under the pressure of a heavy mash bed.

  This tight tolerance design prevents excess grains from seeping through the screen. Features of the QTS lauter tuns include gear drive and agitation, which are configured based on the size of the vessel. Other standard construction features include a freeboard above grain bed depth, flanged and dished top head, shallow cone bottom, rake assembly with plow bar, glass top manway, tank light, removable CIP assembly, rectangle side entry manway and wedge widescreen false bottom. Optional features are a combination mash and lauter tun and underscreen CIP.

  Lager tanks designed by QTS feature a horizontal design that the company touts as more efficient since the tanks have more surface area coverage. The lager tanks feature flanged and dished heads, an insulated vessel design, a heat transfer surface jacket, a quarter-inch thick formed saddle with adjustable feet and an oval swing-in manway. They also have a removable CIP assembly with a “whirly spray” device and come fully equipped with a PRV, sample valve, butterfly valves and a CIP accessory. Available options include a stacked tank design and a visual sight gauge assembly.

  For distilleries, QTS offers custom-made hot and cold liquor tanks with features that include flanged and dished top heads, an insulated vessel, a round cross-arm manway, a heat transfer surface jacket, overflow control, F&D and flat-pitched bottoms.

Options include a visual sight gauge and an immersion heater. 

  One QTS product used for adding ingredients during the brewing process is the QTS Q-Bot. It can be used as a dry hop or slurry vessel. The tank’s flexibility helps in the work of adding ingredients at different points in the production process. Among its features are a shallow cone top head, a 24-inch round pressure manway, interchangeable perforated baskets in sizes of one-eighth, one-fourth and one-half inches, a tangential side inlet, a rolled push ring and caster wheels.

  Cleaning tanks and the accompanying equipment are very important, not only for protecting the investment in production, but also for protecting the distillery products. At Potomac Distillery, Thrasher favors a non-chemical approach to cleaning his tanks, which he says are all jacketed.

  “We clean the still and fermentation tanks about once a month. We typically use a combination of water and citric acid and then clean again with distilled water.”

  Experts say that designing, manufacturing, installing and maintaining tanks and their accompanying equipment is done with a combination of craftsmanship, innovation and ever-evolving technology. The aim, of course, is to preserve the products that craft brewers and distillers pour their time and resources into making and getting ready for market.

Inviting Sustainability into The Vodka Industry

Cyndi
a lone white flower

By: Tina Karras, Founder & Owner — Tina’s Vodka

As a founder and owner of a vodka distillery, I regularly contemplate our industry’s sustainability. I want people to have what they enjoy, but I also want a future for our planet.

  The process of sourcing, making, and packaging alcohol has environmental implications that we can no longer afford to ignore. It varies by the liquor and production method, but the Beverage Industry Environmental Roundtable’s research reveals that each 750-milliliter bottle of liquor produces an average of 6.5 pounds of carbon dioxide into our atmosphere. This cannot continue.

Sourcing Sustainable Ingredients Through Regenerative Agriculture

  I’ve always been disheartened by the nagging fear that nothing I did as a single business owner would impact the global environment. However, after watching the documentary “Kiss the Ground,” I am hopeful at last. This film asserts that if we commit to changes that regenerate our planet’s soil, we will simultaneously balance our changing climate, replenish the Earth’s water supply, prevent species extinction, and raise more abundant crops. Here, at last, is a film with solutions that leaves me optimistic about our planet’s future.

  The documentary inspired me to embrace regenerative agriculture in my vodka production process and spread the news to others. This type of farming is not new by any means. Instead of industrial farming methods that deplete the land with a lack of biodiversity, pesticides, and fertilizers, regenerative agriculture applies traditional farming methods to maintain healthy soil, plants, and water. It seeks to reverse environmental damage through no-till systems, crop diversity, planned livestock grazing, and biosequestration (the method of trapping and storing carbon in plants, microbes, and other organisms).

