Cutty Posted October 16, 2011 Share Posted October 16, 2011 Doesn't section 23363.1 of the CABCA mean that tastings are allowed to be conducted on the DSP premises? 23363.1. Distilled spirits manufacturers, product tastings. (a) A distilled spirits manufacturer’s license authorizes the licensee to conduct tastings of distilled spirits produced or bottled by, or produced or bottled for, the licensee, on or off the licensee’s premises. Distilled spirits tastings may be conducted by the licensee off the licensee’s premises only for an event sponsored by a nonprofit organization and only if persons attending the event are affiliated with the sponsor. No distilled spirits shall be sold or solicited for sale in that portion of the premises where the distilled spirits tasting is being conducted. Notwithstanding Section 25600, the licensee may provide distilled spirits without charge for any tastings conducted pursuant to this section. Link to comment Share on other sites More sharing options...
bluestar Posted October 16, 2011 Share Posted October 16, 2011 The California law can not supersede the Federal law. So, the law can not allow bars and restaurants to do anything that was reserved by Federal law to the DSPs. If you have to get a Federal permit for it, so does the bar or restaurant. Now, if California restricted bars and restaurants MORE THAN DSPs in the past, and the new law relaxes that restriction, then yes, the DSP would be losing that state privilege. And yes, if the DSPs would lose a privilege previously according them a competitive advantage, it would be reasonable to use that as an opportunity to lobby the legislature for some compensatory privilege, like greater flexibility in providing tastings or on-premise direct sales. But I think you are missing the point many are making here: it is far better to lobby for greater freedom or privilege for the craft DSP than to lobby against one of your most important customer bases: the bars and restaurants. Link to comment Share on other sites More sharing options...
Scott @ Twenty2Vodka Posted October 16, 2011 Share Posted October 16, 2011 2) Infusing and Blending is part of the art and craft of distilled spirits manufacturing. If you think otherwise, chances are you do not now or have ever operated a DSP. Oh and yes.... a part does make a whole. Infusing and blending is also part of the art and craft of distilled spirits mixology. Adding a raspberry puree to vodka (infusing), then selling that now raspberry flavored vodka as part of a cocktail that has been significantly diluted (blended), from ice or other mixers, does not require federal permission because the mixing and blending took place AFTER the taxes were paid on the distilled spirit. The "mixology step" of the supply chain is essential for consumers to enjoy your product, because no matter how hard you kick or stomp your feet, not everyone is going to drink your spirit warm and neat (hey, that rhymes!). If you think otherwise, chances are you do not now or have ever sold a drop of product to people other than family and friends. And the mixology side of the game (as in on premises sales) will never ever, ever go away. Ever. It's been tried before, and it didn't work. So embrace the creativity and extra energy bartenders, bar chefs, and home chefs can give your brand and product. Or continue to alienate them with the claim that it just "ain't fair", and watch them vote with their feet. That will be the end of my contribution to this thread, best of luck to our Cali brethren, hope this works out for you. -Scott Link to comment Share on other sites More sharing options...
WI Distiller Posted October 16, 2011 Share Posted October 16, 2011 I just have to add my 2 cents here and agree with Scott on just about everything he's said. As a huge fan of creative mixology and great bartenders, I have to say that infusion after the point of purchase (after the spirit has be purchased wholesale from a distributor who bought it from a DSP) is a vital part of many great cocktails and restricting this would be ridiculous. I would gladly sign a petition and support anything that says you should have the right to serve samples and sell your product from your facility, but the argument that a bar should need to be a licensed DSP to make infusions is crazy. But, I don't have a DSP yet, don't live in California, and have no plans to make Vodka, so feel free to ignore me Link to comment Share on other sites More sharing options...
nick jones Posted October 28, 2011 Share Posted October 28, 2011 I think that the rest of the US could learn a thing or two about states' rights from California. Who cares what the feds say anyway. If the FBI, TTB, or ATF don't like it, let them come bust the door down: 27 CFR 31.233 - Mixing cocktails in advance of sale. A retail liquor dealer shall not mix cocktails, or compound any alcoholic liquors in advance of sale, except for the purpose of filling, for immediate consumption on the premises, orders received, or expected to be immediately received, at the bar. See § 31.204 for additional mixed cocktail rules. But given the federal resources required to enforce federal drug laws in California, somehow I doubt that there will be any left to bust down the doors of retail liquor establishments playing at being rectifiers... Nick p.s. Seriously though, I love the feds. Those guys are so much fun to drink with. Link to comment Share on other sites More sharing options...
