Category: Archived Articles

Chronicling the Rise of Schilling Cider

Cyndi
5 ciders placed in a table

By: Becky Garrison

How did Colin Schilling go from making cider in his teens to operating Schilling Hard Cider,  the second-largest cidery in the United States? According to Emily Ritchie, executive director of the Northwest Cider Association, it’s a smart business. “That, combined with a passion for cider, has enabled them to be one of the top cider producers in the country! They’re pushing boundaries and finding shelf space for the cider category. They’re helping to lift all ships in the rising tide,” she notes.

  When asked about the inspiration behind his innovative cider portfolio, Colin Schilling points to his great-grandfather. In 1881, August Schilling founded the Schilling Spice Company in San Francisco, where he became known for products that put quality over a lower price point.

  Schilling grew up with cider in his blood. In the 1970s, his parents carried on this family craft tradition by pressing and making small-scale cider on their farm in rural Idaho. While he started making cider when he was 14 years old and continued homebrewing during his college days, Schilling says he never envisioned a future as a cidermaker.

  Then, after a five-month stint with Microsoft, he noticed how Angry Orchard kept trending in a direction that pointed to a growing interest in ciders. In Schilling’s estimation, his cider tasted better than other ciders on the market. So he convinced his friend, Mark Kornei, to join him on a new venture. They both quit their corporate jobs and launched the cidery, with Colin taking on the title of CEO and master cidermaker and Mark assuming the role of CFO.

  By November 2012, they had developed their initial concept for their cidery and filed their LLC papers the following month. At the start of the new year, they moved into a 30,000-square-foot facility south of Seattle in Auburn, with their first sales in April. Initially, raw apples were processed into juice, which was completed in Yakima in Eastern Washington, and then the juice was trucked to Auburn. They also employed a local cannery that filled and seamed their cans.

Pushing the Boundaries of Cidermaking

  From the cidery’s inception, Schilling has wanted to continue his family’s commitment to craft while pushing the boundaries of what he envisions as a cidermaker. Over the years, he has maintained a commitment to producing a craft cider that fits the definition of cider in the United States. Hence, 51 percent of the apple base in all Schilling ciders is made with 100 percent fresh-pressed apples. “At its core, cider is good quality apples. Then from there, the world’s your oyster,” Schilling reflects.

Canned Cider Pioneers

  Schilling proclaims they were a pioneer in producing cider in cans instead of bottles. When they started Schilling Hard Cider, ciders sold in the US were in bottles. But Schilling believed cans represented a far more sustainable way to package a beverage product. So, even though ciders had not previously been sold in cans, they committed to more sustainable practices on the assumption that canned ciders would also be popular.

  After California voters passed Proposition 65 (The Safe Drinking Water and Toxic Enforcement Act) in 1986, the composition of canned liners changed from an epoxy base that contained trace amounts of BPA to 100 percent BPA-free cans. Schilling was able to access a canning process that was safer for both the planet and people. As an additional sustainability measure, they print their iconic labels directly on the cans rather than use non-recyclable stickers that must be peeled off the cans before they can be recycled.

  Schilling ciders are essentially sulfite-free, which the company states is necessary to make a quality canned beverage using their current liners. To ensure their products are self-stable without adding chemicals, they pasteurize their ciders through a large state-of-the-art tunnel pasteurizer.

  Among their earlier canning experiments, Schilling was the first cidery to produce a nitro cider in a can. Called Grumpy Bear, this was a nitro cider made with coffee beans that poured similar to a Guinness, replete with a foamy head. Also, they were the first to produce ciders from fruits other than apples, including grapefruit and pears.

Development of Tasting Rooms

  About ten years ago, Schilling decided to open tasting rooms in Seattle and Portland because these two cities represent the two fastest cider markets in the country in terms of per capita consumption and awareness of craft cider brands. In 2014, they opened their first cider house in Seattle with 32 taps, which, at the time, was the most extensive collection of cider taps in the world.

  Their number of taps has now grown to 35, featuring regional and local ciders and higher-end imports from Europe. At one point, they included two nitro taps into this mix. Because they are able to rotate multiple kegs at their cider house, they can test out new ciders and quickly gauge which flavor profiles resonate with consumers. Additionally, they now have the largest packaged selection of craft cider, with over 200 varieties in their cold cases for customers to enjoy onsite or take home.

  In 2018, Schilling opened a second cider house in SE Portland in the Goat Blocks neighborhood, which boasts the country’s largest selection of draft ciders with 50 cider taps. This site also has a restaurant serving a gluten-free menu and a winery license, where they show off some small-scale techniques by producing wines in five-gallon tanks. These wines are used primarily for special events and experiments.

Expansion of Schilling Cider

  Shortly after opening in 2012, Schilling ran out of space and utilized satellite warehouses to store empty cans, cases and other materials. So, two years later, they relocated to a 110,000-square-foot warehouse, also in Auburn.

  This expansion gives Schilling the infrastructure to scale up while still maintaining its craft sensibilities. For example, they can now store enough apples to fresh-press apples year-round. As proof, they are the largest fresh-pressed cider production facility in the country.

  Schilling also now has the fastest canning line in the world, which can run up to 1,050 cans per minute. The entire production line is fully automated, with a crew of highly trained individuals overseeing this production. Because the line is highly automated, and no one has to work shoulder-to-shoulder on the production line, they were able to assume total production during COVID while practicing social distancing. 

Changing the Corporate Culture

  Schilling attributes the high employee retention rate among his 75 employees to their work with Moe Carrick, an executive leadership consultant and author. “We’ve done a lot of soul searching, training and coaching regarding how I lead and run a company from the top. Then we’ve implemented policies that I think are quite different from what other folks experience in our industry.”

  For example, they benchmark their employee’s pay raises to the Social Security inflation number. Also, they engage in honest real-time feedback and just rolled out a company-wide employee training program whereby everyone gets to pick a broad topic they will focus on for a year. Along those lines, they work to ensure that all employees are tuned in to the company culture to function as effective brand ambassadors for Schilling Cider.

Charity Partnerships

  Every year they run a campaign called Keep It Wild with Oregon Wild and Washington Wild that raises money to help keep wild spaces intact. Last year, this campaign raised $20,000 for these charities. This year, they’ve expanded the program to eight states. In addition, the company hosts cider diners designed to raise funds for hunger relief charities. Schilling is also building multiple collaborations around National Cider Month in October, participating with the Northwest Cider Association and local events, such as Cider Summit Seattle and Cider Summit PDX.

New Product Developments 

  When Schilling’s Excelsior line of imperial ciders launched in 2018, they had the distinction of being the first cider to produce a cider with over seven percent alcohol that was packaged into a six-pack of 12-ounce cans. In doing this, Schilling figured out a way to scale up a high-tannin exotic cider by bringing in bittersharps and bittersweet apples from Europe and France, where cider apples are still grown in abundance. They combined these apples with locally grown apples to create a tart but semi-sweet cider.

  Also, through experimentation, Schilling developed the ability to produce a highly carbonated cider, a feature they employed in their Excelsior Red Glo! This one-of-a-kind dry imperial cider is made with unique and rare Lucy Glo™ apples. A cross between a Honeycrisp and an Airlie Red Flesh apple, these apples are grown by fourth- and fifth-generation growers in the heart of Washington State’s apple country.

  Another new Schilling product is Vida Maté, a non-alcoholic canned drink made from Yerba Maté, a South American plant that contains naturally occurring caffeine, brewed into a tea and flavored with real juices.

  Moving forward, Schilling points to their 110,000-square-foot warehouse, noting they have plenty of room for expansion. Along the way, Colin Schilling will continue to explore ways to be a sustainable leader in the industry while producing unique craft ciders. 

OH! Canada

Cyndi
people dining outside

By: Tod Stewart

Dubbed the Great White North, Canada has stereotypically been viewed as a country perpetually shrouded in snow – where herds of caribou and roaming packs of wild wolves play survival games in the streets, where the inhabitants (clad in parkas and donning toques and snowshoes) emerge from their igloos to dine on seal blubber and polar bear meat. And beer.

  Okay, that’s pushing it a bit far. Anyone who lives in all but the most northern reaches can regale you with stories of asphalt-melting, paint-peeling summer heat. Interior British Columbia’s Okanagan Valley has literally caught fire on some occasions, with daytime temperatures reaching higher than 120 degrees Fahrenheit. In Winnipeg, Manitoba, you’re more likely to be eaten alive by ravenous hordes of summer mosquitos than a murderous hibernation-starved grizzly. No, the country’s really not a wasteland of frozen tundra. That being said, when it comes to the distribution and sale of beverage alcohol products, Canada has a ways to go before it really emerges from the Dark Ages.

