OLD MOTHER HUNT FINDING A CALLING IN SPIRITS

OLD MOTHER HUNT MOTHER KNOWS BEST WHAT DO YOU DO WHEN LIFE THROWS YOU A CURVE BALL, YOU MAKE RUM. VELO MITROVICH REPORTS

People go into making spirits for a variety of reasons. For some, especially in the whisky industry, it is a family tradition, or the local distillery is the largest employer in the area. You either work for the distillery, in a support industry, or you move to where there are other life opportunities. Many, too, in whisky, follow a more traditional path of either learning on the job and working their way up the food chain, or starting with a university degree in distilling. However, craft gin and rum are totally different animals. Many times, people going into either have a ‘regular’ job. But, feeling unsatisfied and unfulfilled or just wanting to do something different, they decide to give distilling a try. Most times they keep the other job until the distillery starts to pay its way or they decide this wasn’t for them. You could label this the ‘safe or hobbyist approach.’ For a much smaller minority, craft gin and rum distilling represents a way of putting food on the table, keeping up with house payments, and trying to make the best of a bad situation. That is exactly where Matt and Rebecca Hunt found themselves at the very start of the Covid pandemic. Matt Hunt was a pilot for Flybe; being a commercial pilot was all that he ever wanted to be. However, being a pilot is a lot less glamorous than it sounds. If you’re flying for smaller airline or doing local hops for a big one, there is no schedule or rhythm in your life. You’re up at 3.30am for a 5.30 flight. The next day you could be starting mid-afternoon and be flying late. You

grab any and all hours offered. And the perks? Big airlines might have a crew lounge at airports. For the rest, the same uncomfortable terminal seats you sit on are their lounge as well. For Rebecca, with two small children, Matt’s varying hours made it impossible for her to find work. But she knew how much Matt loved to fly, what pinning on those gold wings meant to him every day. She supported him fully. If only the industry had done the same. In March 2020 during the beginning of the Covid pandemic, Matt’s Flybe work chat suddenly became filled with messages from worried colleagues reporting their aircraft had been grounded and impounded, or that airports suddenly refusing to give fuel. Matt and Rebecca were worried. They had just bought a larger house for their growing family. Still, the government immediately stepped in and promised it would keep Flybe flying. Things wouldn’t be that bad. It was a pie crust promise – easily made, easily broken. The next day Matt got the official notification that Flybe had folded, and he was made redundant. It hit Matt like a ton of bricks. He and Rebecca realised that with so many other pilots around the world suddenly out of work, finding a pilot’s job elsewhere wasn’t an option. Matt had always been self-made. Even with his flight training, he had worked a variety of jobs to pay for it. But now like a trapeze artist, he had just let go of the bar, realised there were no safe hands waiting to catch him, and worse of all, 54 | WINTER 2021 DISTILLERS JOURNAL

there was no safety net below. Rebecca and Matt started looking for work anywhere and would even try for the same job. From being seen as a stayat-home mom, Rebecca would always be under qualified. As a pilot, Matt would be overqualified They were quickly running out of options. “We realised that no one was going to give us a job. No one was going give us a future, everyone was struggling. The whole economy was shutting down,” says Rebecca. “We needed to make our own success.”

THE ALCHOHOL JOURNEY

The couple spent nights brainstorming ideas. An idea that Rebecca still feels there is merit is making a portable children’s slide that would attach to a house’s stairs. However, they found that there were already several protypes out there. They then noticed that while sales of alcohol ceased in pubs, restaurants and night clubs, breweries and distilleries were still finding creative ways of getting their drink into customers’ hands. Distilling gin or rum would be something they could do at home and people in the area were wanting to support locally made products. In looking at the two spirits, it was hard not seeing that gin could reach a saturation point. However, with rum there was less competition and in Scotland, there is an on-going rum renaissance. The couple bought plain white rum and then infused it with different ingredients, trying to come up with a flavour that would be theirs and not a copy of someone else’s.

They had some recipes they were happy with, it all looked promising, and then reality hit them like a ton of bricks.

With gin, nearly all craft distillers buy their base spirit and then distil into it the botanicals. Because they’re not making a highly volatile spirit on their premises, getting a license through HMRC is relatively painless and straight forward.

However, Matt believed – as do many in Scotland – that the entire rum making process needs to happen at the distillery. It wasn’t good enough to bring in rum from the Caribbean or elsewhere and then distil flavourings into it like gin. Scottish rum needs to be made in Scotland from sugar cane molasses and all-natural flavourings.

But to do this, the hurdles started coming in fast and furiously, with the highest one to jump coming from HMRC. To get a license, Matt and Rebecca would have to show that they had a distillery and the expertise to run it. They had neither. And with rum there is a real Catch-22 situation with HMRC. Before a license can be granted, a distillery must be built. But there is zero guarantee that a license will be granted. A want-to-be distiller could be left broke and holding a huge white elephant. The couple, though, refused to be discouraged.

Matt realised that first off, he needed to learn as much as he could. There are short courses and university degrees in distilling. Oftentimes involved in the sale of a still, besides being trained how to use it, help is giving in creating flavours and styles. At the other end of the spectrum are YouTube videos and books from Amazon. While this might seem like a waste of time, UK bronze medal winner Sky Brown learned how to skateboard by watching YouTube videos.