Napa Valley Distillery Posted October 29, 2011 Author Share Posted October 29, 2011 Happy Saturday morning to everyone! Allow me to once again state our official position, just in case I was understand the first 3 times, most likely from someone who does not own a DSP or legally manufactures distilled spirits. We are not upset at bars for infusing. Once again.... we are not upset at the bars for infusing spirits. Our gripe is with the State of California for allowing them to do so, without either... 1) Making them get some sort of production permit (like we have to) 2) Allowing us (DSP's) the opportunity to allow tasting/sales out of our facility to level the playing field. We are asking for a fair playing field nothing else and this new bill in fact, will probably help us get it. Finally, for the record, infusing and/or blending is a form/part of production and manufacturing of distilled spirits. Anyone who has the interest in the craft of infusing distilled spirits, including bars, should be allowed to do it. Actually, I say let everyone do it! However, once you attempt to sell the finished product, like the bars are doing, and have altered the taste, color and chacter of the spirits as per ABC and TTB rules, then you should have to adhere to the same regulations others have to. If you still disagree with our position, thats OK, I understand. Hey...if I didnt own a DSP, I probably would agree with you too. But, I invite you to spend a year of your life setting up a working DSP while going through all the frustrations of dealing with local, state and federal regulations and miles of red tape you have to go throught to get a DSP, then once licensed, buy the right equipment, find the right ingredients, make a product, get the labels and formulation approved through TTB, bottle and package it, find a distributor for it, help them market it and sell it, and then pay the exicse taxes on it and if there is something left over at the end.... start the process all over again. Do this and I think you will understand our position on this issue. Cheers everyone! Link to comment Share on other sites More sharing options...
grehorst Posted October 29, 2011 Share Posted October 29, 2011 Arthur, Do you really wish to give your potential customers a requirement for additional permits?? I've been through the process, invested the time and money, worked to get state laws changed and been doing this for a while so don't write me off when I say this; the requirement for a DSP permit is to ensure a system of collecting EXCISE TAX. Bars purchase their alcohol from a distributor. The tax is priced into the alcohol they buy. What they do with it after that point should not be of any concern to a DSP unless they are bottling it and selling it off their own premise. When it's on premise and sold in a glass this is called a cocktail, doesn't matter what the ingredients are, how long it's been sitting around, or whether it's in a shot glass or 5 gallon carboy. Seriously, this will NOT effect YOUR business. In my state bars have been infusing for years. I can tell you it doesn't harm us one bit. A little advice. Focus on getting laws changed to allow you to sell and pour in YOUR facility, don't worry about how bars are using it when they have bought and paid for it. Don't even mention bars infusing as it will take away from the message of what you really need to say- that laws forbidding sales from your tasting room need to change to allow sampling and sales on the spot. Good luck, Guy Link to comment Share on other sites More sharing options...
bluestar Posted October 30, 2011 Share Posted October 30, 2011 Yah, what Guy said. Link to comment Share on other sites More sharing options...
Scott @ Twenty2Vodka Posted November 2, 2011 Share Posted November 2, 2011 Yeah, what Guy said. And can I just state for the record that your continuous and repeated assumption that those contributing to this thread do not have the necessary qualifications, to quote you specifically "most likely from someone who does not own a DSP or legally manufactures distilled spirits" is really really getting annoying. See the links below in my signature as my proof. ugh. Good luck, seriously. -Scott Link to comment Share on other sites More sharing options...
delaware_phoenix Posted November 4, 2011 Share Posted November 4, 2011 Seems like this recent article in the LA Times says that California's microdistilleries are booming. All based on a close relationship with bars and restaurants. http://www.latimes.com/features/food/la-fo-1103-california-spirits-20111103,0,209266.story Link to comment Share on other sites More sharing options...