  For example, there are antiquated liquor laws that haven’t changed dramatically since being imposed in the 1920s, combined with an inability to shake off the chains of the Ghost of Prohibition Past. Health Canada has recently proclaimed that no amount of alcohol is safe, and any more than two drinks per week – yes, you read that correctly – increases your odds of being dead). Additionally, federal and provincial government bodies have gotten rather intoxicated on the gold they have mined from drinkers. All of these things together to create an odd cocktail of private, public and government interests. So, how does this all affect a producer – perhaps you – who wants to break into the Canadian market?

  First, it’s important to understand that alcohol importation, distribution and, ultimately, sales are pretty much the sole domain of government liquor monopolies (“liquor boards”). Each province behaves somewhat differently in its approach, but all function in a fundamentally similar way. Let’s focus on Ontario (mainly because that’s where I live, and my knowledge of “the system” here is probably better than the workings of other provinces).

  Second, it’s equally important to understand that provincial liquor boards exist to feed provincial government coffers. That’s it. That’s all. This wasn’t always the case. The Liquor Control Board of Ontario (LCBO), for example, was originally envisioned as a transitional mechanism to ease the province from prohibition (via a system of “controls” – many of which would likely today seem in violation of personal privacy if not being downright racist) back into the private retail sector. It wasn’t supposed to be still with us today. Of course, the original mandate was rethought over time as successive governments realized that in controlling booze sales, they had given birth to a proverbial golden revenue goose.

  The upshot of this is that, though you may be convinced you’ve developed the most wondrous elixir thus far known to man (confirmed by family and friends), it really means nothing to the liquor board. What matters is how much money your concoction will rake in if the decision is made to give it a shot in the market. As with many other businesses, the salaries and bonuses of LCBO executives (which are substantial) are directly tied to “corporate performance” (read, sales numbers). If you can’t help them, they can’t help you.

  There’s a saying: “If you want to make a small fortune in the wine industry, it’s best to start with a large one.” The same is true with trying to break into the Ontario market. Having a decent chest of loot socked away to market and promote your product – primarily through LCBO-controlled programs that you will be “strongly encouraged” to participate in – will significantly up the shelf space ante.

  “Okay,” you say, “I get it. It’s all just business…but I still want a piece of Ontario action and I’ve got the resources to give it a serious go. So, how do I do it?”

  Assuming you are a producer of “craft” products and don’t have a global corporation with an international sales force to help you, you will need someone in Ontario to act on your behalf. A “manufacturer’s representative” (aka, an “agent”) essentially acts as your sales and marketing (and often PR and government relations) wing in Ontario. A good agent likely has a decent working relationship with LCBO buyers (and possibly LCBO executives), knows how to navigate the system and work through the reams of often byzantine paperwork, knows which LCBO sales channel (and there are several) would work best for you, knows the market, can assist with pricing decisions and – perhaps most importantly – has the patience of a saint and the tenacity of a limpet. While you may luck out and get a bite on your first cast into LCBO waters, this typically isn’t the case.

  Suppliers often become frustrated and blame their agents for the lack of LCBO purchase orders. Truth be told, it’s very rarely a failure on the agent’s part. Even the most seasoned of them are often left scratching their heads when it comes to explaining why a product was rejected, though there’s really no mystery (see “provincial liquor boards” paragraph five above).

  Agents come in various shapes and sizes, from a one-person shop servicing Ontario only to corporations representing producers in each province and territory. Each type has its upside and down. Larger agents have a greater range, bigger budgets and more salespeople in the field. It’s also no secret that the LCBO tends to favor larger agencies when it comes to new and subsequent listings. The downside is that, as a craft producer, you may not have the volume of product to meet a large agent’s financial needs. Also, large agents often give the most attention to the suppliers in their portfolio that generate the most income. This might not be you.

  A smaller agency, while not having the range or resources of the big guys, typically has a smaller portfolio and can dedicate resources to building your individual brand in the market. In any case, any agency will be projecting a bottom line and weighing the effort needed to reach it before taking on any new supplier.

  Having an agent (of whatever size) doesn’t mean you can simply sign an agreement and then sit back and watch the revenue roll in. You and your agent must present a marketing plan to convince LCBO buyers to take a chance on an unknown brand. This chance will be better if your marketing plan includes numerous accolades and high scores from critics and the media.

  Once accepted, you still have to physically get your goods into the province. Large orders – or orders within reach of convenient co-loading ports – are usually easy to deal with. In fact, the LCBO will take care of most of the shipping and customs clearance responsibilities (while marking up any incurred costs and applying that to the cost of your shipment). Looking to ship in five cases of craft spirit from upstate New York? Though Ontario might literally be just across the lake, getting these cases into the province can pose challenges and requires that you, the supplier, do some homework before attempting to ship.

  Of course, once the goods do arrive, it’s not like the items are immediately shipped out to stores or offered for online purchase. The LCBO chemically analyzes all beverage alcohol products destined for sale in the province. It also holds the agent and supplier to specific labeling requirements (details here: https://www.doingbusinesswithlcbo.com/content/dbwl/en/basepage/home/quality-assurance/quality-assurance-policies—guidelines/labelling/-lcbo-product-packaging-standards-and-guidelines-for-chemical-an.html). Lab testing isn’t provided free of charge. If your product fails well, you have the option of having it shipped back (on your dime) or destroyed (also on your dime). If “corrective labeling” is required to make your labels compliant, you’ll be charged for that, too. Be forewarned, the time it takes to have your stuff available for sale once it landed can be frustratingly long, and the reasons given (or typically not given) for the delay will almost be guaranteed to cause further frustration.

  You might also be (unpleasantly) surprised to find out what the retail price of your product will be once it’s available for sale (though, to be fair, you will know this before you even decide whether a sale to Ontario is worth the bother). To quote the LCBO’s website: “The price that is seen in a store or online is a combination of the supplier’s price plus import duties, freight, levies, a standard markup, HST and container deposit.”  The “standard markup” on spirits is a modest 139.7 percent. The Harmonized Sales Tax (HST) is 13 percent. All of these costs are passed on to the end consumer.

  Things aren’t much easier if you’re a craft brewer. You might have heard of The Beer Store (TBS) and think this might be a way around the burdensome LCBO process. Think again. TBS is simply another monopoly, only rather than being run by the government, Canada’s three big brewers run it. If you think they are interested in offering competing products on their store shelves, keep dreaming. As with distillers, foreign brewers really have no choice but to deal with the LCBO.

  Finally (at least as far as this story goes), getting your product into the LCBO system is no guarantee it’ll stay there. You’ll be expected to meet sales quotas. If you do, reorders are likely – probably in larger amounts than your initial order. If it looks like you can’t, well, you can always try throwing more money into marketing, promotion and advertising. But in the end, if the consumer judges your product to be a dog or has no interest in trying it, it’s off the shelf – which is really no different from most retail products.

  Believe it or not, I’m not trying to discourage any beer or spirits producer reading this from trying to get a toehold in the Ontario – or Canadian – market. Personally, I’d love to be able to sample your wares. It won’t be easy, but it could be worth it, given the adult populations of major centers. Look on the bright side, if things go well, you might be able to unload your entire annual production on one customer – and with that customer being a government agency, payment is hardly ever an issue. Or you might decide that the LCBO is just another four-letter word.

Taking it Easy with Light Spirits

Cyndi
keep calm and stay sober

By: Hanifa Sekandi

You want to be the life of the party, but you do not want the party to take the life out of you. So you are on the hunt for a middle ground where you can entertain and imbibe with friends yet feel refreshed in the morning. So far, you have tried mocktails and light cocktails with just a splash or two of tequila. Globally, you are not alone. Just like you, people are looking for lighter spirits that maintain a robust flavor profile. Luckily, the industry is catching on. Spirits, ready-to-drink bever-ages and beer brands create must-have light spirits and drinks to keep the party going without tip-ping the scales.

  This change is a major innovation in an industry where consumers desire more than just the same thing packaged differently. Light spirits attract discerning beverage enthusiasts who seek a healthier lifestyle or simply to consume less alcohol. However, craftsmanship and ingredient still matter, and consumers are not ready to compromise quality. Brands who plan to enter this burgeoning, niche market must understand consumer demand and how and what to bring to the shelves.

What is a Light Spirit?

  When discussing light spirits, it sounds like we are talking about the paranormal. Alas, we are not. However, it does seem like magic when thinking about a once hard liquor becoming less potent.

  So, what is a light spirit? A light spirit, also known as a spirit drink, is an alcoholic beverage that contains a low alcohol percentage between 0.05% and 1.2%. This percentage scale is not consistent across the board and is dependent on the alcohol type. Some lighter alcohols are referred to as “re-duced alcoholic” beverages since they contain higher alcohol content than light spirits. Anything above a 5% ABV is considered a reduced or moderate alcoholic beverage. Moderate alcohol drinks contain approximately 9.5% ABV. This percentage scales up to 20% ABV for spirits, far below the higher alcohol range for spirits with a legal minimum of 40% ABV.