If We Implement These Solutions, We Will See A Rapid Shift In Our Planet’s Health

  Regenerative agriculture is the simplest way to heal the soil, and soil health is the key to solving the climate problem. If every alcoholic beverage producer sourced grain from fields farmed with regenerative agriculture and bio-sequestration, massive amounts of CO2 would be drawn down into the soil and out of the atmosphere. Tilling fields for corn, wheat, barley, rice, and other ingredients we source for our products releases massive amounts of CO2 into the atmosphere. No-till plows can plant those seeds without allowing CO2 to escape. The healthy soil that resulted would capture carbon and reduce runoff. If we keep the soil covered and healthy, CO2 remains in the ground where it belongs.

Resistance to Regenerative Farming and Organic Ingredients in the Liquor Industry

  Leading scientists and soil experts claim that capturing atmospheric carbon and replenishing the Earth is possible with the technology we already have. Unfortunately, this type of farming faces strong opposition, and many remain resistant to change. I haven’t yet seen regenerative agriculture become a significant part of the spirits industry. Perhaps this is because organic, non-GMO corn is simply more expensive to produce than GMO corn.

  Today’s farmers are able to keep the cost of industrial agriculture low through the extensive use of harmful chemicals. These become necessary because their way of farming creates an ecosystem centered around only one crop. Over time, it depletes the soil of nutrients and throws the environment out of balance. Natural ecosystems are filled with a variety of plants and animals, each designed to keep the others in harmony. When massive amounts of one plant cover an area, it is natural for predatory insects and weeds to move in and take advantage of the surplus. In an effort to protect their crops, farmers spray tons of poisonous pesticides and herbicides on the fields. To replace nutrients in the soil, they turn to harmful fertilizers. 

  For example, glyphosate has had a major impact on the production of corn for vodka. For over four decades, this chemical has been the leading tool farmers in the United States used for killing weeds before planting their corn. According to the United States Department of Agriculture (USDA), glyphosate — the main ingredient in Roundup — has become the most widely-used herbicide in the US since 2001.

  The problem was that this chemical killed all plants indiscriminately. In response, scientists created “Roundup-Ready” crops in 1996. Genetically engineered plants were then able to tolerate the herbicide. After this, farmers could spray their entire cornfield without worrying about being selective. Today, farmers who grow Roundup-Ready GMO crops use glyphosate as a desiccant to speed up their harvesting timetable. Spraying their plants with the herbicide kills the crop, causes it to dry out sooner, and produces more consistent yields. This allows them to harvest crops as much as two weeks earlier than they could have otherwise, which proves to be an advantage in colder climates.

  Exactly how glyphosate impacts long-term human health is still being debated, even though its use has increased almost 20-fold during the last two decades. The World Health Organization’s International Agency for Research on Cancer (IARC) declares that glyphosate is a carcinogen. The IARC also claims that Roundup is linked to Parkinson’s disease, Alzheimer’s disease, and autism.

  Regenerative farming employs biodiversity to control weeds and pests. It is more expensive, but the cost is worth it. When spirit brands embrace this way of farming, they discover exciting benefits. In addition to the environmental gains, they will also be pleasantly surprised by a vast improvement in the quality of their product. Vodka made with organic corn and without added sugar simply tastes better, since it has its own natural sweetness. There are no additives — just organic corn and water.

  The best way to ensure the corn and grains sourced for the production of spirits are organic and farmed sustainably is to purchase them locally. Eliminating the need for transporting large volumes of grain over long distances is also a way to reduce the liquor industry’s carbon footprint.

  Despite the cost, a growing number of farmers are looking into the possibility of producing their crops with sustainable farming methods and regenerative practices. Because of the damage that has already been inflicted on our planet and the harmful practices still going on today, regenerative farming requires commitment. Some of these farmers have to spend up to three seasons restoring the soil in their fields. On top of this, many are forced to plant a 25-foot buffer crop to block the overspray of pesticides from neighboring farms. It is time for the liquor industry to show these farmers our support.

