Biggest surprise

[jbdavenport1]

Here's one for the whole peanut gallery.

 

So I consider myself a huge research geek. I will read and research things to death. But as much as I read and gather info...every issue I answer seems to spawn 5 new questions. 

 

Here's the question...what have been the biggest surprises or unknowns as you've gone through the buildout and startup of your distilleries. I feel like I am just waiting for that one big 'uh oh, I never even thought of that'. 

 

Thanks in advance. 

[Silk City Distillers]

Budget for mistakes, because every mistake seems to cost $5,000.  It doesn't matter what it is, it's probably going to cost $5,000 to make right.  Figure that you, or your contractors, will make a few mistakes along the way.

[captnKB]

Silk has got it. Budget for mistakes and delays on buildout. some of your contractors will not get the job done on time. Some of your contractors will end up hitting you with additional costs. There will invariably be hidden costs you did not account for in planning. @Paul Tomaszewski summed it up well

"A very realistic rule of thumb is to take your budget and cut it in half. Use half for your facility and equipment, then the other half for your initial production costs and unappropriated costs."

[bluefish_dist]

Build out cost and the time required to get approval.  We did only minor changes to our space and it took 10 months from first submission until occupancy.  We also had to do a lot engineering as our building had fallen through the cracks, which cost a lot more than expected. 

The whole DSP and state license process was far easier than expected.  

[Skaalvenn]

How long it takes and how difficult it is to truly start making money worth writing home about.

[Falling Rock]

State is harder than Fed. Fed has it all mapped out. State, County seems to be feeling their way through it.

Most of it isn't hard, but an endurance test.

[Glenlyon]

“Here,” said Wayne my electrical contractor and thrust the plans into my hands. “You need a handicapped washroom.”

Surprise!

WTF? Valiantly, I defend myself. “Nobody told me that” I mutter to no one in particular.

The workers shuffled around awkwardly, staring at the ground and the builder glared at Wayne. He shrugged. “Ya gotta have it,” he declared happily.

My distillery building was already impossibly tiny. No one in their right mind would build such a small project but I was already nearing the limit of the maximum building size for the rezoning application and the building lot.

“Someone in a wheelchair has to be able to turn around so that’s a five foot radius plus the door has to be larger.” Wayne confirmed.

What a fount of knowledge, I thought sourly.

“We could widen the building two feet,” I suggested. I looked at Marlin the builder as he winced. I knew why. The building was a post and beam design and finding even longer solid wooden beams which would be sound to an engineer’s satisfaction was another added cost. Not to mention, the ones we had, were already custom cut.

Note to self: ‘Try not to think ahead too much. It can be expensive.’
Note to self: ‘Try to think ahead as much as possible. It could save money.’

Shit. Which one is it?

Anyway, back to the story...

Straight away this morning, I was up at the district office bending the ear of the building permit guy, Alan.

“Here’s the thing,” says Alan. “If we classify the entire building as high risk, then you won’t need a handicapped washroom... On the other-hand, if we declare that the tasting room is medium risk, then you’ll need the bathroom. But, you’ll have to build an explosion proof wall between the production area and the tasting area.”

Either way, its going to cost. Cost more of that mythical $500k you didn’t think you’d need to spend.

In the end, the jury is still out. And so, we wait...

In the meantime, the septic guy has just called, apparently the health people aren’t convinced about my solid waste plan...

Surprise!

[Lenny Gotter]

There are all kinds of little costs that eat up your profit.  I had someone from the Dept of Agriculture stroll in my distillery one day, the end result was that I needed to have a license from them, even though we didn't produce a food product, and I would never see them again.  The license is $380 a year and they do not prorate, so I have to pay $380 in March and $380 again in June.  Sure that's only $380 a year but the little things add up.

Play music in your tasting room? Someone from BMI or the other artist rep companies will eventually come in a demand a license.  Luckily thru DMX you can license for all three agencies for $25 a month, instead of the $25 per license per company that they will try to stick you with.  The list goes on and on.

[bluefish_dist]

4 hours ago, Lenny Gotter said:

There are all kinds of little costs that eat up your profit.  I had someone from the Dept of Agriculture stroll in my distillery one day, the end result was that I needed to have a license from them, even though we didn't produce a food product, and I would never see them again.  The license is $380 a year and they do not prorate, so I have to pay $380 in March and $380 again in June.  Sure that's only $380 a year but the little things add up.

Play music in your tasting room? Someone from BMI or the other artist rep companies will eventually come in a demand a license.  Luckily thru DMX you can license for all three agencies for $25 a month, instead of the $25 per license per company that they will try to stick you with.  The list goes on and on.

If you have a small enough tasting room you can play a radio station.  I don't remember the size limit off hand, but a quick search should give you an answer.  

Changing occupancy does open you up for a lot of changes to your space.  We had to lower a sink 1/4" to meet Ada, had to add exit lighting even though the front of the tasting room is glass, had to lower all the fire extinguishers for Ada.  Oh, if the occupancy is more than 15 people you need two bathrooms.  We were also requested to document the whole building as the building department didn't have any plans for the internal buildout. To do it again I would get occupancy first so you can bail if the surprises are too much $$. 

[Lenny Gotter]

22 hours ago, bluefish_dist said:

If you have a small enough tasting room you can play a radio station.  I don't remember the size limit off hand, but a quick search should give you an answer.  

 

My tasting room was tiny....if you play music in a place of business where customers can hear it, you have to pay:

https://www.bmi.com/licensing/#faqs

[bluefish_dist]

From what I have read, you can play radio or tv in a restaurant or bar that is less than 3750 sq ft or fewer than 6 speakers.   https://ucomm.wsu.edu/music-copyright/#8. Now with Internet there are lots of great radio stations.  We use kuvo out of Denver. 

[Lenny Gotter]

On 9/1/2017 at 2:28 PM, bluefish_dist said:

If you have a small enough tasting room you can play a radio station.  I don't remember the size limit off hand, but a quick search should give you an answer.  

 

My reply wasn't meant to be a big discussion on music licensing. As a business owner, we each need to decide whats worth the risk or not.  ASCAP and BMI will send you threatening letters and if you are in an urban area they have reps with territories, and eventually, one of them will come in and write a little report and send you a letter.