  As the market gains momentum, lighter spirits will provide consumers an outlet to create and im-bibe quality cocktails and drinks that still taste as good as their full alcohol counterparts. One could consider lighter Scotches, whiskeys and gins as the rebellious offspring of the spirit world, having one foot in tradition and the other in modernity. An example is Scotlands’s Whyte & Mackay Light with a 20% ABV. This smooth, earthy spirit is aged in bourbon and Sherry casks. The fact that it can be enjoyed neat or over ice is a true test for a moderate spirit.

  This trend has seen gains in North America and across the globe. A study conducted on alcohol consumption in the U.K. found that Brittons are either reducing their alcohol intake or opting for no or low alcohol alternatives. According to the study, by 2030, there will be a decrease in alcohol consumption per adult by 11 liters. The change is predominantly led by individuals 18-24 in the U.K. and 25-34 in the U.S.

  The results provide perhaps an unexpected pivot from previous generations who viewed these years as a time when drinks were endless and throwing caution to the wind was the norm. The “vi-va forever” celebration no longer fits the ideals of many younger imbibers. Light spirits seem like an appropriate transition for these consumers, who have less desire for wild nights of binge drink-ing.

  Globally, the light spirit trend is set to grow 34%, a significant marker since product selection in this category can be limited. This growth possibility opens the door for some brands to change fo-cus and become light spirits producers.

  Two things that cannot be compromised when crafting lighter spirits are that they must be premium quality, and they must blend in. It is not about standing out. It is about being a welcome addition to a bar cart or restaurant menu selection. The pleasant surprise for a low ABV spirit should be that there is no compromise on taste, so much so you cannot tell the difference between it and its higher alcohol counterpart.

Taking it Light & Easy Around the Globe: South Korea

  Change in every industry is inevitable. The transition to lower alcohol spirits has been slowly happening over the last ten years. Notably, in 2015, Diageo debuted a 35% ABV “spirit drink” – W Ice by Windsor – in South Korea. The spirit was the first low ABV whisky.

  What spurred this change in South Korea? Simply, whisky is no longer the desired spirit. There was a time in South Korea when Scotch was the drink of choice and often used to make a popular drink called poktanju, a combination of beer and Scotch. Another reason for this change, similar to other countries around the world, is affordability. Younger consumers in South Korea want inex-pensive spirits. In addition, spirits synonymous with youth appeal to this generation. Although there has been a shift and the younger generation is finding interest in what was once considered an “old man’s” drink, the creation of spirits that appeal to younger consumers has taken hold as brands observe the popularity of vodka.

  As a result, the goal of whisky brands in South Korea is to entice people to see it as a viable drink choice by lowering the alcohol content and promoting it under the guise of light and conscious im-bibing.

The Sensible Imbiber

  Taking something old and giving it a new image needs to encompass more than beautiful packaging. A complete product delineation needs to be undertaken to make spirits appear new and fresh. The central premise must sit within the ideal of living a healthier lifestyle. Drinking just one glass of spirit neat or over ice and not feeling the effects also signifies the end of an era of binge drinking, ushering in a new time of sensible imbibing. For the light spirits consumer, drinking is about living life while not feeling pressured to be anything other than yourself. It is not about standing out or being the life of the party. Instead, it is about connection and requires one to slow down and experience moments that build memories worth remembering.

From the Ground Up: Building a Brewery

Cyndi

Expertise Now Rescues Craft Brewers from Costly Headaches Later

brewing materials in a convention

 By: Cheryl Gray

Quality, precision and productivity are just some of the elements that factor in when deciding what brewery equipment to install.

  Whether for a start-up or an expanding operation, equipment is a major investment, and there are companies whose expertise is to help guide their brewery clients toward making that investment pay off.

  One of them is Craftmaster Stainless, a full-service stainless equipment provider that provides an expansive list of products for breweries, wineries and distilleries. The California-based company has clients across the United States and Canada. The company prides itself on the detail and finishing of every product its manufactures, as well as the customer service it provides before and after the sale.

  Mackenzie Sant is a sales and equipment specialist for Craftmaster Stainless. He says that learning about craft brewing from the ground up introduced him to the company’s products. The team behind Craftmaster Stainless, Sant explains, has multiple years in brewing, technical detail and customer service. That experience supports the company’s ability to translate a client’s equipment wish list into a customized experience. It is just one of the company’s assets that Sant believes puts Craftmaster Stainless ahead of its competitors.

  “We offer every piece of equipment someone needs to start a brewery. We want to be your one-stop shop. We won’t furnish your taproom or install your walk-in cooler, but we have all the equipment you need to upscale that popular homebrew batch or to upgrade from the ugly  brewhouse you have been brewing in for four years. We wish we could have in-person meetings with everyone shopping for a new brewery, but a phone call works wonders. Tell us your business plan, what styles of beer you want to brew and projected production numbers, and we can spec out the equipment you need. We work closely with other manufacturers and suppliers in the U.S. to source equipment that we don’t produce, from the start of the brew day milling the grain, to chilling and carbonating before pouring a crispy pint.”

  And just what does a newly-minted brewing operation need? Sant provides a checklist of essentials, beginning with a business plan and a building followed by must-have equipment, such as a mill/auger for crushing and transporting the grain to the mash tun, a mash tun/lauter tun for converting complex malt sugars into fermentable sugars and a kettle for “cooking” unfermented beer (wort), as well as for adding hops/adjuncts and pasteurizing the liquid to ensure a clean fermentation.

  Sant adds that additional essentials include a heat exchanger to cool the wort down to fermentation temperatures, pumps for cleaning or transferring liquids, unitanks/conical fermenters for the bulk of fermentation, brite tanks for conditioning, clarification and carbonation and, lastly, a glycol chiller for controlling fermentation and conditioning temperatures. The latter, Sant advises pairs well with a cellar control panel to control each tank.

  Regarding some of the most popular items on the product list for Craftmaster Stainless, Sant points to a number of items that highlight the company’s unique feel for what breweries need, including one piece of equipment that takes the tedium out of a very mundane but necessary chore.

  “I would say our keg washer is the most popular piece of equipment at the moment. I think I speak for most brewers when I say that keg washing is probably one of the most repetitive jobs in the industry. This machine makes that job easy. It is seriously your best ‘employee.’ Once again, our customer service is always there to help with any trouble shooting. We understand downtime is not profitable, so we are always available to help. I would say our brewhouses are popular as well. They look great and they get the job done. Our level of customization on our brewhouses will catch your eye. We do have a couple other products releasing this year that will steal the spotlight for a while.”

  The company’s new product launches include the Craftmaster Stainless Semi-Auto ‘Keggernaut’ Keg Washer and another new equipment item.

  “We just released our Three Gallon Hop Doser. The Hop Doser is a great attribute in our equipment line up. When introducing hops into the brewing process, you don’t want to introduce oxygen. This hop doser allows you to dry hop without oxygen ingress. It can be used for other adjuncts as well, so use your imagination. Keep an eye out for equipment to come. There is so much technology in the industry that isn’t being used, and we have big plans for the future, while staying competitive.”

  From Lincoln, Nebraska, is ABE Equipment Company, which designs and manufactures a variety of equipment for breweries. The company’s brewhouse equipment is custom-built, paying special attention to solving problem areas such as low ceilings, tight spaces, ventilation barriers and utility requirements. Ashlei Howell is the marketing manager for the firm’s parent company, Norland International.

  “Our sweet spot is the 1,000 BBL to 5,000 BBL per year brewery. Our products cater to much larger breweries, and much of our equipment can be used on a much smaller scale, but the niche we serve will be a bit on the higher production end.

  We pride ourselves on being able to offer a complete solution at a fair price. We handle everything from grain to glass. Everything is designed and assembled in Lincoln, Nebraska, and we employ over 130 hardworking Americans to make our suite of products. Our dedicated customer service technicians train our customers and make themselves available nearly anytime to answer questions.”

  When it comes to introducing new products to the market, Howell explains that ABE Equipment Company is focused on what will increase its clients’ bottom line.

  “Our newly released products have changed how breweries and distilleries package their product. The new CraftCan Go is a small footprint, one operator and a dual-purpose (atmospheric and counter pressure) canning machine. Breweries are packaging so much more than just beer in today’s environment.

  A canning line capable of making beer, coffee, seltzer, tea, and anything else that may be high or low in carbonation adds versatility to the brewery. It sets that particular machine apart from anything else on the market.

  The Patriot Fill Station allows companies to package virtually any beverage on a budget. It is a manual fill station allowing the user to package around eight bottles per minute. This machine can handle alcohol, syrups, oils and many more viscous or non-viscous liquids. With so many craft beverage companies coming to the market, having an affordable machine to get a product into a package at a reasonable price is a must for any beverage company wanting to stay ahead  of the game.”

  Howell offers input on some advanced equipment choices for breweries to consider.

