Round and round in Pennsylvania

[jessicajlemmon]

Where to start? Been to a class, working on a business plan to secure an offer on a building. Not a lot of context to work with in Pennsylvania, especially in my great-lakes region.

Every answer seems to raise two more questions. Trying to get legitimate pricing has been problematic at best. After some talking we were able to get rough numbers from still manufacturers, but bottles, labels and all those finer points are still elusive. Seems like the craft 'boom' has cause quite a backlog in the system and vendors are swamped getting through the inquiries.

Local zoning put us 6 months behind by wasting our time with a bait and switch on approvals which wasn't too thrilling.

There isn't a lot of context to work in within PA, which is a double edged sword. Hope to be on the cusp of the revolution, yet we're stuck blazing a new trail, which slows us down considerably.

Happy to talk with anyone else in-state that is in/through the process.

Let's make it PA Preferred!

[Salishseaorganicliqueurs]

Hi Jessica,

I just went through the same difficulties with suppliers. What are you looking for? Perhaps I can point you in the right direction. I've also just gone through a lot of similar issues with my local municipality. I would be happy to provide any advice that I can and if I don't know the answer I can point you to who would know. Either way, you've come to the right place, this forum has proved time and time again to be an invaluable resource. Welcome!

In good spirits,

Sam

[MG Thermal Consulting]

Hey, my Mother was born in Macadoo, PA, does that count (jk).

I can help you out on a budget for a cooling system, if that helps.

Regards,

Mike

[SGSTom]

Hi Jessica,

I was born in Philadelphia so I hope that counts!

Anyway, I think I can help you with labels. I work for SGS and we provide labels for many of the new craft distilleries around the country. I also have a lot of personal experience with the TTB and COLA requirements so hopefully I can be a one-stop-shop for you related to anything having to do with labels. Feel free to call/email me at:

Tom.schiller@sgsintl.com

502.297.3048

SGSLabels1.pdf

[Silk City Distillers]

Every time you go round, your chances of success rise. It's not wasted time, it's invested time.

There is no longer first mover advantage in Craft Distilling, there is no rush to market.

If your only differentiator is first mover, you don't have a business (unless you are tech or in a space where you can protect your IP).

The only time you should rush is when there are clear benefits to market share or revenue, and those benefits will outweigh the additional cost of associated risks and mistakes. Every time you make a mistake, it costs real money. Spoke to a start up distiller who said a similar thing, every mistake costs $5,000.

I've worked with many startups whose only differentiator was that they were first to a market, failure rate was high. Not the same business, but competitors will have an easy time following once you've paved the way.

I'm sure equipment and supply manufacturers are being inundated by would-be distillers calling for price lists and quotes. They've got to run their businesses too, which means they need to weed out the chaff. Just spoke to the zoning official in my home town who told me there is someone looking for a conditional use variance to put a distillery in a 900 square foot basement of a commercial building in a residential zone (which is crazy talk). If this is any indication of how crowded the market may become, I suspect it will only get to be more difficult for startups (no payment terms, prepaid orders only, larger order minimums, etc).

[HedgeBird]

I can understand getting prices on stills and large equipment might be challenging, but you should be able to get other pricing pretty easily.

Lots of folks on this forum are happy to answer questions and provide info.

If you just need it for a budget/business plan; or orders of around 1,000 each..

two color front label $0.20

two color back label $0.20

tamper seal sticker $0.23

natural t-top corks $0.23

750ML bottle $1.50

That puts your bottle packaging around $2.45. Lots of room to lower that price by ordering larger quantities, getting a cheaper bottle, using synthetic tops, etc.

Located in Lancaster PA, opened to the public Christmas eve 2013, happy to speak on the phone and help if I am able.

[jessicajlemmon]

Thanks for all the replies so quick!

<if> we get the property we want, the primary advatange is a lot of initial storage space, so we can do certain orders in bulk if we need to, without a storage issue. (Loading dock, large truck friendly, etc.) The building was an old train depot feedmill.

