How to Start a Distillery

A distillery is a dream business for many people. However, it’s not the easiest venture to start. It can be very difficult if you aren’t fully prepared for it. There are plenty of different questions that have to be asked and answered to feel confident in your venture. This is especially true before you go ahead and take out a loan to start the business. While this article isn’t going to go over everything you need to know about starting one, it will give you a solid overview of what you need to know to get started.

The Basics

If you are going to get serious about starting a distillery, you need to get all of the basic equipment. Don’t worry though, when we say basic, we truly mean it. The equipment listed in this article is the bare minimum. Therefore, you want to take a good look at what you are looking to do and figure out whether or not the equipment in this list gets you where you need to go. Some adjustments may be needed if you are looking to do more.

– A Water Source

For one, you need to get a water source. You won’t be in a position to make any kind of alcohol without water. The process of distilling boils down to adding and subtracting water throughout the production. As a result, you need to have a solid water source available. When in Kentucky, we utilize limestone-rich water directly from aquifers or streams.

– A Cooker

A cooker is essentially something that you add to the grain along with water. This helps to drive up the temperature of the solution for a needed period. It’s always helpful to have some type of plumbing in the cooker that ejects the heated mixture to a fermenter. However, a pump can do the job just as well.

– A Fermenter

You will need a fermenter too. This is a large vessel that is used to ferment the grains, yeast, and slurry. Throughout the fermenter, the yeasts feed on the sugars. It then turns into alcohol. Once a couple of days have passed depending on your process, you will end up running whatever’s left through your still.

– Still

You will need to have a still. This is a must and it should go without saying. Nonetheless, you need a still to produce alcohol that can be consumed.

It’s always a good idea to have drains throughout your floor. This can help to minimize waste. The more you have, the better it will be. After all, it can produce a lot of waste.

Frequently Asked Questions:

There are several questions that you will need to get answered before you get started with anything.

1. What Are You Planning on Making?

2. How Much Are You Looking to Produce?

You cannot get started with building out your distillery without knowing the answers to these two pertinent questions. Everything about your distillery is going to depend on your answers to these questions. You need to be fairly precise with your answers too. You cannot be too general because it’s not going to help you establish what you need in terms of equipment. Try to do as much research as possible so you know what you will need to support your market. Having a comprehensive business plan is a necessity.

We continue to get asked the same questions about starting a distillery. We also get the same follow-ups. Because of this, we’ve gone ahead and answered them below.

– How Much Does a Distillery Cost to Start?

You will find that a distiller comes in a lot of different sizes. You can have a small one and a large one. Your needs are going to vary based on your desired size. The difference in cost will vary considerably. The total cost is going to depend on several factors. A good rule of thumb is to mark up your budget beyond what you expect to pay. It is worth it to get quality equipment like the commercial grade distilling equipment from ABS Commercial.  The distillery tends to always cost more than you originally thought. However, by figuring out the small details before getting started, you can get as accurate of an estimate as possible. However, it’s always a good idea to plan to spend a minimum of $300,000 to get started. Don’t be surprised if you end up having to spend upwards of $500,000 though.

– You’ll Need Branding

There are plenty of different things that you may not add to your cost estimations when you are getting started. One of the main things that can be easy to forget is branding. Branding is an element that is often not calculated in the process. Many assume that your product just needs to be good. The truth is, no matter how good your product is, you still need to have a quality brand in place. A good product doesn’t just sell itself. You will need to get quality branding done. You also need to have quality packaging. All of this will help you differentiate yourself from the competition. You also want to be thinking about who is going to be selling your brand. While you may have a quality and experienced distiller, you still need someone out there pounding the cement and selling your product. Think about who your customers will be. Who are you going to sell to? This is always going to be an added cost on top of opening your distillery.

– What’s It Take to Become a Master Distiller?

You will need to earn it. while there’s no set certification or test to become one, you do need to get some experience under your belt. If you aren’t knowledgeable and you don’t know what you are doing, it’s going to be easy to tell with your end product. There’s nothing shameful about calling yourself the Head Distiller instead of calling yourself a Master Distiller. Once you gain some experience, you can swap the name. Spend some time crafting your product and mastering the technique before you change your title.

– Is The Market Too Saturated?

This is one of the common questions we get. The fact is, the market isn’t too saturated. There is a major demand for distillers. While there are a lot of distillery operations opening up every year, that doesn’t mean there isn’t room for more. You can take a close look at the craft beer industry. Numerous craft beer operations are opening up and the demand is sufficient to support them. The same is expected to happen for craft spirits.

– Is Opening a Distillery More Difficult Than a Brewery?

You can expect this to be the case. Not only are the upfront costs more, but you also have to worry about adhering to more codes and passing more inspections. Because you will be selling higher-proof alcohol, you will also have elevated safety standards that you have to adhere to. This ends up increasing the operational costs associated with running your distillery. Along with this, you will be paying a lot more in taxes on your spirits than a brewer does.

– Can I Buy Used Equipment?

If it’s available. However, it’s not often that used equipment becomes available and doesn’t get snatched up quickly. However, as more and more distilleries start to scale up their businesses, you can anticipate there being more used equipment for sale. You can find some used equipment at American Distilling Institute (ADI).

– Can I Start at Home?

No. It’s illegal to start distilling at home. It doesn’t matter what your state’s laws are or what someone told you. You cannot distill at home. This is not expected to change anytime soon either. There are several reasons for this. The primary reason is safety. There are standards in place to ensure that you are doing it right. You may make poisonous concoctions if you don’t know what you are doing. Also, you could end up blowing your place up if you aren’t experienced. The entire process is simply not safe if you don’t know what you are doing. Also, there is the case of taxes. It’s nearly impossible for the IRS to calculate taxes owed if you are distilling at home and selling without a license. If you are looking to get into distilling, you will need to enroll in a class or learn from someone experienced before getting started.