That's Genius: The Way Forward - Part II
Picture it: you're a small spirits producer launching a new brand that no one's ever heard of. You've worked hard to perfect your product, you've invested countless dollars and hours into its inception, and you want to just hop in the car, stop by a few retailers and restaurants, and get the show started. You wish to God you could go around peddling the bottles yourself, but a set of national distribution laws stands in your way. As a producer of distilled spirits, you have to hire representation for all transactions -- a third party that will act as the middleman between you and your customer, otherwise known as a distributor. And they'll be taking a cut of the profit, of course, despite how much or how little work they do on your behalf.
Unfortunately for you, small producer, every state requires its own distributor. That means if you're in Texas and you want your product to sell in California, you'll have to hire another third party within that state to handle your business. Maybe they'll move it to the front of their priorities, or maybe it will get buried under the weight of larger brands. The larger the access of the distributor, the more money they'll require for their services. Six months later, your enthusiasm has dwindled. You've sold six bottles in Washington, ten bottles in New York, two bottles in Florida, and you've made nothing. In fact, you probably owe them money. And, unlike produce or tupperware, you don't even have the option of a farmer's market or door-to-door sales. You must hire distribution if you want to sell distilled spirits. There's no going it alone.
Or is there?
What if there were a store in California with enough reach to handle your small production needs? A store with a reputation for quality, integrity, and exciting new releases with a website that garnered tens of thousands of hits every day? What if that store worked with distributors in the area to clear out-of-state products at lower margins, passing on those savings to the consumer and allowing you -- the producer -- to take your full margin without sacrificing percentages to a sales force? It's not like you have that much booze, anyway. You're never going to be Johnnie Walker or Patron. You just want to get your spirits into the hands of people who will appreciate them.
That would be nice, wouldn't it?
Luckily, such a store does exist and we're continuing to reach more small producers around the world who are more than satisfied with the market share that K&L can provide them. We can't offer bars and restaurants, national shipping, or large sales figures, but we can offer an audience of dedicated drinkers. We're at the point where brands are coming to us, rather than the other way around, and that's a great thing -- especially when we really like what they're offering. They say like attracts like. I'm always surprised at how sycophants tend to travel in packs, as do most personality types who require a certain aptitude for one another. The same tends to happen in the booze world -- the people who care deeply about quality all seem to find one another across this great divide.
Mike Groener, a small distiller in Austin, Texas, found his way to K&L via this spirits blog. He thought we might be a good fit for his new Genius Gin -- a self-fermented spirit made from local sugar cane and distilled on-site in small batches -- so he sent me a sample. I was immediately impressed. Not only was the navy strength gin fresh, balanced, and complex, but it wasn't redistilled from GNS purchased on the open market -- a real rarity in today's gin game. Mike wrote to me in a very straight-forward and honest manner:
I have been both inspired and intrigued by your spirits posts on the K&L blog. The way in which your passion for process and honesty shines in the writing is nothing short of brilliant. I personally find it the best source of information about upcoming spirits. In effect, I'd like to thank you for that continued commentary; it's vital for the continued elucidation of spirits production.
Further, I am too a spirits aficionado (being a producer in Austin, TX). We ferment from scratch, distill from two 26 gallon boilers, build our own cooling solutions, and use aquarium heaters to keep our yeast comfortable. I liken it to the producer who uses duct tape to reduce ring on a snare drum instead of using some $500 big budget solution. I ultimately hope our gins symbolize a shift in thinking, and represent a beautiful aesthetic on a shoestring budget.
Not only does Mike's gin symbolize a "shift in thinking" regarding spirits, the way in which we've managed to bring these gins to California customers also represents a new way forward regarding distribution. What if you chose exactly whom you wanted to work with, rather than allowing distribution to make those decisions for you? What if you could select a handful of key accounts that you felt best represented you and the nature of your spirits? That's where my head has been for the past few months. I'm not merely thinking about finding good booze anymore, I'm also thinking about how we can best distribute it to you -- the consumer -- in the most efficient, cost-effective way possible.
The Genius Gin from Austin, Texas is one of the best new craft spirits I've tasted in years -- and the price is right where it should be at $29.99. Austin is one of the most up-and-coming cities in the United States, with a cocktail scene and farm-to-table culture that now rivals San Francisco and New York. In 2011, Charles Cheung and Mike Groener created Genius Gin -- a cane-based spirit made entirely from scratch in a tiny warehouse with a tiny still. Utilizing years of tech industry experience, Genius ferments, distills, and bottles with immaculate attention to detail. The navy strength was inspired by Plymouth and Old Tom style gins; the botanicals span from lime leaves to lavender to create a classic gin profile that is quite simple and utilitarian in its profile. It's not some wacky new designer gin, but rather an honest, botonical-driven spirit that's distinct, yet familiar.
And, for right now, it's only available at K&L in California. Mike has been called "the Walter White of gin," obsessing over his chemistry in a Heisenberg-like fashion. Like Heisenberg's product, this isn't a gin you buy once, marvel in the uniqueness, and then decide you want to go back to "normal" gin again. Genius Gin will be a staple of the bartender's shelf -- at least those like-minded bartenders who care about where their booze comes from and who made it. I'm very excited that Mike chose us to help launch his product in the nation's largest craft spirit market. I think our new relationship is beneficial to Genius, to K&L, and to the consumer -- who is getting a damn good price. I'm also hoping that we're possibly creating a new way of doing business for smaller producers who recognize that a strong partnership with a similar mind might be the better route -- at least in the short term.
Whether this idea is a genius one remains to be seen. The gin, however, is indeed fantastic.