  Farming is inherently risky, and farmers are resistant to change. When you ask them to do something they have never done before, especially when neighboring farmers aren’t doing it, you are asking a lot of them. It’s hard for farmers to learn new techniques because so many of them are already working another job to avoid losing their farm. Greater education is key to getting more farmers to adopt regenerative practices.

  The best means of persuading large farms to commit to regenerative agriculture is by demonstrating that it makes financial sense. If large distilleries can work out long-term contracts to source grains directly from the farm, it could be a win-win scenario for both parties. The distillery could share a regenerative story about the farm and about their product. Likewise, if a farmer knows there is demand for sustainable ingredients, they will be willing to meet it. There are so many positive stories that can come out of these partnerships.

Reducing Waste in the Distilling Process

  Sourcing quality ingredients is paramount because it offers us a chance to restore our planet’s health. However, the most unsustainable part of liquor production is distillation. It leaves us with waste products that are harmful to the environment if not disposed of properly.

  Inspired by shortages during the Covid-19 pandemic, some distilleries began turning these waste products into hand sanitizer and are still doing so even after the commercial producers restocked the shelves. I have known certain distilleries to give away a bottle of sanitizer with every purchase.

  Distilleries are also forming partnerships with industries such as fish farms, livestock farmers, and bakeries to put waste grain and water products to good use. At TimberFish Technologies, spent grain is converted into fish food and pumped into growth tanks brimming with speckled trout, Atlantic salmon, and shrimp. Distilleries also send waste products to farms that raise livestock — often the same farms where they purchased their grain initially. Upcycled waste products are not just for animals. Bakeries use mash to make sourdough bread and grain byproducts to make flour.

  Other distilleries are exploring ways of reusing their waste products to keep the machines running. Converting waste into energy can be achieved by an anaerobic digester system that uses waste to produce methane. Cyclically, this methane helps to fuel the very distillation process that produces it.

Reducing The Impact Of The Liquor Industry’s Packaging Materials

  After distillation, packaging is the second most significant environmental challenge in our industry. A 2019 assessment finds the carbon footprint of glass vodka bottles accounts for 43 percent of the product’s carbon footprint. Recyclable PET plastic bottles account for around 27%.

  Ideas for making the packaging of our products more sustainable include recycled glass and cork. Larger distilleries are funding research into biodegradable bottles, recycled paper-plastic hybrid bottles, and plastic bottles made from wood pulp.

Hope for a Sustainable Future in the Liquor Industry

  As more and more of our consumers become aware of climate change and its implications, they are adopting a new understanding of what it means to drink responsibly. Today, people are reading labels. They are aware that their purchases have an impact on our planet and want to know where their food and beverages come from. We should give them the opportunity to make a difference with the products we provide.

  There is a new climate story that is optimistic and simple, and the liquor industry can be part of it. If we learn how to support sustainably-farmed ingredients, manage our waste products responsibly, and package our products in environmentally-conscious ways, we don’t have to live in fear.

The Most Important Opportunity for Brewery Owners

Cyndi

Why So Many Are Missing It

employee retention tax credit

By: Catherine Tindall

The Employee Retention Tax Credit (ERTC) is one of the best ways for those in the beverage industry to regain their footing in a post-COVID age. Unfortunately, according to current estimates, many eligible businesses are missing out on this historic opportunity. For those who received or may otherwise be familiar with the Paycheck Protection Program, also known as the PPP, the concept is similar, but there are key differences that make the ERTC a much more generous program overall.  To understand why I will outline some of the key provisions and eligibility parameters, explain the process for claiming the credit, and answer some common questions I encounter in my own practice, such as “why haven’t I heard of this before?”

  The ERTC is a tax refund credit entitling employers to up to $26,000 per employee, depending on the number of quarters a business qualifies for. Eligibility is determined by either revenue disruptions or government orders on a quarterly basis. Many breweries are unaware that they are eligible for the ERTC due to the capacity and operation restrictions on their indoor dining and/or tasting rooms that occurred during the pandemic. Financial disruptions to that aspect of the business trigger ERTC eligibility for all the divisions of the brewery, not just the restricted segment.  We routinely see businesses qualify for six or seven-figure credits under these parameters.