We all bring something from a previous job to the current, but it seems at first glance that it is near to impossible for Matt to have brought with him anything from a cockpit to a craft distillery. That said, being a pilot requires a very focused approach, being extremely resourceful,

and with zero cutting of corners, attributes only the best distillers have. With becoming a pilot and staying up to standards, Matt was used to pouring over and absorbing the information in technical publications. What Matt quickly learned that while they weren’t over their heads in what they wanted to do, the water level was up to their chins. If the two wanted to make rum, they’d need help.

CONTRACT DISTILLERY

Celebrities or those with deep pockets can come up with a concept, and let their wallets bring in the experts to turn an idea into a saleable spirit, all without their hands ever getting dirty. Even on a much smaller scale, the only action some gin distilleries do is to put the label on their bottle, contracting out all other aspects of the operation. There is absolutely nothing wrong in doing this. To paraphrase Clint Eastwood in his ‘Dirty Harry’ role: “A distiller needs to know their limitations.” The process, too, of using contract distilleries and outsourcing some or all of production allows those new into the game to create their product with significantly lower up-front costs and greater flexibility. There is a faster time to market and less red tape, and perhaps the most important aspect – depending on who you contract with and their attitude towards helping – you can have access to established distilling talent and mentorship. The search began to find a contract distiller, but with tough Covid-19 lockdown measures in place – especially in Scotland – to pop into a distillery was out of the question. This meant that samples had to be sent back and forth. Finally, they found one in London they were happy with. Now came the allimportant name. When Rebecca had their first child, her family jokingly called her ‘Old Mother Hunt’. It seemed like a good name for their rum.

At this point Old Mother Hunt rum was doing what almost all craft gin distillers and even some of the major players. They buy in the base spirit and then add flavourings. However, for Matt and Rebecca, this wasn’t good enough. As hard as it was going to be, they wanted full control over their product and their lives. If they failed, it was due to their own fault, not because a contractor couldn’t deliver. “We wanted something that we could be proud of, not just something to make money. If our rum was going to be something honest and authentic, and also be a future for us, it was something we’d have to ultimately make for ourselves,” says Rebecca.

BRINGING IT HOME

With Matt and Rebecca Hunt being Matt and Rebecca Hunt, a course they would build their own 200 litre cooper pot still. Trying to fit it all in the tight space they had was like playing a game of Tetris,

“We realised that no one was going to give us a job. We needed to make our own success.” Rebecca Hunt, Old Mother Hunt

says Rebecca. Still, HMRC gave it the allimportant license to begin distilling.

While some distillers are small and some are tiny, Old Mother Hunt defines the word ‘micro’. Enough so that Rebecca is trying to get it officially acknowledged as Scotland’s smallest commercial distillery.

Despite the still’s small size, they produce five different types of rum: Coffee & Chocolate; Silver Rum; Number Seven Spiced Rum; Smoky Oak Golden Rum; and Winter Spiced Rum. Most is sold through their website, with additional sales though farm shops, other retail outlets including Master of Malt, Craft56, The Little Whisky Shop and The Rum Company. Production can be comfortably run at 600 bottles a month but can be increased to 1,200 depending on demand. If you have small production, you need to ensure that your spirits will somehow stand out in a crowded market and justify what you will have to charge to make a profit. If you try to duplicate the spirits of major producers, you’ll go bust. There is absolutely no way you can do it cheaper, and why would a customer pay double the price of what a Bacardi knock-off is charging. Your craft spirits need to reflex your story, which is what Old Mother Hunt Rum is doing.

THE FUTURE

Matt and Rebecca have had a huge learning curve with all aspects of the

business. When people first think about becoming a craft distiller, they seem to forget that making a spirit is just one part of the whole, you have bottles to buy, labels to design a website or blog to catch up with, marketing concerns and million other things. Adding to Matt and Rebecca’s mixture are two young children. Has it been worth it for them?

At this point you would like to hear that everything has turned out grand with Matt and Rebecca and Old Mother Hunt Rum. But, as if the gods themselves are seeing how much the duo can take, both got Covid and are only recently recovering from it, with their sense of smell and taste not 100 percent by any means. They are still in business, however, and still selling rum.

Rebecca is asked if in hindsight she had any regrets or would have done things differently. She thinks for a moment and says: “We weren’t prepared at all for our first Christmas…” and she goes on to explain that they should have realised that’s when their biggest sales would take place and they should have more bottles and been more organised and so and so on. That really isn’t the answer you were expecting. The reason why air travel is so safe is that pilots and crews don’t gamble. They check weather conditions and make sure the plane is 100 percent ready for flight. While most people think the expression ‘winging it’ comes from the early days of flight, it actually comes from the theatre when actors would hastily learn their lines while waiting in the wings. Pilots don’t wing it and Matt doesn’t strike anyone as someone who throws the dice when making a crucial decision.

While it sure seems like that is exactly what Matt and Rebecca were doing with Old Mother Hunt, they aren’t. The first time you go into business for yourself, you have to expect that you’ll make some mistakes. What separates those who end up going bust and those who succeed is how they look at mistakes. For Matt and Rebecca, they’re not ‘mistakes’, just part of the learning curve. You treat them as part of the education process and move on, wiser for having made them.

