The Koloa Rum Co.’s store and tasting room at Kilohana Plantation in Puhi is now open, after being forced to shut down for eight months because of the pandemic.
“We are very excited to get back and feel a little normal,” said Valerie Smith, retail and tasting room manager. “My team is excited, and a few of them have moved on to do different things because they needed to. I got a good crew and we are ready to tackle anything.”
Like many Kaua‘i businesses that closed, Koloa Rum Co. also took a big hit.
“In the very beginning, all our sales were in Hawai‘i. We feel like basically, we’re the rum of Hawai‘i, and we were continuing to grow our outside-distribution line in our wholesale business,” said Bob Gunter, president and CEO. “At the end of 2019, our revenue from the state of Hawai‘i, including the tasting room here, amounted to about 73% of our revenue overall.
“So when COVID hit and everything shut down, that went away. We basically lost nearly all of it. Although our products were still sold in the grocery stores, Costco, those kinds of places, there were no visitors, and local people were furloughed and laid off, so the business just dropped,” Gunter said.
The company lost 95% to 98% of revenue sales they were generating before COVID-19, but they were lucky to have other avenues to rely on.
“The only thing that kept us going was two things,” Gunter said. “One is over the years we put ourselves in good financial position, and also our mainland business and international business actually improved. It’s really ironic because, after the pandemic started, our mainland and international distribution are up 50 to 60% since COVID-19. It enabled us to continue to stay afloat.”
Koloa Rum Co. continued to operate its distillery in Kalaheo through the pandemic because they wanted to build their inventory and try to tweak their business while recovering from their losses.
“We furloughed 11 employees, including Val,” Gunter said. “Back then we had no idea when the state was going to reopen again. Since then we have been operating on a bare-bones crew. We just got a few staff back from furlough, and we even got Val back in September when the governor was initially going to open transPacific.”
Gunter said as he and his team watched the news carefully each day with uncertainty, and when they found out the state pushed back the reopening of trans-Pacific travel date from September to Oct. 15, he and his team chose their own reopening date while still considering all safety guidelines.
“We decided to reopen on Nov. 15,” Gunter said. “But then we started noticing visitors trickling in and calling us if we were open, so we opened on Nov. 3. On that day we got 30 visitors and almost the same amount the next day.”
Before COVID-19 closed its doors, Koloa Rum Co. was entering its products in liquor contests around the country, this improved their name recognition and set the stage for the next step.
“Over the last 10 years we expanded our distribution to what is now 28 states,” Gunter said. “We also have a distributor in western Canada, in Japan, Australia and New Zealand, and we are sending our first container of rum to an importer in Europe next week.
“We been trying to work through all the export regulations and everything. We are ready to do this,” Gunter said.
Besides waiting for the Kilohana Safari Rum tour to begin within the next two months with Kilohana’s train, Gunter said they finally made some progress with their own locally-grown sugarcane in Koloa.
“We planted sugarcane last year at our new Koloa distillery site across the ball park, and last week was the first harvest of our organic sugar cane, with our second harvest earlier this week,” Gunter said.
Gunter is hopeful that the new distillery will be built in the heart of Koloa within the next six months, and hopes to keep his rum pure and only made with locally-grown ingredients while giving back to Kaua‘i’s community.
Diversifying
During the crisis, Koloa Rum Co. produced their new product line of hand sanitizers and at first gave them away to first responders only.
“After a while, we began to sell it also because people were normally buying it from somewhere else,” Gunter said. “So we had a budget for it. They were not for profit. We continued to donate, and we still sell some of this and donate some of this, too.”
According to Gunter, their new hand-sanitizer product is fragrance-free, considered vegan, and he said it feels really clean.
“There are still several doctor offices and medical facilities that use these products,” Gunter said. “That was something that wasn’t a big revenue-generator for us but we felt it was something we needed to do, something we should do to help out our community. “
Another new product is Koloa Rum Co.’s Kauai Cacao (chocolate), which is coveted by chocolate lovers and can be tasted in their tasting from Tuesdays to Saturdays from 10 a.m. to 4 p.m.
