Interviewer:
With the possibility of the fourth alcohol ban looming, leaving the South African liquor industry questioning their own survival. We talked to Lucy Beard co-owner and distiller at Hope Distillery. Started in 2014, Hope was the first licensed gin distillery to open in Cape Town. And it has since built a reputation, not only for its own distillations but also for the guidance they have shown to fledgling brands around the country.
Thank you for joining us.

Lucy Beard:
Thank you.

Interviewer:
Now, tell us a little bit about what it's like to be a craft distiller in South Africa over the last year.

Lucy Beard:
Yeah, well, it has been a roller coaster to say the least. In March last year lockdown was introduced in South Africa as it was in much of the rest of the world. And there was lots of different regulations all over the place. But the last thing we expected was an alcohol ban, which was suddenly sort of put in place with immediate effect. And as the country came out of lockdown and went back into lockdown, we actually had a further two bans. So we had three alcohol bans over the course of last year and it meant sort of over three months of not being able to sell. And the initial ban also banned any movement of alcohol. So we weren't allowed to export, let alone sell locally.

Interviewer:
Oh really?

Lucy Beard:
Yeah. So that was really, really damaging. Particularly for the wine industry because exports are kind of timed to go into various countries at specific times. And I think much of the export to the US and Europe was kind of about to be missed. And so luckily the wine industry lobbied hugely and eventually the government came to its senses and allowed movement and exports. But yeah, all internal local sales were completely banned for quite a significant period. So it was challenging to say the least.

Interviewer:
What was the government's logic behind that?

Lucy Beard:
So they... I mean, there was lots of research. I mean, initially we actually had a smoking ban ... well, a cigarette ban as well. And it was all to do with freeing up hospital space. There's a lot of alcohol induced trauma, both from drink driving and family sort of domestic abuse caused by excessive drinking. And stats showed that a large number of hospital beds were taken up by alcohol related cases and they wanted to free up as many beds as possible, expecting them to be needed for COVID patients. And the logic behind the smoking ban was that smoking impacted your lungs and so did COVID and they wanted smokers to stop smoking. The smoking ban, there was only one and sort of by the time of the second lockdown and the second alcohol ban, smoking was allowed. Well, sell cigarettes was allowed. But the logic was still that no alcohol related incidents took up hospital beds and that that needed to be addressed.

Interviewer:
I wouldn't thought you were one of the hard-hitting alcohol countries of the world though.

Lucy Beard:
I know. I mean, the research does show that our consumption is excessive. But I think the problem is there's a lot of irresponsible drinking and that is actually relatively small minority of the population but with dramatic impact. I remember on the eve of the second lockdown, when our president Ramaphosa spoke to introduce that second alcohol ban, he was able to sort of say one of Johannesburg's busiest hospitals, the trauma units had been empty because there were no alcohol related incidents from the first ban. And so this was evidence that it was working. So very frustrating.

Interviewer:
Being a small craft distiller it must've hit you guys really hard?

Lucy Beard:
Yeah, absolutely. So the initial ban was from the 27th of March until the 1st of June. And then it was banned again on the 12th of July. So we had sort of a six week window when luckily lots of people stocked up and there was also sort of a worry amongst the general population that there might be another ban. So people rushed out and bought lots. Which, I mean, I don't know if that was what the government was wanting. And then, so between the 12th of July and the 18th of August was the second ban. And then the third ban was over new year. They actually closed beaches and banned alcohol. And obviously, New Year is traditionally quite a festive alcohol-fueled season. But alcohol was bad for the whole of January as well.
January is usually a... Well that period is such a good time for alcohol sales and if you're in the spirits industry. It's South Africa summer, the gin business booms in summer. So in one sense, some of the earlier bans had been over winter when things are quieter. But the third ban, literally wiped out everyone's big sale period. So that was very challenging.

Interviewer:
Now, South Africa is a survivor to periods of isolation in the past. Can the liquor industry see a way through this?

