Volume 2, Issue 2 - Fall 2017

The Saskatchewan spirit

Micro-distilleries are becoming big business in Saskatchewan — and the world is taking notice. 

By Joanne Paulson. 

Drink less. Therefore, drink better. And, while you’re being discerning, drink local.

That’s the new mantra of the modern spirits connoisseur — often a millennial, sometimes a locavore, and invariably a lover of finely-crafted consumables.

The local food-and-drink movement lit the gas that has fueled the explosive growth of micro-distilleries across North America over the past decade. Craft breweries and wineries were at the head of this trend; but, today, small-volume, boutique distilleries are sprouting up in every corner of our expansive national landscape.

Saskatchewan — population 1.16 million — has more than its fair share, despite the industry still emerging out of relative infancy.

The first two micro-distilleries were gleams in their owners’ eyes as recently as 2010. That number has since blossomed to the double-digits. Customers, meanwhile, are lapping up the whisky, gin, vodka, rum, and liqueurs pouring from the barrels and stills more today than ever before.

It all began, though, with a trickle.

At Last Mountain Distillery, located a short drive north of Regina in the picturesque hillside community of Lumsden, owners Meredith and Colin Schmidt were unsure if they could make the 5,000 litres of product targeted in their first year. It is not a concern the couple shares anymore.

“We doubled in size each of the first five years,” says Meredith. “We’re in our sixth year of business. We didn’t double in size this year, but we’re still growing. Actually, we’re trying not to double in size. You can only do that for so long. We’re family-oriented, too, which is partly why we started this.”

Two-and-a-half hours away, in Saskatoon, managing growth has also been a central theme at Lucky Bastard (LB) Distillers. The company began in 2012, but, by 2015, had moved its operations to a new, 15,000-square-foot facility, which expanded capacity tenfold and allowed for the manufacture of a larger, more dynamic product line.

LB Distillers now offers around 20 different SKUs, plus an additional 23 varieties of whiskies — the first of which was released this year. In fact, demand was so strong for the initial four-year-old batch, customers had to enter a ‘lottery’ for a chance to buy a bottle.

“Our list is significantly longer than our ability to produce it, which is a great thing for a company,” beams President Cary Bowman. “We try to make some things seasonal, but they become so popular, we need to rotate them into regular production.”

Even the new kids on the block are experiencing near-unrealistic success.

John Coté and Barb Stefanyshyn-Coté’s vision for Black Fox Farm and Distillery was to blend farming, tourism, and proprietary ‘hard drink’ in an agricultural setting — yet accessible from the urban bustle. They began by growing flowers and grains seven years ago, and launched their first line of distilled products in 2015.

The concept was an instant hit. One short season later, in 2016, they were awarded three medals at the International Wine and Spirits Awards in London, England: A silver medal in the liqueur category for their honey ginger liqueur; another silver in the gin and tonic category; and a bronze for contemporary-style gin.

And this year, they followed that up by taking home the honour of Best Cask Gin at the 2017 World Gin Awards, for their unmistakable, barrel-aged, vapour-infused gin.

Family roots

In true Saskatchewan style, most distilleries are at least partly family-run.

Meredith Schmidt had just married her husband, Colin, in 2010, and was enjoying some welcomed rest and relaxation at nearby Last Mountain Lake. An American expat, she had seen the early interest around micro-distilleries bubbling in the U.S., and was inspired by a connection who was working in Hawaii, creating spirits from pineapple.

The newlyweds’ imagination was sparked. They called the Saskatchewan Liquor and Gaming Authority (SLGA) and asked what was required to start a micro-distillery. The answer? “Send us a business plan and we’ll meet.”

Three days later, they finished penning a business plan, and were eventually greenlighted by regulators. They spent the next month trying to find a house that would accommodate the necessary equipment with a good water supply, and found it in Lumsden, a quaint town of less than 2,000 people.

“The following spring, we had to get water and gas out to the garage, and then we opened in September on a very, very micro scale — literally a 500-square-foot garage,” recalls Meredith. “Within a year, we opened up and, by the following summer, we built a single car garage next to the double just to house our bottles.”

That didn’t last long. The business expanded at a break-neck pace, prompting the Schmidts — who have two children — to build a dedicated 5,000-square-foot facility, adding another 3,600-square-feet only recently to accomodate roughly 20 employees.

