by Michelle Boudin

It’s never been easy. That’s what Thomas Thacker, CEO and founding partner of Southern Grace Distilleries, says of the bourbon making business.

“If you look back historically, the bourbon business has always been a challenge,” he says. “It’s always been a hard-scrabble, low-margin way to make a living for people who work really hard and care about what they did and just took what was leftover at the end. We’ve had a couple of booms, right after the second world war and then again the one we’re in now.”

Thacker says the industry has been spoiled over the last 15 to 18 years as business boomed, but  things are tougher now than they have been in a while. 

“The industry has always been cyclical and seasonal and nothing is going to change that,” he says. “Nobody gets into the aged spirit business to make a lot of money in a hurry — it’s not the nature of the business, but different segments of the bourbon trade are feeling the impacts in different ways right now.”

For distilleries around the country, costs are going up. Southern Grace has managed to continue growing its revenue, however, largely due to the fact that the distillery is a popular destination thanks to its location in an old prison. 

Southern Grace is perhaps best known for the space they’re in. It’s an old prison that draws thousands of tourists every year. And that’s made all the difference.

“We’ve had our best year from a revenue standpoint this year but that’s because it’s driven by tourism. People are curious about being in an old prison it’s not just about the bourbon, so we’re insulated from the national trends.”

Still, Thacker says they’re costs are going up. 

“I think it’s something a lot of small producers are dealing with: At what point do you just have to add three or four dollars to the price to cover because everything is going up every day? At what point do you say we’ve got to change the price? We haven’t reached that point yet. I think it’s something everybody in the industry thinks about.”

Scot Sanborn, owner of Sutler’s Spirit Company in Winston-Salem, says he had to raise his prices by a dollar already, and worries he may soon have to for a second time.  

“I had just raised my prices last year to deal with inflation and then three weeks later the tariffs hit,” Sanborn says. “That affects most gin producers because I get my botanicals from Europe. Our juniper here doesn’t taste good, and for some reason my juniper prices more than doubled in the last three years. Things are tighter. It’s more or less adapting for the future, diversifying and different revenue streams.”

Sanborn started Sutler’s about a decade ago after mixing things up in his garage and realizing he loved the process. To strengthen the business, Sutler’s will soon release a barrel-aged rum, and is currently exploring a move to a new location that would include a bar. Sanborn says as much as loves making gin, it hasn’t been easy. 

“It’s been a lot more work than I ever expected,” he says. “I love being in the food and beverage scene and working with upscale restaurants and bars but things have definitely tightened up. The market matured. It was one thing when I was the third gin producer in North Carolina; now there’s 35.”

Oaklore Distillery opened in Matthews in the fall of 2022, and is getting ready to expand to a massive 50,000 square foot facility in LoSo later this year. The new space, expected to open later this year, will have an expanded production and barrel warehousing facility, restaurant, retail shop, and tasting room, says Vice President of Sales and Commercial Operations Jack Shute.

“It’s big, it’s an exciting time for us,” Shute says. “It’s scary because it’s a big investment to make, but we want to be closer to Charlotte proper. Matthews is great, but we want to be known as a Charlotte brand. We’re also doing vodka, gin, rum, and agave spirits. We’ve got a lot going on and we want to be closer to the heart of it.”

Still a fairly young brand having launched distribution in 2024, you can now find Oaklore in ABC stores around the state and a couple hundred bars and restaurants. Like everyone else, Shute says they’re feeling the pinch even as they expand operations.

“The demand for whiskey went up so high from the pandemic and now that that demand is kind of plateaued, everyone’s got a lot of whiskey in barrels right now. So the prices are naturally kind of equalizing and kind of coming down because of that.”

To stay in the local spirits business, it seems staying positive nearly mandatory.

“I’ve got a great staff, we don’t have a lot of turn-over,” says Southern Grace’s Thacker. “We know what we got into and we’re in the trade we chose so we still feel pretty lucky and the tourism part of our business provides a lot of cash flow and support.”