Is there any money in a legal moonshine business

[bearriver]

The right person can make millions.
The wrong person will throw away all his assets...

[cob]

very sorry to hear about your house. uncle jesse wrote some about his experience, and of course woodshed. the craft distillers thread may
have some info. in racing circles the old adage is the best way to make a small fortune is to buy a race team with a large fortune.
the distilling buisness can be the same way. do a lot of research especially costs. good luck

[WooTeck]

This subject really interests me. Ive been thinking the same thing. Although id combo a craft beer and distillery with in one compound.
Use the brew house to make the wash and wort. Keep a chicken coup and some bees near by as well to get rid of spent grain and natural sweeteners.

That’s 4 products in your craft shop:
Sprits
Beer/ale
Eggs
Honey

I’m just lacking the start up money and the experience to make a superior product to the competitors (so far ive only made some pretty ropey sugar heads, going to start AG this month)

Eck

[LWTCS]

The message at ADI this past year for the little guys was don't quit your day job, and you have to win your own back yard.
Thats going to make for some long days, but lots of guys are doing it.

[wv_cooker]

Not much to add on the distillery part, but would like to wish you well over losing your home. I too was burnt out this year and know that lost feeling when your first standing there. So sorry to here and hope all is going well.

[SoMo]

Wildernessmedic, sad to hear of your loss, we had two house fires growing up total losses, that's a very trying and difficult thing to go through. You might talk to woodshed, he's probably the closest one to achieve your dream, and realize success. Good luck.

[rad14701]

Wildernessmedic, I'm very sorry to hear about your loss... Do plenty of number crunching before moving forward... Some folks enter the craft distillery venture without having an attorney deeply involved while others rely on one heavily... The biggest issue is making sure you do things legally at every government level... Local codes can dictate where you can set up shop...

Good luck...

[Halfbaked]

Wilderness sorry about the loss of your home. I understand on the start up there is a $100k or $200k bond. I think you can get them written for 10%. I am not the expert on this. I would try ADI. I have a guy that is local that did what you are thinking of doing. He started by building kinda like a barn with a floor and bought a $2000 glass 4 plated flute with a a 30 gal boiler. He mashes or makes wash in those 275 gal plastic totes that have metal around them. His setup is stupid simple. One of his products is pretty good (sugar head) and one of his products sucks ass (all grain whiskey). Pretty soon he outgrew the boiler and bought a 300 gal Artisian boiler. I assume that he is using this as a strippper. He has not quite his day job yet. I would think that moonshine is a bubble. I think it got started by the moonshiners show. The bubble could last for ever or bust tomorrow. It could bust at any time but still looks like it is growing. I walk into national chain eateries and they are selling moonshine drinks in the bar and pushing them by advertizn them heavier than any other drink.

[woodshed]

Is there money to be made? Yes. But keep your day job. Then be ready to work long nights and weekends.
Sorry to hear of your loss.

[Coyote]

Wifey and I looked at this several years ago.

Decided it was a 1/2 million dollar gamble

That I wasn't ready to make

Sorry about your loss

Coyote

[MoonBreath]

Also, be prepared for a long period of outgoing cost with nothing coming in ..
Aging and overhead numbers need to be considered.

[woodshed]

We refer to the barrel room as our retirement account. Many micros produce an unaged product to create at least some positive revenue while waiting on the aged. We do so and release some short age as well.
I have always had a ten year plan in place before I expect to be able to "quit my day job".
I could lower my standards and probably do so in 5 but that just is not my style.

[RevSpaminator]

If it is like any other business I've attempted then all I can advise is to expect to pour your entire being into it, work harder than you ever have in your life, possibly lose your family, just to end up dead broke and buried in debt. If you still love what you're doing after all that, then you might as well have fun and make the best damn product you can. You might eventually get lucky and make a dime or two.

[Scribbler]

Woodshed: are you currently legal? As I understand it, you have to pay the alcohol tax at the time of production right? That means all those aging barrels have already been taxed? (Your situation sounds something like what I am considering for fifteen or twenty years from now...)

[Jimbo]

Woodshed: are you currently legal? As I understand it, you have to pay the alcohol tax at the time of production right? That means all those aging barrels have already been taxed? (Your situation sounds something like what I am considering for fifteen or twenty years from now...)

My understanding is if its a bonded warehouse then you dont pay tax on the liquor in the barrels in there until you remove it from the warehouse and bottle it. Is that correct woodshed?

[woodshed]

That's right Jimbo.

[SoMo]

I believe it's possession while/during the commission of a crime.

[MDH]

I'd recommend making some non-distilling investments first in case the floor falls through. I assume you are starting this distillery on money from an insurance claim?

Stores do not necessarily care about a craft product; they are over inundated with products from craft distilleries already and many are starting to put their hands up. Many are less than impressed with craft offerings compared to larger distillery's offerings such as Ardbeg, Alberta Distillers or Evan Williams. So what you will need to do is convince store owners that your product is versatile and very marketable. So, you need a brand that says something about the consumer who buys it. It's unfortunate that people don't just try new things and enjoy it for the taste but that is what sells. That's why people buy Grey Goose.

You need a hook. What is your selling point, your location? Do you have a location people will go to and view as amazing? If not the location it needs to be the product and then you are in another territory as the product won't sell itself (many "nice location" places have awful products but constantly attract people). You'll need to put a lot into making the product pretty, relatively low cost and available to the target market.