  “There are numerous products a brewery can add to its lineup to optimize production, save time, cut costs and much more. A yeast brink allows breweries to reuse yeast and can easily be added to your equipment lineup. If harvested and stored correctly, you can sometimes yield up to 10 generations of yeast, spreading the cost across multiple brews. With rising grain costs, adding a bulk grain silo is becoming a more economical option for breweries. Buying in bulk saves time when brewing, but you can cut significant costs when ordering large amounts of grain at a time. The ROI on a silo is easier to prove now more than ever. There are also a variety of smaller, simpler items, such as brite tank monitors, CIP carts, and brewhouse automation options that help improve production within a brewery.”

  MISCO Refractometer and its 70-year history have earned a place in the specialty field of refractometry. Refractometers in the brewing industry are among the equipment needs experts say breweries should have on their checklist of items designed to ensure quality control. As the singular item that the company manufactures, MISCO offers a wide range of refractometer choices for different industries, but one specifically designed for brewing. The company says that its MISCO Digital Beer Refractometer deploys a patented design specific to wort and eliminates the need to use a refractometer correction factor when placing measurements into beer calculators.

  Another advanced equipment option for breweries is a set of sieve plates for the mill. According to experts like Sant, even a one percent efficiency loss in this area could cost hundreds of thousands of dollars in a single year. Along with this, brewers may want to consider keg washers along with portable and inline flow meters. Sant recommends breweries make equipment choices with long-term gain in mind.

  “Can you save money in the beginning by cutting cost on your equipment? Absolutely. But what about labor cost, repair cost for failing equipment and bad batch efficiency? The list goes on. Spend less time worrying about the equipment and more time worrying about the beer you are creating. A popular beer podcast said that every 10 minutes you save brewing is a cold beer at the end of the day. Spend that extra time focusing on different aspects of the process.”

Proper Tank Selection Begins With Business and Production Goals

Cyndi
2 huge brewing machine

By: Gerald Dlubala

From start to finish, a well-equipped brewhouse or distillery is a complex linked chain of equipment, including specialized tanks and storage vessels, each important to the final product. But brewery and distillery experts agree that before finalizing any decisions on the purchase or upgrade of your tanks and tank accessories, it’s critical that the equipment manufacturers know your business and production goals, both now and in the future, so that they can recommend the proper vessels for your needs.

It’s in Their Name: Quality Tank Solutions

  To help sort through all of the possibilities, Jimmi Sukys, owner of Quality Tank Solutions (QTS), says that it’s critical to research and choose a manufacturer that carries an excellent reputation in your industry with the equipment they manufacture or import and with the knowledge and service capabilities for support of those products. Quality Tank Solutions brings over 50 years of expertise in the stainless-steel industry, providing sanitary liquid solutions to the brewing, food and beverage, dairy and pharmaceutical industries. QTS builds lifelong partnerships because of its willingness to work alongside each customer from start to finish and beyond. They offer everything a craft beverage producer needs in quality, right-sized equipment and accessories.

  “Before we even get to the tanks, a producer should know the production goals that match and support their business plan,” said Sukys. “From there, we can determine the size and quantity of necessary equipment, develop a plan for future growth and plan for the type and size of the facility that will support this plan. Of course, there are exceptions. For example, when a craft producer finds their perfect location, say, a great space for a taproom, we work backward using the available space. A quality manufacturer helps clients determine the optimal equipment size for their production space and provides the production capabilities of that recommended equipment.”

  “The first step is knowing the process or function required of the tank in question,” said Sukys. “A quality manufacturer should ask questions to be sure they design and offer a proper vessel for your needs. For example, is it a process tank, and if so, what will the process involve? What type of products will you be mixing, adding, heating or cooling, and to what extremes? The more details you provide to a manufacturer, the more value you get from your tank purchase.”

  Sukys said that knowing the size of batches is critical as well. Too small of a tank limits production. Conversely, going too big with a goal of doing double or triple batches or more can raise issues when wanting to do only a single batch. Most tanks are not designed to heat or cool less than maximum volume production batches efficiently. Smaller batches may not hold temperatures correctly or cause stratification. A manufacturer that understands these limitations can be beneficial in presenting options that work for the producer’s needs.

  “Stainless steel has become the standard choice of construction,” said Sukys. “Stainless steel tanks can withstand decades of use when properly maintained. The range of temperatures in stainless steel tanks is much greater than other material choices, allowing a craft producer to use them for a wider range of processes. Welded ports replace screw-on fittings, which may need more maintenance. Additionally, stainless steel offers superior sanitation capabilities and can withstand aggressive cleaning with different chemicals. Quality manufacturers provide maintenance schedules for any equipment they provide.”

  Sukys told Beverage Master Magazine that any other accessories and equipment needed, like boilers and chillers, will depend on what the beverage producer plans to offer. Budgets must also include more minor things that add up, like hoses, gaskets, extra clamps, and fittings. He recommends using a manufacturer that helps with recommendations on what is necessary for startup and what additional equipment is good to have on hand. It’s common for equipment manufacturers to have accessories available to the beverage producer.

“The most important aspect of all of this is to choose a quality manufacturer that keeps current on the evolvement of the beverage industry and has the capability and expertise to design equipment that allows you to produce better beverages consistently,” said Sukys. “A strong warranty and service department is critical for peace of mind and knowing that you have a partner to have your back if unforeseen things happen. And remember that as your business and production goals grow, so do your equipment needs. The industry is constantly evolving, and better design of tanks and auxiliary equipment can help save energy, raw materials and production time. Finally, American-made equipment always has a higher resale value than Asian imports. That can be important when it comes time to resell your smaller tanks to replace them with larger capacity models.”

  For questions, consultations, and more information on Quality Tank Solutions, visit www.qts4u.com.

Flexibility, Efficiency and Cost Effectiveness: Paul Mueller Company

  Since 1940, the Paul Mueller Company has provided experienced help and demonstrated expertise in the processing equipment industry. Their reputation as being not only a quality manufacturer of brewing-related vessels and equipment but also a true partner of craft beverage producers is demonstrated through their equipment and industry knowledge and their respectfulness of client schedules and available workspaces to provide seamless transitions and minimal disruptions or interruptions, whether you’re purchasing new systems or replacing outdated or undersized equipment.

  “The first thing we should look at, as far as necessary equipment and proper sizing, is the planned production, and then work back from there,” said Jon Sprenger, regional sales manager for the Paul Mueller Company. “We find the best way to do this is to consider what your business will look like and what production levels you expect to attain in five years. That number is critical because bottlenecks in brewing and production are generally about available cellar space rather than brewhouse issues. You can brew beer around the clock, but you’re at a dead end if you don’t have the cellar space.”

  Sprenger also said that equipment like tanks could depend on the heat source chosen for the production space. Steam and direct fire are the two most popular, with steam being the easiest way to brew. The boiler can be pricey upfront. Conversely, with direct fire, you’ll be paying regular monthly payments for natural gas on a utility payment plan. It depends on available capital and the owner’s perspective from a cost standpoint.

  Along with this, Sprenger adds that an owner has to consider if they want to distribute their products or remain true to being a craft taproom. How do you want to handle your packaging? A quality equipment manufacturer will use this information to develop a successful equipment plan that incorporates the entire business model, not just presently but also with an eye toward the future.

  “And we can achieve that in different ways,” said Sprenger. “Consuming beer is like eating food. You do it first with your eyes. So many times, older, trendier and historic spaces have become desired locations for breweries and taprooms. That’s okay, and we can fill an already acquired space, or we can look at a producer’s projections and recommend comfortable square footage estimates to fulfill those goals. Either way of building a system is acceptable and falls under the umbrella of what we can do. Most manufacturers, including us, offer layout services and work with the available contractors and architects to develop a successful system. Stainless steel is advantageous simply because of its longevity. It’s built to last with simple and easy maintenance and cleaning capability. When compared to oak, which is difficult in this day and age to brew beer in, it becomes an easy and economically sound decision to go with stainless products just based on ease of cleaning and maintenance, lifespan and consistency in product endpoint and taste.”

  Sprenger tells Beverage Master Magazine that Mueller offers everything for a complete brewing system that falls in between the raw ingredients and the end glass.

  “We understand that it’s a lot easier and less time-consuming for beverage producers to deal with as few vendors as possible, so we offer all the necessary related equipment and accessories that they’ll need to complete their brewing system. That being said, we also easily adapt or integrate our products into any existing equipment that a craft producer already has in place. All of our equipment is customizable and will comfortably fit where it is supposed to go using as little movement as possible. Our equipment and installation successes are great marketing tools as well. Like consumers, we love to see our tanks on display in taprooms because they are also on display to other industry professionals that visit, including other brewers.”

