If you’ve never toured a whiskey distillery, the experience can be uncommonly old-fashioned. While newer distilleries thrive on automation, many still tout their “by hand” operations as a defining characteristic, a heritage that gives them street cred. Many distilleries are downright smug about the lack of computers or even climate control in any facet of their operations—even if this means things don’t always go according to plan. Easily preventable errors are chalked up as a cost of doing business, perhaps adding to the romance of whiskey-making while draining the budget.
Mandell says that while the influence of a seasoned master distiller is great, there’s a real risk in eschewing technology when it comes to the finished product. “What many of the other guys get is just inconsistent,” he says, “because they have less control over the process.” And that inconsistency, he adds, can often be felt down the line, in the quality of their whiskey.
Contract Negotiations
Like many industries, whiskey is very incestuous, and the distillery named on the label may not really make the liquid inside the bottle. In fact, that distillery may not exist at all. For example, you can’t visit Redemption Whiskey’s distillery, because there isn’t one; the brand sources all its stock from MGP Ingredients in Indiana.
There are two primary ways to get whiskey without distilling it yourself. Sourcing usually involves buying barrels that have already been made by someone else. Contract distilling happens when whiskey is distilled to order for a client’s specifications. Both are commonplace.
Mandell is a veteran of Bardstown Bourbon Company, a well regarded operation he helped to launch in 2014. Bardstown made (and still makes) its own whiskeys, but like many distillers it also produces for others on contract. These contract distilling services are where the fast money is made. Whiskey produced today won’t be sold until it’s properly aged—for years—but unlike consumers, contract customers have to pay up front. Bardstown has been able to thread the needle and do both sides successfully—though without its thriving contract production business and the hiring of Hargrove (who now leads the Whiskey House production team) to fix some quality issues, Mandell implies that Bardstown might not have been so fortunate in its early days.
The gleaming building, located 50 miles outside of Louisville, Kentucky, looks more like a data center than a distillery. In many ways, that’s what it is.
When Mandell and Hargrove departed Bardstown around the time of a private equity buyout a few years ago, they got to work on a new business almost immediately. The concept, Mandell says, was simple: “What if we could start over, take everything that we learned, and create the distillery and the system from scratch,” he says. “What’s needed out there? What problems can we solve?”
It turns out there were a lot of problems to solve, and a lot of demand. After all, the many so-called non-distiller producer brands—including most of the “celebrity” whiskeys that now crowd the market, like Beyonce’s SirDavis—have to be made somewhere.