You need an excellent graphic designer (Do not do 99designs, serious), you need bottle suppliers... you will have to constantly put in small insurance deposits left and right so that you do not get screwed in case something goes wrong. Insurers will not happily insure equipment you have built or modified yourself either - they like third parties who specialize in making the equipment the most.

Starting a distillery is not exactly a piece of cake. It's more work than most people initially expect it to be.

[Jimbo]

that's not silly at all. Never disclose your hook or niche publicly.

[WhiteDevil504]

Here are a few thoughts and please take them with a grain of salt as I am not the. Out qualified to speak to this...

First I think the type of market research where you go into a bad without a product and ask hypotheticals of staff and patrons is going to be hard to hang your hat on for a business plan. Often people will be more positive and may have a different mental imagine or impression of the product the you even though you are describing it clearly in your mind. So I'd be careful relying on that and perhaps look at larger market trends and gaps to see if your concept fits there. Once you are content you've done your due diligence there, work up your appropriate IP protection (trademarking, buying domain names. Registering your company name, etc if applicable).

From there you can draft up more targeted marketing materials to use to have a higher level discussion with a few key opinion leaders, for instance if you are wanting to do non gmo or organic alcohol I'd find a boutique food and wine/spirits store, talk to the dept manager and find out if they've had customers asking for something along those lines, find out if they know of anyone else in that space (maybe you haven't seen it because it's special order only or maybe it sells out before it hits the shelves). Those people are talking to your customers everyday and have good visibility of current trends I'm your area.

I'd also consider a higher end local farm to table organic or other foodie establishment that carries spirits and do the same line of questioning there. You don't have to show all your cards but just let them know your a prospective producer interested in working with them and that this is an area your considering.

Again just my .02 cents of a few things to try.

[MoonBreath]

You better get you a small still and refine your methods, routines, And your recipe ..
Jumping in the deep end without swimming very much is to risky ..imo

[youngonce]

I was just in the Virginia ABC store and the shelves are full of moonshine.. Some with the cherries in the jar with the cherries turned all brown IMO the market is saturated.

[MDH]

You should email David Driscoll from K&L Wine Merchants in California. This guy watches and knows the industry like a hawk and is full of opinions on it. Just ask him to be candid to you directly about your product ideas and what he thinks about the prospects of carrying them out.

[LWTCS]

I was just in the Virginia ABC store and the shelves are full of moonshine.. Some with the cherries in the jar with the cherries turned all brown IMO the market is saturated.

Noted.
But in other places within the market, vendors can not keep the "moonshine" product on the shelf. See what the demand is in your back yard first. Stop in on every establishment an simply ask them what is selling.
If you see a delivery being made, stop and ask the driver what is moving.

[Scribbler]

In a post above, someone used the terms 'saturated' and 'gimmick' to suggest it would be hard for newcomers to the scene to make living at it.


To some extent, I think that this is probably true. However, there are always mitigating circumstances.

1) gimmicks: gimmicks are the sort of thing best exploited by resource-heavy companies with marketing departments. They can spot an opening, determine the investment, payoff, and best time to switch to something else. I'm thinking that a gimmick is not something for boutique operations to stake a presence on.

2) Saturation: things are always going to be saturated... Started a small concrete construction company in a 'builder saturated' province of Canada a few years back. It was tough, but still doable. Likewise, small estate wineries seem to have saturated the landscape in wine growing areas. But there is always room for one more... -if you know what you are doing, and can convince everyone else of this!!! Passion and soul are likely key. I'm not interested in Brad Pitt's vineyard, because he is just done guy trying to make a buck... But the vineyard just up the road, run by a family who put their dreams into their wine is an operation that I will definitely buy a few bottles from!!!

(I should probably take it back what I just said… From several stories that I've read, Brad Pitt actually DOES love his winemaking, and is quite passionate about it…. 'Brad Pitt' is just my habitual go-to name when I want to portray a "person who is clearly awesome and unfortunately not me"

[LWTCS]

Don't confuse a gimick with a back story I would say.

[Scribbler]

Totally... But a huge company could make it look the same... Whip up some cheap ass shit, call it moonshine,and tell stories about the good old days...

A good craft place will simply introduce the history of the product. Maybe it IS a Familly recipe, or maybe the founder of the stillery is getting back to traditions, or exploring history through drink... Need to make a good product and then sell it with the passion & heart...

[MDH]

None of the above; just ask him about industry trends and what attitudes in the retail industry are. He has perspective.

[SoMo]

Is there room for a quality handmade product, does the high dollar stuff out sell low ball? Why if not what's a good price point. Local people will support a local person with a quality product if you are on their side.

[Red Rim]

Some of the research I have done violates our don't tell policy, however if you are serious about your distillery and working on the paperwork then I think you could make an exception.

I have shared drinks with friends that own high end restaurants and bars. They loved what I have made and volunteered to carry it. I think that is a foot in the door way to get started, with your own backyard. It is risky though if you tried that nonsense with someone you don't know well, you could surely get your pee pee in a wringer.

I too am working on the details but trying not to rush into something unprepared.

On a side note. Another acquaintance just got his ttb license, but instead of distilling, he is making krupnic, a polish drink I believe. He is working on his own family recipe that has been passed down for generations. Once again a unique market.
I wish him well, but it is not the direction I would like to go.