Like a morning fog rising off a lake that allows you to see the trees on the opposite shore so clearly, the vaccine’s availability seems to have changed our perspective on life. Finally, we can go “back” to what it was before.
But for many spirits entrepreneurs, back is not where they need to go. The veil of the pandemic provided an impetus, and deep cover, for them to move forward. And now that most bars and restaurants are open once again, the spirits industry will never be the same. And they like it that way.
With on-premise revenue channels cut off for so many producers, business survival relied on creativity and an awareness that with restrictions came the great freedom to change.
Peter Nevenglosky, co-founder of Drifter Spirits, quickly discovered when COVID-19 restrictions hit, that his beloved Avuá Cachaça and Svöl Aquavit not only lost their on-premise channels, but he knew the marquee brands in his Drifter Spirits portfolio didn’t yet have the name recognition, nor the category appreciation, needed to drive high volume sales at retail like vodka and whiskey were enjoying.
Staying afloat meant re-imagining the business. For Nevenglosky and partners, it took the form of creating a whole new line… Drifter Cocktails. He shares, “For us, the pandemic allowed the space to reflect and work on this with more time to focus and the same for the busy global bartenders we partnered with to bring it to life. While the tragedy of the pandemic for all the places we do business both in terms of health and damage to our beloved bar partners, it did provide a reset that allowed for focus to launch this project properly.”
Canned cocktails had been on the drawing board in Allison Evanow’s office at Square One Organic Spirits long before the pandemic. As an innovator in the spirits space who first introduced organic vodka to the craft market with her Square One Vodka, Evanow has continued to expand her product line while honing to her commitment to organics and originality. Her planned foray into the canned cocktail segment was intended to join her mixers line which had recently been introduced and the canned cocktails were timed to take advantage of the growing popularity of the sector.
Evanow was counting on rolling out the canned cocktails that offer proprietary recipes that she knew would be well received in this format. Her rollout felt the impact in terms of timing and the markets she could reach. Distribution became a challenge to overcome. She explains, “Many distributors, even those interested in the product line were not bringing in any new products during the pandemic, both because they didn’t have the sales personnel to sell it or because they were so heavy in inventory on all products that stopped being sold in the on-premise channel, that they wanted to find outlets for those products. Plus, everything just took longer to pull together because early on even the production facilities were not fully operational. Having said that, as a brand that has been heavily skewed to on-premise, thank goodness we had the canned cocktails and the non-alcoholic cocktail mixers (Q4 2019 limited release, then launch in Q1 2020) as they are more retail oriented. And for the mixers especially, since they do not have alcohol, we were able to sell them direct to consumer and direct to retail shops via our e-commerce channels. That was a huge opportunity for us, and they are still selling well online even with the market opening back up.”
Going direct to consumers was one tactic that worked for so many businesses. The increase in on-line DTC services reflected the loosened local alcohol laws that allowed for to-go cocktails across the country.
Kelly Levison always believed in to-go cocktails. Even back in his business school days at Cornell when his cohort dismissed his idea of creating the Canned Cocktail Company, a company that provides bars with the ability to can their signature cocktail and sell it. Levison knew the time was right when the pandemic hit, and bars shut their doors. Others may not have had faith in the concept, but Levison says, “It stayed in my veins until I just had to launch, and I saw no better time than the pandemic to help out the restaurant industry and provide a much needed service to help bars increase sales and visibility!”
He’s since opened a bar called Canned Cocktail Company; it is a cocktail bar with the sole purpose of bringing the cocktail bar experience home to you in a can. Canned Cocktail Company’s drinks are made with the finest shelf stable ingredients by the best, and most innovative bartenders in the industry. The food menu is made up entirely of conservas…Levison brought a little bit of Spain to New York City when we couldn’t travel.