  There are a number of features that set this credit apart from other programs designed to aid businesses affected by the pandemic, like the PPP. Unlike the PPP, the credit itself comes back as paper checks from the IRS, and also unlike the PPP funds, which were restricted to certain uses, a business owner is free to use the ERTC however he or she sees fit. This is because the credit is actually a refund of wages and payroll taxes your organization has already paid. A consequence of this is that there is no overall program limit on the funds to be disbursed through the ERTC, in contrast to the PPP which had a limited fund pool. Businesses affected by government orders are entitled to every cent they qualify for. Taken together, all of these factors are what gives this program its power. The only limitation is time. This credit will begin to be phased out in April of 2023, meaning that business owners need to ensure they submit their claim as soon as possible. 

  Given the tremendous upsides, every business owner in the beverage space should try to see if their business qualifies, even if it seems doubtful. There is no need to become experts in the credit’s provisions, which can often be nuanced. The important thing is to find the right professional, and, to this point, one must be careful. There are unfortunately a lot of bad actors in this space looking to make a quick buck, and many of them are very good at seeming legitimate. 

  The following are some of the most asked questions associated with the ERTC.

  Should I get a second opinion? Because of the substantial nature of these credits, it’s often worth speaking to multiple providers for the credit to get a sense of the relative merits of each, and to look to the expertise and experience of those working on your case rather than fancy marketing or smooth sales tactics.

  Why haven’t I heard about this before? There are several reasons why many business owners have not heard of this important credit. One is that, in contrast to the PPP program, the ERTC has not been well advertised by the government (after all, since when did the IRS advertise refunds you’re entitled to). Another is that many tax practitioners are hesitant to pursue it given the sometimes complex nature of the claims, if this isn’t their area of expertise. Finally, we commonly find that too many CPAs mistakenly believe that their clients do not qualify for the credit, and so never bring up the possibility of claiming it with them.

I would encourage all brewery owners to actively explore eligibility. The potential benefits of qualification, hundreds of thousands of dollars in obligation-free money from the IRS, is one of the highest value things you could do for your business in the current environment of economic uncertainty.

  There are certain pitfalls to avoid, such as dishonest companies operating in the space, but if you choose the right firm or professional to partner with, the process is remarkably painless. Just be mindful that this is an opportunity with a time limit attached. With less than a year before it begins to phase out, now is the time to claim the credit you’re entitled to.

  Catherine Tindall is Partner & CPA, Dominion Enterprise Services (DES), a full-service CPA firm providing tax planning and consulting alongside specialty tax credit processing. The firm has more than 50 years of collective experience and recently announced the launch of its Employee Retention Tax Credit (ERC) Division to help restaurants assess their eligibility for the ERC and properly secure the maximum refund allowed. Learn more at…

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New Brewery, Winery or Distillery Start Up

Cyndi
a cozy winery

By: Kris Bohm: Distillery Now Consulting, LLC  

Starting up a new beverage alcohol business is hard. Whether making beer, wine, or spirits, the challenges are daunting and upfront costs are huge. No one takes the leap to start a new business knowing it will fail, but many of them will. Based on industry data, up to 40% of new beverage alcohol businesses fail. To create a successful business, there is a common question that arises during the planning phase of launching a new beverage alcohol business.

What is the difference between a successful business and one that fails?

  This massively important question should be answered early on for a new business. In doing so, key strategies will be defined for the business from the beginning as it ventures forward. In the following paragraphs, you will find not only the answer to this question, but also a further analysis of successful business practices.

Defining Success: Let’s take a moment to define and measure success in a beverage alcohol business. This definition applies whether in a brewery, winery, or a distillery. These measurements of success will allow us to look closer at the internal workings of the business. As you look closer you will find common traits among nearly every business that is successful. For the sake of this article we will narrowly define success using the specific individual metrics of profitability, sustainability and velocity.