Saving Money, Increasing Efficiency With Mueller’s Serving Beer Tank

  “One thing we’re excited about, and brewers should be too, is our serving beer tanks,” said Sprenger. “They’re a great alternative to kegs, and they don’t require the cleaning or CO2 that kegs demand. Beer goes into a mylar or polymer, food-grade bag inside a pressurized tank using only compressed air. The serving beer tanks don’t require cleaning because the replaceable bag protects the stainless steel from ever contacting the enclosed product. The use of compressed air negates the use of CO2, and we all know about the cost and shortage issues there. They come in various sizes and are perfect for taprooms. The tanks are completely mobile, easily transported outside for parking lot events, off-site festivals or stacked above your bar or in cold rooms for an awesome visual experience. The uses and locations are endless, and our serving beer tanks provide ultimate flexibility, space savings and costs incurred with keg ownership. In addition, the serving beer tanks offer a self-cooling, streamlined process of serving beer directly from the tank that promotes longer shelf life and fresher beer. We do recognize the need for kegs for distribution and other uses, but our serving beer tanks give brewers a cost savings option to replace kegs where available.”

  Mueller’s serving beer tanks show well in a copper or stainless finish, are ASME (American Society of Mechanical Engineers) code-rated and can easily push beer several hundred feet with no issues and serve multiple draft towers at once.

  For those looking for a complete system, Mueller offers their Beer Genius brewery system, a space-saving craft brewery package customized for your space and featuring their serving beer tanks, making everything from buy to brew easy and efficient with expert help and advice along the way.

  “We work with brewers through these types of things daily,” said Sprenger. “It’s critical to think through expected future growth. If you think you’ll need a size five tank, get a seven. The small extra cost will surely be less than the headache accompanied by a misjudgment in equipment sizing. Always consider your cellar tank needs, including brite and fermenter tanks, to accomplish your desired production goals. It’s always worth the effort.”

For questions, a consultation or more information on Paul Mueller or their serving beer tanks, go to www.paulmueller.com.

In the Market for Quality Parts and Accessories

  Many top tank and equipment manufacturers rely on parts and accessories from Gould Stainless Products. Gould Stainless Products sells everything you need except the tank and is a leading wholesale importer and distributor of stainless-steel sanitary tank accessories. Since 1991, Gould Stainless Products has filled the need for sanitary fittings, valves, pumps, tank manways and related accessories for the brewing, distilling and winemaking industries.

  Their extensive catalog is available online and by mail order. You can order a single, threaded joint, sight glass or replacement fitting up through stainless tubing lengths and replacement manways in various shapes, sizes and closure choices compatible with your existing system equipment.

   For more information and to view the extensive line of products that Gould Stainless Products offers, go to www.gouldstainless.com/home

S & B Farms Distillery 

Cyndi
man and woman in a bar

By: Gerald Dlubala

Some distilleries begin with a vision or dream that ultimately comes to fruition after years of systematic, careful research and planning. Some get their start by currently employed, industry-trained distillery professionals that feel they have something unique and personal to offer the distilled spirits world. However, few business plans begin with a strategy that includes jumping in with both feet without prior distilling knowledge. Yet for owners Sara and Brian Winkleman of S & B Farms Distillery in Bancroft, Iowa, this was the chosen path to an award-winning, sought-after line of spirits that continue to impress even the most discerning of bourbon and whiskey drinkers.

  The path to distilling started with a simple request from a friend to use Winkleman’s Iowa-grown corn, raised in the rich, nutrient-rich soil widely known to produce exceptional quality crops, to create a quality moonshine. Sara became intrigued as she watched the process of turning their family farm’s corn into moonshine at a Georgia distillery and never looked back. The distilling process piqued her interest, transformed into a fascination and finally resulted in a full-blown infatuation that flared up in her like the burner on a moonshiner’s still. She was hooked, and although her background in cosmetology and her family’s farming experiences hadn’t provided the expertise typically needed to jump into the distilling business, Winkleman would not be denied. She jumped in with both feet for what she described as a turn-and-burn learning experience that would culminate with an award-winning destination distillery that continues to grow and evolve.

  “It was not an easy path that I chose, that’s for sure,” said Winkleman. “I really was clueless about the industry, regulations and the whole nine yards. Mentors were critical, and I have to mention Mike Norman, who initially got us into the process, and Dwight Bearden, who helped us with the technical aspects. Our mentors were everything to us. We brought Mike Norman (yes, that Mike Norman) back to Iowa to teach us the most critical and crucial things we needed to know and fully understand. His experience and knowledge were an invaluable part of my passion and infatuation with distilling. At that point, my only way was forward. Having the ability to be taught and learn from a professional using a complete, hands-on approach was a blessing. We had immediate access to all the critical and hidden skills and trade secrets you can’t acquire from books or training videos, like recognizing the right textures and aromas. It can take some distillers years to learn these things without professional help or mentoring.”

  S & B Farms Distillery is 17 miles from the Winkleman family farm, where all the corn used in their distillery is still grown. The farm also has cattle, hogs, soybeans, peas and green beans for the nationally recognized Green Giant brand. The field corn is milled on-site weekly, providing the freshest ingredients to use in their spirits, with used mash returned to the farm for the cattle.

  “Our distillery, market and tasting room are about 17 miles from the farm,” said Winkleman. “The location was originally a dentist’s office with 13 small, divided rooms constructed of cinder block that we gutted and reconfigured into a distillery production area, tasting room and retail space. Our main and immediate focus at this point was production capability.”

  As daunting of a task as it all seemed, trying to accomplish it was admittedly overwhelming at times.

  “Networking was everything,” said Winkleman. “And truth be told, I had to walk away for a couple of weeks just to get some mental downtime and refocus. We had the distilling side of the business, but we also had to address the federally regulated side. And Iowa is a controlled state with a different set of rules than other areas. So again, networking played a major role in our success, this time with native distillers, so we could learn how to navigate Iowa’s regulations. We counted on many awesome people and had amazing support, creating a family atmosphere and team system.”

  S & B Farms Distillery officially opened in 2018, only a couple of short years after the initial spark of curiosity and twinkle in Sara’s eye. The first products offered to consumers included a spicy pineapple jalapeno moonshine named Field Fire, a bold-spiced savory spirit, and Private First Class, named in honor of Sara’s grandfather, Ray Baade, a World War II veteran and one of her biggest supporters along the distilling journey. There was also their Hog Wild Cinnamon, providing a fresh take on the beloved red-hot candies.

  “We never thought about growth potential at the start,” said Winkleman. “Honestly, I just concentrated on trying to hit that sweet spot across the board by producing something that we thought had a pleasing flavor and aroma but also appealed to the tastes and appreciation of consumers. It started great, with immediately positive feedback. We knew we had production where we wanted it to be, and then, of course, the pandemic hit and changed everything. So, like many distilleries, we pivoted to making sanitizers and secured the business of 15 Iowa counties, along with part of Iowa State University.”

  Ironically, this COVID-mandated pivot in their business led S & B Farms Distillery to win the 2020 Iowa Farm Bureau’s Renew Rural Iowa (RRI) Award while they grew their network of business contacts across the state.

  “Ironically, the whole COVID situation became a bit of a blessing for our business,” said Winkleman. “Our network grew through the sanitizer business. That growth led us to work with knowledgeable people that helped us develop and formulate a solid, workable business plan, find accessible funding, and source local, quality ingredients without the price-gouging that was going on with some suppliers. To this day, we maintain these awesome relationships to consistently review our business plans and change them to include things we never thought of initially, like how to bring our daughter into the business when the time comes.”

  The pandemic brought about a nationwide call to support local businesses when possible. That call to action, combined with the surge in consumers buying alcohol for home consumption, meant the demand for S & B Farms products increased while it cut spirits production to meet sanitizer demands. 

  “With the focus on local support, customers started purchasing more of our products for home use,” said Winkleman. “As that happened, our sales increased. In addition, our Sir Winston Peach Whiskey became wildly popular and was chosen by Casey’s to sell in their stores, further increasing visibility, sales and demand. As a result, we quickly outgrew our small production space and went through a 7,000-square-foot expansion in 2020. We added another still and four fermenters, essentially doubling our production capabilities. We blend, label and bottle on-premises in our controlled environment. I learned the hard way that the steam and humidity put off by the stills can affect proof, which has to be right on. One thing with me is that when I make a mistake, I will never make that again. It’s a learning experience and a teaching lesson.”

  If you, like I, were wondering how someone with little to no distilling knowledge or experience goes from deciding to make distilled spirits to an award-winning destination distillery within just a couple of years, Winkleman says it was a true turn-and-burn type process where a lot of things went in their favor once they started. With the help of friends and acquaintances and being the lucky winner of a government draw that helped small businesses get permitted, Winkleman’s business and licensing paperwork was immediately reviewed, deemed correct and accepted for approval. That meant that work could begin immediately instead of having the traditional, more extended wait period that usually occurs.

  “We were very blessed and fortunate to be able to open that quickly,” said Winkleman. “I don’t take that for granted. When I left Georgia, I jumped in with both feet to learn and digest all the needed information. There were many 16-hour days of research and learning, not just the process but what type of equipment we needed, how to locate and get that equipment and how to install it. Shop talk with my mentors was crucial and is still as important today as it was back then. It still happens regularly, and I’m truly grateful to have that knowledge base at my disposal.”