I have a good quote on still eqipment, found pricing for totes, and have already hit up the local feedmill for grain costs. We intend to do some bourbon, and getting non 'novelty' costs for barrels has been a bit tough, but we have a ballpark at least for budgeting.

Need to find out what the average cost is to convert a milk tank into a mash cooker. (Have access to a good size, in good condition for a resonable price.) I know it's done a lot, but unless I can crawl inside one and see the nuts and bolts of it, I can't estimate what cost it might be.

I do appreaciate the ballpark prices on the labels and bottles. That sounds fairly in tune with the stuff I've dug up myself (no thanks to the reps). Anyone have experience with USA glass vs. China glass? I'd prefer to go US, but... that might be an upgrade we do once we can get things going. I've heard mixed reviews on China glass from other craft distillers we've talked to.

Water filtration/amendment will likely be an issue there since it's well water. I haven't even scratched the surface on that yet. I intend to keep the scale of the operation down small enough that we won't trigger sprinklers. That would be a financial death blow at this point.

I do have a concern that as this gets more popular in PA, that the legislation will get increasingly refined, aka restrictive. I'm an Architect by day, so I see that happen a lot when code changes happen. I think there is enough market-share in this region that I don't have to worry too much about being quick to market, but I don't want to sit and wait forever, either.

We have a lot of good resources, but figuring out how to utalize them all is the challenge. I'd love to hear about things like using or selling spent grains, if I can get the most bang for my buck, I'd rather use it than throw it in the trash.

We can grow grains on the family farm and recycle the spent grains as beef feed if necessary. We also tend to do a lot of the 'hands on' work ourselves, though there are some specific things I would hire out. I anticipate a lot of sweat equity to get rolling.

Initially we're aiming for a 250 gallon still set up. It seems to be a reasonable size for our situation, and we have room to expand in the future.

See what happens? Get me talking about this and I can't stop!

Thanks!

[hiredguns]

Hi Jessica,

I can help with info on pricing for the design side of things: branding, packaging design and brand collateral design.

You'll find everything from the local, generalist design shops who will quote fairly low rates for this type of work to specialists (such as ourselves) to very large specialists in large, swanky offices in large cities who will quote you 6 figures +.

Let me know if I can help provide more concrete figures for you.

Cheers!

[Artisan Still Design]

not sure if we've been in contact with you or not, But I can put you in contact with folks in your area who have our equipment and are in production.

Its a rough ride finding people who have been there who are willing to share openly, but we have been fortunate to work with some very good folk.

Steve

[Natrat]

Jessica,

Best of luck on the new venture! As for converting a dairy tank, a lot depends on exactly what you want to do and the current configuration of the tank. Generally, a major rework will run you about $3000, but minor stuff like added ports (not manways) and access conversions can end up being just a few hundreds of dollars. If you have access to a TIG welder and a bit of practice, then self-modified tanks are not out of the question. Feel free to PM me if you have any in depth questions about it...I've modified lots of old dairy and pharma vessels in the past.

I'll also add that lumping glass into "USA" vs. "China" vs. "India," etc. is not a road to go down. I've seen great glass and terrible glass from every country of manufacture. There is very little in the way of self-policing in the glass industry. Some of the worst glass I've seen was made right here in the ol' USA...! Rather than shopping for the lowest price, I recommend interfacing with a rep or a distributor that really knows the industry, and they can source great product for you. You've got a steep learning curve going into the distillery business...no reason to become an expert on bottle-making when there are already some great people around...and some of them are on this forum :-)

[jessicajlemmon]

We were 'observing' bottles at various places over the weekend and noticing that not many are the bar tops. After talking to a couple of bartenders, they actually seem to prefer the twist off.

It seems like 'everyone' is using the short, round bottle with the t-top and I'm trying to figure out why? From the intial pricing I've done, they seem to be more expensive. Just wondering, first of all, if people are going w/ the corks because they're easier to do by hand? While I do like the look, I'm just wondering if it's a premium worth paying for.

Also, has anyone dabbled with wax dipping?

