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This month in 2011, CBN noted while Scottish craft brewers BrewDog sure knew how to get attention, co-founder James Watt’s latest rants raised questions whether the revolutionary had some reservations. Had to acknowledge BrewDog’s success/ growth at the time. UK sales jumped 230% in 2010, brand was now in major retail chains and it sold equivalent of over 7 mil bottles Watt told The Herald and other UK press. But rather than simply celebrate success, Watt went out of his way to stick it to mainstream competitors and their products. He called Molson Coors’ recent purchase of highly regarded Sharp’s brewery in UK “an act of panic, not a commercial nous,” [sense or rationale]. “Buying a small brewery does not buy you a craft beer soul,” Watt raved on, quoted in The Drinks Business. “All this does is prove they can see the change is coming and recognition that the market is changing; it won’t help them be a part of it.” And more: “They, along with every other mainstream brewery are shaking in their boots.” While mainstream brewers have relied on “marketing propaganda” to sell product rather than taste/quality, craft’s rising popularity reflects “tectonic shift in mindset” of Brit drinkers, Watt said. 2011 will be yr of change, he declared, adding: “Companies that sell beer through sales offers, discounts and marketing gimmicks are just not sustainable any longer.” CBN wasn’t sure whether Watt’s tongue was firmly in cheek when he said this, but few brewers had exploited gimmicks/propaganda as effectively as BrewDog, and he was clearly not averse to selling his beer in major chains which often employ deep discounts. This month in 2012, CBN noted “of all the remarkable growth stories in craft, few have hit with quite the velocity of Lagunitas in recent years.” The Northern Calif brewer arrived with a bang to the 100,000-bbl club in 2010, growing by biggest % among top 20 craft brewers. What did they do for an encore? Turned it up several notches to grow 60% to 162K bbls in 2011, according to numbers from chief operating officer Todd Stevenson. That was once again the fastest growth rate of any top 20 craft brewer. In 2011, only Sam and Sierra gained more bbls. How was 2012 going? Up 60% again thru mid-Feb, said Todd. Lagunitas execs “bat around how much we’ll grow,” said Todd, but feel “we can continue at this pace for a while.” If Lagunitas kept up the pace for the rest of 2012, co “would grow nearly 100,000 bbls this yr to more than 250,000 bbls. That would place Lagunitas squarely in top 10 among craft brewers in 2012, when it wasn’t in top 20 in 2009,” wrote CBN. This month in 2013, CBN reported how a couple of recent high-profile moves of head brewers reminded of concerns expressed by BA’s Paul Gatza at last year’s Craft Brewers Conference about the supply of talented brewers keeping up with the creation of positions for them. One of more vocal in-planning brewers, Modern Times Beer, announced addition of three experienced brewers to its team, including Lost Coast head brewer Matt Walsh. The prior week, Boston Beer’s Alchemy and Science picked up John Carpenter, who most recently was brewmaster at Golden Road. It wasn’t just brewers in high demand, noted CBN, as there was an early-year influx of job postings as several brewers were ramping up sales force. While a struggle for growing craft segment, it was certainly a good time period to be looking for a position in the craft beer world. This month in 2014, CBN put spotlight on very hot craft market in San Diego. Beer sales were up over $100 mil to $781.5 mil in San Diego, industry jobs shot up 40% to ~2,300 and number of local breweries had more than doubled to 84 in the past 2 yrs, per analysis by National University’s Institute for Policy Research. Established San Diego brewers, such as Stone, Green Flash, Ballast Point, Karl Strauss and Pizza Port continued to show “robust growth,” yet half of San Diego’s breweries were only established in past 2 years and their sales were difficult to track, “in their infancy,” senior policy analyst, Vince Vasquez told San Diego Union-Tribune. Analysis found too, “San Diego county brewery workers overall make some of the highest annual wages in the country,” at an avg of $38.5K in 2012, well above craft-centric cities like Denver and Portland. However, the cost of living was higher, and “brewery and brewpub workers make less than average wages for the region.” This month in 2015, CBN reported on big strides being made at Connecticut-based Two Roads. Before Brew Hub came along, Two Roads was operating as mainly contract-brewing facility. “And it too has proven that the concept can work in a bigger way than many anticipated,” wrote CBN. “But perhaps the biggest surprise at Two Roads is the rapid sales trajectory of its own brands,” added CBN. In their 2d yr, Two Roads brands had more than doubled from 6,800 bbls to 16,800, shared founder/CEO Brad Hittle. So co reached regional brewing status as fast as anyone else had. Two Roads was way ahead of what it forecast with distribs and was even further ahead of that its original biz plan projected. What’s more, Two Roads was tracking ahead of plan on its contract production biz, which had more than doubled to 53K bbls in 2014. Some of its craft contract customers included Lawson’s, Evil Twin and Stillwater. There were other bigger contract customers at Two Roads that preferred not to have their names revealed. It’s been a more challenging period for Two Road’s own brands more recently, but its contract biz is still hummin’, and last yr, Two Roads joined B3 platform that now includes Yards, Bald Birds and Heavy Seas. This month in 2016, as Wall Street was getting past the “sticker shock” of Constellation’s $1-billion buy of Ballast Point, a pair of reports contended that “the brand can easily grow into its lofty acquired multiple.” The deal was “clearly favorable to STZ,” both financially “and strategically,” wrote folks at Morgan Stanley in lengthy report focused entirely on making sense of the deal. Similarly, STZ was “most favorably positioned from a craft perspective,” among big US brewers, Goldman Sachs wrote in recent “Rise of Craft” report. That report noted big distribution runway alongside IPA strength and extensive Morgan Stanley research dug into Ballast’s “unprecedented pace of growth” among similarly-sized peers at an outlier price point. Overall, higher prices and thicker margins were key to analysts’ expectations for Ballast, buttressed by its strength at home. Yet that’s not how things turned out as Ballast brand ran outta steam and its outsized investment ultimately flopped.

Craft Throwbacks - Feb

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