Local liquor store shelves are rife with bottles touting the title of “artisanal,” “craft,” or “small-batch.” Consumers focused on buying from small business jump for joy at all the handcrafted choices sitting within arms reach.
Up until recently, these consumers had no reason to question the feel-good story on the back of the bottle describing an idyllic relationship between artisanal distiller and third generation farmer who supplies the distillery with grain.
Recently, the craft distilling culture had a spotlight moment when it was revealed some small distilleries that had become recognized as producers of a 100% handcrafted product, were not, in fact, producing their own liquor. Instead, they were (and are) sourcing their alcohol from stills at a massive factory in Lawrenceburg, Indiana.
Suddenly, the drinks industry seems to be following the same path as the food industry did with the all-natural trend, which turns out, is largely controlled by corporations that have a less than healthy reputation.
See Kashi – what started as a legitimate health foods company focused on all-natural ingredients, has since dropped the “all-natural” tag as part of a settlement following a class-action consumer-fraud ruling this past spring. Why? Kellogg’s acquired Kashi back in 2000, at which point Kashi’s sales skyrocketed and the quality of ingredients plummeted.
So has the drinks biz been tossed into the mix of consumer fraud?
Some have argued that it doesn’t really matter where the liquor is distilled because it solves the problem of demand – and demand is particularly high when it comes to rye and Bourbon. And, sure, outsourcing is a tried and true model for handling over-demand.
In all honesty, if the whiskey is good, does it really matter where it is distilled? For those who love true artisanal products, yes, it does matter. For those who just want a quality whiskey that won’t cost them $50, no, it doesn’t matter.
But really, isn’t the bigger issue transparency? Doesn’t it matter that customers are being misled?
Take this analogy from Jamie Gulden of Feisty Spirits:
Imagine a new brewery opened up near you. You go in, have a few beers and think they are doing a decent job. But then you find out that they are buying beer from one of the big corporate brewers and just bottling it with their name on it. Some beers they modify a bit by adding flavoring and now you have a bunch of different beers that they sell. How would you feel about that compared to the other local breweries that you can choose from? If your answer is “that’s okay as long as I like the beer” then that should be the same for distilleries. But, if something about that bothers you, then it should be the same for distilleries.
Living in Colorado, consumers are spoiled. There is an emphasis on local, small-batch, craft, and artisan. Small business is engrained within the community and we see where the product is made when we visit tasting rooms. We have come to expect that the owners of our local watering holes create the product because they love it and they wouldn’t rather be doing anything else.
This is not always the case, however. Spring 44 Spirits, which now produces its own grain-to-bottle whiskeys, has purchased Bourbon from Kentucky in the past and sold it under the Colorado brand.
“We formerly had a Bourbon offering that was from various barrels we purchased from Kentucky and blended and bottled here in Colorado,” says Spring44 CEO Jeff Lindauer. “We were transparent about this and our label specifically called out that they were purchased barrels.”
What’s different about Spring44 Spirits in this situation is that even though they purchased liquor from the outside, they didn’t claim that it was 100% handcrafted or even that it was distilled in Colorado.
“A good indication that a distillery didn’t make the alcohol is if a label only says Bottled By,” says Gulden. “However, some distilleries that buy alcohol are allowed to say Distilled on their label because they run it through their own still before bottling. This applies mostly to clear spirits like vodka and gin.”
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