By: Sean Anger on June 17, 2018
Michelle is very patient with me.
An alert from our bank just told her that someone spent $77 on our debit card. Must be Sean. Must be Spec’s. Anything for that 5% discount!
This is a routine occurrence and, as such, there’s a cacophony of bottles in my liquor cabinet.
- “100% Grain Neutral Spirits. Bottled by…”
- “Distilled & Bottled by….”
- “Pot distilled from corn, rye, and barley and hand bottled by…”
- “Produced by…”
- “Distilled from grain. Bottled by…”
I reached in and picked five random bottles. That legal blip is required by law to declare how that juice got into the bottle. Sometimes on the front, sometimes on the back, but it’s there somewhere. Isn’t it great that our government requires manufacturers of a distilled spirit to call out the origin of the spirit itself?
Some of you already know where this is going…
Of the descriptions listed above, it’s likely that only one of them was actually distilled by the company I bought it from. The rest? Well, their marketing worked on me that day - they probably didn’t distill a single drop of ethanol in the bottle. What a scam! Right?!
It’s not all that bad. In fact, many of the distilled spirits you and I drink come from only a handful of producers. Distilleries routinely purchase already distilled and aged spirits from mass producers and repackage them as their own brand. The industry term for this practice is “sourcing”. Many startups and small distilleries turn to sourcing as a means to get early cash flow into their business.
From a business-owner’s perspective, there is a strong case for sourcing product. The capital hurdles to start in the distilled spirits industry are significant. The local building & health permits, distilling equipment, commercial lease, insurance, and construction plans are all pre-requisites for your application to obtain a federally-issued Distilled Spirits Permit (DSP). Re-read that last sentence, then think about the cash required before you can even apply to distill.
The DSP is the only permit that allows you to legally distill in the United States. Once you get the permit, then you can start to work on your product and nail down a recipe. Once you get a recipe, then you need to outlay the cash for a full batch and, in the case of whiskey, let it age. With all of the financial constraints, it’s difficult to ignore sourcing as an option to bridge your cash through startup and beyond.
I have no issue with the practice of sourcing. I understand the business case and blending whiskies is a discipline with its own merits. But I do have a problem with companies who source, then mislead me to believe the product was made by them.
So, as a consumer, how do you know what your buying was actually made by the company representing it? The only term that can provide assurance is “Distilled by”. If it doesn’t say “distilled by” on the bottle, there is a strong likelihood that it was sourced from a mega-producer and repackaged just for you.
- “Distilled from grain. Bottled by…” – likely sourced product
- “Distilled & bottled by…” – that’s the good stuff