How to Start a Distillery: Part 1

Getting Started: TTB Regulations

As the leader in beverage equipment, we wanted to bring you a new series of blogs that we think will be helpful for many startups, small distillery and craft brewery establishments that are thinking about getting into distilling craft spirits. Some of the initial questions we get at ABE Equipment from those starting a distillery are about what we do and how our distillation equipment can help you be more profitable. We invite you to read through our blog series and hope that it makes the process of distilling alcohol a little bit more painless!

After over a decade of experience in outfitting hundreds of customers with distillery equipment, there are a few common questions we get:

“What size of Craft Still do I get?”

“What type of Still should I get?”

“How do I get into the market?”

“Is it necessary to have a Commercial Still?”

“I don’t necessarily want to start distilling products. I just want to get a beverage out there, start marketing, and start making money. Where do I start?”

ABE to the rescue! Throughout this series, we will answer many of your questions. Regardless of if you are looking into whiskey distilling, want to distill vodka, or are interested in gin production, the first place you’re going to start is the Alcohol and Tobacco Tax and Trade Bureau. We’ll refer to this as the TTB website in this article. Bookmark this URL! https://www.ttb.gov/regulated-commodities/beverage-alcohol/distilled-spirits

A few things to point out on the TTB website. It’s very important that you do your research, and it is easy to do on this website as there are tutorials, pictures, and step-by-step instructions. You will need to supply your business information when applying for your distilled spirits plant license.

Here are all the different definitions of the Distilled Spirits Plant license. You must know which applies to you and your distilled spirits business.

Distiller:

The TBB definition of a distiller is someone who produces distilled spirits from any source or substance, makes or keeps mash, wort, or wash, and has a still to process that wort, mash, or wash.

If you are starting a distillery and you have a Craft Still, you will check this box on the DSP application.

The next section underneath Distiller would be a Processor.

Processor:

Any person who manufactures mixes or bottles otherwise processes distilled spirits or denatured spirits or manufactures any articles containing denatured spirits.

They’re saying that once you get a DSP, or you have a facility, and you apply for a DSP, and you don’t have a distilling still, you can purchase product in bulk, transfer it from a supplier (a bulk manufacturer), and do a bond-to-bond transfer. That means you don’t pay tax on it until you have canned, bottled, or packaged that product and sent it out to the retailer, whether that be through a distribution retailer or a tasting room. You don’t pay tax on that product until you sell that product.

Warehouseman:

A warehouseman is a Distilled Spirits plant proprietor who stores distilled spirits in containers with a capacity in excess of one gallon. So, if you’re processing bulk spirits, you will need to have that section of your DSP application checked off.

Application Process:

If you’re applying as a Distiller, you’re going to have to provide a written ‘A to B” description of your production process. Start with where you get your grain, to crushing the grain, to crushing the corn, to mashing it, to your temperature when you mash it, and your temperature when you knock out. The amount of detail is up to you, but remember they are looking for a breakdown and to make sure that you know what you’re doing to make your spirits. Your statement must begin with the treating, mashing, or fermenting of raw materials and continue through each step of the distillation process and the refining process until production is complete.

If you apply as a Processor, the TTB requires that you provide details about the storage of bottled, cased, and packaged spirits, including the location on the premises. When you choose ABE Equipment as your beverage production equipment provider, we’ll do a layout for you based on the dimensions of your facility. Our experienced engineers will help identify an area where storage goods are opportune, so you don’t need to spend a bunch of money getting that done, as it’s an included service.

If applying as a Warehouseman, you must describe how you will store bulk spirits. Pro tip! The TTB likes when distilled spirits are locked up. They want to ensure that no one will tamper with your distilled products. It would be ideal if you could lock it up in a caged space or if you have a lock on the vessel, but generally, they want to see something that’s grounded and in an area that is going to be explosion-proof. If you house bulk spirits with high proof, you’ll need to check with your local fire marshal to ensure the volume you can hold. There’s a certain amount of volume that you can hold in your facility if you have a sprinkler system for example.

But again, dive into the TTB website, and you’ll have a leg-up on the first part—turning your idea into a legitimate business!

There’s much more to cover! We hope you read our How To Start a Distillery Blog #2, where we dive more into Calculating Theoretical Yield. If you have any questions, we welcome you to speak with one of our extremely knowledgeable Solutions Specialists at 402-475-2337. Quotes are also always free and with no obligation. If you’d rather listen to a version of this blog on our Youtube channel, head on over and look for Tanner Talks Episode 1. And if you’d like to get a head-start on researching our distilling equipment visit our Patriot Craft Stills and Micro Distillery Equipment pages.