Small business: Pōkeno Whisky - from north Waikato home to NZ’s largest single malt distillery

Pōkeno Whisky Company founder Matt Johns.

Matt Johns talks to Alka Prasad about how his team’s “stubbornness” and commitment to the craft of single-malt makes the Pōkeno Whisky Company a true competitor to national and global brands. With the country’s largest distillery in the small Waikato town of Pōkeno, Johns is preparing for an exclusive deal with Liquorland and an international launch.

What does Pōkeno do?

We’re a craft distiller of premium single malts which we make uniquely from New Zealand ingredients.

Where are you based?

Have a guess! For us, Pōkeno at the northern tip of the Waikato is a hidden treasure of New Zealand. It provides us with pure spring water to make the spirit and a sub-tropical local climate that accelerates its maturation and flavour development in the barrel.

Whisky drinkers will be familiar with the angel’s share phenomenon – the evaporation rate that occurs as the whisky matures. In Pōkeno, the angels don’t like to wait.

What makes Pōkeno whisky unique?

I’d have to say it’s our stubbornness not to compromise on anything we do and that we do it all here in Pōkeno.

We’re New Zealand’s largest single malt distillery with a state-of-the-art set-up that stands in comparison to those used by some of the biggest single malt producers in the world. But unlike them, we’re not driven by how many litres of alcohol we can produce from a tonne of barley. Rather our focus is on quality over volume, which means we have the freedom to ferment for longer and slow down the distillation process. This allows us to refine our flavour profile and ensure that only the purest spirit is taken for maturation in specially-selected casks.

Johns says the Pōkeno distillery is a rival to its international competitors.

We’re also able to experiment with flavour. Beyond our core range of single malts, Pōkeno Origin, Pōkeno Discovery and Pōkeno Revelation, we also produce a variety of single-cask special editions – all made uniquely from New Zealand ingredients.

Another thing that makes us truly unique is that we have the only cooperage and cooper (cask and barrel production) in the country. While whisky barrels are traditionally made from oak, we’re already beginning to experiment with native wood to see how we can further take whisky drinkers on a journey of discovery through New Zealand.

How much did it cost to start up Pōkeno Whisky?

For the first four years before we could sell any product, designing, building and operating the distillery including took a significant investment and to a certain extent a leap of faith. Throw Covid into the mix and you can add grey hairs and frown lines to the mix too. It will take us many years to recoup this investment, but this is the case for any whisky distillery and we’ve always viewed this as a long-term project.

Pōkeno Whisky is home to Aotearoa's only barrel-production plant, or cooperage.

How did you raise the capital to start the business?

We have fully financed the project ourselves. This includes purchasing the 4000 square metre site that leaves us plenty of room for expansion in the future.

How do you build your own distillery?

To turn the dream into a reality, it all begins with a long and detailed planning stage. This includes not only determining the plant specifications but working with the relevant legislative bodies on requirements around things like health and safety and hazardous goods.

The detail of this initial planning stage was such that we were 18 months into the project before we actually started building anything. Then for the equipment that is very specialised, such as the stills and spirit safe, we had these custom-built with up to 12-month lead times.

How much does it cost to buy your products? How did you decide on your prices?

We’ve deliberately positioned the Pōkeno Whisky range at a very competitive price level alongside other major world whiskies as we seek to develop it as a global brand.

Pōkeno Origin is $99 a bottle, Pōkeno Revelation and Discovery both $121.99, and our special edition single casks are $199.

The Pōkeno Whisky Company is NZ's largest single-malt distillery.

How much is your annual profit?

When you build a whisky distillery, you’re committing for the first 4-5 years to just injecting cash into the business. This is not only for the initial build but also the running costs of the distillery which include raw materials, energy, salaries, insurance and the multitude of other costs that running a business involves. We only very recently launched our brand in August last year, and it will take many years to recoup those costs. Making whisky really is a long-term project.

By how much have your production costs gone up in the last year?

Considerably - the cost of shipping, which we’re exposed to for raw materials such as our barrels, bottles and corks, is far greater than when we set out on the project. We’ve also seen a significant increase in the cost of energy and insurance and of course salaries for our staff to keep pace with inflation.

Pōkeno Whisky's distillery on the northern tip of Waikato.

Is your focus on quality over volume economically sustainable and how does it compare with other Kiwi alcohol producers?

Single malt whisky is always about quality over quantity, but at Pōkeno we take that one step further with our incredibly slow distillation and very small cuts. To help us stay true to this process, we have designed our distillery to allow us to do this in a cost-effective manner, through automation and scale.

Generally in New Zealand, all of the single malt distillers are focused on the quality of their products which is fantastic as we work together to build the category both domestically and overseas.

Who makes up the majority of your consumers? Who is your target audience?

We tend to find that our consumers are 25 years and above. They may be established single malt drinkers or new to the category, but they’re interested in provenance and quality.

At Pōkeno we are truly focused on producing only the finest single malts and it’s a journey of discovery that our consumers understand and want to be part of.

Where do you invest your profit?

Building and running a whisky distillery really is a long-term commitment. We won’t take any money out of the business for at least 10 years. In the meantime, every cent goes back into developing the team, the structure and the growth.

What are your plans for the future of the business?

It’s important that we continue to grow the business sustainably, so we’ll be steadily introducing Pōkeno single malts to new markets around the world as we expand production, as well as growing our domestic presence through our exclusive partnership with Liquorland.

We’ll also be looking to develop the live experience for people visiting the distillery. We’re currently open for tours and tastings on Saturdays, which is going really well.

What advice do you have for people looking to start their own business?

Making whisky is a long journey, requiring a lot of investment up front. Making sure that you have a solid and sustainable financing model in place from the start is the only way to succeed.