Lucy Beard:
Yeah, I mean, ultimately South Africa in the past, apartheid days when we were completely isolated from the rest of the world, the world was a very different place. Now, I mean, being a Cape Town based distillery and a lot of the alcohol industry is based around Cape Town. We realise how much we rely on tourism. And so being isolated has been even more challenging because the tourism business has obviously dried up completely as it has in the rest of the world as well. So being a craft distiller, we suddenly realised how much gin tourism and kind of distillery tourism they was. And how many of the bars, restaurants and hotels supported us because they were servicing tourists who were interested in local products and buying local and drinking local. And that's been a huge impact. And that is something that's going to be very difficult to recover from. And certainly, general sort of sales in the craft spirits industry and the craft beer industry, I think, have been impacted by the lack of tourism and the challenges getting locals to support local and often that means spending a little bit more. And of course, financially people are having a tough time of it as well. So it's going to be a real challenge to bounce back from this property until things really start opening up again.

Interviewer:
Now, I know a lot of the bars around the world have been looking into creating different income streams. Is that something that you guys and other distillers have been exploring?

Lucy Beard:
Yes. And certainly a lot of bartenders who found themselves out of work because of the alcohol ban looked at doing all sorts of other things as unique events, looked at doing sort of prepping and getting ready to launch bottled cocktail offerings. So we helped out with a few of those and then some of the distilleries looked into and got into hand sanitiser. That was slightly more complicated because you needed different licensing and registration for it. So again, it was kind of more challenging than I think, it should have been. But yeah, a few managed to really make a huge success of it, which was amazing.

Interviewer:
Now I imagine you've got distillery tours and your own little distillery bar set up. I imagine those have been closed for months now.

Lucy Beard:
Absolutely, we've sort of been... We had actually just towards the end of 2019, opened properly as a bar. Mainly just on a Friday and Saturday, Friday night and Saturday. And of course had to close that down in March. Reopened briefly mid year, but then closed again. And of course, there've been restrictions around numbers of people allowed in anywhere as well so we were never able to kind of gear it back fully. And now it's closed again. We don't think it's responsible to open with third wave looming and we haven't been offering tastings at all. We did launch a home tasting kit where we would send a little gift pack of our gins and garnishes and notes so that you could do gin tastings at home. But yeah, sadly, we just haven't had anyone really through the distillery at all, which is sort of such... had been such an integral part of the business. And it was so wonderful because our tasting room overlooks our distillery floor. So people come in and sort of can see the distillery in action. And of course that hasn't been happening at all.

Interviewer:
Is there any word yet on whether a fourth ban will come into place?

Lucy Beard:
Well, there are lots of rumours. They've been quite a lot of studies about how successful bans are. At some stage sort of after the initial bans, there were then limits on when alcohol could be sold, there were curfews. Bottle stores weren't allowed to sell on Fridays, Saturdays and Sundays. Restaurants were limited. Also sort of evenings and weekends, which was very challenging for them. But a lot of the studies say that that doesn't really actually make a difference. The only thing that makes a difference is a full ban. So that's fairly worrying. We know that the sort of National Executive Committee and the Coronavirus Command Council of South Africa met at the beginning of the week. So we're expecting an announcement any day now. And rumours are rife that it might bring another ban or at the very least restriction on sales over weekends again. But of course, the liquor industry has been lobbying hard. But yeah, who knows how far their efforts will reach. So yeah, I think we're gearing up for it and desperately hoping that it doesn't happen.

Interviewer:
I imagine that you're actually one of the few countries in the world that has taken that step to ban alcohol during any of lockdowns?

Lucy Beard:
Yeah. And it's such a strange... I mean, as I said earlier, at the beginning, it took us all by complete surprise. It was the last thing we were expecting to happen, but the worry is that it will happen again because hospital beds were freed up. And yeah, it's been interesting because so few other countries have done it. I think there was one other, I can't recall offhand, which it was who temporarily introduced a ban. And there have been some like our neighbour Namibia, did some restrictions. So no Sunday sales, that kind of thing. But a complete ban has been pretty unusual.

Interviewer:
Now you mentioned that export was banned in the first ban. But I imagine it you were able to do that from mid last year onwards. Has that been keeping the stills working at all?

