Spend any time in a cocktail bar or a liquor store, and you'll notice a number of brands that weren't around a few years ago. There's a reason for that. Just as beer cases have become filled with colorful labels and exotic flavors, craft spirits are becoming hip alternatives to the traditional big liquor names.
"Craft beer is now, but craft spirits is the future," says Michael Nagrant, a Chicago-based food writer.
The number of craft distilleries jumped 26% in 2017 compared with 2016, according to an annual report, released last week, by the American Craft Spirits Association, an industry trade group.
What's more, employment is rising, too. The association's Craft Spirits Data Project found that 19,529 people were employed full-time at craft spirits companies in 2017. That's up 47% from the 13,329 people who were employed making craft spirits in 2016.
Craft spirits are defined as producers making 750,000 gallons or fewer each year. They must identify themselves as craft producers. They can't be controlled by a big distillery, and they agree to follow the association's code of ethnics.
Where are they? By far, the greatest number of craft distillers, 32.7 %, are in western states.
Next comes the South, with 29.3% of craft distilleries. The Midwest has 19.1% of craft distilleries, with the Northeast right behind at 18.9%.
The top five states. Among individual states, the leader by far is California, which has 148 craft distilleries, or nearly 10% of the total. New York State is next, with 123 craft distilleries. Washington State has 106, while Texas has 86 and Colorado has 80.
Small, but gaining. Craft distilleries are still a blip on the overall booze radar, but they're picking up sales and volume. In 2016, craft distilleries held 3% of sales; in 2017, that rose to 3.8%. In volume, craft distilleries took 2.6% of the industry last year, compared with 2.2% the year before.
In actual cases, the craft industry has risen from 2.5 million cases sold in 2012, to 5.8 million cases in 2017. (A case holds nine liters of alcohol.)
Big at home. Interestingly, the association says that more than half of the sales for craft distillers come from customers in their home state. Nearly 20% of sales take place at the distillery's headquarters, which the group says illustrates the importance of tasting rooms.
Some craft distillers are benefiting from the loyalty that craft beer makers have cultivated in their customers. Nagrant says that's helpful with a product like vodka, which generally is colorless, odorless and neutral in taste (the exception being flavored vodkas).
"If most vodkas are like bottled water, what am I gonna drink? If Grey Goose tastes the same or within an acceptable range of a vodka distilled by a former pro hockey player in a re-purposed building in downtown Detroit, I'm drinking or buying the stuff from Detroit because it's a much cooler story that also speaks to my love of that city," he says.
To be sure, craft distillers have been around for years. But Nagrant says a maze of state laws dating back to the Prohibition dampened the industry's growth.
For instance, California limits distillery license holders to production of 100,000 gallons or fewer per year. California also limits on-site tastings to six quarter-ounce servings, or a single 1.5 ounce serving.
In Washington State, meanwhile, those holding a craft distillery license can produce of no more than 150,000 gallons per year.
However, changes are happening.
In New York State, farm-based distilleries are now allowed to sell beer, wine and cider along with spirits, under a law signed last year by Gov. Andrew Cuomo. This allowed distilleries to be on the same playing field as farm-based beer and wine producers, who have been allowed to sell all those types of spirits.
(You can read more about your home state in the association's report, which was produced with Park Street Imports and IWSR, which offers drinks market analysis.)
With consumers looking for something different to add to their liquor cabinets, craft distillers are providing the answer. Nagrant says they generally are willing to take more risks than the big players.
"As a rule big guys go for scale and mass tastes, but small guys hew towards flavorful idiosyncrasy," he says.
