One Year Later, Destihl Grows To Global Beer Player | WGLT

One Year Later, Destihl Grows To Global Beer Player

May 31, 2018

When you think of Bloomington-Normal brands with national or even international reputations, it's State Farm and Beer Nuts. Now Destihl is on the list.

Destihl recently marked its one-year anniversary since opening its brewery and beer hall in north Normal just off Interstate 55. That new $14 million facility has allowed Destihl to expand its distribution to 22 states, plus South Korea and the United Kingdom, and welcome more out-of-town visitors to Bloomington-Normal.

Twenty years ago, Destihl CEO and Brewmaster Matt Potts was brewing five-gallon batches at his home. His first Destihl location (the restaurant in Normal) could make 250 gallons of beer at a time. Now, Potts runs a brewery that can handle 1,800-gallon batches. If he had the fermentation capacity, he could do 150,000 barrels of beer a year.

"Everything's bigger,” Potts said. “The batches are bigger, the expenses are bigger, the sales are bigger ... the team is bigger, our market reach is bigger."

All that beer requires a lot of supplies. Destihl gets cans delivered by the truckload ... 200,000 at a time.
Credit Carleigh Gray / WGLT

And the list goes on.

Destihl has helped put downstate craft beer on the map. Three other craft beer taprooms have opened in Bloomington-Normal in the past year.

Potts himself has emerged as a sort of symbol of successful Midwest craft brewer. Gov. Bruce Rauner even recently visited to tour Destihl as a successful Illinois business.

Does all the attention feel normal yet?

“When you plan on that, or you envision that, then when it happens it feels kind of more normal, but at the same time it’s a little surreal. Like, do you realize we just sent beer to South Korea or the United Kingdom?” Potts said.

By the end of 2018, Destihl's U.S. distribution could reach 30 states. It arrived in South Korea six months ago, then the U.K. this month.

Potts said they're trying to get a feel for what kinds of styles South Koreans and Brits like to drink. Destihl is well-known nationally for its line of Wild Sour beer, but it also does IPAs, pilsners, and stouts.

“I think the South Korean market is a little bit like Bloomington-Normal was in 2007,” Potts said. “(They’re) definitely into IPAs and stouts which is fine because we can send plenty of that there as well. The U.K. market is pretty well developed so it’ll be interesting to see what kind of beers that really sell well there.”

Potts said he now finally has time to focus on bringing to Destihl to new markets and just running the operation—instead of just thinking only about expansion. Destihl has 275 employees between Normal and Champaign, including 125 workers at the brewery.

Starting Up, Then Ramping Up

If 2017 was the startup year for Destihl, 2018 is the rampup year.

“Last year was really just about getting the inventories built up and getting stabilized,” Potts said. “But hopefully within about 12 months, we would be maxed out at our capacity here. And when I say capacity, I’m not talking about the facility. I’m talking about the equipment that we have.”

All that beer requires a lot of supplies. They get cans delivered by the truckload—200,000 at a time.

They buy thousands of pounds of hops. When they're doing brewing, they send up to 60,000 pounds a week of used-up grain to the Ropp farm, where it can reused as animal feed.

Quality control can be a nightmare even with a small batch of homebrew beer. If you don't clean your equipment, your beer can come out nasty.

At Destihl's scale, quality control (QC) is way harder. Potts said they've recently expanded their lab and QC program, including a full-time lab technician with a biology degree.

"This pretty high-tech lab equipment we're trying to add, just to have more tools at our disposal, to make sure that our beer can survive as long as possible on the shelf,” Potts said.

And not just on the shelf, but all the way to South Korea. The international distributors that Destihl works with refrigerates from when they leave the U.S. to arrival at stores overseas.

“It’s more critical with IPAs because IPA shelf life is so short ... anywhere from just three to four months,” Potts said. “So if you have a month of that time spent on a ship you obviously want to make sure your QC program is spot on.”

Surprises in Normal

Back in Normal, Potts said the new brewery and beer hall have exceeded expectations—and brought with it some surprises.

