Jump to content
ADI Forums

Glenlyon

Members
  • Content count

    19
  • Joined

  • Last visited

  • Days Won

    2

Glenlyon last won the day on July 16

Glenlyon had the most liked content!

Community Reputation

5 Neutral

About Glenlyon

  • Rank
    Contributor

Profile Information

  • Gender
    Male
  • Location
    British Columbia
  1. Bank Loans

    In a word - greed. The provincial government makes well over 600 million dollars a year on booze. However, the real story is a bit more complex. I'll sum it up briefly. Way back in the olden days (mid eighties) when I was a wee lad of 18 - a local returned from a trip to England. As Victoria, my home town was inclined to sell itself as a 'British' themed place - this local quickly noticed that the English Pub was conspicuously missing. So, eventually, he opened BC's first craft brewery - Spinnaker's. That business is still thriving and they make over 4 million dollars in profit a year out of their original brew house, a tiny, tiny space in an old heritage waterfront building. Shortly thereafter, one other like minded business opened, Swans Brewery - also still operating. After that nothing happened for a long time. With the exception of course that 'we', Victoria's youth, were drinking real beer, not that watery shit that comes from a factory in a can. Which is why today, there is such a deep rooted love for craft alcohol throughout the province. A couple of years later, we had a crazy Premier leading the province. A real nut job, but he accidentally created the farm-gate wine business when he issued some licenses to a couple of farmers who wanted to be in the wine business Euro style. Small batch, gate sales, etc, etc. Predictably, their wineries were a hit and pretty soon more piled on. By then everybody was complaining about the system and so the BC government began reforming the alcohol business through de-regulation and by streamlining the application/tax processes. By then they were realizing the vast potential for the craft alcohol business in several areas. It created tax revenue by the truck load and it revitalized small farms, restaurants and other associated tourism activities. The Okanagan Valley here in BC is a fantastic example of how the wine business absolutely and completely transformed the landscape and the economic output of a region. Eventually, (about seven years ago,) some entrepreneurs went to the government and said, 'Hey, we want to distill spirits.' And, the government agreed, eagerly anticipating even more revenue and so the age of distillation began. In the end, the system created itself to be very responsive to the industry and although one does have to be patient with the inevitable bureaucracy, it is manageable because everybody agrees, alcohol is a great business to be in - if you can afford to anti up - and therein lays the the catch of course.
  2. Explosion venting

    Are they talking about just keeping the air clean of explosive concentrations or actually directing the explosion somewhere? Directing an actual explosion sounds complex. We agreed to build a fire/explosion proof wall between the tasting area and the production area. The idea being that in the event of a blast, the customers would have time to flee. The district people didn't seem to care much about the fate of the poor distiller - although, we did wind up build in some extra egress doors - just in case. Ethanol is a 'temporary explosion' - my favorite phrase. Temporary? But, that's how its classified. In Canada anyway. Having worked in the gas business for a long time - in the end - concentration is what you are looking out for - which, if your equipment is running properly and under supervision you shouldn't be having a problem with. If you are - you have to revise your approach - after all, you want those fumes in the bottle, not the atmosphere.
  3. Bank Loans

