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Ultimate New Distillery Guide

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Hey everyone,

 

We've been woking for a few months on a guide that we are hoping will be the ultimate guide for newbies starting their very first craft distillery. We'd love to get some outside eyes to let us know if we missed anything that you wish you knew during the startup phase or if there are any areas in which we need to expound upon so that there's sufficient education.

 

Again, we're hoping this will be the go-to guide for new craft distillers. It's lengthy, just FYI - http://distillingcraft.com/starting-a-craft-distillery/

 

Thanks and looking forward to hearing some feedback!

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I just scanned some it pretty quickly, but I think you did an excellent job covering a ton of key of information in a very concise way. Best guide I've seen so far. Think a lot of people will find this very helpful. Couple points I found especially interesting-  

n 2017, testing was done to all of the spirits submitted to the ADI spirit competition and 80% of the vodka submitted had chemicals in them that indicated that it had not been distilled above the 95% alcohol required to call them vodka

 As you can see, those two rules of thumb illustrate the vast difference between the two distillery models: a distillery bar will need to sell 13 times less booze than the distribution facility.

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1 hour ago, adamOVD said:

n 2017, testing was done to all of the spirits submitted to the ADI spirit competition and 80% of the vodka submitted had chemicals in them that indicated that it had not been distilled above the 95% alcohol required to call them vodka

 

Well I find that fascinating.  As in, what kind of chemicals will come over at 94.9% and not 95% ?  wot kinda witchcraft be that??

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Man I've been wondering what you've been up to, now I know. Kudos! I'll be reading it in greater detail over the next couple days and I'll give you some feedback.

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Here are a few additional categories you can consider:

Training - spend several months to a year visiting other distilleries and learning.  Join ADI and go to the conferences.  Consider taking distillery operations classes, brewing science, etc.   Anything and everything you can afford and have the time to do.  It is amazing how I would visit a place and learn so many new things.  You don't know what you don't know.  And mistakes in understanding can cost a great deal.

Business plan including brand design / business concept.  Keep in mind that this is a business, not a hobby (unless you are made of money and like to spend it)... before you start dreaming about making stuff you need to develop a vision for the business.  What is it that you want the brand to target as customers.  What is the theme you think means something to you and that you can make a compelling story around.  You will need to connect your logo and product packaging design to this concept.   This is where I recommend a person spends a good several months or a year working on.  Make sure you get the ideas out there and live with them in your head before going off and throwing down a lot of cash.  Shoot holes in them.  Ask trusted advisors and friends what they think.  Finally, become 100% committed to the ideas and then move on to make it happen.

One that goes along with planning and facility is "engineering".  In addition to a floor-plan that may or may not require an architect, you may need engineers.  I needed a plumbing engineer, and electrical engineer, a mechanical engineer, a civil engineer and a structural engineer.  Again it will depend on where you are located.

In terms of facility selection and engineering, the source of tank/still heat and cooling could be a big learning project for you... you might need a consultant to help with that if you don't have any experience. 

Finding a suitable facility probably justifies a larger discussion.  In most places in the US, for a craft distillery, that is a very challenging task.  Beer and wine are much easier because they are not making an explosive product.  It took us 1.5 years vetting six different properties in three different surrounding towns before we found one that would work.  And then 10 months of work to get it to open (we are 8.5 months into that project... not open yet).  For each property, I had to engage my architect, engineers and developer to help answer the question "is it feasible?".  The city staff are also needed.  For one place that we thought would work, turned out that the water main was on the other side of a busy road and it would have cost another $100k+ to connect to it.  The city records were wrong and only one of the city employees remembered this point.  You will likely have a lot of that type of headache. 

Another is money.  If this is a startup it will be next to impossible to get loans.  Think savings including retirement, home equity and maybe investors.   Don't think of starting this endeavor unless you can see clear of at least $1M before your would break even (assuming you own the building or well rent)... and probably a lot more depending where you live.   And keep your day job if possible.

Then there is legal.  You might be able to do this all yourself, but you probably need an attorney... and absolutely if you have investors or a complex business entity-structure and/or partnership.  TTB and ABC can be navigated if you are smart and persistent; but it is good to have an attorney that knows the liquor business in your rolodex for questions.

Insurance... a BIG topic.  Get a really good agent... you will need one. 

Just a few things off the top of my head.

 

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On 11/13/2018 at 3:19 PM, daveflintstone said:

As in, what kind of chemicals will come over at 94.9% and not 95% ?  wot kinda witchcraft be 

High tech gadgetry like Gas chromatography and mass spectrometry I'd imagine. If there's more that 5% fusil oils or other "tails" found it's not a true neutral. I'm just guessing though.

Also if you were going to add more information with your guide, I really struggled with the TTB reporting. There are guides on the .Gov sights but they are pretty cryptic at first.

Possibly short a section on proofing as well as it isn't really mentioned.

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This rather simplifies a complex business. Great for the fantasy. Don't forget the parts about working 10 hour days seven days a week and the constant cleaning which you'll have to do unless you have labor, which is another whole discussion.

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On 11/13/2018 at 4:55 PM, adamOVD said:

I just scanned some it pretty quickly, but I think you did an excellent job covering a ton of key of information in a very concise way. Best guide I've seen so far. Think a lot of people will find this very helpful. Couple points I found especially interesting-  

n 2017, testing was done to all of the spirits submitted to the ADI spirit competition and 80% of the vodka submitted had chemicals in them that indicated that it had not been distilled above the 95% alcohol required to call them vodka

 As you can see, those two rules of thumb illustrate the vast difference between the two distillery models: a distillery bar will need to sell 13 times less booze than the distribution facility.

Thanks so much for the feedback, adamOVD

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On 11/13/2018 at 8:07 PM, Foreshot said:

Man I've been wondering what you've been up to, now I know. Kudos! I'll be reading it in greater detail over the next couple days and I'll give you some feedback.

Looking forward to your feedback!

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11 hours ago, adamOVD said:

High tech gadgetry like Gas chromatography and mass spectrometry I'd imagine. If there's more that 5% fusil oils or other "tails" found it's not a true neutral. I'm just guessing though.

Also if you were going to add more information with your guide, I really struggled with the TTB reporting. There are guides on the .Gov sights but they are pretty cryptic at first.

Possibly short a section on proofing as well as it isn't really mentioned.

Copy that! I'll see if we can work on some content to clear up some of the general parts of TTB reporting and add in details about the proofing process. Thanks for the great feedback!

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