Profitability: The first key metric and measurement of success is profitability. A business must either be profitable, or at a minimum near self-sustaining, with revenue covering the cost of operating the business. Achieving profitability is one of the biggest metrics that defines success. Reaching profitability is essential, as every successful business must be self-sustaining after a certain amount of time. If a business is not profitable for too long of time, it is almost certain to fail.

Sustainability: A successful business must be sustainable in the capacity to produce the products it intends to sell. To clarify, we do not mean sustainability from an environmental impact or energy usage standpoint. Sustainability in this model means the ability to sustain and meet demand for products through growth. For a business model to be sustainable the equipment must have the capacity to grow and meet new demand as the company grows. The reason this metric is so essential is that most businesses must grow to reach profitability. If your business cannot sustain growth it most likely can not grow to become profitable.

Velocity: A business needs to have regular sales to provide consistent revenue for the business. Velocity is a measurement of how quickly your business is turning raw materials into finished goods and selling those goods. High velocity of product means there will be more consistent cash flow for the business. As product velocity increases it is followed by increases in revenue and often economies of scale. Both of which help a business become successful.

Tripod Business Model: Most businesses achieve some of these measures of success, but not too many will achieve them all. Among those who do succeed in meeting all three, there is a common thread that these successful businesses share. They will usually have three separate divisions that perform distinct business activities. These three divisions are production, sales, and marketing. This concept we will refer to as the tripod business model. If the top of a tripod is a successful beverage alcohol business as measured by our success metrics, then there almost always exists these three divisions in the business that make up equally important legs that hold up the business. If you remove any of the three legs, it only leaves the business on two unstable legs, and in time the business will fall and is likely to fail. It is easy to take this observation and call it as incorrect, but if one was to look closely at established successful beverage alcohol businesses they would find truth in this observation.

  When a sizable amount of time and resources are heavily invested into sales and marketing, the business has a strong probability that it will flourish. Often the business will flourish so strongly that production will often feel constrained in the resources it needs to meet the demand of the business. This is the correct way to invest time, financial resources and manpower to grow. If too many resources are dedicated to production in most instances production will have far too much capacity and there will not be enough demand for product to keep production running near its capacity.

  Now that we have defined some measures of success and the business practices that support them, let’s look closer at the three practices that hold up a successful beverage alcohol business, through the lens of a distillery.

SALES: Sales is essential and paramount to the success of nearly any business that has a product they sell. It can be the easier path for a new distillery to focus on their production with a plan to only sell spirits through a tasting room or cocktail lounge that is part of the distillery. A business plan like this can work, but it has a low ceiling that will often restrict a distillery from growing to a successful level. Real sales of considerable volume come from a distillery selling products in the same market as its competitors. This means working to sell spirits in liquor stores, bars, restaurants and other venues. In this market there is immense competition. The only way to compete in the larger spirits market is by investing into sales. This means having people working for your business who are full time employees whose job is to pull your spirits through the market and drive sales.

MARKETING: Marketing is the driving force that directly links to the success of sales. Marketing can come in a multitude of forms, some obvious and some not so obvious. Public facing platforms, such as social media, websites, billboards, magazines, newspapers, and influencers are all forms of marketing in action. The more a consumer or target consumer encounters a brand, the higher the chance that the consumer will buy your brand. Without an active marketing plan in place, consumers will quickly lose sight of your brand. A strong marketing plan and the person or people to continually implement, monitor, and drive a marketing plan is paramount to achieving success. Marketing is the key difference that will take a brand to the next level and keep pulling it up from there. Although it can be easy to not put an emphasis on channeling resources to marketing, it would be a mistake to do so. Many businesses have launched with little to no resources committed to marketing. Often these launches feel successful, but by our measurements are in fact not truly successful. Oftentimes the business will get going and be selling some amounts of product but in most instances a lack of marketing will cause a business to plateau quickly.