Products Reflect Personal Connections

  S & B Farms Distillery offers a range of products to please a wide range of palettes. S & B Farm’s Field Fire, Private First Class and Hog Wild accompany the Sir Winston line of spirits, named for their canine family member. Consumers will enjoy the easy-going, laid-back Sir Winston Wheat Whiskey, the classically flavored Sir Winston Bourbon with notes of vanilla, fresh oak and caramel and Sir Winston Peach or Apple for flavored spirit aficionados.

  As initially demonstrated by the release of Private First Class, Winkleman has always held great respect for military veterans. That respect and support continue with a non-profit she is starting called “Beyond The Still” to provide support and give back to veterans.

  “We bought an old house and property across from our distillery with a vision to transform it into a true veteran’s memorial park, honoring all military veterans within a large memorial area,” said Winkleman. “We estimate that it will take four to five years to complete. Additionally, we continue to offer Coming Home Bourbon, an annual special release that occurs every Veteran’s Day. As you can expect, it is very much in demand and sells out quickly.”

Priority on Flavor Leads to Awards

  Winkleman spends a lot of time on her recipes before handing them off to her husband, Brian, for distilling. She tells Beverage Master Magazine that it takes a lot of trial and error, with the ultimate goal of developing a taste that is both satisfying and remarkable in its palette-pleasing qualities. Until she hits on a flavor profile that she deems superior, she doesn’t settle. This way of coming up with her flavor profiles has been very successful, with S & B Farms Distillery winning numerous awards early-on, the latest being a gold medal for their Private First Class at the 2022 Las Vegas Spirits Awards.

Previous Awards and Recognition:

Private First Class – Spiced Spirit

•    2020 USA Spirits Ratings – Silver Medal

•    2019 North American Bourbon and Whiskey Competition – Bronze Medal

•    2019 Denver International Spirits Competition – Silver Medal

Sir Winston Bourbon

•    Sir Winston Bourbon Barrel Proof – 2021 North American Bourbon and Whiskey Competition – Silver Medal

•    Sir Winston Bourbon 93 Proof – 2021 John Barleycorn Award – Gold Medal

•    Sir Winston Barrel Proof – 2020 American Distilling Institute (ADI) Judging of Craft Spirits Awards – Silver Medal

•    Sir Winston Bourbon 93 Proof – 2020 Las Vegas Global Wine and Spirits Awards – Gold Medal

•    Sir Winston Barrel Proof – 2020 USA Ratings – Gold Medal

•    Sir Winston Bourbon 93 Proof – 2019 Great American International Spirits Competition – Bronze Medal

•    Sir Winston Barrel Proof – 2019 North American Bourbon and Whiskey Competition – Bronze Medal

Sir Winston Wheat Whiskey

•    2021 John Barleycorn Award – Silver Medal

•    2021 21st Annual Finger Lakes International Wine and Spirits Competition – Silver Medal

•    2021 North American Bourbon and Whiskey Competition – Bronze Medal

•    2021 Denver International Spirits Competition – Gold Medal

•    2020 USA Spirits Ratings – Bronze Medal

Sir Winston Peach

•    2022 Las Vegas Global Spirit Awards – Gold Medal

•    2021 21st Annual Finger Lakes International Wine and Spirits Competition – Silver Medal

•    2020 Denver International Spirits Competition – Silver Medal

•    2020 USA Spirits Ratings – Silver Medal

Hog Wild Cinnamon

•    2020 USA Spirits Ratings – Silver

•    2019 USA Spirits Ratings – Bronze

Field Fire – Spicy Pineapple Jalapeño Moonshine

•    2021 21st Annual Finger Lakes International Wine and Spirits Competition – Silver Medal

Looking Toward Expansion and

Possible Product Additions

  “Well, we’ve already maxed out our production capabilities and outgrown our latest 7,000-square-foot production expansion,” said Winkleman. “More expansion will come soon, although we haven’t detailed those plans yet. But it’s coming.”

  When asked if she would branch out into perhaps a gin or vodka, Winkleman hesitated a bit and said that currently, there really are no plans to pursue a vodka. But then a spark came through in our conversation that I expected accompanied a twinkle in her eye. “There is, though, perhaps an interest in a rum that’s been running through my mind.”

  And by now, I think we all know where that will lead.

For more information please contact…

 S & B Farms Distillery

212 E Ramsey St. Bancroft, IA 50517

Email:  sbrfarmsdistillery@gmail.com

Website:  https://sbfarmsdistillery.com

Fractional General Counsel: A Flexible Solution for Legal Services

Cyndi
corporate man typing

By: Brian D. Kaider, Esq.

Every business has legal needs that require the assistance of an attorney. Like other small businesses, most breweries and distilleries do not have the resources or the need to hire a full-time, in-house general counsel. But, with the high cost of legal services, many owners only contact an attorney as a last resort.  A fractional general counsel arrangement offers a flexible solution.

What is a Fractional General Counsel?

  In broad terms, a corporate attorney can be an in-house counsel, which is a full-time employee with a salary and benefits, or an outside counsel, which is an independent contractor.  Outside counsel work under a variety of fee structures, such as an hourly rate, a flat fee, a retainer, or some combination thereof.  Flat fee arrangements are typically used for a specific, defined project, to be completed at an agreed upon price, often paid in advance.  Retainers are often a fee charged in advance by the attorney and held in an escrow account.  As the attorney completes work, fees are transferred from the escrow account to the attorney. In some cases, when the retainer drops to a certain level, the client is billed to replenish the funds. 

  A fractional general counsel is slightly different.  In this arrangement, the client pays a fixed fee for a certain amount of the attorney’s time, usually on a weekly or monthly basis.  What happens if the attorney works more or less than the allotted time can vary significantly, as discussed, below. 

Benefits of a Fractional General Counsel

  The benefit of a fractional general counsel versus a full-time in-house counsel is obviously a lower cost both in terms of salary and associated benefits.  But, it also has advantages over other forms of outside counsel.  Typically, the fees are lower than the attorney’s standard hourly rate.  More importantly, the arrangement gives the client a predictable cost it can include in its budget.  This certainty benefits the attorney, as well, particularly for solo practitioners and members of small law firms.  As legal workflow is often cyclical, the certainty of income associated with a fractional general counsel arrangement helps to balance slow periods in the practice.    

  Many small business owners only seek the advice of their attorneys when a situation is critical, because when working with an outside attorney on an hourly rate, they think about how much it will cost every time they pick up the phone. By contrast, when working with a fractional general counsel, a certain amount of the attorney’s time is already reserved to the client.  This results in a much more collaborative relationship, in which the attorney becomes an integral member of the team and has a deeper understanding of the business. Over time, the attorney develops institutional knowledge about the company that fosters better legal advice. 

Issues to Consider

  Despite the many benefits of a fractional general counsel arrangement, there are several issues that should be considered before taking the leap.  First, estimating how many hours of legal services per week/month are needed can be difficult and different attorneys handle overages and shortages of those hours in different ways.  Some will roll over unused hours to the following term.  That model is essentially an agreement for pre-paid legal services.  Others take the view that the agreement requires the attorney to allocate a certain number of hours to be available to the client during that month, so the fee is earned whether the hours are used or not. 

  If the attorney works more than the allocated hours, they are often billed at an agreed hourly rate.  Alternatively, there may be a built-in buffer of ten percent, for example.  So, if the contract is for 20 hours per month, the fee would cover 18-22 hours of legal services.  If fewer than 18 hours were used, they would roll over to the following month and if more than 22 hours were used, they would be billed at the attorney’s hourly rate.  It is also a good idea to build into the agreement a periodic review of usage to determine whether it makes sense to increase or decrease the estimated need.

  This raises another issue to consider when deciding whether a fractional general counsel arrangement is a good fit; they usually require a commitment to a minimum term, such as; 12 months, 6 months, or at least 3 months.  This is because the purpose of the arrangement is to promote an attorney-client relationship that fosters a deeper understanding of the business.  If the client’s goal is simply to lower the cost of legal services for a specific, short-term project, the better approach is to negotiate a flat fee with the attorney.  Typically, if a client terminates a fractional general counsel arrangement before the minimum term, the fee structure will revert to the attorney’s standard hourly billing rate, which will become immediately due. 

  Regarding the types of legal services they will likely need under the fractional general counsel agreement, the client should carefully consider the expertise and experience of the attorney or firm.  As the name suggests, a “general counsel” has broad knowledge of a wide variety of legal issues a business needs.  But, there will likely be gaps that have to be filled with other attorneys.  The agreement should be clear about the fractional general counsel’s role in managing these outside attorneys.  Because of this issue, it may seem that a large firm would be the best candidate for the role, because with more attorneys there are likely to be fewer gaps.  There is a risk, though, of losing one of the primary benefits of a fractional general counsel, which is having a single attorney with a deep understanding of the business.  The bigger the firm involved, the more likely the attorney in charge of the representation will be out-of-touch with the actual work being performed by other, usually junior, attorneys. 

