The drinks business is, at its heart, a relationship business—a notion that might give small, shoestring-budgeted “nano-brands” a rare advantage in the marketplace over established, macro-brand spirits owned by deep-pocketed multinationals. This was a key theme of the panel “Small Is Beautiful: The Power of Nano-Brands in 2018” at Tales of the Cocktail in New Orleans last week. The panel featured three spirits entrepreneurs with three very different market approaches—one of them operates his own distillery, while the other two partner with outside distillers to produce their products.
“[With nano-brands] there’s no bureaucracy,” says Philip Duff, a longtime drinks industry consultant and the founder of Old Duff Genever. “There are no middle managers.” There’s also a sense of controlling one’s own destiny, suggests Allison Parc, the founder of Brenne French Single Malt Whisky. “It’s who I am,” she says. “When I wake up every day, I don’t have to answer to anyone, and that’s very fulfilling.”
Staying small also means that bar, restaurant, and off-premise retail managers often get something from nano-brands that they seldom get from their much larger counterparts: one-on-one time with the spirits’ creators. “[We have] an unfair advantage over the larger houses because we get to have that face-to-face,” explains Gable Erenzo, the founder of the fruit brandy distillery Gardiner Liquid Mercantile, named for the upstate New York town where it’s based. “Just being able to walk in to fancy restaurants and bars like the Four Seasons—we get to the front of the line because we’re not just a brand rep or salesperson.”
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Erenzo comes from a prominent distilling family. His father, Ralph Erenzo, cofounded the Gardiner-based Tuthilltown Spirits, which, when it opened nearly 15 years ago, was the state’s first whiskey distillery since Prohibition. Gable worked as the chief distiller there and was a significant Tuthilltown shareholder. After Tuthilltown sold its Hudson Whiskey to William Grant & Sons in 2010, he became the brand’s national ambassador. William Grant acquired the full Tuthilltown business in 2017, and Gable Erenzo went on to launch Gardiner Liquid Mercantile. The company operates both a distillery and, on the town’s Main Street, an off-site branch that functions as the retailer not only for its own products but for other Empire State producers’ spirits, wines, beers, and ciders. “By the time we sold Tuthilltown, we had 50 employees,” Erenzo says. “Now [at Mercantile] it’s just me.”
Opening the new business was largely a quality-of-life decision for Erenzo. During his years as the Hudson Whiskey brand ambassador, he was always on the road, away from his family. And while being the sole owner-operator of a distilling business involves its own set of time-management challenges, it keeps him close to home. It also helps that all his products are sold by the distillery itself, in town, thanks to a recent change in New York State law that allows distillers to operate retail businesses for their own brands, as well as for other products produced in the state using mostly New York–grown raw materials. So most of Erenzo’s customers have to come to him if they want to drink his spirits.
Parc’s path to her own brand was considerably different. After retiring at 23 from a career as a professional ballerina, she discovered whisky and fell in love with the spirit, a passion that ultimately led her to launch Brenne after many years of pounding the pavement to get it off the ground. She collaborated with a third-generation Cognac distiller to produce Brenne, which has been on the market since October 2012.
Parc’s “Create, not copy” philosophy is part of what helped propel Brenne to success. Before its launch, few in the industry were talking about terroir in whisky, and even fewer were talking about French single malt. She was able to fill a gap in the market.
Her ultimate goal, she says, isn’t for Brenne to remain a nano-brand; it just happens to be one now. In 2017, Brenne was added to the drinks investment group Samson & Surrey’s portfolio, which also includes Few Spirits, Bluecoat American Dry Gin, and Widow Jane Bourbon—a big step considering it wasn’t too long ago that Parc was delivering cases to accounts on the back of bicycles that she didn’t even own (thanks, New York’s CitiBike!).
Duff made his way to nano-brand ownership through the consulting realm. He’d been running Liquid Solutions Bar & Beverage Consulting for nearly two decades before he launched Old Duff Genever—a category for which he’d had a soft spot. The Irish-born entrepreneur lived in the Netherlands for 17 years, speaks Dutch fluently, and, through Liquid Solutions, had helped re-launch Bols Genever with its original 1820 recipe about a decade ago. For his own brand, Duff partnered with Herman Jansen distillery in Schiedam, the Dutch city that once was—and, in a lot of ways, still is—the epicenter of the country’s historic genever industry. “Now I’m really worth my [consulting] fees,” Duff jokes. “I thought [starting a brand] would be the ultimate liquor industry MBA—and it’s a lot cheaper than getting an MBA.”
Starting her brand definitely provided a comprehensive curriculum for Parc, who hadn’t gone to business school. “I had this idea,” she says, “and I researched and did everything. I literally went to a bar and asked, ‘How did that bottle get on your shelf?’” The bartender, she says, shrugged and said, “Southern”—as in Southern Glazer’s Wine and Spirits. (Parc then had to ask the bartender, “What’s Southern?”) “One of the benefits of being nano,” she says, “is that you’re super agile and flexible and can [turn] on a dime.”
It may seem daunting, Duff says, but you learn how to create and manage a nano-brand by doing it. “It’s a terrible idea for surgeons,” he says, laughing, “but it’s a terrific idea for liquor marketers.”
Jeff Cioletti is a former editor in chief of Beverage World magazine and the author of the books The Drinkable Globe, The Year of Drinking Adventurously, Beer FAQ, and the upcoming Sakepedia. He’s a Certified International Kikisake-shi (sake sommelier).