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Spirits Trends

Small is Beautiful

August 6, 2010 By: Jack Robertiello Night Club and Bar Magazine


Boutique Spirits are Helping Bars Build a Niche and Grow Drink Sales

Distillation Still

My neighborhood in Brooklyn is beyond the borders of the overheated New York cocktail scene, but even here, there’s plenty of evidence revealing how important small brand, “boutique” spirits have become for bar and restaurant owners.

At family-friendly The Farm on Adderley in Brooklyn, which offers a few house cocktails but does a steadier business in wine and beer, the backbar is dominated by spirit brands unheard of just a few years ago. There are plenty of gins, whiskies and rums, but few brands that dominate sales in most of the country. What exactly is going on here?

Look at the numbers: More than 160 craft distillers now operate in the U.S. today and more are on their way. The increase is spurred by consumer thirst for handmade products, the power of the locavore movement, artisanal drink programs and bartenders demanding flavor profiles outside of the tried and true mass-market brands.

This new generation of distillers builds a buzz — and a market — by producing moonshine and absinthe, liqueurs and rye — anything that invention and innovation allow. So today, bartenders are pouring whiskey from Kansas (High Plains), Colorado (Stranahan’s) and Iowa (Templeton), gin made in Idaho (Bardenay), Pennsylvania (Bluecoat) and Washington (Aviation and Voyager), rum from Tennessee (Prichards’) and vodka from just about everywhere, prompting patrons to swoop in to buy drinks made with these small-batch spirits.

So, what’s in it for you? And how can you tap into the boutique spirit trend? The answer to the first question is quite simple: traffic, sales and profit. These products carry a certain local appeal and unique cachet, and, in most cases, a quality level that can attract the cocktail-curious crowd and work to differentiate your place. What’s more, many come in at a competitive price point but can be priced at a premium when mixed in innovative drinks.

The second question’s answer also is simple: Stay on top of the new releases, especially those from area distillers or in spirit categories you want to feature behind your bar. This may take some legwork and time, but read on to get started.  

A Growing Desire

Twenty-some years ago, only a handful of modern craft distillers, such as Jörg Rupf at St. George Spirits, Ansley Coale and Hubert Germain-Robin at Germain-Robin and Stephen McCarthy at Clear Creek Distillery, were known for their special brandies, eau de vies and vodkas. Even today, the overall volume of small-batch spirits is very small, but the ubiquity and growth of brands such as Tito’s Handmade Vodka, Lucid Absinthe, St-Germain and Domaine de Canton liqueurs shows what a little creativity and pluck can do in the boutique spirit category. The trend also has resulted in the resurrection of some long-lost products, such as Crème Yvette from Cooper Spirits Company, the source of St-Germain — the purple-hued liqueur went out of distribution in the 1960s but made a comeback earlier this year. Robert Cooper says he began production of the original Crème Yvette recipe in response to requests from bartenders eager to re-create old cocktails.


Allison Evanow Robert Cooper Robert Cassell H. Joseph Ehrmann 
Brand representatives and distillers work hard to hand-sell their products, like [from left] Square One Organic Spirits CEO Allison Evanow, Cooper Spirits Company founder Robert Cooper, Philadelphia Distilling’s master distiller Robert Cassell and Square One ambassador H. Joseph Ehrmann.


“Bartenders are a little more interested in what these products are all about,” says Robert Cassell of Philadelphia Distilling, maker of Bluecoat Gin, among other products. “They’re interested when they find out that the guy who is near them makes good stuff, and they can identify with the people who are making these things.”

Cassell points out that some of the boutique brands gain popularity because of their slightly peculiar flavor profiles, as the makers of Hendrick’s Gin discovered when the cucumber- and rose-influenced spirit started to muscle out the bigger gins at the bar. Other gins such as Bulldog, using poppy and lotus leaf, Square One Botanical, which adds lavender and pear in the mix, or Bluecoat, which has a definitive citrus note, incorporate flavors bartenders otherwise would have to create themselves through infusions or syrups. With bars already jammed with mysterious, tiny bottles of bitters, tinctures and such, a small-production spirit providing a quality flavor component can be alluring.