    British Columbia is indeed a wondrous land awash with craft alcohol of all kinds. Hundreds of wineries and breweries and now upwards of 60 plus distilleries live here. For distilling in particular, its quite attractive because if you make an 'artisan' product and sell it directly through the internet, tasting room or farmer's markets we get to keep the provincial alcohol tax. A considerable benefit!! The downside is we have to use 100% locally sourced grains and fruits for fermentation - so, for example - we can't make rum because cane sugar isn't a BC product. But, we could make a 'rum' using honey. Wayward Distillery in Comox is doing something along those lines. That restriction is a bit irritating but compared against the advantages of our area, its worth it. Having paid a god awful, jaw dropping sums in loans and interest in my previous businesses - I'm a little down on the loan concept for the distillery start up. That's why I stressed having your own money. If you can get out of the startup phase with as little residual debt as possible, its a lot easier to make some ground. If you are burdened with a loan or investment right out of the gate, its hard to get traction. Especially, when you are trying to get those first critical accounts and the cash flow sucks. People are easily attracted to the investment idea - or even a partnership concept to get things going. And, its easy to get on this track, because investment money is relatively easy to come by. However, in the long run, I'm sure many, many players on this forum will weigh in on the downsides of investors and partners. Most will probably tell you they regret bringing on the money - because when you're broke, fifty grand sounds great. In the heat of battle, that $50K is gone in a flash and now you have the additional stress that goes with having to cater to that partner/investor and their now historic cash. Its hard to get started. No question about it. But here is another interesting wrinkle about the BC environment. Once the government gives you a license - they don't want you to go out of business and they make extra sure you run a profitable business - if they think you're going off track, they'll let you know loud and clear. Very cool, when you actually stop and think about it. When I consider how regulated the American system is, I often wonder how people make a go of it - but, distillery business people are a tough lot, driven by thirst
  4. I first encountered the idea of owning a distillery waaay back in the late nineties when I was shooting a wine series. The winemaker in question wistfully painted this idyllic scene of the happy European distiller frolicking naked through the fields. Well, perhaps he didn't say quite that, but the dream was planted over a wee dram of his 'home-distilled' product - a black walnut liqueur. However, I only seriously began to re-consider the idea about two years ago when a friend of mine and I started doing our own home distilling. In no time flat we'd brewed up more booze than we could possibly drink and it became obvious, unless we were going to sell the stuff - there wasen't much point in continuing. My friend chose to stay home, but I ventured into the field - being the foolish entrepreneur that I am. The first hurdle I faced has taken a year to get over - rezoning the chosen property for the distillery. (Passed into law only yesterday! Yay!) Next is the provincial and federal process which will take about 4 - 6 months. Then, we're planning for another six month delay as we refine the product for sale. So, conservatively - you are looking at two years - unless you choose an already zoned environment in which case, I'd plan for a year. If you are paying rent, that's a year of expenses with no income, so plan accordingly. I've said before, alcohol is a business of patience. The upside of this, is while you are waiting for your permits etc., you are given ample time to build your market. Lot's of people wait to build the market until they have a product in hand, but then you loose the slow burn of anticipation and word of mouth. I've sat on a local bus while two people behind me discussed the opening of the distillery. They got some of the details wrong, but they were keen. That's what you can't buy. Another fantastic quote I've picked up somewhere and whoever said it was brilliant - "No one can tell you how to open a distillery, you just have to do it." I second that. Not to mention, its great fun.
  5. Bank Loans

    Bank vs. investor - is one of those nasty: 'It depends'... You need to ask yourself at the very, very beginning - am I creating this business to enrich myself and my lifestyle - or - am I building this business to make money for other people? If you are wanting to enrich yourself - you are establishing a 'founder's based business'. Otherwise, you are creating an 'investment grade business'. So, here is the 'depends'... If you are creating a founder's based business, a bank loan, although difficult to get - is the better way to go. For one reason - they are predicable. You know the payment schedule, the interest rate and the time frame. As long as you operate within these constraints, you're gold. Your goal as the business operator is to make money. The more money, the richer the happy business owner and paying the loan is no problem. Even if you have a challenging cash flow projection. A clever bank will recognize this and will structure the loan accordingly. How do you find a bank that will listen to you? Don't bother - look for a credit union instead. You will have a lot more luck with less paperwork. That being said, you better present a killer business plan and as much collateral as possible. I won't get into the complexities of an investment grade business but, I will say in the long run it will be vastly more expensive to operate with investors and their attendant opinions and associated problems. Investors are for bigger companies with a management team that can handle them. Don't forget, starting a distillery will suck up cash faster than you can possibly imagine. For example, your choice of window frame color can affect the window invoice by over 30%. Handicapped bathrooms? Who knew? And that's just a few examples. No one thinks of these kinds of things when they are creating the business plan. Banks or investors not withstanding, you need to have your own money one the table and you are going to need a lot. My pico distillery is closing in on $300K and I'm month's away from opening and by the time I do, I'll probably be out $400K+. With that kind of a budget, you can fly around the world and amass one hell of an alcohol collection and still have $100k in your pocket. So, consider the dream carefully and double down on the business plan! Make those numbers sing! I also should add - I operate in BC Canada - where our regulatory system is vastly superior to most American jurisdictions, featuring fewer rules, a better tax system and a clearer road to profitability. Easier for the banks to understand - something else to keep in mind. I guess.
  6. Thanks to Paul and Susan and their crew as we take delivery of our first still! The distillery construction workers went nuts when we un-boxed it. (Site behind the truck) Talk about building excitement and a market! Awesome. Glen
  7. Biggest surprise

