Boutique distillers joining forces as industry grows

New Zealand's burgeoning boutique spirits industry is setting up its own sector group as it begins to look for more government support for the rapidly growing industry.

Robert Brewer, chief executive of Spirits NZ, which represents the bigger players in the industry, says the smaller home-grown distillation industry is worth a conservative $3 million to $5 million a year but it's growing fast.

There were more than 60 commercial distilling operations in New Zealand but that was growing by the month, Brewer said.

"Spirits NZ believes that the sector is swiftly reaching a critical mass of dedicated producers and investment whereby, with the right support, the New Zealand distilling industry could being to grow almost exponentially over the next decade," Brewer told a parliamentary committee yesterday.

Brands such as Thomson's, Lighthouse, Juno, Ariki, Black Robin, Scapegrace, Broken Heart and Gunpowder are already being sold throughout the country but the provisionally named Distilled Spirits Aotearoa would bring a group of "individual, highly entrepreneurial small businesses to a co-ordinated, focused group of businesses".

Brewer flagged with the Foreign Affairs, Defence and Trade Select Committee that there were issues the group would want resolved if the industry was to grow.

Among these was the level of excise on spirits. At $52 per litre of pure alcohol for spirits, it is nearly double that of wine and beer ($22).

"For small business, the impost of excise is a heavy burden," he said.

Out of step regulations covering everything from production to storage would also be a priority for the group.

Dave and Jo James, who make the award-winning Juno gin in New Plymouth, were at The Food Show in Auckland today to show off their wares.

"One of the barriers that we faced was with excise, the requirement to have a bond on our house so that they would be confident that we would be responsible about paying our duties and bills on time, which of course we have," said Jo James.

"When you're a start-up, cashflow can be difficult ... and we were able to manage that because we had an asset in the house, but it would be difficult for other industry participants," Dave James said.

"We're an industry which is new, the distilling industry is really only a couple of years old. So it's the right time to step in and just have a look at it and say 'OK, how can we support this so that it can grow into an international well-recognised industry'.

"That's another reason why we're setting up the association so that the little distilleries can get access to some of the information from some of the supporting parties available."

The couple are very proactive in the research and development of their product and want to share that. They see the formation of an industry body the way to do that.

"We'd really like to enable all of New Zealand's distillers to have access to the research work that we're doing and to those collaborative activities with larger government organisations and with regard to legislation as well on hazardous materials, handling etc," said Jo James.