April 24, 2012 in Business, City, News
Dry Fly gearing up for June 1 change
Distillery boosts supply, hires delivery company
Spokane’s Dry Fly Distilling has a two-part plan to take advantage of the big switch in liquor sales starting on June 1.
That’s the date Initiative 1183 goes into effect, allowing more than 1,600 retail locations to start selling spirits across Washington state.
The Spokane-based distiller of whiskey, gin and vodka has amped up production of spirits, amassing a warehouse full of inventory that won’t go out the doors until June.
It’s also hiring another company to serve as its delivery agent. That company, Spokane-based Driftboat Beverage, will help Dry Fly get its products to more retail locations around the state.
Company co-founder Don Poffenroth said the reason for hiring another company is to keep the price of alcohol at or near current levels.
If Dry Fly hired a distributor, the state would require that company to pay a 10 percent fee on liquor sales, a provision added to the initiative to help offset the loss of direct sales to the state. The distributor fee drops to 5 percent after two years.
Instead, Dry Fly is setting itself up as the direct shipper of its products. Driftboat will simply deliver them.
“All the invoices are Dry Fly invoices. We do all the billing and the collection (on sales),” Poffenroth said, noting that Driftboat will be paid a commission on the volume it handles.
Driftboat is a new company, a subsidiary of longtime local fine-wine distributor Vehrs Inc., incorporated in the past 30 days, he said.
Dry Fly would be increasing its production at its East Trent Avenue location even without the initiative, Poffenroth said. The company installed a second production line late last year.
Dry Fly and one other distillery, Woodinville Whiskey Co., are considered the state’s two large producers of spirits. When Dry Fly started in 2007, it was the state’s only grain distillery.
Today there are more than 40, though most are small and produce limited amounts of spirits.