The Future of Boutique Distilleries

     

Because of my two blogs deal with whiskey, from time to time I am called upon by start-up distilleries for images and sometimes for thoughts.  Two years ago the Delaware Valley Fields Foundation asked me to come to a convention of boutique distillers, held at the Philadelphia “Phillies” ballpark. I was part of a panel discussing the history of rye whiskey-making in Pennsylvania.  It was a fascinating experience, allowing me to talk to a number of young people about their business plans and the first of several encounters with distilling start-ups.

Opening a distillery and expecting to make a living at it is a tricky business.  Unlike boutique breweries where the beer can be drunk almost as soon as it is produced, real bourbon and rye must be aged at least four years by law and a proprietor easily could go broke waiting.  There are interim strategies, e,g. making and selling “moonshine” —clear whiskey— or flavoring as gin the clear liquid that comes out of the tubes.  But competition is heavy in both areas. I left the convention worried about the futures of those starry-eye young people.

As in the case of Sagamore Spirits Distillery of Baltimore, Maryland, it is best to have a millionaire owner such as Kevin Plank, shown here.  He is the CEO of Under Armour Corp., high flying manufacturer of sports and casual attire, including footwear.  Sagamore’s public relations people were in touch with me for ideas on a gallery devoted to Maryland’s rich whiskey past.  For several years the distillery has been up and running at Baltimore’s Port Covington, where the cruise ships anchor. Shown below, It is the first part of a envisioned $5.5 billion development there to include a new headquarters for the Under Armour, residences, stores and recreational amenities. The distillery currently is open for tours and for tastings.

Until recently, however, the whiskey bearing the Sagamore labels was NOT made on premises, but in Indiana at a conglomerate-owned distillery that makes whiskey for a host of start-ups.  Meanwhile Sagamore’s product was aging to the desired four years.  Plank’s distillers are not trying for top shelf status, competing with quality national brands of longstanding. Theirs is not “sippin’ whiskey.” Instead they emphasize using their ryes in mixed drinks and cocktails.  It is priced accordingly, with a fifth generally available in the $35 to $50 range.  While probably losing money for Mr. Plank initially, Sagamore has a good longterm strategy for profitability.

The Jos. A. Magnus Company of Washington, D.C., is on a more worrisome track.  Having seen a post of mine about Joseph Magnus of Cincinnati (shown here) on my Pre-Pro Whiskey Men website, his great-grandson, Jimmy Turner, a former sports agent, was in touch with me several years ago about his vision of reviving the Magnus brand name on whiskey.   

Although I was cautionary, Mr. Turner has been successful in finding sufficient investment to install a distillery in a vacant warehouse in Northeast Washington, hired a young, confident looking distiller named Brian Treacy to run it, and has placed his Joseph Magnus Straight Bourbon Whiskey in liquor stores including Northern Virginia where I live.

This distillery also is making gin and, I assume, some moonshine.  But like Sagamore Spirits, while the Magnus D.C. distillation is aging the required four years to be marketed as bourbon, it has contracted with the Indiana outfit for product.  Unlike the Baltimore oufit,  Magnus has priced its whiskey as a top shelf bourbon, selling for as much as $90 a bottle.  Even after its own distillation has sufficient age, breaking into the Woodford, Wild Turkey, Pappy Van Winkle circle will be extremely difficult without the national advertising those brands can afford.  I hope the best for the Magnus Distillery but with trepidation.

My final distillery has neither a rich underwriter like Sagamore nor a distinguished pre-Prohibition pedigree like Magnus.  It is the Flying Buck Distillery of Augusta, West Virginia.  It is the brainchild of Jim Gearing, a retired federal employee and wine maker, and his partner, Jimbo, an organic farmer and barbecue griller who lives off Route 50 east of Romney, WV.  Compare their distillery building here with Sagamore’s above.

I recently attended a tasting of Flying Buck liquors, presided over by Gearing, who clearly is a master of taste when it comes to alcoholic beverages.  As can be seen from the bottles here, the partners are experimenting with various flavors of moonshine, including fruit-flavored “Apple Pie,” barreled “Naughty Oak,” and plain “Spirit Whiskey.”  The taste of each was unexceptional to me (others invited to the tasting seemed more enthusiastic).  The problem is the intense competition:  Every boutique distillery in America seems to be making moonshine and trying to market it.

The one Flying Buck product that tickled my taste was its “Raspberry Starshine,” a cordial that, as the label here shows, combines red raspberries with herbs and spices.  There may be real prospects for it.  Although Brown-Foreman, a major liquor company,  has sold the French raspberry liqueur “Chambord” in the U.S., Gearing believes it is no longer available.  As a result the marketplace may be wide open for Raspberry Starshine.  Right now Flying Buck is attempting to get the aperitif placed in the state liquor stores of Virginia.  P.S.  I bought a bottle.

If these stories have a common theme, it is that unless one has a “deep pockets” owner like Kevin Plank, the future prospects for the great majority of boutique distilleries is problematic.  The positive side is the prospect of their bringing new and desirable spiritous products to the marketplace, just as the craft breweries have broadened the taste of Americans in the matter of beer.

Mike Owens and His Revolutionary Bottle Machine

On February 26, 1895, an American glassworks employee named Michael J. “Mike” Owens, shown right, was granted a patent on his machine for blowing glass and 2,000 years of making bottles went crashing into shards.  Early next year we will celebrate the 125th anniversary of that defining moment in glass manufacturing.

