SPOTLIGHT ON BUSINESS MAGAZINE
OCTOBER 2017
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SPOTLIGHT ON BUSINESS MAGAZINE • OCTOBER 2017
When Adam McDonnell, the Managing Director of Canada’s bestselling and fastest- growing craft distillery, spoke with Spotlight on Business over the summer, he made one thing clear almost right away: “We’re on a mission to help grow the category of locally- made Canadian spirits, coast-to- coast and beyond.” Part of that mission, Adam explained, is educating the consumer. “Most of the big spirit brands you find in liquor stores across the country are made in massive factories with very little crafting involved. Even a lot of the so-called craft brands you’ll find out on the market are nothing more than one-time, contract- made products that follow, more or less, the same factorymodel.” Goodridge&Williams Distilling in Delta, British Columbia crafts and bottles each and every one of their eight products in-house and “in a real distillery,” he said. “We’re authentic and we’re world-class and we do it all while investing in Canada – unlike the big international companies. The success of the craft beer scene in Canada has proven that consumers want to buy local, they want to spend their money on well-made and locally-sourced Canadian brands. But there’s still work to do. We need to level the provincial liquor playing fields in every province for distillers and I’d like to think that we’ve taken some big steps in that direction.” One of those big steps was taking home a silver medal at the 2017 International Wine and Spirit Competition. In a competitive field that included spirits from more than 65 countries, G&W’s Nutrl Vodka emerged as the only artisan vodka from Canada to win an award that year. But I was surprised when I mentioned the Distillery’s laurels to Adam. He deflected my journalistic praise with, and please forgive the pun, such genuine spirit. “Anytime people cheer our spirits it’s like they’re cheering for Team Canada and that reinforces on an international stage that we have awesome stuff at home – and that’s good for all Canadian distillers in so many ways.”
By David MacDonald A dam, it’s well-known in the Canadian craft distilling industry that the provincial government in BC really set the standard in Canada – and arguably in the world – when it established the requirements for official “Craft” designation four years ago. How did G & W come onto the scene in all this?
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OCTOBER 2017 • SPOTLIGHT ON BUSINESS MAGAZINE
AM: Well the name Goodridge&Williams stems from the founders – that’s Stephen Goodridge and his wife Judy Williams. So, in 2013, when the government decided to create this craft distilling industry, he and his wife were one of the first pair to join that trend. So that’s really where the name comes from. Stephen has been a brewer and a distiller by trade for more than 25-years and he’s crafted beer and spirits for some of the best microbrew- eries in Vancouver. “Stephen has been a brewer and a distiller by trade for more than 25-years and he’s crafted beer and spirits for some of the best microbreweries in Vancouver.” As far as the provincial standards go, we stick to the guide- lines for BC craft products and use only local ingredients. But we decided pretty early on that the locally-grown, over- the-counter operation model wasn’t going to be enough to get everyone talking about Canadian craft spirits the way we had envisioned. We knew we were going to have to be a commercial-level distillery to be truly competitive in the market place outside of Delta and the Greater Vancouver Area. That involved us taking-on a much higher tax burden than the other small craft distilleries, those who sell private-
ly over-the- counter. We felt the only way we could grow was to have the provincial liquor board as our partner and to do that we had to change our tax structure.
Right now, there are two categories in the distilling industry: “Commercial” and “Craft.”
If you’re a BC “Craft” distillery, you’re very restricted in the ingredients you can use, the amount you can distill, and the distribution channels you can use to get away from the mark-up. We’ve decided, even though we produce a very small amount of spirit in the grand scheme of things, to go right up against and to be taxed the same as the international spirit producers – who have very few people in Canada. Here we are a small company trying to get a foothold in the industry while trying to get more people involved. We’re going up against these global brands with global economies of scale. How would you like to see the current system modified? AM: What we really need to see in Canada is the same sort of playing field that’s been groomed for brewers and vintners, a graduated system. Even though we may sell more than 5000 cases, we’re not to the scale and economy that says Johnny Walker is.