After thinking about it longer, Rebecca says: “Even with all the problems, it’s been worth it because it’s given us a sense of purpose and a hope for the future.” You talk to some companies, and you know that despite all the advantages that they have, they’ll fail. You talk to others who, as our grandfathers would say “barely have a pot to piss in” and you know they’ll still succeed. Between these two, you know where you see Old Mother Hunt Rum.

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BRAND VALUEKNOWING YOUR TANGIBLES FROM YOUR INTANGIBLES NO MATTER WHAT YOUR DISTILLERY’S SIZE IS, IT’S VALUABLE FINDING OUT WHAT ITS BRAND VALUE IS IN TODAY’S MARKET. DISTILLERS JOURNAL REPORTS

We have all seen lists of brand ratings and worth. ‘The Top 15 Spirit Companies’, Worlds Most Valuable Drink Companies’ and so on. The thought must cross your mind, no matter if you are the largest distiller or the smallest – what is the value of my brand? Does it matter? In one word – yes. Every business has a brand and a brand value. In fact, even countries – Italy winning the Euro 2020 will boost its economy by 4 billion euros in the short term. Understanding the value of your brand can help you invest in it, it will aid you in growth, and will give you something to show your stakeholders. And, if an offer is being made on your company or if you want to attract a buyer or majority investor, you’ll know what you’re really worth and if you’re getting a good deal. There are many brand evaluation companies out there, with the three major players being Interbrand, which does a ‘Best Global Brands’ list; Millward Brown which has a BrandZ Top 100 list; and Brand Finance, with has a ‘Global 500’ list. The three use a similar starting point – the company’s income. Then, each tries to estimate something a bit intangible – how much future profits can be attributed to the brand itself. How data is collected and evaluated differs between all three, which can lead to three different valuations placed on the same company. Indeed, Marketing Week brought together representatives of all three companies to explain this for a feature called ‘Brand valuation: Brilliant or Bullshit? While all three have positives to offer if you are considering having your brand evaluated, Brand Finance has recently

BRAND VALUE released a report detailing the brand value of the top 50 international spirit manufactures which drew Distillers Journal interest to it. This company, which has offices around the world, evaluates the strength and value of more than 5,000 global brands a year, in 46 sectors ranging from engineering to pharmaceutical to spirits and beer. Who the top five spirit companies are and how they reached that position, you will find surprising in a feature which directly follows. According to Richard Hague, managing director of Brand Finance, to put it simply, the brand value is how much the brand is worth. “From the biggest to the smallest, every business has a brand and a brand value. What does your brand value do for discovery? Understanding the value of your brand means you can invest in it properly, you know what it’s worth, you know how to build it, and you know how to build value for your business.” A brand valuation is, however, more than just about your distillery, it’s about your customers as well. As Shakespeare said how we are all actors on a stage, so too you can say that we are all brands in our own right. Do the brands that we buy from reflect our own personal brand? A well-done brand valuation will point out who your customers are and how can approach them and their personal brand. Probably no other product reflects this as much as a car. For example, if you see your personal brand as somebody who cares about the environment, you were driving a hybrid before anyone else and now you’re driving a full electric. You see your personal brand as being a bit of a maverick. When it comes to spirits, the more obscure the better is your motto. Thus, someone like Diageo would be wasting their money on trying to tie your personal brand to theirs. distillersjournal.info WINTER 2021 | 59

I own a medium-size, independent whisky distillery in Scotland. Our sales team has absolutely no problems selling our stock, and in fact, we have the opposite problem – we have to limit sales. Why would I want to have my brand valued? “It’s another asset that you have at your disposal to bring value to your business,” says Hauge. “You don’t necessarily have to pay quite as close attention to it as some other organisations where brand is a large proportion of their business. But understanding how it’s delivering value to you will help you make the most of it and might unlock a new way of creating value for you and your distillery.”

With this imagined medium-size Scottish distillery, it is easy to see what its tangible assets would be. These are its property, plant and equipment; if you can put your hand on it, it’s a tangible asset. But a term which is batted around by brand valuation companies is ‘intangible assets’. “Our Scottish distillery we’re talking about has a good distribution network. That’s an intangible asset, as are its customer relationships, goodwill, brand recognition, trademark and all of that,” says Hauge. While it might not seem it, attaching value to a company’s intangible assets is not as difficult as it might seem. A problem Distillers sees, however, is when the company itself decides its intangible value. It would be just as easy to undervalue as it would be to overvalue.

GROWTH DRIVERS

There are few things which have shook up the drinks industry in the last 50 years the way Covid-19 did, and the closing of pubs, clubs and restaurants. While spirit sales took a dive, it was temporary as customers found new ways to get their drink, either in supermarkets or online. As things, however, slowly get back to the new normal, what will be the growth drivers? “Over the next year, there’s going to be a surge back to bars as they open up. And people will want to be trying new things. Over the course of lockdown, people haven’t necessarily been trying new brands, they’ve been sticking to the ones that they know, particularly with spirits,” says Hauge. “This is because it’s much more of a gamble buying a full bottle of spirit when you don’t know if you like it or not. Whereas in in a bar you can try it for the price of a drink, plus it is easier to get spirit recommendations as well. “Everyone seems to be saying that gin has reached its zenith, it will start tailing off, and rum will be next on the agenda. It does seem to be heading this way right now. There are a lot of new rums appearing and the big companies, like Diageo are all talking about their rums,” he says.

