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It seems to me that we all need to batten down the hatches and pre-pair for the fallout. I feel that the distillery bubble is just about ready to burst. This year (2017) will be by far the biggest year on record of distilleries going out of business. There are many factors why I feel this way bust just to name a few. Two main reasons to always reflect on. The battle for Shelf Space, and Operating Capital. And a couple more. 1. To much bourbon. I believe that this is the year that the larger number of distilleries will for the first time be trying to sell there brown spirits. The problem is not there local area it would be everywhere else they are trying to sell the brown juice. The Distilleries will be battling in a marketing game, and that in it self requires MONEY and TIME, and time cost MONEY. To put up all that bourbon cost Money straight out of the operating capital. When product does not move as quickly thought. The R.O.I. Is much greater and the hit is much harder. 2. I Deal with people from every corner of the world, in every facet of this industry. I deal with people that have big budgets and small budgets. I am aways blown away when someone just wants to make a little booze and thinks they have got to have a $200,000 dollar still, or pay $75,000 for a 50 gallon pot. The reason for item #2 is the spending of MONEY in the most stupid ways possible. People don't stop and think that some of the biggest components of equipment are truly the least important. People think the need the biggest and baddest still but forget about the boiler, chiller, mash cooker, ferm tanks, bottles, labels, and all the small things that nickel and dime a start up. Stop and think "how many bottles do I have to make to pay this off". 3. Sell out, sell off. One of the biggest mistake someone could make is to sell off the larger part of stock in the company to get to the place they need to be or get the equipment they think they need. When you realize that you are not really the owner and your are more a employee that person cares a little less and gives up quicker. When you work the hours we all do at a distillery and think...."I could be making more money flipping burgers".....how much heart do you have really in it. People have medical problems but I am floored by how many distillers are selling out because of it. I get it no one on earth want to admit "I Failed". So don't sell your soul just to crush your dream. 4. This one will be easy. Operating Capital- how many times have you looked around your distillery and saw a piece of equipment that you bought a while back and thought "man, I wish I never bought that" Or "I would like to have the money I spent on that". #4 = Don't buy stupid Crap. THINK. It comes right out of your Operating Capital. 5. Distilleries trying to do something so so different that they Distill there way right out of a business. Think about what you do before you spend the money. I just checked yesterday and let me see, time, grain, water, labels, bottles, and corks still are not cheap. So is it a good idea to have 100 cases of something that won't sell. Please, impress the bank with your massive over stock of junk. 6. This one is kinda like #5. Not listening to your patrons. People that will go out of business are probably bull headed and think "If I make it they will come". Make products that is proven that people like. You don't have to copy, put your own spin. Know what is selling on the markets. 7. Getting out in front of the public. You may be making booze, but you are also selling your self / story. You spent all this money on a shiny piece of copper, where is your advertising money? Distilleries have to get out in front on the public doing tasting, and ect. I see a trend of people not doing that as much as is needed. 8. Part of #7. I was in a very top self liquor store today and there was 250 different types of brown spirits. Which one do I choose? 9. Battle for shelf space. With the gates opening on distilleries all over the us and more imports coming in, the battle for shelf space has begun. All the money you spent making that rum, whiskey, vodka, ect, will be for nothing if you can't get it on the shelf. Enough said. Summary-Rough seas ahead. Tighten your belts. I am all ready seeing lots of used NOS everywhere. It used to be when something was put online it was gone in hours. Now it just sits there... I wish everybody always thoughts. I wish everyone the very best. Let us all be in good SPIRITS in 2017 and the years to follow. Joseph Dehner

Hey Guys...Starting to look into our water treatment systems and have put together the systems below. Based on the water criteria we have here...attached...what is everyone's thoughts on this system? Water Info: City water that originates from 4 wells within the county. Considered "Hard" water. Main water inlet to building is 3/4" There are 2 main systems. The first system will be our process water with the 2nd system being our finishing water. Process water system-Flow: Sediment Filter-Softener Finishing Water System Flow: Sediment Filter-Softener--Additional carbon filtration-RO System Initial Sediment filter http://www.uswatersystems.com/us-water-big-blue-4-5-x-20-commercial-triple-filtration-system.html?fee=10&fep=5067&gclid=CPrP36PdpckCFdCPHwodsFQFyg Filters for sediment filter 20 micron, 5 micron, & Carbon Block for removing dirt, sediment, and chlorine Softener http://www.lowes.com/pd_416874-43353-WHES33_1z10xx4__?productId=3824563&Ns=p_product_qty_sales_dollar|1&pl=1 Additional carbon filtration http://www.amazon.com/Hydro-Logic-31027-Pre-Evolution-Pre-Filter-Evolution/dp/B004LO0HBS/ref=pd_bxgy_60_img_2?ie=UTF8&refRID=1X6QQPSMBKB5NP3H9MTJ RO System http://www.amazon.com/Hydro-Logic-31023-1000-GPD-Evolution-RO1000/dp/B004LNUNKE Some major questions are: 1). if the additional carbon filtration prior to the RO system is necessary sense the water first passes through the carbon block within the sediment filter then the softener prior to even entering the RO system. 2). Should the softener be upgraded to output greater than 15gpm. Thanks for the advice guys...welcome any input or opinions. Best.