Like any other manufacturing operation, the Schmidts believe their success is grounded in three fundamental pillars — a good business climate, a receptive market, and innovative products.

According to Meredith, one of the primary advantages of being a micro-distillery in Saskatchewan is the regulatory framework. Producers can sell directly and distribute both through private retailers as well as SLGA-operated outlets, thanks to sweeping new reforms.

Although, in the end, it’s all about the customer.

“We consider ourselves incredibly fortunate to be doing what we’re doing here in Saskatchewan,” she says. “Saskatchewan people have given us the success we have. They’re so eager to embrace a local product, and they like a good drink, so it makes for a good combination.”

The company is also stretching into Alberta and B.C., but the sourcing of inputs stays, largely, in Saskatchewan. Last Mountain Distillery procures its wheat from a farm near the Village of Earl Grey, while the dill and cucumbers for their popular Dill Pickle Vodka come from nearby Lincoln Gardens.

The only time the pair diverges from their ‘Saskatchewan first’ purchasing strategy is when certain ingredients simply cannot be found in the province, or in the quantity they need — for instance, the apple juice or cinnamon that goes into their Apple Pie Moonshine.

“Saskatchewan people love Saskatchewan. It gives me such as sense of pride to be part of it, even a little part of it. It’s about the people here — they’re amazing. They’re incredible to be so enthusiastic and supportive of Saskatchewan products.”

Locally made, globally inspired

Similar to the Schmidts, the seeds of inspiration for Cary Bowman were planted beyond Canada’s borders.

In 2010, while on a trip to Europe, he read an in-flight magazine profiling the resurgence of micro-distilleries in the U.S.

“I was intrigued,” he recounts. “Here I am off to Europe and they’re everywhere, in the tens of thousands.” (He also noted that micro-distilleries are not an entirely new phenomenon. “Prohibition wiped them out in North America, but Europe never went through that.”)

Unlike the U.S., larger commercial brands don’t have a powerful foothold in the European marketplace, where most alcoholic beverages are locally or regionally made. So, Bowman decided to tour those facilities and meet the families running them.

He was hooked.

“I came back to Canada and there was nothing going on,” he says. “There were a handful of distilleries spread across the country. I started doing some research and talked to the SLGA. They didn’t even have a policy to deal with us.”

Bowman, an investment banker, wanted to be on the leading edge.

Idea in-hand, he turned to friends Lacey Crocker and Michael Goldney. Goldney was a practicing physician coming off a $14.6 million lottery win approximately a decade prior (the impetus for the Lucky Bastard name) — an experience he “highly recommends” to those he meets.

Both needn’t think twice. They were in.

Goldney even took a step back from his Saskatoon medical practice and joined LB Distillers full-time beside Bowman.

“We’ve found people have really embraced it,” says Bowman. “The consumer does not want artificial stuff. They want to support local farmers. We found a tremendous opportunity in an industry that hadn’t really begun here.

“Now, there are about 100 micro-distilleries in Canada. In the U.S., there are close to 1,500. It’s gaining and gaining fast.”

Success did not come, however, without significant changes to the business plan.

The original concept was to be a single malt whisky producer. The drawback is that whiskies must be aged, differing revenue along with it. Scotch whisky must be matured in oak barrels for at least three years. Instead, vodka makes up the overwhelming share of the distillery’s worldwide sales.

Other specialty products have made inroads as well, including rye, Caribbean-style amber rum, and European-style single-fruit berry liqueurs — not all of them sweet.

“Some are tart. No water, no preservatives. We use a pound-and-a-half to three pounds of fruit to produce one little bottle. And all our fruit is from right here in Saskatchewan. We do Saskatoon berry, haskap, crème de cassis, a dwarf sour cherry developed by the University of Saskatchewan, and a sea buckthorn and wild honey liqueur.”

LB, which was ranked number four on USA Today’s list of top distilleries in Canada, now manufacturers between 125,000 and 150,000 litres of product per year. Most of those beverages remain on the Prairies, and are stocked by 300 bars and restaurants in Saskatchewan alone.

“The economic spin-off of what we micro-distilleries do is a lot bigger than we are,” exclaims Bowman. “Most of our orchards weren’t commercial orchards before we started buying from them. Some people have quit their jobs and are in full-time fruit growing because of us. That’s rewarding.”

Sure, rewarding is one thing. But Bowman sums up the entire experience in three words, echoing a sentiment shared by Meredith Schmidt:

“It’s downright fun.”