Napa Valley Distillery Posted November 5, 2011 Author Share Posted November 5, 2011 Guy, you bring up a valid point, but california is different. For one, there are 3 types of DSP's here. One is a TYPE 7 - Rectifier license (still a DSP) that requires all the same federal permits as a full blown distillery. The main difference is that they do not operate a still on premise. There are a several of them here in operation making some fine liqueurs and spirits. Their whole business model it based on infusing spirits. It hurts them the most. because they had to go through all the licensing to be able to make and sell their infused spirits. There was even an article in the paper quoting a bartender basically saying that there is no need for him to buy a popular infused vodka made by a popular distiller here, now that he can make his own flavored vodka for $6 instead of paying $18. We didnt make a big deal about it, because yes, we dont want to piss off our customers, but trust me when I say that every single DSP that I've talked to here in CA was not in favor of this bill passing. The main reason is that the bars are selling their infusions to the public when we DSP's cannot sell our own manufacter products to the public. Please understand there is a difference and the unfairness in that. Also, while Wisconsin is a terrific state, (I have product being distributed there) I am certain there are not as many bars as there are in CA. California is arguably the center of craft-made cocktails. San Francisco is known as the cocktail capital of the US as such, too many bars will take advantage of this law effectively hurting the bottom line of all DSP's, mostly the TYPE 7's. In order to really get a grasp of what I am trying to say, you really have to understand the laws here in CA and how archaic and unfair they are to DSP's and how much this bill effects DSP's. Again, perhaps this issue would not effect DSP's in other states, but based on current ABC laws limiting DSP growth, this law is literally a punch in the gut for us. What ruffles our feathers is the unfair restrictions imposed against DSP's in CA. While we are trying to fight for an equal playing field, the state goes and allows a bar to basically do the same thing a TYPE 7 holder can do only without the regulations and then be able to sell to the public when we cant. It's unfair. Finally, per your advice, we are already focusing on getting the laws changed. Actually we've been trying to get them to change the law regarding tasting and sales for years. The 2 biggest distributors here fight it tooth and nail. It aint easy my friend. These guys are big and support a lot of legislators. Were trying and maybe this year we'll succeed. While 1 of the 3 types of DSP here in CA can conduct tastings, they cannot charge for them and cannot sell the customer a bottle afterwards, so really whats the point of having a tasting room until we can. As for the comment from Scott, you can take it anyway you like. I would assume that most DSP owners would symphathize with the difficulties we in CA have to face or at least try to understand them. Instead, your posts came off to me as a little on the agressive side and so that leads me to believe that you either didnt have a DSP or have one in a state that has much less restrictions on your business. Start one in CA and you'll see the difference and perhaps understand what we go through to support our craft. Lastly, to Delaware... things are booming yes, but most of us sell more product outside CA then we do here in CA...me included. We continue to create close realtionships with the bars here even though we are pissed off at the situation because its really not there doing or fault. It takes a lot of diplomacy, but we have no choice. If one of my accounts stops buying one of my infusions because he can make it himself, then what do we do? It hasnt happend to me yet, but it has happened to someone else already. Cheers! Link to comment Share on other sites More sharing options...
Denver Distiller Posted November 5, 2011 Share Posted November 5, 2011 If one of my accounts stops buying one of my infusions because he can make it himself, then what do we do? Make something that they actually want to buy. Problem solved. Link to comment Share on other sites More sharing options...
Napa Valley Distillery Posted November 5, 2011 Author Share Posted November 5, 2011 Make something that they actually want to buy. Problem solved. BRILLIANT IDEA!. Wow... now why didn't I think of that? Amazing it never crossed my mind before. What a concept...make things people actually want to buy. Gosh, thank you so much for pointing that out. I guess I've been going about this whole distilling thing wrong. Please keep the advice coming and please...continue to not think things out before you make a comment. I rather enjoy your ignorant twist. Thanks pal, that went down really well with my coffee. Link to comment Share on other sites More sharing options...
delaware_phoenix Posted November 5, 2011 Share Posted November 5, 2011 If one of my accounts stops buying one of my infusions because he can make it himself, then what do we do? It hasnt happend to me yet, but it has happened to someone else already. One account? A bottle a month loss maybe? Maybe 2 or 3 bottles a month? Maybe more if the bar manager decides that your whiskey or gin or vodka is their "well" brand, and the one that is reached for most by the staff. Given the number of bars in CA or even just LA or SF, it should be "easy" to develop the relationships necessary to establish your infused spirits as their "go to" brand. I put "easy" in quotes because for some bars, they'll just always stick with the mass marketed and distributed brands, and it's still a lot of legwork to get to know the people behind the bar and to get them to know your products. But just because a bar could make an infusion themselves, doesn't mean that they will, because it takes time and effort to do it right. Maybe you should ask some of your customers what they'd want you to make? But so long as you consider on-premise customers your competitors you won't approach things from the proper angle, and you might not treat them as your friends which they can be. Good luck to you! Link to comment Share on other sites More sharing options...