    “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!
  8. Lead Time

    Meanwhile, late into the night, Glen toils to find a way to pick up the pace of the distillery project... to no avail... When I first had the idea of a distillery proposed to me way back in the late nineties, there was not a snowball’s chance in hell it was ever going to happen. That’s a pretty long lead time! More recently however, when I decided to pursue the reality of actually creating an establishment, I was warned it would take 2 to 3 years to open. Being a guy who likes things to happen much faster than that, I scoffed and said ‘I’m sure there’s a faster way!’ A year later with another stretching out before me, I clearly see the reasons why and have come to terms with the slow pace. After all, I tell myself, ‘Alcohol is a business of patience.’ Dealing with the local zoning process, the neighbors and the building permits have been an exercise in zen like behavior modification. The latest twist is now the ministry of the environment wants to know where the waste (spent grains & fruit lees) are going to go. I had no idea this particular ministry even knew I existed. I’ve certainly never contacted them. (Turns out, the local health authority did.) “Into my pigs,” I said. “They are going to eat it. Then, I suppose after that, the compost. Then, the garden.” “We’ll have to study that radical new idea.” They respond, while everything grinds to a halt. Again, turns out - if I just dump everything into the sewer, no problem. Its only when I want to manage the waste myself with either my septic or animals they care. Ummm, OK. In the beginning, this kind of stuff would really get under my skin. But, now I look at it as an opportunity to gain more followers. Every single time something comes up, I meet new people. I sell them on the yummy potential of my imaginary, yet obviously incredibly fantastic products, if only I could get started. They are always enthused and then they promptly think up new ways to slow me down. Cat and mouse. Still, I am making steady progress and the key is, expect this shit and just keep your shoulder to the wheel and eventually, hopefully, the tide will turn in your favor. And the upside is, I do have a much, much bigger potential market now than I had when I started. When you start to realize that, suddenly the wheel seems a lot easier to turn. Cheers, Glen.
  9. Water, water everywhere...

    Meanwhile, Glen works through the paperwork... Ring, ring. “Damn phone” mutters Glen and picks it up. “Oh hi Glen, it’s your local politician here. Just wanted to let you know a local activist has taken up the cause against your distillery.” Ah, for fucks sake, only 30 days to the deadline. Now what? thinks Glen, then asks politely. “What’s the problem?" “Water” responds the politician cheerfully. “Water?” “Yep, apparently you’re going to use it all. Probably pollute the rest. Riled the masses. Look for a negative letter to the editor in the next local newspaper edition. Good luck!” Glen stares into space morosely. What now? How do you counter that? That’s a tough one. Not easy to overcome, because you are dealing with something you can not possibly control when you are a tiny operation. Its also a great example of one of the little barriers that need to be overcome that no one thinks of - even during the business planning. Not to say we didn’t think water - we have an ongoing discussion with our local heath department regarding the water. But, that is mostly around the issues of potability and serving water to the public. So things like heavy metals, arsenic, hydrocarbons, etc are tested for and the septic and waste water all come under their purview. So, we thought we were covered. What I’ve learned in response to the opposition, is that here in BC Canada, we have a newly enacted ‘Water Sustainability Act‘ which requires all users of water from wells, streams, lakes, etc to get a water usage license. This means you have to submit an application and a hefty $1k+ fee (yet another fee that helps add up to the $500k you didn’t think you needed to spend) to get such a license. Once the application goes in, you have a government inspector come out and review the operation, how your usage will affect other users, natives etc. In the end, it is quite the process and will no doubt take some time, possibly months to complete. The upside of this process is that it knocks the local government out of the equation and so local complaints about water are not considered in the final zoning amendment no matter how much the opponents yell. Whew! That was a close one. Next?!