Lucy Beard:
Yes. And it was quite amazing actually. I mean, people we'd had dealings with in the past who sort of imported our spirits actually got in touch and were amazing at placing orders, knowing that we were having such a tough time of it. So it really showed that the world kind of tried to rally around the South African alcohol industry, which was quite incredible. And we did see a nice increase in our exports. And it is something we're going to be concentrating on for the foreseeable future to really try and drive forward just because local sales are down.

Interviewer:
As I mentioned, you act as an advisor and contract distiller for a number of micro brands. How have they been fearing?

Lucy Beard:
It's been tough for everyone. Interestingly, we don't know of any who've actually folded, which is fantastic. But sort of... Everyone's numbers are way, way down. We've been trying to do joint exports. So sort of exporting ours and a number of other brands, which has helped. But they certainly sort of in the local market being a big contraction in the craft spirits world. I think some of it price related and obviously a lot of it alcohol ban related, but also people are going out less and drinking less. And it has impacted all of us, the baby brands in particular, sadly.

Interviewer:
Now contract distilling was a fair chunk of your business, I imagine. So that must be an added setback for you guys?

Lucy Beard:
Absolutely. Absolutely. And we contract distill for three relatively large craft brands in the market and they have all shrunk in terms of sales quite significantly, which has been... Obviously has had a real impact on us.

Interviewer:
As I mentioned, you guys are best known for your gins. Do you want to walk us through the three expressions that you carry?

Lucy Beard:
Absolutely. So we do a London dry, so our Hope London Dry. And it was the first gin we launched. We wanted to launch a classic London dry style, London dry methods. So one-shot method, only natural ingredients. We wanted to make it a uniquely South African expression. So we use lemon pelargonium in it, which is a fresh, bright lemon. We use the leaves, which are amazingly fragrant. But it's quite a simple gin. So sort of citrus, coriander, juniper, and lemon pelargonium, a little bit of rosemary and it's really our take on a classic.
It's been interesting because locally there was sort of such an explosion of interest in gin and then people wanted to try all the weird and wonderful flavours. And we always had our London dry knowing that it was... it's something we wanted to offer as a craft distillery. But knowing that it was, sort of people like, "Oh, we know what a London dry tastes like we want to try something else."
But it's been slowly building and building and is sort of... We never expected it to be sort of neck and neck with the other two but it has been, which has been fantastic.
And then we do our African Botanical Gin, which is... It used to be called our Salt River Gin, but everyone kept on saying it was salty and which it isn't. But because the distillery is based in a suburb of Cape Town called Salt River. And we actually, when we changed our labels, we decided to change the name just to rather describe what was in the bottle than confuse people. And it is sort of a celebration of South African fynbos, which is a sort of a range of plants unique to the Western Cape.
And we used two fynbos varieties in the gin. One called kapokbos, which is a wild sweet rosemary. And the other called buchu, which is spelled B-U-C-H-U and is a fragrant shrub. The variety we use has got quite a blackcurrant flavour to it. And it's quite interesting because the fynbos is quite punchy. So it makes for a very aromatic gin and which opens up beautifully on tonic. The citric and the tonic and just diluting the fynbos favours really sort of sweetens it and makes it really, really sing. I would say it's South Africa in a glass.
And then our third expression is our Mediterranean Gin. And we were actually sort of inspired to launch the distillery and go on this journey after spending quite a lot of time in Spain while traveling and seeing the gin revolution really kind of take hold of Spain in 2013.
And one of the gins that I absolutely loved was the Gin Mare, which was olives and herbs. And so I wanted to do something similar, almost to celebrate the fact that it was in the Mediterranean that we decided to go on this journey. But it's a South African take on it. And so with local olives and basil, rosemary, thyme and lemon thyme and lots of orange peel. And so it's far more complex than the other two, savoury and unusual.
And it's been an interesting sort of seeing South Africans reactions to it. Initially, people are sort of, “What, you can't put olives in gin." But people tasted and fall in love with it. And it's the one gin that where we do have, sort of in the past when people were coming for tasting, sometimes you'd have a group and one of them would sort of say, "Oh no, I'm not a gin fan.” And it would always be the one that they would then fall in love with because it's not your typical London dry, it's got other flavours that come to the fore and people actually are quite gobsmacked literally. And yeah, so it's been fantastic.