PRODUCTION: This practice of manufacturing is easy to give too much focus in the business of distilling. Whether you are distilling whiskey from scratch or bottling sourced spirits, the production part of this business is extremely important. While production is absolutely paramount to the business, this does not mean that the bulk of resources the business has should be invested into the production of spirits, nor the labor or equipment to produce the spirits. If the bulk of resources go towards production thus starving sales and marketing, there will invariably be a lack of sales to cover the costs of production. Now the manufacturing of distilled spirits is in no way inexpensive. Considerable resources have to go to production for it to function. We are trying to urge you to consider all resources the business has and properly allocate them to all three practices.

The battle between the practices: If you ask most folks who work in this industry, whether they work in sales, marketing, or production, they will all likely tell you that their business function is the most important to the success of the business. To be fair, all these folks can probably make a reasonably sound argument to support that statement. It is normal that there is some friction between all three practices because they all have unique functions and priorities that often do not align with one another. For a business to be successful, production, sales, and marketing must work together to achieve the goals of the business. When common goals are shared it is much easier for each part of the business to work in harmony.

Is it Time to Order More Brick-and-Mortar Locations for Your Bar or Restaurant?

Cyndi
dark bartending area

By: Raj Tulshan, Founder of Loan Mantra

Is commercial real estate making a comeback in the hospitality industry? After several extremely disruptive years of a global pandemic – and the resulting lockdowns, inflation, supply chain disruptions, and staffing shortages – is the future finally brighter for hospitality and real estate? Is it time to invest in more bars and restaurants – and if so, where exactly should you invest and when do you know if it is the right time?

Investing in real estate is a major, long-term commitment requiring careful consideration. Business owners must do their homework before signing a real estate contract, thinking about a host of factors, including the building’s location, the economy, zoning laws, the projected value of the property, and its expected appreciation over the coming years.

  Location is a huge factor. Is the property you’re considering in a good spot that will attract customers? Is the property attractive, in a safe, high-traffic location? Is the community vibrant and growing, with a history of economic stability? Is there easy access with ample parking, or is there a subway or bus stop nearby? What’s the neighborhood like? Is there considerable competition in your space, with tons of other bars and restaurants nearby? Is the neighborhood hungry (pardon the pun) for your type of establishment? Are the demographics right for your type of business? For instance, a heavy metal-themed bar might not flourish in a neighborhood with an older demographic.

  Despite major difficulties in 2020 and 2021, the hospitality and commercial real estate industries are finally in growth phases again, and this growth is likely to continue in 2022. Some things to consider include:

  People are going out again. Demand for in-person goods and services is rising again, as people want to eat at restaurants and go out for some beers. This pent-up demand is good for commercial real estate – and the bars, restaurants, and other businesses that occupy these buildings.

  Hospitality is rebounding. Now that the worst of the pandemic is (hopefully) behind us, business and leisure travel will start increasing again, and people will be dining out more frequently. The growing travel demand means hotels, restaurants, and bars may take on renovation and expansion projects that stalled during COVID. And, increasingly, hospitality business owners will invest in real estate to house their bars and restaurants.

  Secondary markets are growing. The evolution of remote and hybrid work means many employers and employees are moving out of high-rent cities into smaller markets that are more cost-effective. Recently, people have been leaving big, expensive cities like New York in droves, in favor of smaller, more affordable markets like Nashville and Tampa. If you’re thinking of opening a bar – or expanding your brand to new markets – consider these geographies.

  Operators are opting for building ownership. Some restaurant and bar brands are opting to own real estate rather than leasing. When leasing, the building owner is making money, regardless of whether your business is profitable. However, when you own the property, you’ll be building equity regardless of how your business is performing. Many restaurateurs and bar owners are choosing to buy instead of lease because it makes more financial sense over the long term. If you’re the property owner, you won’t have to worry about surprise rent increases. You also won’t need to abide by your landlord’s rules, giving you more freedom with your business and your property.