Denver Distiller Posted November 5, 2011 Share Posted November 5, 2011 Please keep the advice coming and please...continue to not think things out before you make a comment. No need to be rude. I guess I wasn't clear enough, so my apologies there. If this law is interfering with your business (I don't think that it is in the least, but I digress), then the problem isn't the law: the problem is your business plan. If you go into a bar, and some guy says "why should I buy your stuff, when I can do this myself?" You should take a look at your portfolio, and makes something he DOES need. Get it now? Make something that they actually want to buy. So that's all I meant. I didn't mean to offend you. Delaware Phoenix got what I was saying just fine. Link to comment Share on other sites More sharing options...
Palmetto Coast Posted November 11, 2011 Share Posted November 11, 2011 Just ran across this one today. Bartenders are actually fermenting and bottling now as well. http://www.tastingtable.com/entry_detail/national/6157/The_latest_cocktailing_trick_Fermentation.htm Link to comment Share on other sites More sharing options...
daveflintstone Posted November 11, 2011 Share Posted November 11, 2011 Any bartenders are welcome to use my products in any way they see fit, including barrel aged cocktails, bottle fermented cocktails, infusions, glass cleaner, alternative fuel, holiday displays, and air freshener. Link to comment Share on other sites More sharing options...
nick jones Posted November 12, 2011 Share Posted November 12, 2011 So if I buy truckloads of cases of everclear, mix up a nice cocktail that is about 60/40 everclear/water, dump that into some barrels, let that age for a few years, then sell it over my bar as a "barrel aged whiskey cocktail" that's totally legit, right? Who needs a DSP? Bartenders don't need to apply for COLAs for their cocktails after all, so I could call anything whiskey! If I buy a few railcars of grape juice, put it into some barrels with some yeast, let it ferment for a while, then sell it over my bar as "barrel aged champagne cocktail" that's fine too right? I guess for that matter, I could cook up some barley-mash with some hops, strain out the barley and the hops, age THAT in a barrel with some yeast, and have a super cool "barrel aged beer cocktail" that I could sell over my bar. Why bartend if you're not going to push the edge a little? Seriously though, I wonder how long this fermented cocktail thing is going to go before the feds come down on it. That's pretty flagrant. Nick Link to comment Share on other sites More sharing options...
malabarsp Posted December 4, 2011 Share Posted December 4, 2011 If you are selling rectified spirits to bars, you may lose out on this business. However, if you are selling directly to consumers, which is a much bigger market, this will likely help your product. If a consumer really liked a rectified spirit, that individual would rather go to Costco or Safeway to buy a bottle of it rather than go to the bar and pay 10x the price for one drink. This could also open the markets to new tastes by exposing consumers to the rectified beverages...in fact, this may be a boon because the bar has done free marketing and some trial sales already for you. Link to comment Share on other sites More sharing options...
kkbodine Posted December 19, 2011 Share Posted December 19, 2011 Just ran across this one today. Bartenders are actually fermenting and bottling now as well. http://www.tastingta...ermentation.htm This might taste good but is obviously crossing a legal line that both the state and federal governments won't like. He is selling untaxed alcohol (at least the part he ferments). Keith Link to comment Share on other sites More sharing options...