Glassblowing as a technique is believed to have been invented by Syrian craftsmen in the first century B.C. somewhere along the Syro-Palestinian coast.

The rise of the Roman Empire served to spread the technology to other areas and blown glass became common for household and other uses.

Over two centuries, techniques for glassblowing were tweaked but did not change significantly.  The worker attached molten glass on the end of a blowpipe and with his breath pumped air into the blob until it reached a desired shape. After the glass had cooled it was broken away from the pipe, rough edges smooth and, voila!, a bottle.

Growing up in West Virginia, Mike Owens knew a lot about blowing glass.  Born on January 1, 1859 in West Virginia, he was the son of an Irish immigrant coal miner.  Sent early to work for the family by the age of fifteen he had become a glassblower in a Wheeling, W.V., factory.   Through intelligence and hard work he advanced to a master glass worker, leaving his native state to help organize a glass company at Martins Ferry, Ohio.

Owens’ reputation reached north to Toledo, Ohio, where rich and well-born Edward Drummond Libby, left, had taken control of a glass factory and in 1888 offered him a better paying job.  His talent evident, within three months Owens was managing the glassworks department.  Several years later he approached the owner to say that he had idea for an automatic bottle machine and asked for money, time, and assistance to bring it to reality.

Many industrialists might have scoffed and told Owens to get back to work.  Libby, for whom my aunt, Nell Sullivan, was a secretary, was an enlightened entrepreneur. (Around my Toledo home we always referred to him reverentially as MR. Libby.)  He gave full backing to Owens and on February 26, 1905, the inventor was awarded Patent No. 534,840 for a glassblowing machine, the drawing shown here.  In the paperwork accompanying his application, Owens stated:  “My invention relate to an apparatus for blowing glass and has for its object to perform mechanically, what has heretofore been done manually.”

With that announcement, two centuries of making bottles by human breath came to an end, except for artisanal purposes.  By automating the manufacture of glass containers Owens helped eliminate child labor in glassworks — a practice of which he was well aware.   Two diseases were eliminated that plagued the workers, an inflammation of the aerodigestive tract and clouding of eye lenses, both resulting from exposure to hot gases.  

On the economic front, the cost of glass bottles was reduced by 80%, leading many canners, brewers and distillers, to move rapidly to machine-made containers.  At the same time, however, it left many glassblowers and their helpers unemployed since the mechanized process needed many fewer employees.

Within three years of the invention, the early Owens machine produced an estimated 105 million bottles.  As he gained experience with the process, the Irishman continued to improve on his invention, ultimately producing the “Owens

Automatic Bottle Machine.”  It is shown here, one of the rare views of the inventor with his brainchild.  This machine increased production numbers by 1915 to over one and one half BILLION bottles manufactured annually.

Owens was fortunate that Edward Drummond Libby was a man of integrity and high character.  A lesser man might have tried to marginalize the unlettered inventor and “stolen” his invention.  Libby, on the other hand, continued to encourage Owens to continue inventing, financed his efforts and advanced his name to the forefront of American industrialists.   Note Owens Bottle Machine Co. (now Owens-Illinois), Libbey-Owens Sheet Glass Co. (Libby-Owens-Ford), and Owens-Corning Fiberglass.

In 1915 the Franklin Institute of Pennsylvania awarded its coveted Elliott Cresson Metal to Owens.  Established by philanthropist Cresson in 1848, the medal was awarded annually  “for discovery or original research adding to the sum of human knowledge, irrespective of commercial value.”  Because of its “novelty and utility” the automatic bottle machine earned Owens the honor.  Seen here front and reverse is the Cresson Medal.  

As additional evidence of the importance of Owens's machine to the industry, within 20 years nearly all bottles manufactured in the United States were produced automatically.  Standardization of bottle sizes and quality led to high-speed filling capabilities by those who used the bottles.  As a result, the bottle machine had a huge impact on food, soft drink, pharmaceutical product, and alcoholic beverage producers.  Shown below are glass paperweights issued by the Owens Bottle Machine Co., depicting early glass container mechanisms.

In the summer of 1956, I worked as an intern at Owens-Illinois in Toledo, writing items for plant newspapers.  As a result I was allowed on the factory floor to see the contemporary version of the Owens machine in action.  It was an unforgettable experience.  The heat and glare of the molten glass, the long mechanical arms reaching into the inferno and scooping up an orange glob, straightening out while blowing air into the glass, dislodging it as it cooled, and ducking back for more — totally spectacular.

Mike Owens died in Toledo on December 23, 1923, at the age of 64, having revolutionized an industry.  His passing came unexpectedly. He was attending a meeting of Owens Bottle Company directors when he got up, walked a few steps, sat down in a chair, complained of feeling ill and died within 20 minutes.  He was buried in Toledo’s Catholic Calvary Cemetery, his gravesite shown here.

In a memorial booklet to Owens, Libby had this tribute:  "Self-educated as he was, a student in the process of inventions with an unusual logical ability, endowed with a keen sense of far-sightedness and vision, Mr. Owens is to be classed as one of the greatest inventors this country has ever known.”   Libby commissioned a pressed glass bust, shown below, that was given to a limited number of Owen’s relatives, colleagues and friends.