There are more than 150 craft brewers in BC. Do you know how many people that employs, not including the trick-
le-down business the craft breweries bring to tourism and retail? It all helps to improve the economy of BC. We’re pushing and hoping that the government will see it our way and agree with us and allow us a more graduated system based on how much we end up producing year over year. Working with them has really worked in our favour, though, in the early years. Our growth has been pretty steady year- over- year. Our Sid’s Handcrafted Vodka, Nutrl Vodka and Tempo Gin are widely distributed and available in most BC government liquor stores. We’ve even been able to expand into other provinces in Canada. We’re selling in Alberta, Manitoba, Ontario, and we’ve sold G&W in the Atlantic Provinces. We’re represented in BC we’re in three channels. We have our government liquor board channel, our private LRS channel – private liquor stores and retailers – and then we have on-premises channels in restaurants, cafes, and really any provincially-licensed place selling cocktails to consum- ers. We’re well-represented in all three channels. People are very attracted to BC products and especially well-priced BC products like ours. So many craft brewers and wine makers in the province have really paved the way for us so the enthusiasm is already there. It’s an exciting time. It’s a time of growth and I sometimes like to describe it as the awkward teenage years. Battling with issues in the industry and our own growth are very exciting challenges to have. The response we’re getting from everyone at the provincial level is a resounding “Wow, we love what you guys are doing – keep doing it.” You seem to have a remarkably diplomatic spirit for a citizen and small business representative considering all the red tape and bureaucracy, Adam. AM: Well, we’re very passionate about what we do and we wear it on our sleeve – but you have to be practical. I can honestly say that all levels of government we talk to are understanding of our plight and we understand that change can take time – especially during election years. Well, your argument includes the fact that Canadian spirits represent so much to so many people around the world besides quality. For many Americans, for instance, they represent prohibition and rum-running and a connection to their past. Why do you think the global market has recently shown even more interest in truly Canadian spirits? AM: It stems from a couple of things, really. I think, as you say, that Canadian spirits have always been well-respected. But when most people think Canadian spirits, they auto- matically think of the best rye whiskeys. I have a lot of family in the US and overseas and they think we only make Crown Royal and CC here. These are giant global brands that are exceptionally well-respected and I think we’re likely to see a It’s very encouraging.
real upswing in craft ryes coming out of this country in the near future.
Now what I find across Canada with craft distilling is we’re starting to see great vodkas and gins. Craft distilling is really allowing us to branch out and try new things and I know other distilleries are just as imaginative. The Canadian craft spirit is getting a toe-hold in the Canadian market and somewhat in the international market. “Now what I find across Canada with craft distilling is we’re starting to see great vodkas and gins.” I’ve got to admit that when the G&W assignment came across my desk I had a moment where I thought I was dealing with a longstanding brand. There is something about the name Goodridge & Williams that gives the impression of a time-honoured distillery. AM: You know, we agree; it sounds very established. But that’s not where the name story ends. Our most popular product, Sid’s Handcrafted Vodka stems from Stephen as well. His father gave him the nickname Sid as a kid and the brand is near and dear to his heart. I think like any new entrepreneurs, Stephen and Judy poured their blood, sweat, and tears – that sort of thing – into their business. There is a lot of pride in the name of the distillery and what the products represent. When a customer comes into the Distillery on Vantage Way in Delta for a tour, what can they expect? AM: Our operation is on a smaller scale than the typical mid-size craft brewery but we have a larger output – so we can probably do a little bit more and leave a slightly smaller footprint. We have two stills, one 2500 litre and one 750 litre. Much of the initial production is similar to brewing but it’s what you do with that fermented product after the fact that really makes the difference between a spirit and a lager, for instance. We ferment; we get that mash going; and we pull the mash into the main kettle. (For all intents and purposes you’re cooking, boiling, and vaporizing it). We’ve got a 38-plate column reflux-style still, so picture the contents of a big kettle moving from the kettle into two very tall copper towers with 19 little windows in it. Each one of those little windows lets you follow the distillation process. The spirit is heated, it climbs to the next window, and it does that 38 times. With these stills, you experience the true magic and the real difference between small batch craft distilling and the large, global brands.
