Business Interview: Nigel Mills, Chairman of The Lakes Distillery

Tom Keighley finds out more about his most ambitious project to date, The Lakes Distilley

Nigel Mills, Chairman of The Lakes Distillery
Nigel Mills, Chairman of The Lakes Distillery

Faith, hope, luck and love are the four words emblazoned on the quatrefoil design that features throughout the Lakes Distillery buildings.

Faith is certainly a tenet of Nigel Mills’ career to date. Luck doesn’t figure.

The former convenience retail player - who since 1986 had built up 77 thriving Mills - was in the market for a new business to grow after selling up to Tesco in March 2011.

An intervening period spent investing in property and running The Trout Hotel in Cockermouth, proved not enough for the born entrepreneur.

Flash forward to September 2013 and the world was shown “The One” - the first blended whisky to emerge from Mills’ latest venture - The Lakes Distillery.

Developed out of a once derelict Victorian model farm near Bassenthwaite lake, The Lakes Distillery has been a lesson in putting the right team together.

With names like former Mills Group finance director Martin Stokoe, and Paul Currie, the founder the award-winning Arran Distillery in Scotland - Mr Mills has carefully assembled his force for the £5m venture which aims to reach £3m turnover a year.

“I read a newsletter from a firm of architects in Carlisle that said they’d acquired planning permission to build a whisky distillery at the head of Bassenthwaite lake. I thought - now that’s interesting,” said Mr Mills.

“For me the opportunity incorporated not just the distilling but also an element of tourism - and with the hotel in Cockermouth - I thought there was synergy.

“I found out it was Paul Currie who was behind the project and immediately organised a meeting with him.”

The recession had decimated Mr Currie’s finance for the project, which looked a sure bet after he and his father had previously built the Arran Distillery in Scotland.

Mr Mills’ eye for an opportunity kicked in, and the pair were soon rewriting Mr Currie’s original business plan to incorporate the distillery, a tourism aspect, food and beverage and an internet membership club.

Turning to his network at the Entrepreneurs’ Forum, where Mills is chairman, he sought the advice of former Diageo production director Alan Rutherford - who fortuitously lives in Hexham.

Mr Mills added: “Alan thought it was a really good plan, and I invited him to become a director. Alan helped us to find a head stillman in Chris Anderson, a master stiller at Dewars. Suddenly we had some of the best whisky experience in the world.”

Now equipped with £4m funding through the government’s Enterprise Investment Scheme and topped up with grants, and bank loans - the project was ready to motor.

But, with still some years to wait before any whisky would emerge, Mr Mills decided to launch their own blended whisky to take the brand out to market - cue The One’s launch in September.

Initial deals with Harvey Nichols, Majestic Wines and two major wholesalers put The Lakes Distillery on shelves - no mean feat considering Mr Mills had no prior experience in the sector.

Another Entrepreneurs’ Forum connection - Eutechnyx’s Brian Jobling - is helping Mills to launch the distillery’s ecommerce function - and Ouseburn-based Hedley McEwan are handling design duties.

“The project is a fantastic amalgamation of skills - distilling, property, retail, tourism, hospitality and branding. We’ve put together a really great team,” added Mr Mills.

“The whisky industry is going through a change in the same way the wine industry has done. 10 or 20 years ago you’d only buy wines from France, Italy or Spain - but now the world’s biggest producer is Australia. There’s a revolution in whisky. 21 distilleries operate in Australia, eight in Sweden - and many others around the world. It’s a growth in the new world whisky industry.”

Once it is operational, The Lakes Distillery will have the capacity to produce about a million bottles of malt per year - thanks to the capacity of the largest stills outside of Scotland.

The stills were made over the course of 15 months - by the “Rolls Royce” of still producers - McMillans - based at Prestonpans, just south of Edinburgh.

Coincidentally it is Heaton-based Holmes Dodsworth Metals which supply Diageo with much of the extruded copper for its stills. Needless to say, the family firm was a sure fire for The Lakes Distillery’s needs.

Separate stills at Bassenthwaite also produce gin and vodka.

“All stills in the world are unique. With the expertise of consultant John Bowman, we’ve designed and built a still which allows us to distill over copper and stainless steel. We think this set up will give us a much smoother spirit - our malt will be mellow,” added Mr Mills.

Water is important to whisky making process - and quality water is something The Lakes Distillery has in abundance - via Sprinkling Tarn. The position is no coincidence.

Mr Mills explained: “We already knew the water quality was extremely good. It’s slightly peaty because it runs off the fells - and that’s perfect for the type of malt whisky we’re trying to achieve, which is more of a Spey whisky than a Western Isle whisky.”

Landing a brand new distillery in the Lake District National Park might seem like trying the impossible, and Mr Mills certainly has admiration for Paul Currie’s success in securing a site and planning permission.

He added: “Part of the National Park Authority’s development criteria requires you to have all manufacturing inside existing urbanised areas - not out in greenfield. For us to be able to build what is probably the biggest tourist attraction in the Lakes for 20 years is really down to Paul’s achievement.”

Mr Mills confesses he wasn’t a whisky drinker until he started the project. The point being he doesn’t need to be. The Lakes Distillery has been the perfect opportunity for the entrepreneur to apply all his learnings from the Mills Group.

Top of the list is “employing people who know more about the subject matter than you”.

Mr Mills said: “People talk about working on the business or in the business. In hindsight, I probably spent too much time working at the coalface at Mills. Not only is it hard work, but you can miss opportunities that arise.

“If you can get people who are both more knowledgeable than you, and passionate about your idea - you can deliver a world class business.”

Another key hire is Katie Read - a former director of West Cumbria Tourism Partnership - who was instrumental in bringing rugby World Cup matches to Workington. She will head up the business development function at The Lakes Distillery.

Detail is important in this industry. Mr Mills and his team have spent some 18 months and more than £100,000 in putting together a tour of the distillery which can rival the best in Scotland. The process involved hiring a helicopter kitted with high definition cameras to fly from the top of Scafell Pike, over Sprinkling Tarn and through Keswick into Bassenthwaite - and on to the Irish Sea. The resulting film will give distillery-goers a cinema style experience - rushing down the mountain with the water.

“Consumers all over the world increasingly want to know more about where their food has come from - and that’s what we want to give them.”

Mr Mills mentions that the firm working on the tour with his team are Willington Quay-based - yet another North East face in the supply chain. And, hang on - the bottling is being handled by Eaglescliffe firm, RSM Solutions. The kitchens - from Gateshead’s CNG. Even the cutlery is from Crosby’s in Newcastle.

He explained the pattern: “We needed the absolute best for this project, and we searched the world over for it. Ultimately we keep coming back to the North East - it’s one of the enigmas of the region’s business community - there are some fantastic businesses here.

“Ultimately, we’re trying to source as much as we can in the UK.”

The Lakes Distillery will retain its head office in Gosforth, where tradesmen hammer away to prepare the business’ Kenton Lane premises. Keeping one foot firmly in the North East is important to Mr Mills, who has a family here.

The project has been an almighty learning curve - but that is what excites him most.

“The beautiful thing about business is that you never stop learning, and you never quite know what’s around the corner. There’s a great expression - if the rate of change inside your business doesn’t keep pace with the rate of change outside your business - you’re losing ground. That really encapsulates it for me.”

Journalists

David Whetstone
Culture Editor
Graeme Whitfield
Business Editor
Mark Douglas
Newcastle United Editor
Stuart Rayner
Sports Writer