  Add new revenue streams to boost profitability. With labor shortages impacting the operating hours (and bottom lines) of hospitality businesses, restaurants and bars have realized the importance of having multiple revenue streams to increase profitability, especially if they’re working to cover the cost of their mortgage. Some brands are selling their own beers online or selling branded merchandise at their brick-and-mortar location and online. While people are finally coming back to dine and drink in-person, it’s wise to have additional revenue streams to keep a steady stream of revenue flowing – and so you can cover your mortgage and property taxes if you’re the building owner.

  If you’re financially able to swing it, buying property for your bar or restaurant can be a wise move. As experts predict that the worst of the pandemic is behind us, it looks like the hospitality and commercial real estate industries are poised for a rebound. If you’re thinking about a real estate investment for your hospitality business, be thoughtful and consider the decision carefully before signing the contract.

About the Author:

  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 designed to serve small and medium businesses with offices in New Jersey, Charleston, SC and New York. At Loan Mantra your success is our 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 the US. 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 or 855.700.BLUE (2583)

Optimizing Same Day At Home Beverage Delivery  

Cyndi

By: Anar Mammadov

It’s not easy to make a beverage brand succeed. The marketing must be just right, including packaging, positioning, and placement of ads. Securing distribution is another step; hitting your sales numbers starts with getting your product in stores. Even when those two are achieved, brands still need to find a customer base that will adopt them, sharing their enthusiasm and spreading the word about their products.

  In 2022, beverage brands that want to be successful can add another task to their to-do list: providing same-day delivery. Consumers, responding in large part to the stay-in-place culture that was inspired by the COVID-19 pandemic, have come to expect that most any item can be delivered to their door in a matter of hours, if not minutes. This is true of everything from bandages to burgers to big screen TVs. And it definitely includes beverages. When a customer realizes that they don’t have the beer they want for the cookout or decides a nice bottle of wine would go well with tonight’s dinner, they are looking more and more to same-day delivery options.

The Current State of Same-day Delivery

  For beverage brands that want to meet the same-day delivery expectation, there are a handful of delivery services that can help them. Looking at the reviews for those companies, however, reveals they leave quite a bit to be desired for the brand that is concerned about providing service that consistently inspires glowing reviews.

  Forbes recently ran an article rating alcohol delivery services. At the top of its list was Drizly, which is an online platform that allows users to get alcohol delivered from local retailers. Drizly promises delivery in less than 60 minutes and the “biggest selection for on-demand alcohol in the history of ever.”

  Forbes rated Drizly as the “Best Alcohol Delivery Service Overall,” but reviews show it to be hit or miss. According to the consumer review website Trustpilot, Drizly needs to do some work to become a five-star service. While 39 percent of the reviews described Drizly as “excellent,” 46 percent labeled it “bad.” The most frequent complaints from users focused on delivery times and fees that could be improved.

  Minibar is an online alcohol delivery platform that Forbes rated as “Best Quick Alcohol Delivery Service.” According to user reviews submitted to the online review site Influenster, Minibar provides better than four-star service, but still struggles in some areas, such as providing reliable ETA info.

If you are ordering alcohol with a takeout food order, Forbes says DoorDash is your best option. But users are not kind to DoorDash in their ratings on Trustpilot or Reviews.io.

The Issues That Make Same-day Delivery Challenging

  What is keeping these companies from achieving consistently reliable delivery service?  Anar Mammadov, CEO of Senpex, has some ideas. Senpex is a logistics company that provides safe and reliable on-demand pickup and delivery services for a wide range of companies, including beverage companies. Central to the service that Senpex provides is an AI-powered engine that ensures all of the delivery factors are considered and routes are optimized.

  “There are a lot of factors that need to be considered if you are going to provide delivery in a timely, professional way,” explains Anar. “These include the volume of product, which dictates the size of the delivery vehicle needed, as well as traffic and other road conditions. When you have multiple drivers making multiple deliveries, it gets exponentially more difficult to plan. At Senpex, we rely on our route optimization algorithm to make sure that deliveries are possible and profitable.”

  Sen has some experience in making deliveries. Having worked with more than 3,000 corporate clients, Senpex has more than 500,000 successful deliveries and a 98 percent customer satisfaction rate. And thanks to the help of AI, it is able to achieve that for as little as $7 per delivery stop.