Interviewer:
Now, aside from having decided to start the distillery in Spain, could you say that the Cape Town has a bit of a Mediterranean climate of its own? And do you think that that gin then kind of represents the city?

Lucy Beard:
Absolutely. And I mean, it's amazing. The olive oil industry has really taken off in South Africa because our climate in the Western Cape is so good for olives. And so more and more of the wine farms are also growing olives as well as vines, launching olive oils. And it is because it is that kind of wonderful Mediterranean climate. Cape Town being on the sea sort of the white beaches and the crystal blue ocean but it's freezing. So certainly not the Mediterranean, but yeah, no, it definitely has... It's sort of, it feels like a little piece of the Mediterranean on the tip of Africa.

Interviewer:
If you had to choose a cocktail to go with each gin, what would you pick?

Lucy Beard:
So for the London dry, definitely a martini. We use a grain spirit for it just because we want it to be beautiful and smooth and the juniper citrus is the perfect martini gin. Myself, I like quite a dry martini. The African Botanical goes really well with grapefruit and so sort of a take on a salty dog with grapefruit and a bit of sugar syrup is perfect. And the Mediterranean works so amazingly in a Negroni, it makes for very complex, quite unusual Negroni. And we tend to break the rule of the equal parts and just lift the gin part up slightly for that to really shine. And it's phenomenal.

Interviewer:
Now you mentioned with the African Botanical Gin that you use native ingredients, can you talk about their significance and the flavours that they impart?

Lucy Beard:
Yeah, absolutely. So Cape Town is sort of surrounded by this floral kingdom, which is unique in that, I think it's the only sort of separate floral kingdom entirely within one country. And it's actually in quite a small part of the country and it has, I mean, thousands, I think 9,000 different species within the floral kingdom, which is quite amazing. And fynbos is a sort of significant part of it. Fynbos, is an Afrikaans word which literally translated means ‘fine bush’. So not very descriptive and comprises an enormous array of different plants. A lot of which have been used traditionally for medicinal purposes and in healing and also to flavour drinks. And so we use two, just two varieties because we wanted to keep it quite simple.
But one of the ones I mentioned earlier is buchu and actually sort of way back for years and years and years since brandy has been quite a popular drink in South Africa and buchu brandy was quite a thing. But buchu was traditionally used for both drinking for stomach ailments, you'd mix it into kind of a buchu tea and then as a tincture for bruises and cuts. And so it's good for you as most botanicals are. And it's quite amazing because within the buchu family, there are quite a few different buchus and there's citrus buchu, there's lemon buchu, there's orange buchu, there's almost a sort of a garlic buchu, there's an aniseed buchu. And then we use one which is quite blackcurrant-y. So adds a fruitiness to the gin, which is lovely.
And then the second native ingredient we use in the African Botanical is something called kapokbos, sometimes known as snow bush because it produces tiny little sort of white puffy flowers. And it's quite an interesting botanical, it's a wild sweet rosemary, so lends a nice sweetness. But it also is quite a stringent. So gives a dry finish to the gin, which is quite unexpected. And so sort of makes for a more interesting drinking experience.

Interviewer:
Now, I believe you also have a few non gin spirits. One of which is your Esperanza, which is derived from locally source to agave. Do you want to tell us a bit more about that?

Lucy Beard:
Yes and unfortunately, the sad story is that it is no longer derived from locally sourced agave.

Interviewer:
Oh, really?