I run a 265 gallon still and a 15.6 hp boiler (522kbtu). There is no cycling during heatup, as the burner fires continuously for nearly the entire heat-up cycle. The still can easily consume 100% of the steam produced by the boiler - as evidenced by not being able to build full pressure during heat up. It's not until the still nears boiling that the boiler will "catch up", build to full pressure, and cycle. At that point the pressure in the still is dialed back to 1psi or so, and the boiler cycles on a few times every hour. I run 2" steam lines and the both steam and condensate lines are shorter than 10 feet, traps are appropriately sized. My suggestion to be nearer to 600k than 400k is based on my actual operating experience using similar sized equipment. I have absolutely zero doubt I would be able to easily consume another 5hp. The line between having additional steam capability available to accommodate a still upgrade, additional still, or some additional steam equipment (heat exchangers for hot water, etc) and inefficiently oversizing your steam system isn't narrow, and the cost differential to give yourself additional headroom is peanuts compared to tearing out a relatively young boiler. Do with my anecdote whatever you wish.

This is a complicated question. Here is how I understand it. Because the FDA was drowning in requests for GRAS determinations, it took refuge in a policy that allows a food manufacturer to self-certify that an ingredient is GRAS. However, to do so, the food manufacturer must possess evidence that would have convinced the FDA to issue a GRAS certification if the FDA had examined the evidence itself. Under those circumstances, it seems to me that self-certification is not something that most of the people engaged in craft businesses can pull off. The FDA struggled with the rules for more than 10 years, then issued guidelines. TTB reported on this in its newsletter. Here is what TTB said: . TTB NEWSLETTER | Weekly News August 19, 2016 FDA ISSUES FINAL RULE ON FOOD INGREDIENTS THAT MAY BE "GENERALLY RECOGNIZED AS SAFE" Each producer and importer of alcohol beverages is responsible for ensuring that the ingredients in its products comply with the laws and regulations that FDA administers, including rules regarding criteria for concluding that a substance is “generally recognized as safe” (GRAS). Industry members are reminded that TTB's approval of a COLA or formula does not imply or otherwise constitute a determination that the product complies with the Federal Food, Drug, and Cosmetic Act. Source: FDA Constituent Update dated August 12, 2016 In a step to strengthen its oversight of food ingredients, the U.S. Food and Drug Administration today issued a final rule detailing the criteria for concluding that the use of a substance in human or animal food is “generally recognized as safe” (GRAS). Unlike food additives, GRAS substances are not subject to FDA pre-market approval; however, they must meet the same safety standards as approved food additives. The rule addresses the types of scientific evidence that can be used to demonstrate safety as well as the role of publications in evaluating whether the scientific evidence of safety is “generally available and accepted.” The GRAS criteria require that the safe use of ingredients in human and animal food be widely recognized by the appropriate qualified experts. The final rule also formalizes the voluntary GRAS notification procedure, which was originally established under an interim policy and pilot program for human food in 1997 and animal food in 2010. The FDA strongly encourages companies to inform the agency of GRAS conclusions through the notification procedure finalized with today’s rule. While the FDA can question the basis for an independent GRAS conclusion, whether notified or not, and take action as appropriate, the notification procedure yields important information that aids the agency’s food safety monitoring efforts. The GRAS final rule is the most recent step we are taking to strengthen the FDA’s oversight of substances added to human and animal food. Next steps include issuing additional guidances related to the GRAS regulations. As part of the Foods and Veterinary Medicine Program’s Strategic Plan, the FDA will develop and implement innovative regulatory and compliance strategies to improve premarket oversight and safety evaluation of human and animal food additives and GRAS substances. Now, TTB requires that you submit a formula when you add harmless coloring, flavoring, or blending materials to a spirits product that comes under TTB's labeling jurisdiction. However, in all instances, the FDA is the arbiter of what is and is not safe. TTB bows to the FDA's determinations. The question, then, is what TTB would do it you asserted, in a formula, that you cannot give a GRAS number because you have self-certified, to the FDA, the safety or "kukiboja" root (my invention) as a flavoring ingredient in your specialty item. I suspect it would not be well received. The burden is going to fall on you to show the sense of the community of experts applies in the case of spirits, and not just kukiboja jelly or chewing gum. Thomas Merton wrote in his journal, "Isn't life absurd enough already without our adding to it our own fantastic frustrations and stupidities?" I have a feeling attempts to use kukoboja extract might be piling frustrations onto the absurdities. I will add that the possibility that said extract could destroy kidney function is not an absurdity to be ignored. The requirement for proof that it is safe should not be decomposed along with the rest of the administrative state. I prefer to live free of concerns that food producers are poisoning me, even if it means that the food producer is not free to add any damned thing it wants. Tweedle-dee and Tweedle-dum; freedom to and freedom from. Sometimes it is necessary for government to put a thumb on the scale to balance to and from on a reasonable way

