Wausau, WI, US --
A roughly $ 1 million beverage order from China may be the break a fledging ginseng beverage company has been waiting for.
American Ginseng Spirits Corporation President Larry Berens told-the News-Herald today that the order for nearly 26,000 bottles of ginseng spirits was received Wednesday from a Chinese tobacco trading company.
"It is a shot in the arm," Berens said of the order. "It confirms what we've known. We know the potential of the product. When you come through with a signed order, that's the reality. This puts us in a happy situation, but we need to finalize things."
Among the items AGS must resolve funding issues and finding a production site. The Wausau -based company announced plans in December to launch pilot production of its line of ginseng -based alcoholic beverages by the end of 1995. At that time, a $760,000 maximum offering memorandum was opened by the company, but so far, that financial goal has not been met, Berens said.
"We'll take whatever (funds) we can get," he said. "In the original offering memorandum, the maximum to raise was $760,000. We had, at that time, said that if we did not raise a minimum of $500,000, we would not go on. We have since adjusted our sights and through the interest we have had from overseas and the interest we have had from some local facilities, we can make some arrangements from them that may not be hard dollars up front. Bricks and mortar don't make you money."
The roughly $1 million order may boost investment interest, but the need still exists for bricks and mortar, or at the very least, a production facility. The company has been hand-bottling some of the product at its Wausau laboratory facility, but with the order from China and other orders pending, the need to find a sufficient production site is mounting, Berens said.
"One of the sites that was considered for the pilot project was Edgar," Berens said. AGS Chief Executive Officer Edward Wang owns the former Edgar VVillage Hall, and had offered the site as a possible site for bottling operations. "Since then, MCDVCO (Marathon County Development Council), they have a spec building in the West Industrial Park (in Wausau) that we have looked at. It's something that we would consider. There happens to be another facility that we're working with that has expressed interest in us."
A final site could be chosen by the end of the month, Berens said, but the facility must first pass muster with the federal Food and Drug Administration and the Alcohol, Tobacco and Firearms Administration.
"Edgar is not out of the running," Berens said. "We are considering any area in Marathon County."
The ginseng spirits project has been touted as a way to offer a value-added product for ginseng growers, who have been dealing with declining root prices over the past two years, he said.
"When they process roots and grade out the roots for packaging overseas, they cut off all the prongs and pass the main body along," Berens said of the branches off the main root that are cast off during production. "We (AGS) can use the prongs; hopefully, this product can raise the price for those prongs. If we can raise the price of the prongs, we can raise the price of the roots."
In addition to booing root prices, the project will also allow growers better control over the mixing of Chinese ginseng with Wisconsin ginseng , which has been a problem, Berens said.
"Value-added products are the way Wisconsin growers can protect their product and claim to fame," he said. "We need everybody from the ginseng industry and the local communities to join together and make this a major worldwide company within the industry."
In the meantime, AGS officials will continue to woo investors from Wisconsin, as well as Taiwan, China and Hong Kong for the project.
BY : Susan Kampmeier
SOURCE : Marshfield News-Herald
1995. 04.
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