  10. I noticed another article in the local weekly newspaper this morning about my impending distillery. I wasn’t expecting it. The headline read - ‘Distillery in the Creek Moves Ahead’ Good to know. I was wondering how things were going. Considering the paper hadn’t actually interviewed me, the article was surprisingly accurate. As I browsed through it, I realized they had gotten all of the information from the public record. Interesting. It got me thinking about my favorite subject: cultural development around food. In particular, what gets a community interested local food and in turn what convinces a community to produce food for the locals? Why, booze of course. Way back in the mid nineties, one day, on our way home from a dreary government gig, we stopped in at a tiny winery in the Southern Okanagan to take a break from the long drive. We knew nothing at all about wine. The short visit was great. We tasted a few wines, saw some vines and bought a few bottles to go. We later came to learn, the winery we stopped at was terrible, but we sure enjoyed the wine we bought in our ignorance. And ultimately, those few bottles ignited a passion for craft beverages that continues to this very day. Over the next 100 days we explored every inch of BC’s brand new wine business flourishing since the recent introduction of free trade. During that time, the Okanagan Valley was mostly a fruit growing region, producing vast amounts of fruit largely for the super market business. There were only about 20 wineries at the time. The BC government had just approved the idea of farmgate wineries (5 acres, direct sale) and there was only one decent restaurant in downtown Kelowna that we frequented with any regularity. Outside of that, food culture was pretty dull. Over the next few years as we continued to return to the valley, suddenly great restaurants were popping up everywhere. Each one wanting to feature the best local wines and eventually beers and now distillates. They needed better food so the local farmers, switched to producing custom products for them. Bed and Breakfasts began to flourish and within a few years of the introduction of the farmgate wine business, the Valley was hosting over two hundred and fifty thousand new visitors a year. Today, there are hundreds of wineries in the valley and good luck getting a hotel room in the summer. Now wineries, brewers and distillers are everywhere and a major driver of economic activity and the Okanagan has a very bright future as a direct result. How does all that affect our corner of the universe? In the area where I live, we’re cut off from civilization, save the dubious ferry service. And, grapes don’t grow so well here. The only winery on the coast is pretty lame and I believe is closed right now. Up until a few years ago, there was little culinary interest and a lackluster agricultural presence. Then, over the last five years, a couple of local breweries were built and each one was immediately popular and sure enough, restaurants began flourishing where they used to suck. And I mean they really sucked bad. They actually have to compete now. Farms are popping up, where there used to be none. Everything from vegetables to fruit to herbs to honey to meats are available in an ever increasing range and abundance. A few days ago a new cider company opened. Now there is a rush on apples and the demand will continue for years to come. Luckily we had already secured our own sources. I stopped in the other day and they were packed. On the way home I stopped in at the farmer’s market. Packed. More vendors than I’d ever seen. Loads of new food people and what’s this - a beer truck! Awesome. I’m starting to worry we might be more popular than we’re anticipating. Already, we’re dialing back our opening plans to be a long quiet one with no fanfare. One of the things the article pointed out was our commitment to secure much of my fruit needs through the local community. A positive look at what we’re doing. Nice. The other thing the article is telling us is that the community is already taking ownership of the idea. Never before in my TV career did a newspaper publish a story about us without us putting a lot of work in to convincing them to run it. I can now see the community is even trying to name us and in-spite of our every effort to resist, well, resistance is futile. Want better food? Make booze. Glen
  11. Prepair for the FALLOUT!!!