Rum, however, is not just one cohesive mass like gin and therefore it’s potentially going to be a bit more difficult to get people drinking rum with categories such as spiced, white, dark and golden, according to Hauge. “People are going to have to see it in a different way and so it’s going to be slight take slightly longer to take hold.” If you’re taking a more global view as to what will be the new growth drivers and markets, you have to realise that every market is different. You might see an opportunity in a market that isn’t present in the UK, or vice versa.

“You need to essentially be aware of what the global trends are particularly focused on and what trends are happening in large markets, And all of this depends how long term your timelines are,” says Hauge. “If you’re looking at the next year, then you probably need to be looking more at what’s happening in the US. If you’re thinking five, 10 or 20 years from now, you probably need to be looking more with what’s happening in China.”

INVESTMENT OR BUYOUTS

You have a small distillery and big plans. Unfortunately, when you look at your big plans and the small revenue coming in, you can see that it will take 10 to 20 years to accomplish this goal. However, if somebody buys you out and keeps you on, or at least invests in your company, you’re going to have the revenue now. If this is your goal, should you approach Brand Finance or other like-company, get you brand evaluated so you can see the real value of it, and then approach some of the big companies to try to get bought. Or is it better to wait for a big company to find you? “That’s a personal choice. It’s hard for me to say in any specific circumstance, whether being proactive would be better than being passive. But I’d imagine if you really want this to happen, you’re probably going to have to get them to notice you in some way,” says Hauge. “Which might mean that you will have to go and ask them and say, ‘Hey, I’ve got this valuable property. I’ve got this great brand, and I’ve got this great vision. This is what I can do with your help.’ If you just sit there waiting for them to find you, it could be a long wait.”

If you are thinking of having your distillery evaluated, remember there are

numerous companies which specialise in this. There are also software programs to enable you to do this yourself, however, at Distillers Journal we believe it is very difficult to evaluate yourself when it comes to something like intangibles.

No matter who does your brand valuation, you should expect the following information: u The strengths and weaknesses of your brand and barriers to growth u Who are your customers and is there a potential segment which you should target? u It should evaluate your marketing strategy and point out weaknesses u And the evaluation should give you strategic insights to help move your brand forward With a brand evaluation, remember there is much more to it than just the cost of what comes in your door and the profits that occur when your beverage leaves. There is also the public’s perception of your brand. Take two bottles of CocaCola, keep one in the original bottle and put the other in a bottle marked “AldiCola”. It’s pretty much a guarantee that anyone given the choice between the two drinks, they will choose Coca-Cola. If allowed to sample from both of the identical colas and then asked which one tastes better, the majority will choose Coca-Cola.

Why? According to marketing author Philip Kotler, brand value is directly related to the perception and mindset of potential and current customers. It reflects the direct and indirect brand experience of what they have seen, heard, learned, thought, and felt over time.

When looking at Moutai, why are Chinese customers willing to pay more for this brand than others? There is the belief that it is a superior baijiu and the prestige that comes in serving it. Good luck trying to use your Excel spreadsheet in calculating the value of that.

Everyone agrees that a strong brand is valuable – this doesn’t matter if you sell your spirits by the case or by the containership full. The challenge, however, is putting a price on that value. This is a good time to solicit the help of an expert.

LUXLO GINCARVING OUT THEIR OWN CATEGORY ANOTHER DISRUPTOR HAS ENTERED THE GIN SCENE... STEVE ADAMS AND HIS 20% ABV BEVERAGE THAT IS MADE FOR GIN LOVERS WHO WANT TO REDUCE – BUT NOT ELIMINATE – ALCOHOL IN THEIR DRINK. CAN ADAMS BE ON TO THE NEXT BIG THING? VELO MITROVICH REPORTS

Outside of Johnny Depp’s character in Roman Polanski’s ‘The Ninth Gate’, few people drink gin neat. By EU and Gin Guild regulations, gin needs to have a juniper-led flavour and have a minimum 37.5% ABV. That said, gin mixed with tonic water is its most common manifestation – a G&T – and gin’s ABV drops to 10% in a pub drink, while in a Fleabag-pleasing RTD can, it’s anywhere from five to 10% ABV. When Steve Adams started looking at low-to-no alcohol spirits and wondering where they failed, it struck Adams that alcohol adds a lot to a drink besides inebriation. When distilling gin, botanicals work better with alcohol as opposed to water – giving a better flavour – and there is the all-important mouthfeel from the gin’s alcohol. But did gin actually need to be at 37.5% ABV to accomplish this? Could a reduced-alcohol gin give people the same thing they were looking for in a full-strength gin? He’s not the only one with these thoughts. Hayman’s Small Gin falls under proper EU gin definitions but markets itself as a low alcohol gin. How is this possible? Simple, each bottle comes with a thimble which is the suggested serving size. Use that instead of a shot glass measure in your gin cocktail and suddenly 40% ABV became low alcohol. With an intense blast of flavour, it’s not meant to be drunk neat. However, for Adams – being a successful businessman who is the CO and founder of Mattress Online and not a distiller with a knowledge of labelling and regulations – the answer seemed simpler. Reduce the alcohol by a half and give customers exactly what they want. No wondering where you put the thimble, just pour and enjoy. In many ways the idea sounds brilliant.

