Paul Hletko, the founder and master distiller of FEW Spirits, is innovative and mischievous by nature. He doesn't think like everyone else.
When Hletko founded the distillery in 2011, he chose a location considered to be one of the birthplaces and strongholds of prohibition: Evanston, IL.
For 117 years—1855 to 1972—Evanston, was dry, having implemented an ordinance to prohibit the number of bars and restaurants from skyrocketing. The City Council didn’t allow off-premise alcohol sales until 1984.
Choosing to construct and open a distillery in the city that supported temperance for over a century sent a clear message: It’s time to move forward.
We asked Hletko five questions about the industry, how it changed in 2019, and where it’s going in 2020.
How has consumer behavior changed, and how are you helping operators adapt?
Consumer behavior hasn't fundamentally changed—people want what they want; they want it now, and they want it at a lower cost. Today’s consumer is perhaps more empowered than ever through avenues like social media and, as our society becomes more fragmented, reaching them becomes more difficult. As businesses, it’s our job to find ways to address those demands and challenges without necessarily compromising our own company values.
What changes or disruptors had the most impact on the industry in 2019?
The continued consolidation across tiers is gaining impact, as the scales evening the tiers continues to shift back and forth.
Costs seem to be rising on multiple fronts. How are you helping operators reduce them and maintain profitability?
Costs rise—that’s the nature of costs. Profitability is, of course, the key and I think there are metrics that are becoming less relevant. For example, pour cost—obviously, pour costs must be monitored, but banks only accept dollars, not percentages. Focusing on customer experience and delivering an experience that is contagious is the key to driving and growing profitability. It may well be that a pour cost goes above a certain percent, but if the customer experience is superior, it translates into more dollars to deposit.
What new product(s) or innovations are you most excited about?
Innovation of any kind is always going to get my attention. For example, we just released FEW Cold Cut. It is an actual innovation in the whiskey space that delivers a lot of value. We took cask-strength FEW bourbon that’s mashed, fermented, distilled, aged, and bottled at the FEW distillery. We then cut it with cold brew coffee. It’s a completely new drinking experience.
Looking at what's next, what's your forecast for your business and the industry in 2020?
The industry will continue to take off and grow. There's a lot of competition for operators to contend with, ranging from Netflix et al. to legalized cannabis and its effect on changing alcohol consumption channels. But compelling experiences will continue to get folks out of their homes to enjoy.