Helping Hands

Peter Dignan, Lost Loch Spirits.

Published: 15th May 2019

Contract distilling services have helped a variety of Scottish Gin brand owners get their Scottish Gin business off the ground. The distilleries that provide contract distilling services are a gateway for many who are passionate about launching a Scottish Gin brand but lack the resources to open a distillery. In our ‘Helping Hands’ editorial series, we shine a light on these distillery owners who play a crucial role in contract distilling. We explore their processes, involvement, and the benefits and pitfalls of this unique arrangement.

Can you introduce yourself and tell us about your business and background?

My name is Peter Dignan, and I’m one of the co-founders and head distiller at Lost Loch Spirits, based on Royal Deeside on the outskirts of Aboyne, Aberdeenshire. I work in the oil and gas industry but saw an opportunity to turn a passion for spirits into a business during the downturn. With my business partner and co-founder, Richard Pierce, we established Lost Loch Spirits and opened our distillery in 2017. We have three own-brand products and can produce 100,000 litres per year across two stills.

What contract distillation services do you offer?

We offer recipe R&D, production facilities, bottling/labelling, storage, and shipping and packaging services. We also offer our clients the opportunity to get as hands-on with the process as they wish. We believe in offering a home for a brand, and our clients should be proud to say where their product is produced. We are also happy to share the knowledge and contacts we have amassed over the last few years.

Peter Dignan (left) and Richard Pierce (right), co-founders of the Lost Loch distillery established their business in 2017. Image ©The Gin Cooperative.
The Lost Loch Spirits distillery is located on Royal Deeside in Aberdeenshire, a short drive from the nearest village of Aboyne. Image ©The Gin Cooperative.

What’s your process for creating a contract distilled gin?

Every client is different. Some come with an idea, and some require inspiration. We always let the client lead, as it’s their product. The first thing we do is have a chat and work out what flavour profile they are looking for. From there, we create a few recipe iterations and start running/tweaking them until the client has a product they are happy with; the process then moves to upscale the recipe, working towards a final production run of the first batch.

What are some of the challenges you face when contract distilling a gin?

It’s not a problem as such, but when scaling from the 2 litre run to a 400 litre run, we find that some botanicals act differently due to the longer boil times. The more iterations we run, the easier this becomes, as we know how certain botanicals react during the upscale process.

What stages of the contract distillation process do you enjoy the most?

When you hit the sweet spot and know you have just nailed the recipe, it always brings a smile. I also enjoy assisting people who have an idea for their gin but need help figuring out where to start. A big part of what we do is about educating our clients, something we’re passionate about. We want the people who work with us developing their gin or spirit to understand the process and some of the broader aspects of the spirits industry. There’s a sense of achievement when you see the finished product on the shelf, bottled with packaging, knowing that you helped your client get to that stage.

How involved are you in the development of the recipe for a contract distilled gin?

Every client is different, but we are usually heavily involved with the recipe’s development. We always let the client take the lead regarding the flavour profile they are trying to create, and we assist in getting them to where they need to be.

Several smaller traditional Portuguese Alembic copper pot stills are used for recipe development. Image ©The Gin Cooperative.
The Lost Loch team maintain a large library of botanicals ready for use in recipe development. Image ©The Gin Cooperative.

Has contract distillation work helped you develop your skills as a distiller?

Without a doubt, I’ve had the opportunity to run hundreds of different recipes and iterations, allowing me to see the distilled profiles of so many other botanicals. It’s all been in the name of R&D.

How important is contract distillation work to your business?

Contract distilling is important to us, but it is only one aspect of our business. We want to work with a limited number of brands/clients so as not to dilute the contract experience and service we offer.

Why do you think contract distilled gins are sometimes frowned upon?

Contract gins are often misunderstood. When people think of a contract gin, they usually imagine it being produced in large volumes at an industrial distillery without input from the brand owners. Most people want to get hands-on with the production, and our clients spend a lot of time with us at the distillery perfecting their gin. A contract gin produced at a small craft distillery is no less an artisan product than a distillery producing its own brand of gin.

What advice would you give to someone who’s looking to get a contract distilled gin made?

Secure your Intellectual Property, including business name, brand name, website domain, and social media channels. You want to have all these assets under your ownership so you don’t have to negotiate with someone else or find yourself in a costly legal argument over who owns the rights to a name.

Botanicals and carefully measured and weighed for use in recipe development. Image courtesy of Lost Loch Spirits.
The main production still, an iStill, at the Lost Loch Spirits distillery. Image ©The Gin Cooperative.

Do you think the consumer cares if a gin is contract distilled?

When it comes to food and drink, consumers are often attracted to a product because of where it is made. This is where transparency and honesty from all businesses in the Scottish Gin industry count. No one likes being lied to, especially when someone buys a product based on where it claims to be made and who made it to find out later it was a lie. Building confidence and trust between businesses and consumers can only happen when consumers know the facts and truth.

Should all brand owners clarify where their Scottish Gin is distilled and by whom?

Suppose a business with a Scottish Gin produced under contract sends out misleading marketing materials or pretends to be a distillery. In that case, the distillery making the products is responsible for educating their client and protecting consumers. All Scottish Gin brands should be honest about where and who makes them.

Many brand owners with a contract distilled Scottish Gin plan to establish their own distillery one day. Is this true of the brand owners you work with?

I would say it’s a 50/50 split. Building a distillery is a costly exercise and for some, being brand owners is more appealing than being distillery owners.

If a form of protection for Scottish Gin as a spirit category is one day introduced, should contract Scottish Gins be afforded the same protection as non-contract-distilled Scottish Gins?

It’s only fair that if a contracted gin is produced and bottled by a distillery in Scotland, it should enjoy the same protection as a non-contracted gin. This ensures a level playing field for all gin producers, protects consumers and can help the Scottish Gin category grow collectively.

You can learn more about Lost Loch Spirits here.

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