After decades of working in the oil and gas and mining industries, father-and-son duo Diego and Tomas Romero were ready for a change in June of 2018, when they started a business that harkens back to Alberta’s history of rum-making.
Their Calgary-based business, Romero Distilling Co., was a throwback to the province’s past, to an extent. During Prohibition in the U.S., Western Canadian-based rum distillers and rum-runners like Emilio Picariello (“Emperor Pic”) of Crowsnest Pass became notorious and rich responding to the market for booze in the U.S.
With rum being the third best-selling spirit in western Canada (after Canadian whiskey and vodka), Tomas, the son in the father-son business, saw an opportunity to start his own business, after the provincial government changed liquor laws that allowed for more craft brewing and distilling.
Tomas, who has a science degree and an MBA, had worked in the environmental regulatory field for ConocoPhillips and as a consultant, followed by work as a project manager for an Edmonton-based construction firm.
His father, Diego, had recently retired, after many years as a metallurgical engineer working in the mining industry.
Tomas, the CEO of the eight-employee company, was ready for a change and his father, co-founder of the business, wasn’t ready to stop working.
For the pair, deciding to enter the rum distilling business was a gradual process.
But then it became serious, with Tomas taking a course in rum-making and hiring consultants to study the potential to enter the rum distilling business.
In 2018, the father and son team took the plunge, investing in distilling equipment and developing a 1,000-square-foot lounge-bar in the same building in southeast Calgary.
The idea was to use the lounge-bar as part of their marketing push for the spirits they would produce. They also planned to promote the Romero Distilling Co. brand heavily at food fairs, concerts, and other events in Alberta and elsewhere in Western Canada.
“We are the only distillery specializing in rum in Western Canada,” said Tomas.
Under Canadian laws, however, the pair must call their products “sugar cane spirits.” However, Tomas likens the taste of its aged rums to a single malt scotch.
The company produces amber, spiced and dark rum, with all of its spirits made with Canadian-processed molasses, made from non-GMO Guatemalan sugarcane. The company is also working with Calgary’s Village Brewery, using barrels from the brewery that allow for the creation of its Rum Runner, a rum barrel-aged black ale.
Everything was in place for a product launch this spring and summer.
It had opened the bar last fall, after producing its first batch of spirits that spring and summer.
Then the COVID-19 lockdown entered the picture.
“We couldn’t keep the bar operating and it was going to be part of our marketing,” said Tomas. And forget about promoting the products at events.
And then, said Diego, the pair had an “epiphany,” both at about the same time.
Since the company was producing alcohol and there would be a looming shortage of alcohol-based hand sanitizers, why not satisfy that demand?
That led to a quick pivot this past March, with the company gaining Health Canada approval for its hand sanitizer and launching an aggressive marketing campaign.
“We put together the business case in a week,” said Tomas.
That move has allowed the company to generate enough cash flow to keep its eight employees working and to live for another day, when the lounge is open again and it can market its spirits at live events.
The sanitizer, called RDCo, has been sold to numerous clients, many of them involved in the oil and gas business.
Romero has produced and sold about 45,000 bottles a month of its sanitizer, compared to the 8,000 bottles monthly of its spirits.
Diego calls the hand sanitizer business a “bridge,” allowing the company to get over its current rough spot, while engaging in one-on-one marketing efforts for its spirits (it has retained the services of companies that are involved in spirits marketing).
“I don’t see it as a long-term business for us, because major [hand-sanitizer] producers have economies of scale and they’ll ramp up production,” he said.
However, the pair believe that part of their business can continue for another six months to a year, by which time the spirits business, what Romero Distilling Co. is all about, can kick into high gear.