One of the things I found most interesting about Jim and Jamie Walter and their path to launching Whiskey Acres, their value-added whiskey business, is their forethought. They started thinking about ways to grow and diversify their business more than three years ago – when times were good.
"We saw this coming," said Jim Walter. Jamie concurred: "It was a very strategic play to capitalize on high income years - very good production years. To diversify and move up the food chain."
"We had a high confidence that high prices wouldn't last," Jim added.
But whiskey wasn't their only idea.
"We gave serious consideration to the big operator model," Jim said. "For a variety of economic and social reasons, we decided not to go that route – but to pursue the value-added model instead."
Why? Mostly because of the effects it would have on their neighbors.
"We felt land values were already non-sustainable," Jim said. "We didn't want to contribute to something that's not going to help us long term."
Jim and Jamie were both quick to add that their decision isn't a critique of the big operator model. "What we're doing isn't better or worse, it's just different," Jamie said.
So far, whiskey is looking pretty good, though. Distilled spirits are the fastest growing alcoholic beverage category and within that, bourbon is the fastest growing segment. The father and son, along with business partner Nick Nagele, estimate they're adding at least $150/bushel in value to their corn, with about three pounds of grain per bottle, and bottles retailing north of $32. Plus, they can turn production on and off seasonally to utilize labor.
They're also capturing value in transparency. Every Chicago whiskey connoisseur can come to the farm, walk through plots, watch the distilling process, sample the wares and take a bottle home. Or buy a bottle at their favorite store. Either way.
"Come here, see seed in the ground and spirit in the glass," Jamie says. "That's an opportunity. Absolutely it's worth more."
"This might be better than renting 10,000 acres!" Jim laughs.
More in this series:
- So you want to make some whiskey?
- Whiskey or 10,000 acres