But there’s more: What had been a trickle of once-rare European amaros, potable bitters, vermouths and other minor players in Cocktail Nation is now a flood. For years, bartenders have brought home key ingredients for classic cocktails from overseas — cordials, liqueurs, aperitifs and others — that are unrepresented in this country. But Europe has started to listen; in many cities, bartenders now can scheme to get the first bottle of Gran Classico Bitter, G’Vine Floraison gin and other small production spirits.

Bartenders-turned-consultants even risk their business model on these small-batch spirits; recently, San Franciscans Josh Harris and Scott Baird launched The Bon Vivants consulting business by proclaiming their “cocktail programs primarily focus on using spirits from small production companies.”

Taking Notice

Big suppliers now recognize the boutique spirits craze as well. In June, William Grant and Sons acquired the liqueur Root from Steven Grasse and his brand consultancy Quaker City Mercantile, with future releases in the works, including Snap, inspired by a recipe for Pennsylvania Dutch black strap molasses ginger snap cookies. (Grasse, by the way, worked with the company on Hendrick’s.) William Grant also made a deal with New York’s Tuthilltown Distillery to acquire the line of Hudson whiskies, including the flagship Hudson Baby Bourbon, Hudson Manhattan Rye, Hudson Single Malt Whiskey, Hudson New York Corn Whiskey and Hudson Four Grain Bourbon.

Similarly, the small but surging number of restaurant-distilleries, such as Kevin Settles’ three-unit Bardenay based in Boise, Idaho, help customers see first-hand that spirits can be micro-produced, just as the craft brewers demonstrated 20 years ago. In fact, 65 percent of the spirits sold at Bardenay locations are house-made, and between his restaurants and Idaho state stores, Settles sells every ounce he makes.

Bars and restaurants, especially those with high-end cocktail programs, have been the primary market for most niche brands. This is especially true for makers of organic spirits, says Allison Evanow of Square One Organic Spirits.

“Because we embrace [not only] organic spirits but also culinary cocktail ideas, we’re starting to slowly see beverage accounts embrace the philosophy as they look not only for spirits that are organic or sustainable but for all [organic] ingredients,” she says.

Not incidental are the effects of the recession. Customers now are more in touch with what a mass-market spirit costs at retail, and recent research indicates that people may be willing to spend more when they do go out, but they want something special in return. If not, they start trading down. That’s a major plus for boutique brands, because whether designed at the kitchen table and ordered from a contract producer or the result of years of diligent distilling and tinkering, these spirits can be positioned to the guest as something special.

Of course, distribution, marketing and other high stakes elements are issues operators must tackle in order to get their hands on these hot commodity spirits, especially those operating in multiple markets. But with the Internet acting as a modern day drum, alerting every tribe member of Cocktail Nation that something new is almost ready, many of these products find their way to backbars through word of mouth and hand selling. And it wouldn’t be much of a boutique product if it happened any other way. NCB


Sourcing Small Spirits

Having trouble finding that scrumptious liqueur or intriguing rye whiskey? Boutique brands can be tough to source because distribution is often limited. Here are some tips for tracking down the bottles you want for your backbar.
 
1. Keep in touch with the supplier. The three-tier liquor system in the U.S. can complicate getting your hands on a boutique spirit. Make sure you contact the producer or the producer’s national rep so when the spirit becomes available in your market, you’ll be first on the list.

2. Check the Internet. Many consumers keep their liquor cabinet filled with their favorite oddities through online retailers. But check your state’s regulations to make sure it’s legal.

3. Hit the road. For years bartenders have brought extra suitcases with them when traveling abroad so they can stock up on the unusual aperitifs, amaros and other ingredients not readily available in the U.S. Share your wish list with traveling friends, and when in a neighboring state, check out the biggest local liquor store for your favorites. Again, state laws differ about what you can serve, so be aware.

4. Find a local favorite. The micro-distillery business is booming, so look for a distiller nearby and pay him or her a visit to share ideas on what you’d like or think you could sell. It can’t hurt, and you may end up with a boutique spirit with your face on the label.


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