License to Swill

Officially it's called "substandard orange wine," but to small business owners, Premium Blend is a strong shot in the arm

When Genesi Mallay and her husband opened the Lazy Lizard restaurant on Lincoln Road two years ago, the plan was to offer customers the tropical cocktails best suited to Mexican food: margaritas, daiquiris, even the occasional pi*a colada. That was before Mallay collided with Florida's alcoholic bureaucracy.

Because her eatery seats only a few dozen patrons, Mallay didn't come close to qualifying for the hard liquor license automatically afforded restaurants with 200 seats or more. Because the state grants licenses to other applicants by lottery only, she stood less than a one in five chance of receiving a license that way. And because she was a small business owner with barely enough cash to cover the tortillas, she couldn't possibly afford the $40,000 that a private party might ask for his license on the open market.

"The state's basically saying that if you start with a lot of money you have the right to make a lot more money," Mallay huffs. "If you're a little guy, you can forget about hard liquor. It's a totally unfair system."

But revenge has been sweet for Mallay. Intoxicating, even. In fact, for all those merchants who have long desired, but been unable to secure, a hard liquor license, revenge now comes in a dozen spirited flavors. Among them: whiskey, rum, vodka, gin, tequila, and assorted cordials.

Thanks to a product called Premium Blend, some two dozen Dade bistros and watering holes holding only beer-and-wine licenses are now serving traditional cocktails made with "soft" liquor. All with the state's blessing.

The state's licensing division classifies as a hard liquor any distilled product with more than 21 percent alcohol. Premium Blend, which is about 45 percent distilled liquor and 55 percent fermented wine, has an alcoholic content of twenty percent A half the strength of standard liquors A and so is legally considered a wine. "Premium substandard orange wine with natural flavors added," the label reads. Few patrons, however, actually see the label. Instead, they quaff a Premium Blend daiquiri or screwdriver in blissful, if tipsy, ignorance. And because bartenders are free to double the amount of Premium Blend in a drink, devoted boozers can even catch an equivalent 80-proof buzz.

"I wouldn't serve a whiskey sour with the stuff," says David Rutecki, part-owner of South Beach's Society Hill Cafe. "But it works great for kamikazes, sex on the beach, those kinds of shots." Like Mallay, Rutecki could not afford a hard liquor license when he opened his Washington Avenue pub this past May. "Even if you can afford it, you still run the risk of getting shot down by zoning laws or a landlord," he observes. "They've got a great concept, because tons of places on the Beach want to serve drinks, but only a few can get liquor licenses."

The "they" in this case is Orestes and Henry Santos, the Hialeah brothers who launched Premium Blend, Inc., three years ago. Orestes, who graduated from the University of Miami with a master's in business administration, stumbled on the soft liquor concept at an entrepreneur's seminar in 1988. "They were trying to hawk cocktail machines, actually," he recalls. "Along with the machines, they were using this stuff, Wild Cocktail, as an accessory. I took one look at the accessory and said, 'Now this looks interesting.'"

After a dining-room-table consultation with his older brother Henry, Santos decided to investigate further. Wild Cocktail, it turns out, was in the midst of a semipermanent slump. Santos snapped up the concept A and the remaining bottles of ersatz spirits A for a pittance. "They never saw the potential," the 32-year-old Santos says. "What we envisioned was a higher-quality product, one that didn't taste like rubbing alcohol, that would allow all these beer-and-wine outlets to compete with the liquor guy down the road."

His first move was to come up with a substance that tasted good enough to substitute for genuine booze. For this purpose he commissioned a chemist in Lake Alfred to devise Premium Blend's patented formulas. The faux liquor is manufactured 30 miles south of Orlando, at the company's Lake Alfred outpost, by fermenting Florida oranges into wine. The citric acid is then sucked out of the wine, hard liquor is pumped in, and the brew is bottled and tagged with fancy labels identifying the product by an initial A 'W' for whiskey, 'R' for rum, et cetera. (Santos says the "substandard" tag is required because spirits have been added to the wine to enhance its flavor and alcoholic content. The initials are used because it would be illegal to use the name of a hard liquor to describe the wine hybrid; likewise, the company's cordials go by cleverly disguised names, such as Almandine Royale.)

For the first few months, Santos ran the show alone. But Henry, 36, soon signed on and began an aggressive marketing campaign. Last year, the brothers say, Premium Blend, Inc. sold 10,000 cases, racked up gross sales of $700,000, and outgrew the North Dade warehouse that now serves as company headquarters. Henry expects sales to double in 1993. The product sells for $69 per case, about ten dollars less than a generic hard liquor.

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