Several Sonoma County distillers responded to the North Bay Business Journal's inquiry regarding the passage of Assembly Bill 933, which as of Jan. 1 will allow California distilleries to charge for tasting in the same fashion as a winery or brewery, and prospects for sales directly to consumers.
What follows are the interviews that were excerpted in the Nov. 25 story "North Bay distillers seek direct sales to consumers."[poll id="96"]How does AB 933 help California distilleries, particularly your business?
Fred Groth, Prohibition Spirits & HelloCello, Distillery & Indigenous Spirits Lab, Sonoma: The ability for consumers to taste small-batch hand-crafted spirits at our distillery is much needed change for two reasons.
First, it will allow us to directly engage with the consumer by telling our story and having them experience our hard work through a taste. Most small producers like us lack the size and resources to let the consumer know about craft brands outside of a very local area. The ability to gain product loyalty from the consumer is key to having them go out and purchase the product or ask for it from their retailer.
Second, our distillery is geographically located in an area where people are looking for unique beverage-oriented experiences -- wine country. We have dozens of people stop by every day who are curious and want to learn more about our distillery.
Until now, we have had to turn away people who sought us out wanting to learn more -- 99.9 percent of the people are blown away that we cannot supply a sample of the spirits like wineries and breweries can. The ability to provide a taste and generate a new revenue stream while achieving consumer loyalty is fantastic and will benefit our business and the craft spirits industry.
Timo Marshall, Spirit Works Distillery, Sebastopol: This new bill is a step forward in helping to bring California Distillers up to par with the rights enjoyed by many distilleries in other states around the country, namely that customers will be able to taste our products and that distilleries will be able to recoup some of the cost of those tastings.
It directly affects our business by allowing us to employ someone full-time to staff our tasting room in order to be able to offer those tastings.
Adam Spiegel, 1512 Spirits, Rohnert Park: The bill doesn't go far enough and to have such a great disparity between industries and even allowing brandy producers such a right is ridiculous. If I use grain, I have to go through a distributor. Makes no sense. It will help bring great familiarity of the brands and where we are situated but I can not support my business on a $10 tasting.
Jill Olson, Sonoma Coast Spirits, Petaluma: Since we launched our first product March, 2013, we have discovered how difficult it is to get a new distilled product on the shelves of stores. In addition, it is also difficult for a distributor to take on a new product that they are unsure is going to sell. We have been able to go out in the community and hold tastings, which has driven consumers to the stores to purchase our products.
Now that we can finally pour tastings in our own facility, it's a huge leap forward for our industry. However, we really need to be able to sell our product directly just like wineries and breweries. This will create more tourists coming to the area who might like to add distillery tours to their winery and brewery tour itineraries.
I think by California's passing the law that allows distillery tasting is a great step toward point-of-purchase selling, which is where we really need to be.How is not being able to sell direct-to-consumer a challenge for your business?
Mr. Groth: Yes, this is a disappointing aspect of AB 933 that was removed in order to get the tasting part passed. I am blown away that California, which is progressive on so many issues, has aligned its small-business and craft distillery law with those of Alabama and Alaska. Even Utah has more progressive and distillery-oriented laws then California.
Again, people I talk to find it incredulous that we cannot sell the very product we produce. The problem is it is difficult for a retailer to carry our microspirits, because nobody has tried it or has been able to buy it. Distributors are reluctant to carry a small brand that retailers don’t ask for, because the consumer cannot access them through the only means possible, directly at the distillery.
The ability to sell would help raise the awareness of our brands. Until the 30 small distilleries in California have the ability to sell a limited amount from their distilleries, this state's craft spirits industry will suffer and will not grow as quickly as those in other states. The financial aspect cannot be overlooked and would allow us to invest in people, equipment and materials.
Mr. Marshall: Not being able to sell direct to consumers is a challenge to us, as it puts us at a huge disadvantage to many of the craft distilleries in other states. More importantly, it curbs our ability to be able to bring our products to market. And that means we are unable to be as creative with our spirits as we would like to be. The decision as to whether or not a limited-run or small-batch production can actually make it to the consumer then rests with the distributors.
Without fail, visitors to our distillery are incredulous that they do not have the right to purchase our spirits directly from Spirit Works Distillery, a right they would enjoy if they happened to be in another state like, for example, Utah.
Mr. Spiegel: If I were able to direct-sell, it would help me hire more people, spend more on research and development, allow me to sell special small and experimental batches, and actually make a livable wage at what I love to do.
I make everything by hand, from grain to bottle, and people should be able to see, try, and buy on site, like any other alcoholic beverage can do. I'm developing a business for my children to run in my absence. They will laugh when they look back and see how we had to adhere to such archaic laws.
Ms. Olson: If someone comes into our facility for tastings, they really want to be able to purchase the product at the time they taste it. They find it very inconvenient to be directed to a local store to purchase the bottle because of California laws.
As a new distilled spirits business in Petaluma, being able to sell directly to the consumer would have a huge impact on our revenue.
