8 Trends And Traits Defining U.S. Craft Spirits In 2016

6) Outdated Laws Hold Back The Industry

Wineries and craft breweries also operate like local businesses, and sell a great deal onsite and throughout their home states. These producers are helped by pro-business laws that encourage them to operate this way.

However, not all states, towns and counties have laws permitting similar activity for distilleries. In some places distilleries cannot sell spirits, bottles, or cocktails onsite, or cannot self-distribute. This legislation, a business roadblock, typically dates back to right after Prohibition, explained Lehman, when states feared distilleries selling their own product would lead to more crime.

Politicians back then could not have foreseen the 21st-century craft boom. Distilleries today are no longer shady operations or gangster hideouts, but community gathering spots and places of craftsmanship — just like microbreweries and wineries.

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“We just ask that lawmakers give us parity with what they already have in wine and beer,” said Lehman.

Taxes are another issue. Those levied on distilled spirits are among the nation’s highest. Taxes comprise 54% of the typical spirit product’s purchase price.

Of U.S. craft spirits producers polled in the Project, 61% were displeased with federal legislative efforts for their industry, while 54% were unhappy with laws on the state level.

7) Craft Distillery Employees Have Doubled In Two Years

With this growth in the craft spirits industry comes more opportunity for employment. In 2014 there were 5,708 people who worked full-time at U.S. craft distilleries. In 2016 this number is 12,034.

So too has the average staff size gone up. A U.S. craft distillery employed about 6.3 people in 2014. Today, that average is 9.2.

Employing more people naturally increases the rate at which this industry can expand. A distillery that once counted 4-7 full-timers — and was forced to put production staff also on marketing, distribution, hospitality, etcetera — now can afford for people to fill more-specific roles. This improves both the quality and production of the distillery.

8) On/Off-Premise Accounts Want More Education, Fewer Products

The Project polled on- and off-premise operators. More than 90% in both camps thought U.S. craft distilleries should invest more in consumer education. This includes additional in-store tastings, and more educational content on bottle labels.

Both camps also resoundingly believed that producers should make fewer spirits, and of better quality, rather than be too quick to expand product lines.

Kyle Swartz is associate editor of Beverage Dynamics Magazine. Reach him at kswartz@epgmediallc.com. Feature photo atop of  Death’s Door Distillery in Middleton, Wisconsin, courtesy of Death’s Door Distillery.

2 COMMENTS

  1. The picture at the top of the article is from Death’s Door Distillery in Middleton, Wisconsin, right? It’d be nice to know that.

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