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7 Tips for Starting a Distillery
Published Date: 25 March 2024
So, you love the idea of making and selling amazing liquor enough that you’re contemplating starting a distillery—sounds like a great plan to us!
We will caution you though: you can’t just snap your fingers and hope everything will fall into place. There’s a lot you need to think about, from obtaining the necessary licenses and permits to shipping your spirits and liquor to your future customers.
The good news is that if learning how to start a distillery is something you’re serious about, this blog outlines seven helpful tips to do exactly that.
Cheers to better business!
How Much Does it Cost to Start a Distillery?
Starting a craft distillery is expensive, with high-end estimates coming in at around $4 million. This figure encompasses everything from the purchasing of equipment to the dollars you’d devote to marketing your brand.
Still, even if you invest a quarter of that, you’re looking at a million dollars before a penny is added back to your business bank account. That’s why you need to make sure you’re doing things right in order to be successful from the get-go.
Here are some tips to help you succeed!
1. Do Your Research
You need to know what to expect before jumping headfirst into starting a distillery. Like any business venture, extensive work and research is necessary.
You should be able to answer the following questions:
- What’s the current state of the distilling industry?
- Which regulations do I need to be aware of?
- What current market trends do I want to capitalize on?
- Who is my competition?
We recommend taking some distillery tours and really diving into what makes a successful distillery tick. The more you know, the better.
2. Develop a Strong Business Plan
The research you’ve conducted should help you build your business plan. Some details you should include in yours when starting a distillery are:
- Your target market: the customers you intend to reach.
- Your product offerings: what exactly are you going to sell?
- Your production process: how will your products be made?
- Your distribution strategy: how are you going to move products?
- Your financial projections: what are your earnings expected to be?
If you’re asking how to start a distillery business, remember that the drinks you’re distilling matter, but the business component is what will make everything viable long-term.
Image source: Canva
3. Obtain the Right Licenses and Permits
Given the highly regulated nature of alcohol, it should come as no surprise that starting a distillery is illegal without the proper paperwork. The specifics of that paperwork can vary greatly depending on where you’re located.
You first have to apply to be a “Distilled Spirits Plant” (DSP) under the parameters of the Alcohol and Tobacco Tax and Trade Bureau (TTB). You’re advised to do this only once your distillery is constructed and you’ve purchased your equipment.
Once approved, you will be granted a TTB basic permit that allows you to produce spirits for commercial purposes. However, that’s just the beginning as there are state-specific laws for distilling that will necessitate further permits.
You’ll also need to get your labels for spirits verified by the TTB and your distillery business FDA-approved for safety purposes. Failure to comply could lead to hefty fines, your liquor license being revoked, or even a shutdown, so don’t cut any legal corners.
🥃 Read More: A Guide to Alcohol Transportation Permits by State
4. Invest in High-Quality Equipment
While you may not immediately think of starting a distillery as being like starting a restaurant, there are some similarities. One of them is the importance of investing in quality equipment if you want to produce things that taste delicious.
Consistency is key. Like chefs with their special knives and pans, you need reliable distillery equipment to produce spirits that are consistently great. There should be no deviations in quality from one bottle to the next. As such, while it may cost you more, sourcing top-notch equipment is something you have to do if you want to be successful.
5. Build a Brand Identity
As you continue to learn how to start a distillery, we hope the gears have been turning in your head when it comes to building a brand identity. The taste of your spirits won’t matter if your brand is devoid of personality.
How do you do this? There are a few ways:
- Make your brand’s story central to everything you do
- Design attention-grabbing labels and packaging
- Put time and energy into marketing your products
Think about the giants in the spirits industry and how you can recognize their bottles from a mile away. They have character. Consider what makes your craft special, then start weaving that into your marketing efforts.
Image source: Canva
6. Focus on Quality Ingredients
Let’s return to our restaurant comparison; another similarity between the two is the importance of sourcing high-quality ingredients.
A restaurant can’t expect to serve delicious food using substandard ingredients, so you shouldn’t expect to produce amazing drinks doing it, either. There’s a direct correlation between the ingredients you use and the flavor profile of your spirits.
Source the best grains, fruits, and botanicals you can for distillation. One way to make this more affordable is by partnering with local suppliers, as whatever they deliver you is liable to be fresh and delicious—make that part of your story!
7. Outsource Your Logistics
When people ask how to start a distillery business, they’re usually thinking more about the legalities than the logistics. However, the ones that find true success are those that put as much stock into moving their products as they do making them.
Outsourcing your logistics is a great way for craft distilleries to free up more time to focus on making great drinks. Third-party providers can be quite affordable and will navigate all the headaches that come with alcohol transportation for you.
📦 Read More: In-House vs. Outsourced Logistics
Starting Your Distillery is Easier With Us Handling the Logistics
Embarking on the journey of starting a distillery is an endeavor that requires passion, patience, and precision. A distilling business is not for the faint of heart; it’s a venture for those who will do anything to craft spirits.
At Brew Movers, we’re equally passionate about moving spirits for you. We know how much effort has gone into getting your business going, and we want to be partners in your success. We’ll get your drinks to your customers quickly, safely, and without ever charging rates that jeopardize your company’s financial well-being. We’re in this together.
Starting a distillery? Call us at 1-888-720-2739 to learn more about our beverage logistics services.