Who Should Consider a Fractional General Counsel?

  When is the right time for a brewery or distillery to consider a fractional general counsel?  While most small businesses can benefit from these arrangements, there are two stages when they can be particularly useful; at start-up and before a planned growth.  At the earliest stages of the business, there are a wide variety of legal needs, including; formation of the entity, creating operating agreements and other contracts, obtaining licenses and permits, registering trademarks, negotiating a lease or land purchase, etc.  Having an attorney that can handle and/or manage all of these areas can alleviate stress and allow the owner to focus on the many other issues requiring attention.  For first-time owners, there will also be many questions along the way.  Having an attorney who is on the team allows those questions to be answered without having to worry about getting a bill every time they pick up the phone.

  An established brewery or distillery that is entering a growth phase presents many of the same types of issues.  They may need to restructure the company or negotiate new leases or land purchases.  Changes will need to be made to their licenses and permits, etc. 

  Does this mean that companies falling in between start-up and expansion are not right for a fractional general counsel?  Absolutely not.  This is the stage when the deep understanding coming from a long-term relationship can really shine.  An attorney who is familiar with the business can more accurately audit existing contracts to assess any legal exposure or where improvements can be made.  If the business has registered trademarks, routine monitoring should be undertaken to ensure they are not being infringed by other companies.  Internal regulatory compliance audits can identify vulnerabilities before action is taken by the government.  In other words, the fractional general counsel can focus on more in-depth legal issues for the business once it is outside the frenetic start-up stage.

Conclusion

  Eventually, some breweries and distilleries may need to hire a full-time in-house general counsel.  Most will never get that big.  But, having an attorney who is deeply familiar with the business and can handle most of the company’s legal needs is a tremendous benefit.  Traditionally, outside attorneys are hired on an hourly or flat fee basis.  But, the fractional general counsel arrangement offers several advantages, including, lower fees, predictability of legal costs, and development of institutional knowledge in the business.

  Brian Kaider is the principal of KaiderLaw, a law firm with extensive experience in the craft beverage industry. He has represented clients from the smallest of start-up breweries to Fortune 500 corporations in the navigation of regulatory requirements, drafting and negotiating contracts, prosecuting trademark and patent applications, and complex commercial litigation.

Start Your Brand Sooner

Cyndi
woman signing contract

By: Kris Bohm, owner of Distillery Now Consulting

There is nearly a new beverage alcohol business opening every day in North America. Craft beer, wine and spirits are growing immensely in popularity and many people are entering the industry with hope to capitalize on this opportunity. Starting a new business and entering the beverage alcohol industry is challenging to do well and succeed at it. Many new entrants start by building a business that handles all aspects from manufacturing, branding, packaging, marketing, sales, and even distribution. For a new entrant to the business, learning all these aspects of business and succeeding at them is a huge challenge that requires a team of experts. There is an alternative way to get a new beverage alcohol business started without nearly as many challenges to overcome from day one. This alternative is called co packing. It is possible to work with a manufacturer who will make your product for you. By contracting out the production of your product you can focus on the two most critical aspects of a beverage business which is sales and marketing.

What is Co-packing

  Co-packing comes in many shapes and sizes. In essence a co-packer is a facility that produces beverages that offers services to manufacture products for other brands. Essentially you can contract a manufacturer to make your product for you. This can be beer, wine, distilled spirits, ready to drink cocktails or nearly anything else.

  Co-packers offer the opportunity to launch a brand for far less capital outlay than the common path which is building your own manufacturing facility. By removing the capital intensive aspects of manufacturing a product, the owners of a new product gain the freedom to focus on the marketing and sale of their product.

How Copacking Works

  If one would like to create a brand new product and bring it to market the copacker does the manufacturing for you. You can bring an idea for a product to a manufacturer and they will create the product for you. Let’s explore the process step by step you would take to bring a new brand of vodka to market through a co-packer.

•    The first step is to find a co-packer that is a good fit for you.

•    Search for companies that offer co packaging services as not all manufacturers co-pack.

•    Once you have found a company to work with, the next step is to find out the constraints of the copacker.

•    Copackers will have constraints on certain sizes and shapes of bottles, corks and labels that they can work with, understanding these constraints is essential to the design phase.

•    Determine what type of packaging will work with your co-packer.

•    Select packaging the works and fits for your brand and your copacker.

•    Design your brand, including logos, names and artwork.

•    Take a break and have a drink.

•    While you are stopping for a drink, now is a good time to consider the liquid in the bottle. You need to select what the product will taste like and where it will come from.

•    Select the sources and recipes for the liquid that will become your product.

•    Sign a contract with your co-packer and put the pieces together.

•    Have your copacker manufacture the product.

•    Launch your brand.

  Just like that you now have your very own brand new shiny brand of vodka and in most cases now have several pallets of vodka to sell. These steps all sound quite simple, but there are many layers of work underneath this list. Beneath every step there are decisions and details that are critical to the product. Let’s explore some of these key steps and how to best make those decisions.

  The liquid in the bottle is important but more important than the liquid is the brand itself. Putting in work to create a professional looking brand along with label artwork and selecting design elements are all crucial steps to creating a successful brand. Unless you have extensive experience in beverage branding and marketing the creation of a new brand is best handled by people who have experience in the industry. The look and feel of your new product is the biggest opportunity to get consumers to consider trying the product. If you take a minute and walk through your local liquor story you will likely find a few bottles that do not look professional or polished. These not so great looking products are often born out of someone starting a new product without any experience or professionals on their team with alcohol branding and design experience. Hiring a professional at this stage is a good investment to help your brand put its best foot forward. The next step is selecting the liquid that goes into your bottle. There is an abundance of distilleries that will sell spirits to you in bulk that can be packaged up into your own brand. Whether its Vodka, Gin, Rum or Whiskey, all types of spirits can be bought in bulk. Tasting a variety of bulk spirits and looking closely at cost is key to selecting your spirits.

  At this point you should have all the pieces designed and selected including the bottle, label, cork, case, spirits and brand. With this all lined out your copacker can go to work and produce your product.

  There are strong arguments that co-packing is the smart path to launch a brand and some folks will say that co-packing is not the best choice. Let’s compare and contrast the pros and cons of co-packing, as knowing the good and the bad can give you the knowledge needed to weigh your options and make the best choice possible.

The Case for Co-packing

  It takes extensive time and financial resources to launch a brand. Much of the resources needed to launch successfully must be committed to marketing and sales to get a brand into the market and onto store shelves. Co-packing allows new brands to conserve money, time and energy that would be put into manufacturing and direct that energy into sales and marketing. This approach affords a new entrant into beverage alcohol the chance to learn the nuances of the business with much less overhead. Mistakes are expensive to make and outsourcing the production work of a new brand ensures that you will make less mistakes when it comes to producing the product. The strong advantage of not producing the product is you do not have to carry the high overhead of funding a manufacturing facility.

The Case Against Co-packing

  Co-packing is expensive. If you are paying a company to manufacture your product, it will cost more per unit to produce a product than it would if you took the manufacturing process under your wing. Co-packers markup the cost of producing a product to cover their costs of overhead, labor and to turn a profit. Another argument against co-packing is control. When a co-packer is producing your product you will not have direct control over every aspect of the manufacturing process. It is easy to make mistakes that might not be made if the manufacturing is handled in house. A key step to mitigating this risk is working with your co-packer to define their quality control in the manufacturing process to protect against mistakes.

What Should a New Brand Do?

  It is not an easy question to answer what is the best way for each individual business to create and launch a new product. Many factors must be considered to make an informed decision. While co-packing is perfect for some it can be a bad fit for others. A consultant or person with extensive industry experience is the best way to make an informed decision on how to launch.

  Creating a new brand can be a challenging and also extremely rewarding business endeavor. Doing it the right way and finding success will make it that much more rewarding.

Tips for Taxed Business Owners in 2023

Cyndi
2 people discussing in a meeting

By: Raj Tulshan, Founder of Loan Mantra

If you’re worried about finances and retirement – and after facing inflation at a record 40 year high this year, who isn’t? – there is a little good news from the IRS. Due to soaring inflation, reported at 8.2% over the past year, the IRS has raised contribution limits on 401(k)s and IRAs for 2023. In fact, inflation is at its highest level since 401(k) annual indexing began, causing 7% to 11% increases for most 2023 contribution limits. These changes are intended to help offset the higher cost of living.

  For the coming year, the maximum amount that people can contribute to their 401(k) has risen to $22,500, a $2,000 increase. The annual 401(k) employee contribution limit typically goes up by smaller increments – usually around $500 at a time – but sky-high inflation has led to a more significant increase for 2023.