After all Generation Z, the latest generation to be able to legally drink, aren’t rushing to the pubs, with a strong 25 percent in the UK choosing not to drink at all. That isn’t not drinking in January, or not drinking on weekdays, or even just cutting back on units of alcohol. No, they are flat-out not drinking. At 35 or 45 will they suddenly get a urge to have a martini? Very doubtful. In Ireland, spirit consumption is at a 30-year low and it’s not Covid driving this figure. Again, it’s younger people choosing not to drink or to drink considerably less. And it’s just not younger people who are rethinking their relationship with alcohol, but other age groups as well. They’re either preferring to abstain during the week or have just one well-crafted drink – and are willing to pay for it. But, as Adams is finding out with his 20% ABV Luxlo, in the drinks industry it’s never easy to be a pioneer. When you strike out into the great unknown where no one has been before, you often strike-out as well. Think about it. If your average pub or supermarket is still struggling after seven years with where to place non-alcoholic Seedlip on a shelf, where are they going to place a lower alcohol gin-like beverage? BEGINNINGS Although Adams is making something very untypical, in many ways he is following a well-worn path when it comes to gin. Most new craft gin distillers are looking at distilling as a second career. Distilling is not something they know so they either take courses, read Amazon’s collection of gin books and watch countless YouTube videos on gin. Or they bring in a hired gun. “We came up with the idea and registered the company back in January 2018, but it was very much a dormant thing,” says Adams. 62 | WINTER 2021 DISTILLERS JOURNAL

“At that point, we had no concept of how to advance our idea, and we didn’t really know which way to go.” The idea behind Luxlo, however, started even earlier. From a social aspect, Adams has enjoyed going out drinking for years. But, as he got older, he found it harder to cope with this social life. His life’s voyage, too, began experiencing some heavy rolls such as a divorce, and it was a good time to regroup his thoughts and figure out where he wanted to be with himself. He began to live a healthier lifestyle with exercise and diet and reduced his consumption of alcohol, all leading to a big drop in weight. Mattress Online was doing well, he had a strong management team in place, and it struck him he’d like to do something new, something that would give him back that entrepreneurial flair along with allowing him to create.

THE NAME

With a business partner who has since moved on, the two had a massive brainstorming session to come up with a name. Mattress Online has a very simple name and as he says, simple sometimes works best. But with the gin, they wanted it to be a premium drink and a luxury product. Tied to that they knew it was going to be low in calories as well as lower in alcohol. And then, just to make it more of a challenge, in order to stand out on a shelf, they wanted the brand name to be vertical. Lux (luxury) lo (low) was born – LUXLO. Although the working relationship has been superb, Adams is slightly embarrassed to say how he found Matthew Servini who has been the creator and distiller of Luxlo. “It was a Google search,” Adams admits. With Vanessa Rapier, Servini founded The Craft Distilling Business in 2017 and since then the two have set up over 70 distilleries, mostly gin. With Servini working on recipe development, he and Adams came up with nearly 20 recipes until they found one that they were happy with. Servini told Distillers that when you look at some of the low-to-no alcoholic beers being made in the States or Germany, there’s no compromise in flavour, but with spirits it’s much more challenging. Gin, in particular, has a lot of the flavour compounds coming from the botanicals which have a greater affinity to alcohol rather than water, Therefore the flavours dissolve in alcohol and not in water. Servini says that you need the alcohol to stabilize the flavour compounds – especially some of the heavier oils. Although Adams was hoping to have the finished product be 17-18% ABV – making it exactly 50 percent lower than regular gin – 20% ABV was the lowest Servini felt he could go without compromising flavour.

Flavours that were decided on include: Ginny; Blood Orange; Pomegranate & Raspberry; and Passion Fruit. Adams says that flavour selection was a very commercial decision. “We gave Matt a brief saying this is where we think there’s opportunity in the market and these are the flavours,” he says. “I personally like blood orange so that was a personal favourite of mine. With the other flavours we were looking at ones that weren’t already saturated out there in the market.”

In formal blind taste tests results (which Distillers found in informal tests) they

showed that if drinkers do not know it’s reduced alcohol before the test, in almost all cases this was never picked up on. Distillers found that when drinkers were told beforehand it was a reduced alcohol gin, female drinkers said they could taste no difference, while male drinkers said they could. With the label design – which has butterflies, birds and gin botanical plants on it – to the flavours of the different Luxlo beverages, it was decided fairly early on that Luxlo’s marketing angle would lean more to female drinkers than male. “We didn’t design the drink and label to be intentionally female led, but as it turned out, there’s been no surprise when you look at it. Even putting low calorie on it was something that would always resonate more with women then with men,” says Adams, adding that going by names on orders, about 90 percent are generated by women.

