Flag Hill Winery & Distillery Invests in Whiskey

The spirits shelf at Flag Hill. Courtesy photo.

Following nearly seven decades of recalibrations and expansions, Flag Hill Winery & Distillery in Lee bears little resemblance to the dairy farm Frank W. Reinhold Sr. and his son Robert started in 1950. After the farm ceased operations in 1964, Frank W. Reinhold Jr. and his wife Linda revived the property. In 1990, they planted their first acre of grapes, establishing the roots for a winery, distillery and events center in the rural Seacoast town. The company continues to grow under new owner Brian Ferguson thanks to a partnership with a local farm and expanded event offerings.

Ferguson and his wife Maddie took an indirect route to settling in the Granite State. After Ferguson graduated from Penn State in 2010, the couple embarked on a series of moves to follow his career as a distiller, including year-long stints at Finger Lakes Distilling in New York and Cayman Spirits Company in the Cayman Islands. In 2013, the couple wanted to escape the heat and decided to come back to the States, moving to NH when a head distiller position opened at Flag Hill. “We knew nothing about New Hampshire when we moved here, but we fell in love very quickly,” says Ferguson. He adds that “as a small business owner in Pennsylvania, you would never have an impact on what happened in Harrisburg. But here in New Hampshire, almost anyone can have a say in the state legislature.”

Brian Ferguson, owner and distiller at Flag Hill Winery & Distillery. Courtesy photo.

Ferguson began growing Flag Hill’s spirits output, particularly its whiskey production. Since selling its first six barrels of whiskey in 2013, Ferguson says the company has doubled production annually and expects to produce well over 100 barrels this year. On the winery side, Flag Hill reached 6,000 cases in annual sales by 2012, which dropped to 4,000 cases when “a lot of other wineries who are doing a good job came online,” he says. The winery has since refocused its efforts at the 12-acre vineyard to produce semisweet aromatic white wines and sparkling wines, adding that grapes that grow best in the region are great for these types of wines. Sales have grown 20 percent this year and are approaching the winery’s 6,000 case peak.

In 2015, Ferguson bought the company from Reinhold, who was planning for retirement, allowing Ferguson to pursue some new ventures. He partnered with John Hutton of Coppal House Farm in Lee to launch a grain-growing collaboration to improve Flag Hill’s rye whiskey production. Ferguson had struggled to find a local farm that he could work with to grow wheat, with his closest previous option being a couple hours away in Fryeburg, Maine.

John Hutton, left, owner of Coppal House Farm, and Brian Ferguson in the wheat field. Courtesy photo.

“Farmers get paid differently from distilleries; they are more worried about the quantity of their crop, where for us, quantity doesn’t matter if our quality isn’t where we need it to be,” says Ferguson. “Now we’re able to control the varietals we grow and research what crops we want to plant.” The collaboration has required a $100,000 investment so far, primarily for large capital equipment including a combine and grain dryer. They were able to finance the capital equipment through SIS Bank in Portsmouth, but all the inventory had to be financed by Flag Hill. “The reality is we have to grow on our own cash because financing through a bank is tough to do,” says Ferguson. “If we fall through, they can’t sell off our whiskey without a license.”

With continued investment, Ferguson hopes to grow all the grain used for Flag Hill’s whiskey and continue to keep up with demand. Even with production just under a barrel a day, he says the distillery still isn’t close to keeping up with orders. The boom in business led him to hire a full-time sales and marketing coordinator and begin planning a move into a larger building, tentatively by summer 2019.

Ferguson has also expanded the company’s events division. Flag Hill offers an indoor facility and outdoor event area and food grown and raised at an onsite farm, including a herd of pigs that eat the distillery’s spent whiskey mash. The company hosts about 80 weddings and corporate and nonprofit events annually. Ferguson has also added chef’s pairing dinners to his events roster and, in 2016, launched a monthly brunch series hosted on three Sundays in August, September and October. The outdoor tent and buffet event can accommodate 140 people, and Ferguson says each brunch has sold out one or two weeks in advance. For more information, visit flaghill.com.