Lucy Beard:
We use the source local. Yeah. It's just been really challenging getting a consistent supply and finding someone to process it. They used to be a distillery based in an area of the country, which is quite a dry area, outside a town called Graaf-Reinet in the Karoo. And a tequila distiller... Well, an agave distillery was set up there because a lot of agave plants grew there. And unfortunately, the shareholders in that distillery had a fallout and all the equipment was sold off. And someone bought the ovens, which was fantastic and started sort of offering to cook agave and process it for distillers and for the sort of the agave syrup and sugar industry. It subsequently stopped. I know.
And then actually a Mexican consortium looked to reestablish something in that area and we're in talks. I mean, there's one farmer in particular who has been growing agave for quite a while. It's allowed to be growing because it's used as cattle fodder, even though it's actually an invasive species. And they just couldn't get it to work sort of from a financial perspective. And so that never happened. And so for the last year and a half we've been sourcing it actually, we've been sourcing agave from Mexico and then fermenting and distilling it here.
But just so sad because it was wonderful when we first launched the Esperanza, it was a uniquely South African expression. And hopefully someone will sort of take on the business of processing agave again. And if that does happen, we'll certainly revert to using South African, but sadly it's Mexican. But beautiful organic Mexican blue weber agave that we use now.

Interviewer:
That's such a shame though, because it was such a lovely story.

Lucy Beard:
I know. It really is such a shame.

Interviewer:
You also do a rhum agricole, which is of course made from pressed sugar cane juice. Is there anything about that that is particularly South African in its flavours?

Lucy Beard:
Yeah, so we source our sugarcane from an area of province called Mpumalanga, which is just next to the traditional sugarcane growing area of Natal, Kwa Zulu Natal. And it's wonderful, we get a truck down the whole cane and we actually hire and presses and press it onsite at the distillery, which is quite a messy process. But on our staff, everyone loves getting involved with. And we realised you have to do that because you're trying to capture the freshness and capture the very essence of the stalks themselves. And very much, I believe that they have a taste of Mpumalanga, which is quite a green grassy, verdant, amazing flavour. And that really shine. So it's almost like wine has the terroir present in the grapes. Definitely the terroir is present in the sugarcane stalks and so yes, we definitely feel we've captured a kind of a unique grassy South African flavour.

Interviewer:
Vodka is having a little bit of a comeback. And you also do a vodka. How have you found the reaction to that as been?

Lucy Beard:
So vodka has been challenging to say the least. You do realise that a lot of vodka is all about the marketing and not actually about the liquid. Our vodka is a grape based vodka. And it's been so interesting because once people taste it, they fall in love with it, but it's sort of the challenge of actually getting people to taste it. Because they're like, "Ah, vodka is vodka. I'd rather try something else." And we actually sort of started concentrating on it more last year sort of given that there are lots of local gins and everyone in the gin industry was having such a tough time. We were like, right, let's also try and actually push another product. And it worked quite nicely. Sort of people were tasting it and loving it and our sales went up. But yeah, it's been a hard sell though. And we often sort of... I feel as though it's the sort of neglected member of the family. But it shouldn't be because it, it is beautiful and it's Western Cape grape and actually also celebrates something uniquely South African.

Interviewer:
I imagine whilst most people were in lockdown though, vodka would be the easiest spirit to work with.

Lucy Beard:
Absolutely. And I think sort of between bans, when people were stocking up that was kind of our opportunity. And I think people, it was one spirit that everyone drinks and can be drunk in so many different ways. And so we definitely saw it was one that people wanted to stock up on, which was wonderful. And sort of also between bans last year, there was definitely an emphasis on support local, support local, and there aren't that many local vodkas. So I think we really benefited from that as well.

Interviewer:
It's interesting looking at your product range, have you actually made a conscious decision not to age anything?

Lucy Beard:
I mean, we've been talking about ageing since we started. And initially when we were just doing gin, there was a ridiculous law in South Africa at the time that you weren't allowed to age gin. The legislation has since been changed. So we did release a limited release of a winter warmer two years ago, which was an aged... was a kind of citrus heavy, but it was just a smaller release. And we did play with ageing agave as well, but you're not allowed to age that. So sort of, yeah. I mean, everything in the liquor act of South Africa is designed to protect the brandy industry because the spirits industry was brandy.

Interviewer:
Oh, how interesting. Okay.