SALES

According to Adams, at the moment most sales are direct to the public. “We’re at consumer events, we just done CarFest and that generated £10,000 worth of sales in a couple of days. So that’s our biggest route to market at the moment, going direct. “We do a lot on Amazon, we’re on a few websites – the typical ones like Skinny Booze, which are now called DrinkWell, so they sell it very much as a low-calorie benefit. We were heading into bars but then lockdown occurred so that is delaying us.” Outlets such as Master of the Malt and numerous others sell it as well. Reviews in UK newspapers to a one have been very favourable, with the Pomegranate & Raspberry proving to be a winner.

One approach to marketing that Adams hadn’t thought of in the very beginning was the stressing of Luxlo being vegan, gluten free and low calorie. Although most other spirits, too, can be described exactly the same, Adams said that when talking with perspective customers at shows, they all seemed stunned by these three facts. That said, another should be added to this list: Adams says that few gin drinkers he has spoken to are aware of how high the alcohol content is in gin. Which leads to a sore subject.

COMING BATTLE

When Adams compares Luxlo to Gordon’s or other leading gin brands, he sees the exact same ingredients used, with the only difference being the choice of botanicals used which differ in all gin brands. The only real difference is the amount of alcohol in Luxlo compared to regular gin. But Adams says, with the government encouraging people to drink less, they should be supporting those who are trying to create reduced alcohol products and part of that should be allowing him to call Luxlo “gin”, as opposed to “a drink for gin lovers”. “I find the whole concept to be backwards. To tell the truth, the fact that alcohol defines your beverage I think is totally wrong,” he says. If Luxlo wasn’t the new kid on the block, if the Luxlo team had more time and the budget to lobby the government, this is something that Adams would fight.

“It’s a very backward and traditional and archaic way of looking at what is essentially exactly what we should be encouraging people to do – drink less. And that’s exactly the space I want to be in. Because I do like to drink, and I like the feeling of having a drink. So having a non-alcoholic beverage was never my agenda. I wanted to create something more mindful – mindful drinking. As always when anyone is creating a new spirit, be it full alcohol, reduced or none, the question you are asked is: “Where do you see yourself fitting on a Waitrose shelf?” “I see us with Campari, we’re not a lowto-no spirit, we have alcohol, just an amount like in Campari or Primm’s.” At the recent low-to-no exhibit in London, Luxlo had a display and was the only reduced-alcohol product there.

“It was interesting,” says Adams. “A lot of people tried it and said it was fantastic. They thought it was great you can have a product with still some alcohol in it. So, there we sit between that midpoint in the trends at the moment. “We are quite unique; I’m just not sure if that’s good or bad at the moment. We are carving out our own category.”

FILLINGIT’S TIME TO TALK ABOUT FILLING AND DISGORGING

WHETHER YOU’RE A SMALL CRAFT DISTILLERY OR A GLOBAL GIANT, THE FINANCIAL IMPLICATIONS OF INACCURATE CASK FILLING AND DISGORGING CAN PROVE CRITICAL. COCKAYNE REPORTS

Matching your inventory to whisky sales forecasts is a complex task, heavily reliant on robust and accurate data, says David Boyd, former head of inventory at Campbell Distillers and Chivas Brothers. In his 35 years of experience, he has followed millions of casks from the point of filling to disgorging – a journey that, in the case of some premium brands, can take 20 to 30 years or more. “Over the years, I realised that the forecasts I was working to were fun to believe but sales and marketing people will always tell you that a new product will do amazingly well and that established brands will continue to grow in volume year on year,” he says. “The reality doesn’t always match up. And by the time the product is released to the market, the people responsible for those forecasts will more than likely have moved on.

“The data captured through filling and disgorging solutions from specialists such as Cockayne is key,” he says. “Gaining a precise understanding of the volumes of spirit that are actually delivered at disgorging after years of maturation are essential to bestpractice inventory management. Even for the same age of spirit, this can vary from operation to operation depending on cask size mix and warehousing configuration. A fully functional tint measurement system would also have the potential to assist blenders and wood managers in understanding their cask inventory and re-conditioning requirements.” At filling, the data captured includes the make, filling date, cask type, bulk content, alcohol content and the litres of alcohol at filling (OLA) at cask and parcel level. “In conjunction with costing and other financial information, this forms the basis for balance sheet valuations of a company’s liquid assets and has to satisfy HMRC requirements,” says Boyd “It will then be used to analyse scenarios such as trading margins, product costs and trends over time, cost analysis of proposed blend adjustments, and the feasibility of product development.

“And, of course, it’s crucial for assessing your long-term ability to match supply while maintaining spirit quality against sales forecasts for products that can range from three to 30 years old,” he adds. “Each brand has to be assessed across every year on the journey to its release to ensure that the inventory from something produced in the past is in place for sale in the future.” Furthermore, what is derived from this data will drive both future distillation volumes and purchase requirements, sometimes leading to capital investment projects or expensive long-term supply contracts. “The information generated from disgorging is critical to sensechecking these assumptions,” says Boyd. “A small variation on the inventory demand for a one-million case aged brand could be highly significant further down the line – and very costly.”