Travel to New Orleans is a time-honored ritual for thousands upon thousands of people every year at Mardi Gras. But not during a pandemic. However, like the savvy entrepreneurs quoted above, a novel coronavirus and the worldwide havoc it wreaked only provided opportunity for yet another product to be introduced to the world. Lauren Myerscough, one third of the team behind Gambino’s King Cake Rum Cream notes that when they were trying to recreate the taste of Gambino’s Bakery King Cake in a glass, they were able to take the product from idea to shelf in about six months, as she says, “thanks to some downtown courtesy of Covid and the near tireless dedication of everyone on our team. New Orleans is a magical place come Mardi Gras, and if people couldn’t travel here, we knew this was the year to bring a piece of New Orleans to them.”
That effort to bring a piece of New Orleans to others outside the parishes that make up Louisiana saw quite a challenge as Myerscough explains, “We weren’t sure if Carnival cities would be ready to host Mardi Gras by February, but when the Mayor of New Orleans shut down all bars, package stores, and go cups in the French Quarter, it put a damper on our plans to push Gambino’s King Cake Rum Cream through bars and restaurants. We had to shift to an almost entirely retail based sales plan and commit to in store tastings to make sure we weren’t sitting on inventory.”
Pivoting from their original idea and exhibiting some flexibility in seeing their dream through to fruition was more than just fortunate. It took a good base of knowledge gleaned over the years by these industry veterans. Harnessing that kind of knowledge is the key to taking any situation, good or bad, and turning it into a positive.
That’s the advice that Jennifer Colliau of Small Hand Foods considered when she closed her bar and focused on canning cocktails along with the syrups, she sells under the Small Hand Foods label. Colliau, who regularly presents at spirits industry conferences on topics from proper dilution to successful business planning, is proof that gumption and ideas are great, but to thrive through adversity you’ve got to keep your eye on the prize and calculate every single step in the process that will get you there. She remarks, “There are so many intense regulations. I will read the TTB website like a novel. You have to be very down to dig into the regulations so, in terms of starting a business I would encourage people to research with all of the government bodies that regulate what you want to make and see if it’s actually if you want to do.”
If you do, Colliau advises you think long and hard about every step of the way from, “’Who is paying for the truck to bring the farmer’s raspberry to me and are they following FDA guidelines to bring it to me? What happens if it turns over on the highway?’ This is just what goes into the bottle, not the labeling regulations – it’s the execution of every step to get it into from brain into customer hands.”
Getting new products into people’s hands in a worldwide pandemic seemed like an impossible feat. But, as evidenced, a little creativity, passion, persistence, and know-how, goes a long way to finding a bright spot in an otherwise untenable situation for spirits entrepreneurs.
Advice for starting your own spirits business
Myerscough: The process from idea to bottle is legally complicated and often confusing. It doesn’t hurt to have a network that can help you make sense of TTB paperwork and insurance requirements and guide you through pitfalls that you wouldn’t have otherwise seen coming.
Evanow: The market is very saturated in pretty much every category. Unless you are sitting on millions of dollars, there is no such thing as a “if I build it, they will come” strategy anymore. The #1 piece of advice I can give is to have lined up a few key markets in terms of distribution BEFORE you produce your first full run of anything. Go deep before going broad and resist the urge to be everywhere at once. And always remember how many brands don’t ever make it past the first 3 years. This is a very challenging industry to succeed in and there are far, far more failures than major exits. Have a plan for slow growth and strong growth so you know how to deal with both scenarios without running out of money.
New Sips You Need To Know:
The sun is shining, the breeze is blowing, your favorite restaurant isn’t packing away their patio anytime soon, and summer entertaining is good to go. So now seems like the perfect time to up the ante on a Bloody Mary Brunch. Enter Dirty Sue Bloody Mary Spice Mix. This 16 oz bottle is tomato juice-free and yield’s approximately 21-32 drinks depending on spicy or flavorful you prefer your bloody Mary. That’s about three times the yield of a traditional 750 ml bottled mix.
This brunch classic ingredient hits shelves at $22.95 after ten plus years of careful research by its bartender creator, Eric “ET” Tecosky (Jones Hollywood). He shares, “When I was behind the bar at Jones in LA, we would make a great Bloody Mary Mix. The problem was, the mix size was always the same, but we could never predict how many we would sell. By removing the tomato juice, it didn’t matter. Each drink was made to order, and our issue of waste was gone.”