“What’s the Point of Micro-Distilleries Anyway?”

A young man asked me, “What’s the point of micro-distilleries, anyway?”  The question shocked me, but I had to take a moment to process what the question implied.

The expansion in distilling isn’t like the beer boom of the 90’s because the little guys aren’t in it to compete with the big producers.  Small distillers don’t reject the quality or taste of the spirits produced by large distillers.  They admire it.  In many cases, small distilleries unabashedly purchase spirits from the larger producers to bottle and sell as sourced product under their own label to their customers while their own distilled product ages.  I can’t help but be reminded of the time period after Prohibition when companies had to start over with very little product at all.  This is the time when Phil Stitzel and Julian Van Winkle designed their wheated bourbon that would taste better at a younger age.  It was when companies were stretching aged product by blending it with neutral grain spirits to get product to market and turn a profit.  Companies then and now both find an uphill battle ahead.  As an artist, I am biased toward the notion that endeavors should not be avoided just because they seem daunting.  Even when the uphill battle looks insurmountable, the creative entrepreneur forges on.

Most of us don’t realize just how daunting starting a micro-distillery can be.  The fact is, in my state of Pennsylvania, you almost have to start out small.  Distillers that have had the chance to look back will tell you that whatever you thought your seed money amount should be, you should consider doubling that.  This is not your average small business.  There is very little job training for distilling and it’s hard to know how successful you can be.  In many ways, even with its historic roots, spirits production has become a new industry in the state again.  What size still do you invest in when you have no ability to forecast growth?  A new distilling company faces not only the hurdle of finding their recipe and proper aging practices, but also the financial crisis that is time.  Time is an unavoidable demand that barrel aged spirits place on the distiller.  Should a whiskey be sold quickly after being aged in small barrels and risk the negative feedback from customers with overly high expectations?  Should they just sell white spirits for years until the aged spirits are “ready”?  Even with fully aged spirits, many distillers find themselves unable to provide a consistent product, so they opt for many one-off bottlings instead.  To stay competitive in the modern spirits market, though, consumers need consistency.

There is no infrastructure for distilling in this state.  Small distillers, though they may want to source locally and contribute to their local economy, find many road blocks.  There is not enough local grain because farmers no longer grow barley and rye in any large amounts.  The cost effectiveness of growing those grains disappeared with the loss of distilleries after Prohibition.  No distilleries- no demand for bulk grain.  There is no grist mill large enough to supply any large distilling company with ground grain, so many choose to mill their own grain, which can be very dangerous.  Water sources, once desirable to distillers, have been polluted.  Most available locally malted grain can cost twice as much as out-of-state or internationally sourced malt, so distillers are forced to look for less expensive alternatives.  There is no easy way to transport large quantities of grain to and from distilleries, spent grain to farms without the help of the farmers themselves, or make product deliveries.  Most large distilleries in PA used to be located on rivers or next to working train tracks.  Many small distilleries, to avoid extra costs will rent property or move into industrially zoned buildings that have limited access to shipping.

I don’t mean to sound as if start-up distilleries are an exercise in futility! On the contrary, I think that embracing these micro-distilleries is one of the best things that we can do!  Small farming needs to grow to support them.  Water conservation needs to be a concern in the towns that wish to invite these businesses to contribute to their local economies.  Alcohol education and is embraced by the drinker that comes to a distillery to better understand what goes into their glass.  Still makers, barrel coopers, glass makers, graphic designers, farmers, malsters, and so many others stand to profit from their success.   One cannot grow as a company and improve a product without experience!  All creative businesses have to start somewhere!  I’m so glad to be seeing growth here in my state.  I can’t wait to see how it evolves and its positive influence changes our state in the future.