THE PUSH FOR EFFICIENCY

Cockayne Systems, now based in Perthshire, has been a well-known name in the field of filling and disgorging for more than 50 years. The company was taken over in 2019, in a joint venture between Edwards Engineering and DPS Group, and a new management team installed, including Donald Ross, operations director. “The takeover has brought fresh thinking to Cockayne,” says Ross. “We’ve placed an increased emphasis on customer service levels and engineering solutions, investing in R&D to develop longterm inventory technology, with both standardised and bespoke solutions.

“Cask-filling machinery over the last 30 years has contained the same basic building blocks: pumps, valves, and some form of measuring instrumentation to allow for recording and reporting of data,” he says. “And it’s the nature of the process that these building blocks will always be required.

“However, as with all industries, the spirits world is driving a culture of continuous improvement. There is a growing demand for the pumps to be more efficient, the valves to be more tightly controlled, the flow meters to be more accurate, and for the control system to supply more process data.”

Cockayne says that it has met these demands through improvements in drive control, proportional control of valves, the integration of Coriolis meters, and the use of PLC and SCADA systems to monitor the filling machinery. Yet, it says, some distilleries continue to struggle on with older equipment that suffers from a lack of standardisation. “Different distilleries are equipped with different configurations of filling systems, and the control electronics and reporting software also vary,” says Ross. “This means that the filling machines become very difficult to support longer term. Spares holding and software maintenance become expensive and time consuming across so many variations of systems and, as a result, service is not offered to the standard that the industry requires or demands.”

According to Ross, this is why the company developed its Caskmaster 4.0. “It’s a modular system that can easily be scaled to match your production demand. The design uses stand building blocks, utilising the two most common control platforms in whisky distilleries. It also eliminates the need to have two separate software platforms running on the filling and disgorging line – one program for the machine control and one program for the reporting.”

He adds that the Caskmaster 4.0 integrates all that functionality in one platform, with visualisations and screens that allow seamless navigation between engineering and process information. Also, the Coriolis meter gives the highest possible level of accuracy, as well as enhanced levels of reporting (fill volume, ABV%, temperature, density).

AUTOMATION & ROBOTICS

Yet, while Cockayne is already at the forefront of filling and disgorging technology, Ross and his team are keen to address further industry issues through their R&D initiatives and understanding the longer-term operational challenges of clients. He’s also an enthusiast for combining the complementary strengths of technology and humans.

“In the UK, automation and robotics have traditionally been viewed as a threat to jobs, and that’s possibly even more so in an industry steeped in tradition, such as whisky,” says Ross. “However, for us, automation and robotics are simply tools to support and enhance the skills of the traditional workforce.”

He offers colour monitoring systems as an example. The sensor, controller and interface can monitor the spirit during the disgorge operation and tell you what colour it is as it exits the cask. However, that information is worthless without someone who has the skill and experience to be able to say what colour range is indicative of good cask performance.

“The same is true with cask handling,” says Ross. “Conveyors and robots can be used to bring casks to and from processing lines which, given that they can weigh up to 250kg, eliminates a massive health and safety risk. And, while further automation such as vision systems can be used for inspection, a cooper will always be required to repair and rejuvenate poorly performing casks. We feel there can be a balance between using enough technology to increase productivity and keeping our whisky industry competitive, but not so much so that the tradition is lost.” The balance between technology and human experience is one that Ross has followed keenly, while observing that the growth in the popularity of single malts has simultaneously made inventory management even more challenging.

“When I first entered the industry, you might have had two iterations of a single malt brand – a standard offering plus an aged variant,” he says. “But now, when you’re looking to the future, you’re usually having to lay down volume for multiple iterations, each with specific cask finishes and requirements. It’s adding even more lines to an inventory manager’s stock model – a huge database that has become a lot more complex over the years.” Technology has made a hugely positive impact but, as Ross points out, there isn’t a machine or piece of software in the world that can tell you how much of your inventory, across numerous brands and styles, you will lose through the ‘angel’s share’.

It’s a widely regarded rule of thumb that Scottish distilleries can expect to write off two percent of their stock per annum through spirit that evaporates or disappears into the wood. In reality, that rate varies widely. In warmer climates, such as the southern US bourbon trade, the angel’s share rate in year one can be as high as 10 percent. On the other hand, the rate drops as the years progress. According to Ross, if the rate of loss really was two percent every year, there would be nothing left of a 50-year-old Scotch by the time it came to be disgorged. Calling it right, or as close to right as possible, is an art borne of expertise and experience.

Incidentally, you might think that it would be wise for a inventory manager to overstate the likely angel’s share loss to cover any contingency and ensure that inventory targets are met. But, as Ross points out, it’s more complicated than that. “I tended to be more cautious,” he confesses, returning to the theme of over-optimistic sales teams. “If you’re dealing in big volumes and you overestimate required production levels to cover you in case your angel’s share predictions are wrong, you could lead your organisation into some costly decisions such as long-term supplier deals or even building a new distillery. Then throw into the mix the fact that the sales forecast may be wildly overambitious, and you could be storing up a lot of future problems for the business.”