    579 million. Sorry. Still a lot
  12. Prepair for the FALLOUT!!!

    Meanwhile, late a night Glen broods about his future.... Hmmm. What can I do to make a living? Let’s see. Gotta be nine to five and the pay has got to be great... Jeez, that means I’ll have to get an actual job! That sucks. Wouldn’t want to waste my days working. Hmmm. anything else? Wait! I know, I’ll start my own business! Let’s see... Be my own boss. Do what I like... Sounds perfect. But, what kinda business could I start? Corner store? Na. Too boring. Gas station. No, cars are going outta style. Amway? Possibly... Hey! I like to drink! I know how to make some moonshine - I know! I’ll start a distillery! That’s a great idea. I can’t wait to get started! How hard could it be? Hmm, How much money is in the old investment account? I’ll clean that out first as my seed money. I’ve made millions in the TV biz, so that should be OK... Type. Type. Type. Hmmmm. Type. Type. ‘Your balance in your investment account is: $437.94.” ...Or not. OK let’s see what’s in the ‘ol current account. Type. Type. Type. $103. 54 Alright then, my working capital $541.48. Although, once I subtract the mortgage, car and other essential living expenses, that should leave me with about $-6547.96 in my account. Good times. Good times. Well, that doesn’t look too good. Oh well, no worries. Let’s do some research here and see about what’s up with getting this off the ground. Let’s see... I’ll just surf over to alibaba here. Hey look! I can get a still for 2K USD. Gee that doesn't sound too bad... I could build a whole distillery for the price of a used pick up truck. Cool. Although, it does seem a little too good to be true, I wonder what the catch is? Perhaps some more research is required... Five months later... Man I wish I hadn’t written this business plan, it sure is depressing. No matter how I push the numbers around, it looks like it going to cost way more than a pick up truck, new or used by hundreds of thousands of dollars. Shit. Hey what’s this? I need to rezone my property before I do anything else? Eight months later... Man, am I ever gonna get through this process? Sigh. Fucking neighbors. Why did I decide to start a distillery again? Could someone please remind me? Fame, fortune, lifestyle, great whisky, a better gin... you were looking for something different to do, remember? Oh yeah, right. Thanks. Without question, alcohol is a business of patience. So, clearly, the question is, considering the daunting odds why would you bother? Also with more distilleries going out of business and a crowded market, doesn’t that make it harder? Consider the story of two competing coffee companies I know. This is a true story unfolding even as I write. They both started at the same time. They both bought the same equipment and they both were equally geographically challenged. Company One struggled from the beginning because almost immediately they felt overwhelmed by the market and they always felt they weren't making money and ultimately, they had missed the coffee boom. Eventually, they sold their coffee machine and their company and went in a different direction. Meanwhile Company Two, clearly understood that in the modern era, something like coffee would never pass today’s tough food guidelines and, even better - was an addictive substance. Also, who the hell would drink bitter bean juice? They clearly realized, the key to success was to simply sell a (or their idea of) a better bitter bean juice. Simple really. They were recently bought out for 214 million dollars. All of this in a terribly over saturated North American coffee market dominated by big brands. The moral of the story is whether or not you are rich or bootstrapping - the eager distiller should not be scared by the idea that they’ve missed the boat. There are billions of people in the world. Nobody can produce enough of anything edible to meet demand. The trick is, can you produce something people want? Why do they want it? It it better? A cleverer story? Geographical placement? In the case of the coffee companies, a geographically bad location made (well one of them anyway) work harder to get their ‘better’ products out and as a result, built a wider market faster. I’ve found that by going through the rezoning process, an interesting thing happened. People began to follow the story as it periodically appeared in the local newspaper. People were both for and against it. Everywhere we went people would ask us about it. Eventually, we realized this was the very market we were seeking to create. We now have a clear sense of how much product we might sell when we open the doors. In fact, I can’t believe how much people are interested in alcohol. And of course, I’ve realized I’m woefully underfunded and under equipped. Good times. ‘Course you knew that. And really, so did I after checked the accounts at the beginning. So if everything is so hard and jaw droppingly expensive and difficult to achieve and make a profit, why proceed? Because, here in BC Canada (at least for now), you can make a profit in this business if you work at it. As really in any business, if you are financially prudent, run a tight ship and ultimately, make sales. But more importantly, because others won’t. They’ll dream. They’ll make some home made hootch. And, they’ll happily tell you how to run your place better. But they won’t have it in them to actually run the gauntlet and take the risk. Yet, with over a billion people in North America alone there will never be enough brewers, wine makers or distillers. Those who do make it through and can build their customer base always have the potential to do well. As my old fishing skipper told me as advice when I was young: “Sell something people want more of.” Empty bank accounts and no plan B? Awesome. Count me in. Glen.
  13. I hope you all get the idea?

    Yes - that is why its important to think about that, especially, if you want to scale up.
  14. I hope you all get the idea?

    One of the things with the continuous still, it runs basically as long as there is a wash to feed it with. But, size dictates throughput, so if you are potentially using a grain base mash, you want to make sure you only make enough volume the still can handle before potential bacteria takes over and spoils the wash before it has time to get to the still. Yet, at the same time, you need fresh material to keep the still running. So, the timing and volume of the mash creation becomes very important - resulting in a 'just in time' process.
  15. I hope you all get the idea?

    Hiya Mythbuster, Thanks for your note. We haven't yet figured out how to separate the elements within the C. Still environment yet. Right now we're using it as a stripping still and then doing a spirit run using a more traditional system. We have not automated it in any way. We're a bit geezerly for that newfangled computer stuff. But, we'd love to learn! PM me if you want to exchange emails for a more robust conversation. That being said, the product that emerges from the C. Still tastes great (assuming the mash was properly done of course.) It was the taste factor which finally sold me on the idea - as well as the consistency of output. Our C. Still is built out of off the shelf lab ware and so insulation has not been a consideration. Our unit was built more as a 'proof of concept'. But, it runs so well - there is a lively debate about whether or not we should deploy it into an actual working environment. If we decide to do that - we'll head back to the drawing board and build something that will be robust enough for the long haul. One of the interesting problems is the C.Still puts out so efficiently - if we were to run it full time, we'd exceed our yearly production limit in about six months. We would love to do whisky, (and will probably do a little for our egos) but as a small farm distillery we need to focus on a speedier product . Probably Gin and Liqueurs, followed up with a little brandy and schnapps. Purely from a drinking point of view though... I think having a distillery with a variety of stills is a great way to go. We've collected all kinds of different designs and ideas and they all produce something different. That's why I like this business so much - it much more creative than wine or beer and yet still incorporates all the same traditions. Very cool.
×