How to Start a Distillery Business in 2024
Last Updated: 12/17/2023
So You Want to Start Your Own Distillery? Here’s My Advice…
Sup guys! Have you been thinking about starting your own distillery and bottling your own spirits? That’s awesome! As someone who has been in the distilling business for a while now, let me give you some tips on how to turn your dream into a reality.
Pick How You Want to Structure Your Business
First things first — figure out if you want to be a sole proprietor, partnership, LLC or corporation. I’d lean towards an LLC to get the perks of a partnership while limiting personal liability. But chat with your accountant to see what makes sense for your situation.
Need a Distillery Business Plan?
Create a custom business plan with financial projections and market research in minutes with ProAI’s business plan generator.
You Gotta Get Licensed Up
There’s a crap ton of red tape involved in the distilling biz. You’ll need to get federal, state, and sometimes even local distilling licenses and permits. It blows, but start applying for these ASAP because it can take months. Don’t sell a single bottle until you have the proper paperwork from the TTB and others.
Secure a Killer Location
Find a space with room to grow that won’t piss off the neighbors. Make sure the zoning works and you have access to water and electricity. Oh, and don’t forget the all-important tasting room! Location and signage visibility are huge for bringing in customers.
Grab Some Sweet Equipment
Dropping big bucks on a sexy new still and fermenters is so damn exciting! Get multiple quotes and check out used gear to save some money. Make sure to budget for all the small stuff too — bottles, caps, chemicals, ingredients, etc. It adds up fast.
Dial In Your Recipes
Experimenting with different grains, yeasts and processes is one of the best parts! Start concepting the type and flavors of spirits you want to make. Definitely hire a master distiller to help perfect your signature mash bills and recipes. This is key to crafting an awesome product.
Source Your Ingredients
You’re gonna need a bunch of raw materials — secure those supplier relationships stat. Make sure to get back-up suppliers too in case there are shortages. Look at minimum order quantities and plan ahead to get the best deals.
Bring In Some Investors
Beg, borrow and schmooze for money, baby! Pull up that business plan and make your pitch. Most investors want to see you put up a good chunk too. Expect to need at least $250K to $500K to start small. Yeah, this shit ain’t cheap!
Build Your Squad
Find talented peeps to join your crew — especially an experienced master distiller. You’ll eventually need sales folks, marketing gurus, bottling line workers, bartenders for your tasting room — the whole enchilada. Treat them right and they’ll help grow the biz.
Spread the Word!
Social media hype and promotions are key before you launch. Get reviewers to give your spirits a try. Offer tastings. Host open houses. Contact local bars and stores to carry your products. You gotta hustle and get the word out if you want to succeed!
Focus on the Tasting Room Experience
Don’t just hand people a list of spirits — give them an awesome experience! Offer engaging tours and fun cocktails. Have live events and tastings. Sell merch. Make people fall in love with your brand and the hype will spread organically.
Listen and Pivot When Needed
Be flexible my dudes! If certain spirits aren’t selling well or feedback is meh, switch up your approach. Fine tune your recipes and process to improve quality. Gauge demand for new products or increased production. This is a marathon, not a sprint — adapt and keep hustling.
Starting a distillery is a super rewarding journey if you get the basics dialed in — quality gear, money in the bank, the right team, and killer branding and marketing. Stick with it through the hurdles and you’ll be sipping your own badass spirits in no time! Chin up and keep chasing the dream, distillers!
Need a Distillery Business Plan?
Create a custom business plan with financial projections and market research in minutes with ProAI’s business plan generator.
Distillery Financial Forecasts
Startup Expenses
Monthly Operating Expenses
Revenue Forecast
Frequently Asked Questions
Thinking about starting your own distillery but still have some questions? Here are answers to some of the most common FAQs:
Q: How much does it cost to start a distillery?
A: The costs can really vary, but plan on at least $250,000 — $500,000 to start a small distillery. The major expenses are equipment like the stills, fermenters, and tanks, as well as ingredients, licensing fees, lease payments, renovations and more. Be prepared for higher startup costs for a larger capacity operation.
Q: What kind of license do I need to be a distiller?
A: You will need to apply for a Distilled Spirits Plant permit from the TTB (Alcohol and Tobacco Tax and Trade Bureau). There are different classes with incrementally higher fees. You may also need state and local licenses, zoning permits, and more. Start this process early as licensing can take 6 months or longer.
Q: Where’s the best place to locate a distillery?
A: Look for a location with adequate space that meets legal requirements, allows for expansion, has access to water and power utilities, and hopefully gets decent foot traffic. Visibility and amenities like parking for customers are a plus. Proximity to highways and distribution routes is ideal.
Q: What makes a good master distiller?
A: A master distiller oversees the entire distilling operation and should have formal training andmultiple years of hands-on experience. A good master distiller is obsessive about quality, safety, and consistency while also having creativity and a passion for the craft.
Q: How do I come up with distillery brand names and logos?
A: Brainstorm meaningful, memorable names that capture your vibe and location. Steer clear of overused tropes like “Whiskey Creek” or “Clear Springs”. Have fun with alliterations, local history references, or your last name. Logos should echo the brand name and stick in customers’ minds.