Destihl will host the Field Day Beer Fest on Saturday, June 2, 2018. It's an Illinois Bicentennial official endorsed event that's benefiting the Illinois Craft Brewers Guild.
Credit Carleigh Gray / WGLT

They initially kept the beer hall's food menu limited, in hopes of not cannibalizing business at restaurant on Towanda Avenue. But they found the beer hall hasn't hurt business there, so they're adding new things to the menu.

Potts said they're also enjoying the freedom of a new pilot brewing system for more adventurous styles.

“We can brew beers that we just want to sell to our local fans. There's a lot of sense of freedom and creativity that it brings, and unleashing the creativity of all of our brewers has been awesome as well,” said Potts. “That way we get a lot of variety and a lot of beers that may only come around once, maybe they’ll come around over and over if they’re really popular. But we’re not locked in with beers that we have at the beer hall which is, again, pretty liberating."

Potts said they were surprised by the demand to host events at the new brewery. They've cleared out some of the hundreds of barrels in the barrel room and made it an event space.

“We didn’t really plan on having an event space per se, but we had so much demand from people wanting to have their weddings, birthday parties, retirement parties here,” Potts said. "From a business standpoint I couldn’t say no to that for very much longer.

"Maybe we just got lucky that we had planned that second-story barrel space, so we moved a lot of the barrels upstairs, opened up that event space, and now we're hosting events all the time and it’s only going to continue to ramp up."

There's another sign Destihl is doing OK.

"Our parking lot is already too small," Potts said. "Those are good problems to have, but we're not really in a position to be adding onto our parking lot right now."

Industry Changes

Destihl's expansion has coincided with major growth in the craft beer industry overall.

Craft now makes up around 13 percent of the beer business. But after years of double-digit growth in volume, that growth slowed to 5 percent last year, according to the Brewers Association (BA). Nearly 1,000 new breweries opened in 2017, but 165 also closed, BA reported.

Those are signs of a maturing craft beer industry—and Potts doesn't seem too concerned by it. He said he's more optimistic than ever about consumer taste—more beer-drinkers being open to something other than a Bud Light.

“The biggest change really in the last few years has been the explosive growth in the number of breweries,” Potts said. “The explosion in the number of craft breweries has been more than impressive. You’re even seeing that here locally. We went years of being the only brewery around. Now within just a couple year timespan we’re seeing several breweries opening up here in town and others that are opening up downstate.”

Potts said he welcomes that. He said he's been trying to be an evangelist for downstate Illinois beer for years—in a state where Chicago dominates.

Now downstate is taking off. The other local breweries Potts mentioned have all opened taprooms in the past year: White Oak in Normal and Lil Beaver and Keg Grove in Bloomington.

All three of those will be participating in this weekend's Field Day Beer Fest at Destihl. It's an Illinois Bicentennial official endorsed event that's benefiting the Illinois Craft Brewers Guild.

"I've never seen as much camaraderie in an industry as (we have) in the craft beer industry."

“I’ve never seen as much camaraderie in an industry as (we have) in the craft beer industry. Because we all try to help each other, even with the competition,” Potts said.

Even though there is a lot of support between the companies, they are still competitors.

“We also have to distribute in a highly competitive world now, and other markets that have a lot of their own local breweries for us to compete with. For us it’s a matter of having a product that stands out that’s extremely unique,” Potts said.

As Destihl gets bigger and bigger, Potts say he gets asked the same question: Will he sell to an even larger company?

Illinois has a bit of a history with notable craft brewers being acquired, with Goose Island going to Anheuser-Busch in 2011. Last year, Lagunitas was fully bought out by Heineken.

“We built this brewery because we love what we do. We have a passion for brewing, we love coming to work every day, especially now that we’re in this facility,” Potts said.  

"You see some (groups) that may get into the business ... for the sole purpose of building a brewery to sell it. It’s never been our purpose in life to do that. That's not our intent.”

For now, Potts has his eyes in front of him—focused on growing Destihl's business, and finally, not its physical footprint.

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