  The limit on total employer-plus-employee contributions will also increase significantly to $66,000 in 2023, up $5,000 from $61,000 in 2022. Again, these increases are usually made in smaller increments – typically $1,000 – but given the unusual state of our economy, it will increase five-fold for the coming year.

Max Out Contributions

  With the annual 401(k) contribution limit rising, many people might think they must take advantage of this increase but may worry that they can’t afford to contribute the maximum amount to their retirement accounts. Many financial experts would advise that your personal contributions depend on your individual goals, salary and financial situation. Employer matching can help. Often employers provide an incentive to encourage their employees to save for retirement by matching contributions (either in full or in part) up to a certain threshold.

  If you feel pressure to “keep up with the Joneses,” keep in mind that most people aren’t contributing the current (lower) maximum amount to their 401(k). A recent Vanguard report discovered that only 14% of people with Vanguard 401(k) accounts were contributing the maximum amount allowed in 2022. And more than half (58%) of those people were earning annual salaries of $150,000 or more at the time.

Boost IRA’s

  There is more good news for retirement accounts. In 2023, people can get an extra boost for their IRA savings. As income tax thresholds have risen, so have the income limits for IRA contributions. Like a 401(k), an IRA can be effective way to save tax-free money for retirement.

  The amount you can save into an IRA plan will increase from $6,000 to $6,500 next year – or $7,500 for people aged 50+. For people over age 50, or who have 15+ years of service for a 403(b) plan, you may be able to contribute significantly more than this – as much as $30,000 – through “catch-up” contributions.

  As a financial professional who has witnessed the ups and downs of the U.S. economy over the years, I offer the following advice:

Stay Calm – Although the current state of the economy – and record-high inflation – is worrisome, it’s wise to stay calm and focused on your long-term financial goals. Saving for retirement has never been a “quick fix.” People spend their entire adult lives working towards their retirement goals, and there will always be ebbs and flows to the economy over time. The best thing you can do in any economy is consistently save and invest, not making any sudden moves based on what the market is doing.

Focus on Slow Increases – Small increases to your contribution rate – even raising your contribution by 1% – can make a big difference in your retirement savings over time. What may feel like an insignificant amount right now can really add up over the next few decades.

Contribute Enough to Earn Your Employer’s Match – If your employer offers to match a percentage of your contributions, prioritize contributing enough to earn the full match. If you don’t take full advantage of the employee matching program, you’re essentially leaving “free money” behind.

Build Loyalty –  Employee wages, compensation and retirement savings matches are tax deductible as well.

Contribute Early and Consistently – Regardless of how much money you can contribute to retirement, it’s essential to start early and keep contributing consistently. It’s wise to start contributing to your retirement account as early as possible so your money can earn interest over time.

Strive to Invest 12% to 15% of Your Annual Salary Towards Retirement – If that seems unfeasible, try increasing your contributions slowly over time. For instance, if you’re currently investing 5% of your salary, aim to increase to 6% next year, and 7% the following year, and so on until you reach this target.

  Learn more about the contribution changes for 2023 by visiting Notice 2022-55 on IRS.gov and talk to a financial expert about your own financial goals and how to reach financial freedom for your retirement. In addition, there are a few more tips for taxed business owners.

Take Advantage of Business Tax Deductions

  There are options for business owners, too. Make sure your business is making the most out of the current tax deductions available to business owners and entrepreneurs. Tax deductions can greatly reduce a business owners tax liability, saving money. Many business owners are aware of the typical expenses that are eligible for tax credits like: Inventory, meals and entertainment, Office Supplies, Medical Insurance, Employee Wages and Advertising and marketing. But an often-overlooked expense is interest paid on business loans or lines of credit.

  A record number of businesses took out small business loans in the past 2 years. Small business loans that are issued through financial institutions, alternative lenders and online lending marketplaces or FinTechs like Loanmantra.com are financing options for small businesses and have deductible interest expenses. Loans issued through the Small Business Administration or SBA and guaranteed as part of the Infrastructure and Reinvestment Act also have interest that is deductible if the money is used strictly for legitimate business purposes.

Purchase Equipment Sooner Not Later

  End-of-year small business spending can save businesses money through tax benefits or year-end sales. For instance, in 2022, expenses on equipment or a depreciation of 100% of the purchase price can be taken. In 2023, taxpayers only receive 80% toward the purchase price of those same expenditures.

  In early 2023, car dealers who are looking to unload last year’s vehicle model will be more willing to discount vehicles from the previous year to make way for new inventory. The same may be true for technology and software subscriptions. Any way you look at it, there are many angles to come up with new ways to tackle taxes to provide some relief from tax time grief.

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

  Small business owners identify two obstacles to their success: access to capital and financial education. Loan Mantra removes these hurdles so business owners can spend more time actually building their business.

For more information visit their website…www.loanmantra.com

Make Your Product Stand Out in a Crowded Marketplace

Cyndi
stacks of beer in a store
Barrel Chest Beer & Wine Store – Roanoke, VA

By: Scott MacKenzie, Founder and CEO of Gaslight Studios

Walk into the local supermarket or liquor store and its beer and wine sections all have one thing in common – a diverse array of macro, micro and craft beers all competing for the customers’ attention.

  With all this visual noise, how can you ensure that your beer will stand out in a crowded and highly competitive marketplace? While product quality and taste are important, it is not always  a guarantee for success. Often, success comes from a combination of factors that are led by an impactful visual identity that connects with your target audience.

  Developing a successful brand is not simply designing an eye-catching label or logo. It requires the development of a powerful narrative that authentically connects with and motivates your existing and potential customers. What is your brand story? What promise are you making? What are your key attributes and fundamental pillars? What is your brand personality? Are you refined and sophisticated? Are you bold, edgy and sarcastic? Are you heartfelt, understanding and caring? Maybe you are a combination of all these traits.

  Brands aren’t born iconic, but they do need to be strategically and meticulously crafted and launched with intention so as to allow for the opportunity to become widely recognized and well-established. With this in mind, the first step in developing your brand is understanding who you are, what you stand for and what values you wish to convey. As you solidify these fundamental tenets, you also need to dive head-first into the world of your customer base. Who are you selling to and what are their wants, needs, preferences and expectations?

  Does this all sound overwhelming?  Fortunately, it doesn’t need to be. Whether you’re preparing to launch your first craft beer brand, opening a brewpub or taproom, or have been in the beverage business for years and decided now is the time for a thoughtful re-branding, it’s imperative that you do your due diligence to guarantee that the brand you cultivate is the correct brand for the market. And how do you do that?

Understand the Sandbox You’re Playing In

  Knowledge is power. Gather all available data on your marketplace, customer base, competition and if you’re an existing brand, your own history of successes and failures. What is your consumer looking for? What are your competitors providing? What is the market demanding and missing? Conducting extensive discovery and market research will allow you to make more informed and better decisions as you craft your own brand.  Nothing happens in a vacuum and ignoring external factors as you cultivate your own image is a recipe for failure.

Beware the Lure of Trends

  Trends come and go, so while you can ride the trend train in some of your marketing efforts, it’s best to ignore that tempting, low-hanging fruit as you develop your core identity.  If what is popular in the moment is fundamentally tied into the foundation of your brand, the minute those trends go out of fashion, your brand will feel old and outdated. Brands that last feel timeless.

Strike the Right Balance – Be Different – Feel Familiar

  Your brand needs to stand out from the crowd, but it should also feel like it belongs. Be new and fresh and different, but not to the point that it feels completely out of place. Strong brands differentiate themselves from the competition but also evoke a sense of familiarity and connectedness.

Don’t Try and Be Everything to Everyone

  Know who you are and connect with your target customer base where they live through a sense of shared values and common sensibilities. While you want to cast the widest net possible to maximize potential sales, you also need to drive in the appropriate lane and take the right route to get where you want to go.  Sometimes, trying to create a ubiquitous brand that is everything to everyone makes you nothing to no one.

Verbalize and Agree Upon Your Company Goals

  It is essential that you and your branding team are on the same page. Work together to ensure a mutual understanding of your short and long-term company goals. Do you want to always be a local or regional brand? Do you have lofty goals of national and international sales? Do you want to maintain an existing customer base while opening new markets? While this may not necessarily influence your brand narrative, it’s important to fully understand the factors that require consideration.

Set Brand Boundaries

  To guarantee that the brand remains consistent over time, it is important to develop strong brand guidelines that will ensure proper representation of the brand through the various channels of execution over the life of the brand, such as advertising, public relations, digital, signage, etc. If these brand boundaries are not firmly established, the brand can easily veer off course as you implement new campaigns and diversify your product offerings.

Remember

  Crafting a new brand takes the same level of care and attention to detail as making an award-winning double IPA. It also requires slight adjustments throughout the development process to ensure that the end result is what you want and need. So, assemble the right team, get crafting and never underestimate the power of a good tagline.