Seattle’s first bourbon distillery has sought bankruptcy protection, even after earning a major international whiskey award, as America’s craft spirits sector confronts a sharp and prolonged slowdown.
2Bar LLC, founded in 2010 and the first Seattle distillery to make bourbon, filed for Chapter 11 protection on Friday, according to court records.
The award-winning distiller plans to remain open and continue producing whiskey while it reorganizes its finances.
However, its financial position is under significant strain. The company listed more than $1.07 million in liabilities and only about $156,000 in assets.
Revenue fell sharply as well, dropping from over $498,000 in 2025 to slightly more than $182,000 during the first 10 months of 2026.
The filing underscores the growing pressure on small American distillers, which are dealing with softer demand, higher operating costs and a tougher alcohol market.
2Bar’s petition did not identify a specific cause for the bankruptcy filing, but its financial disclosures illustrate the depth of the company’s difficulties.
2Bar Straight Bourbon Whiskey won a Superior Gold medal at the 2025 Tokyo Whisky & Spirits Competition. The bourbon is aged for more than four years and bottled at 45 percent alcohol by volume.
Founded in 2010, 2Bar LLC became Seattle’s first bourbon distillery and is known for its all-female production team
The distillery’s revenue dropped from more than $498,000 in 2025 to just over $182,000 in the first 10 months of 2026
The distillery has built its brand around Pacific Northwest grains and an all-woman production team.
Its name refers to the Kaiser family’s ranch in South Texas, where relatives are said to have produced moonshine during Prohibition.
The company filed under Subchapter V of Chapter 11, a streamlined bankruptcy option intended to help small businesses restructure debt while continuing to operate.
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Steven Palmer, 2Bar’s attorney, told Inc Magazine that the business had “a very solid path forward” and expected to keep making whiskey during the bankruptcy proceedings.
Still, 2Bar is navigating the same headwinds affecting many independent spirits producers across the country.
The American craft spirits industry saw sales volume decline 8 percent in 2025, while sales value fell 3.7 percent, according to the American Craft Spirits Association’s 2026 Craft Spirits Data Project.
Investment also dropped 35.1 percent, falling from $811 million in 2024 to $526 million in 2025.
The association reported that the number of active craft distillers declined 6.6 percent, with closures exceeding new openings for the first time.
2Bar Straight Bourbon Whiskey earned a Superior Gold award at the 2025 Tokyo Whisky & Spirits Competition
Despite the bankruptcy filing, 2Bar plans to keep producing whiskey as it restructures its finances
Erik Owens, president of the American Distilling Institute, told Inc. that shifting drinking habits were helping drive the industry’s slowdown.
“Weight loss drugs, young adults drinking less, health data have all contributed to a slowdown in consumption,” he said.
Emily Pennington, chief executive of the American Craft Spirits Association, cited rising expenses and the challenge of securing retail distribution as additional obstacles.
She said consolidation among distributors had left smaller brands with fewer potential partners and less visibility.
Those pressures are unfolding as Americans increasingly reduce their alcohol consumption. Higher prices and changing attitudes toward drinking have created another barrier for independent distillers.
2Bar’s case is pending in the U.S. Bankruptcy Court for the Western District of Washington.