I don't agree with this, and it's not because I have a biased or vested opinion as an owner (after all, where you sit is where you stand.) Yeah yeah, easy money is over. Everyone with a first mover advantage that didn't parlay that into growth and investment has lost that opportunity. Are we talking about a small craft producer turning into a national brand? Hell, that's always been a long shot. Are we talking about new business failures and failure to launch? I don't think that's new, I think it's just becoming more visible through places like ADI, etc. Remember, 80% of startups fail on average. This business is no different. Like I said, that first mover advantage that might have lowered this rate to 60% - that's gone, but all that means is it's no different from trying to open up a franchise sandwich shop. First, I don't understand how you define or easily identify brand saturation in a market. From my position, if the market sufficiently fragmented such that smaller players are able to gain or retain enough market share to be viable, what does it matter the aggregate number of brands? How is it that the wine market is not sufficiently brand overloaded? I personally think that the Scotch section is incredibly confusing and cryptic, but it continues to grow. In addition, the bulk of the craft brand growth has been local/regional, with very few being in national distribution. There is no single national "shelf", unless you are a major national player, everything else comes down to the local shelf. And not even all of the local shelves, but the local shelves that matter. A single strong specialty spirits retailer can move more product in a month than dozens of nondescript mom and pop corner liquor shops. Why would you even bother to waste your time with the latter (more on this later). Is it about the ability to respond to market changes? Craft distillers can very rapidly adjust their business models to account for short-term preferential changes in the marketplace. We have the advantage of agility. If tomorrow, anchovy vodka was the next hot thing, most of us could be in the artisan anchovy vodka business relatively quickly. A national producer would not have similar agility. We have the advantage of being significantly more agile in the marketplace, this should not be overlooked. Also, are new entrants able to grow the size of the overall market themselves? You might think the question is a little bit silly, how can new market entrants grow a market that major players have trouble doing whilst spending tens, if not hundreds of millions in aggregate, on advertising? But I I think the answer is that they can, by virtue of being local, and by virtue of being experiential. IMHO, that word, "experiental" is going to be the key, and it's not going away. I think the last piece is the key differentiation that craft brands have over nationals, the ability to be experiential. But what the nationals can't do, is appeal to the experiential buyer at mass-scale. They can only be experiential in so far as their marketing material takes them. I don't think that translates into local market dynamics. Awareness is not experience. How can you ignore the demographic change that is driving this longer-term market shift? A shift which clearly has legs. Every retailer is incredibly focused on this. Every consumer service business is incredibly focused on this. Even the financial services industry is spending millions on this. And hell, who wants to be caught dead in a bank branch? What kind of "experience" is that? There are dozens and dozens and dozens of studies and articles talking about this paradigm shift, there are probably just as many consultancies that state that they have the secret keys to be able to navigate this. But, the fact is, nobody has figured this out yet. It's fair game. I'll just leave a few keywords and concepts here, which I think are really important to think about. This is not your father's Oldsmobile. Experience, not Things Authenticity, Sincerity, No Bullshit. Social (as in Conspicuous) Consumption In Collaboration, actually Listening Environmental and Social Conscience Local and Artisanal Obvious Passion Respect, and Respected Unique and Limited, not Mass Market and Undifferentiated I firmly believe that a new craft distillery entrant in a crowded craft market can absolutely destroy the incumbent players if they master this experience component, and can scale it. Let that be a warning to anyone sitting on their ass. A millennial marketing to a millennial will absolutely beat the pants off you. Are you still hanging onto that trope about your great uncle Cletus' secret recipe? Sorry, they don't give a shit about that. Doing a private spirits pairing at the hot local restaurant, with a custom menu designed by it's hot local chef? Pretty food, pictures plastered all over Instagram, now we're talking. Personally? I don't think this demographic is interested in mass market anything. It's about creative differentiation, limited availability, having a brand image that a demographic wants to be associated with. It's not about being able to spend massive marketing budgets either. It should be the national brands who are shaking in their boots.