  Anar also highlights the need for reliable in-house logistics that simplify the delivery process by bringing inventory, ordering, and fulfillment together. In addition to partnering with companies to provide a delivery team, Senpex also offers its logistics platform as a SaaS solution for companies that want to increase the efficiency of their own delivery teams.

  “Having your own delivery fleet is not enough to meet same-day delivery expectations,” Anar explains. “You need sophisticated logistics that convert delivery details into optimized delivery routes. The platform needs to keep drivers updated in real-time to make sure that deliveries are not delayed. Being able to stay on top of ETAs allows you streamline deliveries and keep customers informed.”

  In its own operations, Senpex has found it essential to have an AI-empowered dispatch management tool that also provides drivers with an app to track and verify the delivery process.

  “Customers have a lot of expectations when it comes to same-day delivery, regardless of what the product is,” Anar explains. “They want safe and transparent delivery, competitive pricing, and instant real-time status updates. And they want it all to be managed by a professional delivery team. Businesses that can’t meet these expectations are risking their reputations.”

Navigating the Risks Associated with Same-day Delivery

  So what does all of this mean for beverage companies who are contemplating providing same-day delivery. The bottom line is that it is risky. There is a huge potential for craft beverage makers to grow their following through alcohol delivery, as the financial services platform Square recently reported. However, a bad delivery process can come across as a bad brand.

  Is there a solution? The answer may be found in a delivery system that provides a brand with more control than what is typically available through a generalized delivery service like DoorDash. Professional delivery services like Senpex exist to take your delivery to the next level.

  In addition to providing you with the tools that you need to do delivery well, a professional delivery service can also help you to scale that aspect of your business. They give you access to a large fleet while only requiring you to pay for the deliveries that you need. As the demand for delivery grows, you have additional drivers at the ready.

  As you explore the possibilities that are available, here are a few things you will want to consider.

Work with Drivers Who Know Your Business

  Delivering alcohol is not like delivering anything else. Several states have laws that regulate it. Before committing to working with a delivery service, make sure that they can provide drivers that comply with all applicable laws. In other words, choose a professional service that vets its drivers. Let them do the HR work for you.

  Also, make sure that the delivery service has the type of vehicles that are needed to facilitate your deliveries. Not only should they have refrigerated vehicles when that is necessary, but they should also have the right size vehicle. Vehicles that are too small will not be able to handle the load. But vehicles that are too big will often cost you more than you need to be paying. Ensuring that the right vehicle is available is one of the functions of route optimization.

Work with Companies Who Understand Delivery Logistics

  Whether you are partnering with a delivery company to utilize their drivers or simply taking advantage of their delivery logistics platform to optimize the efforts of your own delivery team, there are some things you should look for. For example, look for a platform that integrates with your existing ERP system. If you truly want to take advantage of delivery automation, it is better to avoid working with multiple systems.

  Dispatch management functionality should include tools that allow for real-time fleet tracking. This includes automatic status updates, electronic proof of delivery, and secure driver chat through simple and intuitive apps that are native to both iOS and Android.

  One often overlooked element of logistics optimization is deliveries that are managed by regular drivers on regular routes. Regular drivers know what to expect from both the route and the delivery destination, making them more capable of delivering the type of experience that will lead to repeat business. A company with a lot of driver turnover will not be the best option for businesses that want to provide a consistent customer experience.

  Finally, tools that empower route optimization are critical to success. Last mile delivery is one of the biggest challenges facing businesses today. It takes the most time, it costs the most money, and it serves as the key point of contact between the customer and the brand. It should be a top priority for any delivery service with which you choose to work.

  Overall, same-day delivery provides another revenue stream that beverage businesses should seriously consider tapping. The market clearly exists, even if the price that consumers are willing to pay has yet to be firmly established. Now is the time to explore the options that are available to create a system that can be profitable and provide a positive customer experience.

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.