When Sam's Club decided to produce its own brand of vodka, the reason was more than just adding one more beverage to its inventory at select warehouse stores across the nation. Executives had been doing their product development homework and chose to enter the vodka market after reading studies conducted by the Distilled Spirits Council of the United States that named vodka the most popular spirit in the U.S., with 2008 sales in excess of £2.9 billion. Not bad for a product that relies on water as its prime ingredient.
- Skill level:
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Things you need
- Business plan
- Licenses and permits
- Brand name
- Packaging design
Perfect your recipe for vodka---even if it means improving upon or changing the ingredients Papa Dimitri brought with him to the U.S. to pursue his dream. Experiment with rye, wheat, molasses, corn, barley, soy, potato, sorghum and any other grain you prefer to jump-start your recipe.
Purchase property to construct a distillery, rent warehouse space to install your vodka distilling equipment or subcontract with an existing liquor producer to create your recipe at their facility. Choose a distinct name for your vodka--particularly consider names that have ethnic, personality-driven or cutting-edge connotations.
Approach venture capitalists, banks and other lending institutions. Bring with you to each meeting a comprehensive business plan that spells out your goals, objectives, competitor analysis, distilling and bottling operation plans, proposed start-up and first-year budgetary figures (including a line item for a still that can cost £162,500 for one with a 1,200-liter capacity) plus all-important marketing strategies. Include as much background data as you'll need to convince these lenders of the merits of your product.
Obtain licenses and permits required by your state's liquor board to commercially distil, bottle and distribute your vodka product. Adhere to health department, food and beverage agency guidelines by opening your production facility to agents for inspections. Act on requests for infrastructure upgrades so your plant's electrical, plumbing and other systems are up to code---particularly since vodka relies on purified water for its taste---or you could wind up without the licenses you need to open your doors.
Meet with a liquor marketing expert and package design professional, both of whom are well-versed in liquor sales to establish your vodka's look, unique selling proposition, advertising and marketing strategies and promotional objectives. Seek a coordinated design scheme for everything from labels and boxing to billboards, ads and promotions so by the time your first bottles of vodka come off the assembly line, the buzz you created will have patrons asking for your brand by name.
Tips and warnings
- Interview liquor stores, bars and upscale restaurants to learn about the phenomenon of trending as it relates to vodka sales. Many will tell you that there's a social benefit in asking for a specific brand name, so positioning and promoting your vodka as the one discriminating drinkers request could get your new brand off to a great start.
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