Classick Posted January 6, 2012 Share Posted January 6, 2012 If you are selling rectified spirits to bars, you may lose out on this business. However, if you are selling directly to consumers, which is a much bigger market, this will likely help your product. If a consumer really liked a rectified spirit, that individual would rather go to Costco or Safeway to buy a bottle of it rather than go to the bar and pay 10x the price for one drink. This could also open the markets to new tastes by exposing consumers to the rectified beverages...in fact, this may be a boon because the bar has done free marketing and some trial sales already for you. If you are selling rectified spirits to bars, you may lose out on this business. However, if you are selling directly to consumers, which is a much bigger market, this will likely help your product. If a consumer really liked a rectified spirit, that individual would rather go to Costco or Safeway to buy a bottle of it rather than go to the bar and pay 10x the price for one drink. This could also open the markets to new tastes by exposing consumers to the rectified beverages...in fact, this may be a boon because the bar has done free marketing and some trial sales already for you. the problem is, here in california.. we are not allowed to sell direct to customers, retail, or people that come in for tastings. If you have a brandy-makers license, you can sell your fruit based spirits directly to retailers and customers, but cannot "legally" taste them on it, they have to buy on smell evaluation alone. I think what Arthur has been trying to point out here is this. We california producers are not mad at bars and restaurants for creating concoctions that will help them sell craft drinks.. We are mad at the state for pushing through, in record time i might add, legislation that directly and flagrantly helps a relatively new business population ( bars and rests looking to make their own infusions) to sell their products, while we the craft spirits producers, who have/are slowly and steadily fought to preserve, grow,and indeed improve upon the craft spirits industry here in our state, fighting with one if not both hands tied behind our backs. When we started our distillery here in the Bay Area 12 years ago, we were one of 6, maybe 7 micro distilleries on the whole west coast.. now there are 28 in California alone, and growing.. and yet for that whole time, we have been denied the ability to dell directly to retailers, bars/restaurants, and hell even people that just want to wander in, maybe do some tasting, and would love to walk out with a bottle but cant. Arthurs argument is that while we have been trying convince the state to give our industry even the same ability as the craft wine and beer industries have here, along comes this state legislation that allows ABC bar to just go an mix their own unique product ( the same as a rectifier would) and sell it basically tax free, even without permits, thus taking away margin from legal rectifiers. I love cocktails, i am in SF quite often, and really enjoy seeing and tasting all of the great mixtures the individual bars come up with.. it really fosters ingenuity... but where is the love for the craft spirits producers? why cannot we get similar legislation fast-tracked and approved so that we may enjoy the same success? where is the business justification for this? Link to comment Share on other sites More sharing options...
Classick Posted January 6, 2012 Share Posted January 6, 2012 The California law can not supersede the Federal law. So, the law can not allow bars and restaurants to do anything that was reserved by Federal law to the DSPs. If you have to get a Federal permit for it, so does the bar or restaurant. Now, if California restricted bars and restaurants MORE THAN DSPs in the past, and the new law relaxes that restriction, then yes, the DSP would be losing that state privilege. And yes, if the DSPs would lose a privilege previously according them a competitive advantage, it would be reasonable to use that as an opportunity to lobby the legislature for some compensatory privilege, like greater flexibility in providing tastings or on-premise direct sales. But I think you are missing the point many are making here: it is far better to lobby for greater freedom or privilege for the craft DSP than to lobby against one of your most important customer bases: the bars and restaurants. Its actually the opposite.. not only did we already have less advantage than bars and restaurants (because they are already selling directly to consumers)... with this legislation, we have even LESS of an advantage, because suddenly bars and restaurants, without the same permiting process, and fees and taxes associated with it, are allowed to perform the same blending and mixing to create unique, revenue generating products as a rectifier would. Link to comment Share on other sites More sharing options...
Jedd Haas Posted January 6, 2012 Share Posted January 6, 2012 but where is the love for the craft spirits producers? why cannot we get similar legislation fast-tracked and approved so that we may enjoy the same success? where is the business justification for this? With 28 micro distilleries in California, surely you can form a trade association to lobby for favorable changes? The "love" is bought via paid lobbyists (or your own grass-roots lobbying effort). Legislatures respond to pressure; they rarely do something because it's the right thing to do. Link to comment Share on other sites More sharing options...
Classick Posted January 6, 2012 Share Posted January 6, 2012 With 28 micro distilleries in California, surely you can form a trade association to lobby for favorable changes? The "love" is bought via paid lobbyists (or your own grass-roots lobbying effort). Legislatures respond to pressure; they rarely do something because it's the right thing to do. you would think... and Arthur has been very involved with organizing ideas and trying to get us some lobby power.. but as of yet, no real cohesion has been experienced. there was an effort a few years back, but it kind of dissolved when interests weren't aligned. Its a work in progress Link to comment Share on other sites More sharing options...
Jedd Haas Posted January 7, 2012 Share Posted January 7, 2012 Unfortunately, this business is far more "political" than one would like. But that's the way the game is played. Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now