The steps to produce each drink are fairly simple, but involve lots of hard labor and attention to detail. The first step is running a barrel of neutral spirits through a carbon filter to remove any impurities or off-flavors from the 195 proof alcohol.
Explaining the filtration step prompted one of the touring industry insiders telling us how many expensive vodkas start life in the same way: carbon filtering a neutral spirit that somebody else distilled. Apparently the rules are such that a vodka can claim to have distilled their spirit themselves even if only a very small percentage of the volume was actually theirs.
In the case of Paula's, this doesn't really matter -- she wants the base spirit to have no flavor so she can add her own. For vodka though, one might ask why you would pay a premium price for what might amount to carbon-filtered commodity ethanol with added water.
After Paula (or often, master liqueur maker Chris Roberts) filters the base spirits, the orange or lemon peel is added. each orange or lemon is hand peeled by Paula or Chris, and the actual meat of the fruit is donated.
Once the peel has soaked overnight (195 proof alcohol works fast), the peels are removed, and the mixture is diluted down to 80 proof with water. The resulting mixture is filtered to remove bits of peel, and bottled on site.
Visiting Paula's in person was a nice reminder that hand-crafted beverages, although they often look like a huge commercial success from the outside, can still be a relatively small operation involving lots of manual labor. I sometimes forget how lucky I am to live in Austin with so many different quality hand crafted beverages (and food) available. Paula's isn't available outside of Texas. I wonder how they make good margaritas in other states.
*Thanks to Paula's for their hospitality!