Boutique Spirits and Micro-distilleries

If you spend any time wandering liquor stores you will have noticed three trends in the last two decades in the spirits world (Give me back my golden Gimlet!)

The first was the gigantic wave of vodka, sold to the public seeking a brand that suited their “identity” and self-image. Sorry folks. Vodka is vodka. Differences, yeah, but more money is spent on the ad layouts than on the recipes.

The second was the rapid growth of tequila and whisky, particularly Bourbon and parallel to this and the tail end of the vodka craze was the rise of micro-distilleries. As Scotch was adopted as the official world spirit of the sophisticated and successful the demand grew geometrically. This rise coincided with the rise of wealthy populations in the Far East. (In very rough figures approximately 2 billion people in India, China and East Asia saw their incomes grow tenfold between 1990 and 2010.) E.G. I love Lagavulin. In 1994 it cost me $48 a bottle, less than 8 year old Glenfiddich. By 1998 it was up to about $70. By 2002 it was over $100 and today sells for about $135 worldwide.

The Third and current wave was a real rise in micro-distilling and the spirit du jour is Gin, a logical outgrowth of the vodka craze.

Now before you rush out and buy the latest greatest bourbon you need to go back and read the numbers on my example of Lagavulin. The cost of Lagavulin product was essentially unchanged between 1995 and 2010, maybe up by 10 per cent. But the wholesale and retail value went up 300 per cent. These kind of numbers got peoples’ attention. They leave a lot of room for profit.

Micro-distilling was a bunch of geeks fooling around to see what they could make. Surely they could produce a marketable product somewhere under say $135 a bottle… Couple curiousity with a desire to support local business and eat local food and you have a powerful marketing combination.

The other thing you need to understand is people buy stories, no matter how fictional. So if I write on a label of booze that it was carefully handcrafted by my grandpappy, hiding in the woods while taking the occasional shot at the McCoys, it sounds ever so romantic.

The kicker is Bourbon like scotch needs to be produced in Kentucky…

Enter the world of Boutique spirits. Big Distilleries have huge inventories of aging liquor. Many of them will monetize this by selling off some of the inventory. More than a few “local” distillers are buying product of big distillers, bottling and branding it and selling it on with a good story.

The single most cost effective way to distill is the coffey or column still. It produces neutral grain spirits. Almost all micro-“distilleries” (but not all your honour) buy neutral grain spirits to craft liqueurs, vodkas etc. If you’re doing otherwise your product costs more; maybe a lot more, more than consumers care to pay. (Tanqueray Gin is a fine product and sells for well under half of most micro- and boutique spirits.)

So before you jump on that bottle Al Capone Whisky, or Movie Star Tequila take a hard look at the price. And try to taste the stuff with your tongue rather than your wallet. There are a ton of products out there that are either crap (more than a few come from micro-distilleries) or hugely overpriced and ought to come in a plastic jug and sell at Wally-World for half the price of Jim Beam.

Don’t get me wrong. I love supporting locals. I love talking to them about their products and how they’re made. But I have two rules: 1. I want the truth (“Yeah we bought neutral spirits from NNN and ran some through our still again with some herbs.”) 2. I reserve the right to drink the cheapest spirit on the shelf (Cuervo anyone?) if it tastes better than your product, even though your whisky was carefully hand-crafted in McStinky Holler when they were dodging the revenooers.

I suggest you as a drinker hold these rules close to your heart. Now go forth and drink.