Lucy Beard:
Yeah. And whiskey, obviously was allowed and there aren't that many whiskey producers. But yeah, there was no sort of regard or consideration of anything else and slowly people are lobbying and things are being opened up. So yeah, as I say, you now allowed to age gin. Hopefully soon we'll be allowed to age the agave. But we do plan and want to do a whiskey, but we just feel we need to get a little bit more of an understanding of barreling. We talked about actually cooking and fermenting sort of the mash for whiskey last year, but with all the bans those plans went completely out the window. And I think it'll only be once we're kind of more back to normality if that ever happens that we'll really look at it seriously.

Interviewer:
Yeah. So I imagine the bans have pretty much halted any new product development. Did you have plans for things that have been stopped

Lucy Beard:
Yes and we also usually do quite a lot of limited release gins throughout the year just to keep things interesting, to play around with new botanicals. And we've kind of stopped doing that just because sales have been on off. We were looking at an absinthe, which we will do, but yeah. The time is not right for it now.

Interviewer:
Quite specific in absinthe.

Lucy Beard:
Yeah. Indeed. And the problem with launching new product is the investment in labels and bottles and all the rest of it. And when cashflow is tight, that's not really when you want to be looking at it. So it's been really frustrating, but it has certainly hampered us doing anything new at this stage.

Interviewer:
Aside from your namesake Hope, how do you move forward?

Lucy Beard:
Yeah. Have a lot of hope that is for sure. But yeah, we actually are looking at potentially getting into the ready to drink market, just as I was saying earlier people are really watching their spending. So look at doing gin and tonic in a can and other sort of mixes just at a sort of lower volumes of the people can buy smaller quantities. And we've also launched, which, I haven't mentioned earlier, we've launched a more entry-level gin called the Hobbs Gin. So we've got two in the range of Cape Dry, which is a lemon grass and spice and our Hobbs Pink Pepper, which is a sort of heavily pink peppercorn and cardamom. They're both cane spirits based, which is a far cheapest spirit in South Africa. And they come in a 500 mil bottle just to try and get the excise duty down. And so sort of for a more price conscious market. And so it will look on really concentrating on those two as well. And hopefully that will see us through until things start really opening up again.

Interviewer:
And those you've brought out quite recently?

Lucy Beard:
Yes. So beginning of 2020, we actually sort of had looked at launching them. We'd had inquiries from another country about doing a ready to drink range, and we didn't want to do Hope in a ready to drink range. And so we were like, okay, well launch this at a more entry-level and then can roll that out, doing gin and tonics in cans and that kind of thing. And then when lockdown happened, we were like, no, this is what we need in the local market sort of for when people are able to spend again, but budgets are tight.

Interviewer:
It's quite forward thinking of you, ready to drinks are the fashion of the day.

Lucy Beard:
Yes, absolutely. I mean, our market is slightly different. We read lots about the States and definite desire for it here. But I don't think we've quite got the same sort of number of people who will buy into that kind of thing. But I definitely think it is that market is going to start taking of here.

Interviewer:
Where do you export to exactly at the moment?

Lucy Beard:
So we export to Europe, mainly Germany, a little bit to Switzerland as well. And then we’ve been very successful in Southern Africa and Singapore and Taiwan. And so really looking to sort of concentrate on the Singapore and Taiwan markets to really consolidate and grow those markets. And then are also in talks with the UK, where we are looking at Hope and some of our other brands in the UK. And then we're also doing a project with some of the other distilleries where we're doing an advent calendar offering and people can sample a range of South African gins in a 50 mil format. And hopefully that might open some doors as well.

Interviewer:
All right. Lucy. Well, look, thank you for taking the time to speak with us. If people want more information about Hope Distillery, they can of course go to your website, which is www.hopedistillery.co.za or connect with you on your socials.

Lucy Beard:
Absolutely. Yeah. And so on social media, we're on Twitter, Instagram on Facebook and our handle is Hope Distillery, so you can find us there.

Interviewer:
Excellent. All right, well then thank you, Lucy.

Lucy Beard:
Thank you so much. That's been really great.