Upload
others
View
23
Download
0
Embed Size (px)
Citation preview
Native Distilling: Innovations Catalyzing Native Economies
Understanding the Native Distilling Economic Model, the Tribal Beverage Network
and Talking Cedar
Moderator Dr. Eric Trevan, Ph.D.Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians (Gun Lake, MI)
Bob WhitenerCEO - The Whitener GroupSquaxin Island Tribe (WA)
David Burnett CEO - Chehalis Tribal EnterprisesChehalis Tribe (WA)
Justin StiefelCEO & Co-FounderHeritage Distilling Company & Tribal Beverage Network
Panelists
Chehalis Tribe: How we got to this point
Chehalis Tribe – Executive Order Tribe (1864)
Congressional repeal of federal ban on distilling in Indian Country Andrew Jackson era statutory ban (25 U.S.C. 251, 1834)
Great Wolf Lodge tax case and its implications for Indian CountryChehalis Tribe vs. Thurston County (9th Circuit)
Learnings from tobacco ventures
CARES Act FundingYellen vs Confederated Tribes of the Chehalis Reservation U.S. Supreme Court
25 U.S.C. § 251 - U.S. Code - Unannotated Title 25. Indians § 251. Setting up distillery
Andrew Jackson - 1834
“Every person who shall, within the Indian country, set up or continue any distillery for manufacturing ardent spirits, shall be liable to a penalty of $1,000; and the superintendent of Indian affairs, Indian agent, or subagent, within the limits of whose agency any distillery of ardent spirits is set up or continued, shall forthwith destroy and break up the same.”
H.R. 5371 repeals1834 statute.
This historical step was led by
Chehalis Tribe and HDC.
Dedicated to making premium craft beers with impeccable consistency
Can produce up to 120 kegs per batch with our state-of-the-art 60 barrel system
Capable of brewing 6 keg batches of one-of-a kind custom beers and private labeling
Working to sell beer to other Tribes for their casinos, convenience stores, hotels, etc
Produced 56 different styles of amazing craft beer in our first year alone
1,880 customer ratings on the UNTAPPD app in first 12 months
MOST AWARDEDHDC is the most awarded craft distillery in North America from the American Distilling Institute 7 years in a row. (Out of 2,000+ distilleries.)
#1 craft distillery in Washington in gross sales. 2020 Revenue surpassed the next 100 distilleries combined.
2019 HDC case volume accounted for more than 1% of all craft spirits volume in the U.S.
FAMILY & WOMAN MANAGEDFounded in 2011 as a family owned distillery. Still family led with a larger investor base. Largest independently owned Washington distillery.
MISSION
We celebrate the HERITAGE of our communities through the power of our award-winning spirits, visually intoxicating experiences and innovative programs, so that our customers become family, everywhere.
TRUSTED. LOCAL. SPIRITS.
• Cocoa Bomb ™ Chocolate Whiskey• Elk Rider® Vodka, Gin, Rum & Whiskeys
(HDC tasting rooms only)
• Batch No. 12® Vodka, Gin, Rum & Bourbon
• Naturally Flavored Vodkas• Dual Barrel Bourbon & Rye• 50 ml, 1 Liter & 1.75 L formats available
in select vodkas, gins and whiskeys• Heritage Series Vodka, Gin, Rum &
Whiskeys• D’s Seasoned Vodka
In partnership with Demitri’s Bloody Mary Mix
OUR PRODUCTS
• Tours, tastings, cocktails and bottle sales
• Cask Club® – subscription based customized barrel program (patented)
• Spirits Club® – subscription based regular pick-up or shipping of spirits (similar to a wine club)
• Spirits Growler® Line – refill and reuse your HDC growlers
Recurring Revenue Model
CONFIDENTIAL/PROPRIETARYProperty of Heritage Distilling Company, Inc.
CONFIDENTIAL/PROPRIETARYProperty of Heritage Distilling Company, Inc.
Tribe X
Tribe #4
Tribe #6
Tribe #3
Tribe #5
Tribe #4
Micro Hub
Regional Hub
(example – Chehalis 2020)
Retail
Retail
Tribal Beverage Network (TBN)
The Bracker Test White Mountain Apache Tribe v. Bracker, 448 U.S. 136 (1980)
(1) whether the regulated conduct occurs on or off a reservation;
(2) whether or not the party being regulated is a tribal member; and
(3) if the conduct being regulated does occur on a reservation, whether State interests outside the reservation are implicated.
“What Tribes Make, They Can Sell…..”
Manufacturer:Brewery, Winery, Distillery
Distributor/Wholesaler/State Control Agency
Retailer (store) /Bar-Restaurant / State Control Store
35%-55% Gross Margin
20-35% Gross Margin
25-50%+ Gross Margin/State Control Tax
100%
Bar/Restaurant –80% Gross
Margins
The traditional model for alcohol sales in the U.S.:“The Three Tier System”
• Exercise Tribal Sovereignty in this new industry (never legal before 2018)
• Keep state and local liquor taxes
• Create new amenities for repeat customer visits & higher spend by your guests
• Use local grains & supplies in your products
• Establish new jobs & industry in your community
• Improve food & beverage margins throughout all of your Tribal Enterprises, including casinos, convenience stores, hotels, golf courses, etc
Benefits for Tribes to Start Distilling
ROI to Tribes of 20%-45%
annually
Store Stacks/ Point of Sale
TV / Radio Ads
Sales Reps & Distributor Incentives
Store Sampling Events
Store Rebate Programs
Magazine/ Newspaper Ads
Sports Sponsorships
Paid Social Media Ads
Paid Social Media Influencers
Branding is expensive…..“How do I get the consumer’s attention?”
Boustead Securities Confidential - 15
Under the legacy system marketing dollars are spent on……
Boustead Securities
• Tribes own 522 of the largest on-premise alcohol accounts in the U.S.
• If any of your locations sell beer, wine, or cocktails……… you are already in the alcohol business……. 16
Solution: The New Modified Pull System
Manufacturer:Brewery, Winery, Distillery
Distributor/Wholesaler/State Control Agency
Retailer (store) /Bar-Restaurant / State Control Store
35%-55% Gross Margin
20-35% Gross Margin
25-50%+ Gross Margin/State Control Tax
100%
Bar/Restaurant –80% Gross
Margins
…but 2/3rds of the economic value is lost before it gets to you….
TRIBAL BEVERAGENETWORKTM
TURN-KEY PHASESOF DEVELOPMENT
Master Agreement
Phase 3 A/E Design
Equipment Spec./Ordering
Construction Support
Construction Admin. Support
Licensing / Permitting/State MOA
Pre-opening Hires
Opening
Operations Support
Marketing
Compliance Reporting
Training
Ongoing Training
Recipe Development
Opening Day
Phase 2 Scoping
Phase 1 Review
Construction Kick OffPhase 1 Phase 2 Phase 3
TRIBAL BEVERAGE NETWORK1) Execute NDA to Share Information2) Develop Site Specific Financial Projections3) Review Memorandum of Terms for Phase I Development and Beyond
Visit our booth - #1007 - to learn more
Next steps for interested Tribes…