The need for communication All of which points to the fact that running just about any kind of business today requires a mix of the right technology and something that only humans can excel at – communication. “In big organisations, decisions are often made about filling and disgorging equipment without consulting the inventory managers,” says Ross. “It’s decided purely on what works industrially. But we should all be having wider conversations about what we’re trying to achieve and why we’re trying to achieve it. And the answers to those questions should then be built into the design and commissioning.”

Traditionally, businesses providing filling and disgorging equipment have been seen simply as ‘suppliers’, whereas Ross believes that the whisky industry stands to gain much from building longerterm relationships with those, such as Cockayne, who offer genuine expertise in this area. “Of course I would say that,” says Ross. “But the big advantage for the whisky industry is that it could exert a huge influence on the direction of research and development, so that the design of the equipment is guided first and foremost by their needs. It’s in everyone’s best interests to have a bigger conversation.”

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YIELD CALCULATION ON STARCH-BASED SPIRITS

IN PRODUCTION OF SPIRIT FROM ANY TYPE OF GRAIN, GRAIN IS MAJOR PART OF THE COST AND UNDERSTANDING ETHANOL YIELD AND POTENTIAL AREAS FOR IMPROVEMENT IS VERY YIELDIMPORTANT, EXPLAINS MARIA NACHETOVA TECHNICAL SUPPORT MANAGER EUROPE – LALLEMAND BIOFUELS & DISTILLED SPIRITS AND MARYSE BOLZON GLOBAL CRAFT DISTILLING MANAGER, LALLEMAND BIOFUELS & DISTILLED SPIRITS. 70 | WINTER 2021

When we speak about Yield calculations it can be confusing since we can refer to various values and it is important to understand what they mean and why we need to use them. First step would be to calculate theoretical yield - amount of pure ethanol that you can theoretically produce from certain amount of grain. Theoretical yield is calculated based on starch content in the grain and theoretical yield from glucose of 0.511g ethanol/g glucose. It is never possible to reach 100% of theoretical yield. Amid the diverse reasons are the production of daughter yeast cells necessary to complete the fermentation, some losses in factory operation, the contamination by bacteria and wild yeast and the production of glycerol, organic acids, higher alcohols, esters and other compounds by the yeast.

Fermentation yield which is calculated as amount of ethanol produced from certain amount of grain in fermentation gives a good understanding of up-front part of the process efficiency, which will include grain quality, milling, mashing and fermentation itself. The aim for spirits producers is to reach 84-91% of theoretical yield. Efficiency of distillation can be evaluated by distillation yield which is calculated as final liters of pure ethanol in your distillate produced divided by liters of ethanol which came into distillation from fermentation. The most important value for distiller is overall yield as it gives you the cost of the grain to produce spirit. This is a quantity of pure ethanol that you can sell per ton of grain.

KEY CONSIDERATIONS

Yeast Choice On grain such as corn, wheat, rye, etc., and also on roots such as potatoes, starch, through the action of enzymes, is converted to fermentable sugars: glucose, maltose, maltotriose. It is important to ferment with the yeast dedicated to the type of sugar you have in your process to make sure that you get a complete fermentation with low residual sugars (<2 g/L) at the end of fermentation.

Conversion Factors Yeast cannot consume starch directly and enzymes are required to convert starch into fermentable sugars. The conversion factor for starch to glucose is 1.11; that means that for 100 parts by weight of starch you get 110 parts of glucose. For high ethanol yield it is essential to manage mashing process (temperature, pH, enzymes dosage, etc.) correctly for efficient starch hydrolyses to fermentable sugars.

Starch Content Starch is what the distiller pays for. The starch content of the grain determines the potential quantity of fermentable sugars and so the yield. u If you have one ton of grains with 60% (ww) starch, you will get 600 kg of starch; if it is 65%, you will get 650 kg of starch. u The difference of 50 kg of starch represents 55.5 kg of glucose (50x1,11) which is theoretically 28,36 kg of ethanol (55,5 x0,511). This is equivalent to 35,94 liters of ethanol (28,36/0,789 (density of ethanol)) per ton of grain. u With 5% starch difference in grains with process efficiency of 85 % you will gain or lose 35,94 liters of ethanol per ton of

grain. Getting grains with high starch content and making sure that the enzymes which are used for

Moisture Content The moisture content is a good indicator of grain quality: high moisture content means bad quality of grain and limited duration of storage and impact on the yield. u If you have a ton of wheat at 65% (dw) starch with 12% moisture and a ton of wheat at 65% (dw) with 15% moisture, the loss or the gain will be 11.9 liters of ethanol per ton of grain (based on 85% efficiency). Calculations are similar to the calculations for starch content).

Monitoring Consistency is the key to success, so always working the same way and recording data is important. It is recommended to keep record of temperatures and specific gravity (SG) during fermentation to make sure that the fermentation is completed. At the end of fermentation and distillation, the final ethanol content is measured by distillation taking care of the accurate volumes of sample and distillate.

Taking in account all these factors, it is important to remember that spirits production is a complex process, and every step of the process will have an impact on the final yield. Using good quality raw materials, efficient and consistent mashing, fermentation, and distillation are the keys for achieving high ethanol yields consistently.

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