With smaller batches, the amount of time that the spirit is actually spending on the copper is much longer. The old
AM: I always tell people to have it the way they have it at home. Some people love a gin and tonic, for instance, and I’m not about to tell them to drink our Tempo Renovo Gin straight now – that’s your flavour profile. We’re all about trying to create more craft drinkers by making them ambassadors of our product as they experi- ence it. Stoli and Smirnoff drinkers know what to do with the grain-spirt profile of those brands and we want craft spirit drinkers, G&W drinkers, to take the same liberties. We also want customers to understand that we always want to give them a great product at a very competitive price. If you’re used to spending $25, it’s difficult for me to say you should be drinking BC craft vodka and charge you $50. We’re very aggressive with our pricing, to the point where I think our competitors think we’re a bit nutty. We try to match our pricing to those global brands because we believe that’s the first move to create the movement we’ve envisioned from the beginning. We’re going to give you what we think is the best product on the market and we’re going to give it to you at a fair price. What’s coming up fromG&Wgoing into the holidays, Adam? AM: We actually just launched in BC and Alberta our NÜTRL vodka soda, so we’re really starting to get into the natural- ly flavoured ready-to- drink beverage market now. We also have another offering in this category: Sid’s Something Else. “I always tell people to have it the way they have it at home. Some people love a gin and tonic, for instance, and I’m not about to tell them to drink our Tempo Renovo Gin straight now – that’s your flavour profile.” Sid’s Something Else is our ruby grapefruit and mandarin vodka cooler. It’s also 5%, it’s made with cane sugar, natural flavours and it’s about a third less sugar thanmost coolers. Think cocktail inacan. We’re always trying to think outside of the box. We know our core products are phenomenal but we’re always trying to reach out to every conceivable market. The trick is figuring out the right way to do it in a manner that represents the best of what the industry has to offer. Craft distillers are entrepreneurs and that means pride in what they do – no additives, no ego. With NÜTRL vodka soda we’re literally using our NÜTRL vodka, carbonated water, natural lemon – and that’s it. That’s three ingredients – no sugars at all.
moonshiners understood the importance of copper and the interaction between the spirit vapor itself and the copper.
The copper actually chemically reacts with the spirit itself – it smooths it out. It takes some of the fire off of it, which is what you get with what I would call a cheap spirit. With a cheaper spirit, you get that ‘Ah! Oh my god, I’m on fire!’ feeling; there is a scorching and almost metallic taste and that tells you it didn’t spend a lot of time on copper. That’s where the small batch craft distilling is so great; it’s small batches, spending a lot of time on copper. The name escapes me at the moment, Adam, but I’m curious whether those high-end cocktails served in copper cups are meant to draw out the flavour of your drink in the same way. AM: The copper mugs? You know funny enough, I’ve tried to research that a thousand times as to why a Moscow mule is served in a copper mug and you know, I’d bet that the taste factor was part of it – but no one really seems to know. I’ve heard some interesting stories about it, why ginger beer is used and all that. Someone who once came into the distillery told me that the drink came to be as a result of Prohibition in the US. Apparently back in the day of Prohibition in the 1920s, breweries realized they had all this equipment and nothing to brew so they thought, “You know what, we’re going to go into soda pop production.” What ended up happening was a whole lot of ginger beer production. Part of that was the infiltration of organized crime. Once these breweries were under the influence of organized crime there came to be a kind of mandatory buying policy. Apparently if you were operating a speakeasy and you wanted a certain quantity of whiskey, for example, you’d have to purchase a certain quantity of ginger beer along with it. What ended up happening was a whole lot of ginger beer and soda pop lying around in speakeasies frequented by vodka drinkers. The legend goes that to sell these drinks of necessity, speakeasies gave out copper mugs with our first Moscow mule. I really don’t know if it based in fact, but it’s colourful nonetheless. Do you see mixology sessions being a part of the G&W tour in the future? AM: We are able to get a lounge license, one where you’re able to pour people cocktails and that sort of thing. I think it’s one of those scale issues – a bit of a chicken and egg situation. Do you wait until there’s massive interest in the tours before you have someone in your tasting room who only gives tours and makes drinks, or do you get them and promote the heck out of them? I can say that we’ve got some exciting things coming up for the tasting roomand that a lounge license isdefinitelypart of our future. Do you have any suggestions – or recommendations – for customers trying your spirits for the first time?
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as spotlighted in the OCTOBER 2017 issue of SPOTLIGHT ON BUSINESS MAGAZINE
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