Inside the Company Behind Your Favorite 'Craft' Spirits


Feb 12, 2018 .  6 min read

Dozens of your favorite "craft" whiskey brands come from the same distillery in Indiana

Imagine going to a clothing store and buying a shirt prominently labeled "produced in America," only to find out later that the fabric was made, cut and sewn into a shirt in China, then shipped to the US and “produced” by merely putting it in boxes. You’d be confused, and maybe even indignant, right?

It sounds kind of outlandish, that’s exactly what’s been happening with much of the "craft" whiskey in America. In this case, however, it’s not necessarily a bad thing. If you take a close look at the dozens of new whiskey brands that have come out in the last decade or so, you might notice something a little odd. Many of them are labeled as "made by," “bottled by” or “crafted by” a company in one state, but also say “distilled in Indiana.”

The odds are that you’re looking at a whiskey distilled at a massive but publicity-averse distillery in Lawrenceburg, Indiana, owned by Kansas company MGP Ingredients. The facility has been making whiskey since 1887 and is one of the five largest whiskey distilleries in the US, but until recently, it didn’t sell even a single product under its own name.

A few years ago, when hipster bartenders and spirits geeks first discovered just how widespread MGP’s products were, there was something of a backlash. But since then, they’ve come to embrace it as one of the finest whiskey distilleries in the world, and the once-shy distillery is finally starting to step out of the shadows. In 2015, MGP was named distiller of the year by Whisky Advocate, and the following year, it released its first whiskey bottled under its own name.

If you’ve never heard of MGP, don’t feel bad: The company doesn’t really sell anything directly to consumers. But if you want to start your own spirits brand tomorrow, it’s the place to go. Between its two distilleries—the one in Lawrenceburg and another in Atchison, Kansas—it ferments, distills and ages a staggering variety of spirits, including 12 different whiskey mashbills, neutral grain spirits and eight separate styles of gin.

MGP Ingredients in Atchison, Kansas. Photo courtesy MGP.

"Sourced alcohol is a vital part of the industry. It’s been going on practically since the first still was erected," says Gus Griffin, MGP’s president and CEO. He cites blended Scotch brands like Johnnie Walker, which have been mixing together spirits of multiple ages from multiple distilleries for as long as they’ve been on the market. “You need different people’s Scotch to get your blend. Selling sourced alcohol for other people to turn into brands has been a part of the industry forever, and it’s industry-wide.” Sounds reasonable. But scandal struck in 2010, when an MGP-sourced brand called Templeton Rye—which touted itself as made in Iowa from Al Capone’s own Prohibition-era recipe—was revealed to be a Lawrenceburg product. A class-action lawsuit over the brand’s deceptive labeling was settled in 2015, and along the way, "sourced" became a bit of a slur among whiskey experts.

"You know, I think MGP and its products are great," says Mike Raymond, who owns Houston whiskey bar Reserve 101 and presented a seminar called “Sourced Is Not a Four-Letter Word” at the 2017 San Antonio Cocktail Conference. Instead, Raymond takes issue with brands being deceptive: His bar offers some 355 whiskies from around the world, but he still doesn’t carry Templeton (despite the fact that it updated its label to be clearer about where it comes from), and he also refuses to sell any “Texas” whiskey not actually distilled in Texas.

MGP insists on strict non-disclosure agreements with anyone who buys its whiskey ("We don’t want our competitors knowing who our best customers are!" Griffin says), but many of the brands sourced wholly or partially from there are an open secret in the bar business, and Raymond carries plenty of them, including spirits from Redemption, High West, Smooth Ambler and Angel’s Envy.

Whiskey aging in barrels at MGP's distillery in Lawrenceburg, Indiana. Photo courtesy MGP.

If you’re willing to pay for it, MGP can create just about any type of whiskey you can imagine. You can sit down with a master blender to mix together existing spirits to highlight any flavors you want, or the company can create an entirely custom spirit, using the mashbill, yeast, stills and barrels of your choosing. But, Griffin says, "once the liquid is done, that’s where we stop. There’s a tremendous amount of value and creativity and artistry, not only in taking our liquid and customizing it to their brand, but also doing all the packaging and marketing and all that."

Chuck Cowdery knows whiskey and its marketing, having worked in the field in both Kentucky and Chicago for many years before he turned to whiskey writing, starting The Bourbon Country Reader, the oldest publication focused exclusively on American whiskey, in 1994. (He’s since published three books on whiskey.) He has no issues with the people who make sourced whiskey, but he’s long been a critic of brands that obscure where they come from. "The reason it’s a scam is that you don’t have to say anything on the label. So people who are saying ‘made by’ or ‘produced by’ [a company other than the one that distilled the whiskey] are trying to convince you of something that isn’t true," he says.

But, Cowdery adds, "MGP whiskey has never been bad whiskey; it’s always been good whiskey." And Griffin knows that, too, which is why his company is finally starting to sell its own products to consumers directly. In 2015, the distillery released a limited edition called Metze’s Medley, a blend of MGP whiskies named for then-master distiller Greg Metze and sold to support local United Way chapters near the MGP distilleries. It was so popular that a larger batch, called Metze’s Select, came out nationwide the following year and sold out rapidly.

Metze left the distillery late in 2016, and MGP created a new house brand that launched last summer, named for Prohibition-era bootlegger George Remus, along with a special Repeal Reserve edition for Repeal Day (December 5, the day in 1933 that Prohibition officially ended).

Fermentation tanks at an MGP distillery. Photo courtesy MGP.

"Our core business will always be supplying people with quality products, but we also thought there was a chance for us to reach consumers with a little bit of our own voice," Griffin says. The philosophy behind the Metze’s Select and George Remus can best be described as radical transparency—the labels proudly proclaim they’re distilled in Lawrenceburg, Indiana, and list extensive details about the ages and compositions of the spirits in the bottle. Griffin insists that he doesn’t see the new products as competing against MGP’s own customers on the shelf, though. “We’re not changing our core business, but we wanted to really show off our artistry and our craftsmanship. We’re not in the business of ‘let’s see how many brands we can rush out.’ It’s a big initiative for us and in a way it’s a big adventure for us,” he says. “It will be a very slow process, but I think we will have more brands, the focus being on the quality and the uniqueness and the ability we can bring to it.” So why does any of this inside baseball actually matter? Cowdery puts it best: "I want people to get interested in whiskey and I want them to feel good about that hobby. And when something happens to cause them embarrassment or like they’ve been made to look stupid, that’s a bad thing. It’s bad for the industry when people do things that ultimately make the consumer feel bad, because they feel like they’ve been duped."

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