Natrat - I'll definitely be hitting you up about the converted bulk tank question. I need to dig up the specs on it.

Thanks!

Jessica

[OldSpye]

Every time you go round, your chances of success rise. It's not wasted time, it's invested time.

There is no longer first mover advantage in Craft Distilling, there is no rush to market.

If your only differentiator is first mover, you don't have a business (unless you are tech or in a space where you can protect your IP).

The only time you should rush is when there are clear benefits to market share or revenue, and those benefits will outweigh the additional cost of associated risks and mistakes. Every time you make a mistake, it costs real money. Spoke to a start up distiller who said a similar thing, every mistake costs $5,000.

I've worked with many startups whose only differentiator was that they were first to a market, failure rate was high. Not the same business, but competitors will have an easy time following once you've paved the way.

I'm sure equipment and supply manufacturers are being inundated by would-be distillers calling for price lists and quotes. They've got to run their businesses too, which means they need to weed out the chaff. Just spoke to the zoning official in my home town who told me there is someone looking for a conditional use variance to put a distillery in a 900 square foot basement of a commercial building in a residential zone (which is crazy talk). If this is any indication of how crowded the market may become, I suspect it will only get to be more difficult for startups (no payment terms, prepaid orders only, larger order minimums, etc).

James is a smart guy, probably because he's from New Jersey.

Our philosophy is "Crawl, Walk, Run". Take your time and thoroughly think through every decision. We have a challenging zoning officer to deal with, but we've been very careful to involve him in the process and educate him as to our exact intentions. We've been granted permitted use and are currently working with an architect to provide the town with a full set of sealed and code-assessed ADs so that all of our modifications to the building will be non-issues. The little bit of time and money spent on this process will save us money down the road in work stoppages and construction do-overs.

Be reasonable in your expectations. I've got a great business plan, put together with the assistance of very solid professionals. There's tremendous up-side, but my expectation is not to "get rich". My expectation is to produce a quality product that I'm proud to put my name on, pay the bills and put food on the table.

Okay, maybe in a few years I buy a 'Vette.

[jessicajlemmon]

I'll be happy to break even! (Ok, maybe a little profit... I have my eye on a big, black Dodge...)

The facility has been the biggest stumbling block so far. We have tons of resources that we aren't 'allowed' to use for various reasons and it's very frustrating. I haven't talked to zoning for this place yet because i want to at least know if it's close to being able to be financed, but I've reviewed the books and we should be good to go... hopefully. If not, I'm on to Plan C and then I'm pretty much out of options.

[Sixdegrees]

For Labels, I've had a lot of luck with SGS. Tom has a lot of knowledge about the industry in general and can help you avoid costly mistakes.

[TuftedTurtle]

We were 'observing' bottles at various places over the weekend and noticing that not many are the bar tops. After talking to a couple of bartenders, they actually seem to prefer the twist off.

It seems like 'everyone' is using the short, round bottle with the t-top and I'm trying to figure out why? From the intial pricing I've done, they seem to be more expensive. Just wondering, first of all, if people are going w/ the corks because they're easier to do by hand? While I do like the look, I'm just wondering if it's a premium worth paying for.

Also, has anyone dabbled with wax dipping?

Natrat - I'll definitely be hitting you up about the converted bulk tank question. I need to dig up the specs on it.

Thanks!

Jessica

I've sold liquor to the general public for quite some time, but don't have much experience in the bar scene. In my experience, when someone looks at a bottle of liquor they have not had before, they judge it by the packaging. Some may see a twist off cap and think it's not good quality. We all know that a twist off cap is just as good as a cork, but that's not what the public has been trained to think.

Bartenders handle bottles as part of their job. Twisting off a cap is easier to do then pulling a cork. General public isn't as worried about how the closure works as much as how it looks.

Cheers,

Turtle.

[craftersglass]

Hey Jessica,

Would love to help you out with your bottle and tops supply if needed. We just came out with a brand new bottle designed specifically for the American craft distiller in mind and unlike anything else currently out there now.

Cheers!