Big brands, what people know, and why we’re not cheap.

It’s been a while since I’ve posted something. I guess I can attribute that to working 70+ hour weeks, installing a new twin pot distilling system, and sending pallets of whiskey out to distributors week in and week out. Most of the time my job really doesn’t suck. Not even a little bit. The hours are worth it as long as we’re making and selling whiskey.

There is one thing, however, that has been eating at me. People that don’t “get it”. Let me explain:

Since the inception of craft distilling here in the US, I’ve read countless articles in magazines, blog posts, online forums, etc. For every negative article written there has to be at least ten that are glowingly positive. All of those positive articles are written by people who “get it” so to speak. They love the alternative products the small distillers are producing. Local. Organic. Sometimes WAY outside of the box. The list goes on. These are all good things to push the industry to new places. Even the big spirits brands have followed suit (it took the big beer companies nearly 20 years to figure out craft brewing was doing spectacular things). Some products will stick and/or find a niche crowd. Others will simply fade away. Natural selection of the alcohol industry is how I think of it.

But what about those people that don’t “get it”?

I’ll start with the writers that do cartwheels, backflips, and do everything but soil themselves in their articles over another (or mothballed) distillery starting up in a European country or a major brand coming out with a new product. Don’t get me wrong, it’s a great thing. A story on a new/refurbished distillery is always a nice article to read. A new product can usually mean good things, too (as long as it’s not another marginal whiskey or vodka infused with shitty flavoring). On the flip side, when a new distillery is started in the US they seem to get criticism, skepticism, rants, raves, and a long tangent on “history”. Why? Sure, the US doesn’t have as long of a distilling culture as some European countries, but so what! This country was founded on spirits. Times are changing, though. Some of the craft distilleries in the US are as big, if not bigger, than some of the independent Scotch Whisky distillers. But for some reason if somebody starts up a whiskey distillery outside of Kentucky in the US (heaven forbid) and their output is less than a major brand… it’s just a “waste of time”. Did you know that Bourbon was actually first produced in Virginia, NOT Kentucky? There’s your history! If being big meant being the best then in that case we would still be buying coffee grounds in a can and drinking wine from jugs. Why do we make craft spirits then? Because we’re producing something that is inherently different, unique, good, local, and fun.

The next point is about major brands and peoples’ tastes. In general, people like what they know… they don’t necessarily know what they like. Any bar/restaurant in the world is going to carry a few of the exact same beers/wines/liquors. To some, that is comforting. You can order that familiar product and rest assured it will taste like it did 2 months or 2 countries ago. For example people know they can get a cheeseburger from McD’s anywhere in the world and it will pretty much taste the same. That’s the comfort factor. You know what to expect and you know you will like it. I remember when craft beers started to become popular in the early 90’s. Not one bar/restaurant around where I lived would carry it. Now most bars/restaurants carry a huge variety of craft beers. Weird. You know why? People tried them. People liked them. They were inherently different, unique, good, local, and fun. The fledging craft liquor industry is in the same position. We are slowly winning people over by having them step outside of their comfort zone and trying new products. Some are historical renditions of the way things used to be made and people of this living generation are rediscovering this flavor. This is very apparent in the cocktail world in recent years; people are rediscovering turn-of-the-century style creations and loving them. Some products are a distiller’s twist on something we already know. Think of the very hop-induced beers or smoky whiskeys people love. It’s an acquired taste… but people that do like them LOVE them.

I will fully admit that I’m no angel when it comes to comfort items. I do enjoy a greasy burger from a fast food joint after a long night of debauchery and drinking. I enjoy a cooler full of ice cold mass-produced “light beer” when fishing a river or boating at a lake. I enjoy a cocktail at an out of the way hole-in-the-wall bar made with mass produced spirits from time to time as well. However, if I’m not in that “zone” I’ll take a well prepared steak at a local steak house over the greasy burger, drink several craft-brewed beers around a campfire instead of the “light beer”, and sip on some unique spirits instead of the mass produced brands to relax with friends. These are the places where I’m most happy and enjoying myself. I think of craft made spirits the same way. There’s a story, not just a marketing campaign, behind the products. That’s where good memories are made.

Hmmm… did I just write my first commercial??

To expand a bit on peoples’ tastes, not everybody is going to like new things. That’s perfectly fine. However, if everyone were like this we’d all be driving the same car, living in the same house design, and eating the same bland fast food every day. Thankfully we have choices.

This brings me to my next point: pricing. Yes, craft products cost more than major brands. Did everyone fall asleep in high school economics class?? I’m so tired of hearing that point argued. If a big brand produces 10,000 barrels of whiskey a week, do you think they have a pricing edge on someone who produces 1000 barrels of whiskey a year? The answer is “hell yes”! Large producers are owned by huge corporate conglomerates. Sometimes they own the barrel cooperage, the bottle manufacturer, and everything else in between. They have bean counters in the front office watching pennies and cutting corners so that shareholders get a payout. Pricing edge: big guys. What you don’t see is that generally small producers don’t own the entire process from manufacturing to distributing. They don’t have the buying power of a large corporation. They are using fresh, local ingredients (they cost more), buying nicer barrels (they cost more), offering unique products (they cost more to make), producing products in smaller buildings in small town America (they cost more per square foot) all the while employing a staff, paying HUGE taxes, not paying themselves, and maintaining growth with little to no marketing budget. I’m surprised craft products don’t cost more, quite frankly. No small producer is getting rich. I have yet to meet a small distillery owner with a fleet of exotic cars, three vacation homes, and a yacht. Small guys are scraping by doing what they love to do and (hopefully) finding an audience that agrees with their products and expanding on that. Growth is the key factor. Not one major brand started out selling millions of cases of product a year. Ever.

Please don’t confuse that last paragraph on pricing with “quality”. There are quality (and crap) products in every echelon of every industry, including liquor, regardless of price. Ultimately it’s up to individual taste, preference, and spending abilities to decide what is “worth it”.

My ramblings are coming to an end here. Reading over this I sound angry. I’m really not. I have a profound respect for the men and women at the helm of the large producers. Without some of those living legends things would be quite different today. I love what I do and at the end of the day the compliments we get from our products by both consumers and professionals are humbling. That’s what keeps us going. That’s why I get up in the morning and stay late every night. I like trying new things: food, wine, beer, spirits, etc. If I didn’t I wouldn’t be making craft whiskey for a living. I am sincerely grateful to all of those who tried our products, offered up their opinions (good or bad), and stepped outside of their comfort zone. You are what is driving us forward and we thank you!

Cheers!
Bryan Schultz
Distiller
RoughStock Distillery
Bozeman, Montana

P.S. Stay put for my next blog post where I take a stab at our small distilling industry in which I’ve titled “Cheatin’ Ass Bastards and The Shotgun Effect”.