How To Start A Craft Distillery

When deciding to start a craft distillery, it is key to plan as much as possible. However, it can be tricky to even understand where to begin. The following steps can help you plan your new business well and ensure it is legally compliant.

STEP 1: Create a business plan

A detailed plan is important for success with any new venture. It can also help you to set goals and to discover risks. A good plan should include:

  • A company description
  • Market analysis
  • Management requirements 
  • A product line
  • Marketing and sales efforts
  • Financial projections

STEP 2: Identify the costs involved 

The cost of starting a distillery can range greatly based on your business plan, the size of the distillery and where it will be located. Some expenses that should be considered include an initial lease and relevant licensing, equipment such as stills and fermenters, insurance and transportation for supplies and distribution.

Distilling is less expensive than brewing and by keeping the origin of your ingredients locally, you can lower costs even more.

STEP 3: Decide who is the target market?

Your most direct customers will be local liquor distributors who distribute to retailers. It is best to first look at small- or medium-range distributors as they are likely to specialise in liquor created by craft distilleries.

STEP 4: Get permits and licences in place 

You want to be aware of any required permits and licenses needed to set up and open a distillery. Not having the proper paperwork could result in fines, being shut down or further punishment. Liquor license applications can be complex processes. Therefore, it is advisable to invest in a local liquor lawyer or agent. 

You will apply for a Liquor Manufacturing License. To sell alcohol to retailers and distributors, you need also need a Provincial Distribution License. For this, you require the following documentation:

  1. A Zoning Certificate from the local Municipality confirming that the premise is suitable for the license.
  2. A Local Authority Approval stating the city or town planner’s permission to apply for the license.
  3. A SAPS Clearance Certificate for each member or director of the company.

STEP 5: Get insurance 

Your business needs insurance to operate safely and lawfully. Insurance safeguards your business’s financial wellbeing in the event of an accident or loss.

STEP 6: Create your brand 

Your brand is what your business stands for. It is also important to present your business to the public. A strong brand can help you stand out from competitors and grow your business among potential customers. A great brand identity can consist of a logo, a website, social media platforms, flyers, and brochures, and even packaging. 

Be part of the craft movement 

Just because you’ve created the perfect recipe for an amazing whiskey doesn’t mean you can immediately start selling it. There are many aspects to consider, and a variety of structures and licenses must be put in place. Luckily, once you go about the process correctly, you can open the doors of your craft distillery and enjoy plenty of future success. Cheers!