Beer Marketer's Insights
Shift to Chains Provides Boost to Colo Biz: Craft at 33 Share of $$, Led by Big In-State Brands
Total beer shipments to Colorado up 1.3% for 8 mos thru August, one of just 11 states where beer biz growing this yr, according to estimates from Beer Institute economist Michael Uhrich. Key piece of that has been start of stronger beer sales in chain grocery and convenience stores, beginning Jan 1. Scan data tracking that biz showing big lift, natch. And many indie liquor stores likely not included in Nielsen data showing just a subset of all outlet channel plus liquor stores (no c-stores), included in recent Black Apple Consulting report. But it does reveal how the new chain biz in the state is shaping up in year-1.
ABI Strikes Deal with Top Southeast Asian Hospitality Co to Open 15 Microbreweries There in 5 Yrs
Seeking to maintain and expand its global beer dominance, AB InBev continues to pull the craft levers it can, especially in key Asian markets where beer broadly and ABI specifically is relatively under-developed. So via its ZX Ventures innovation/investment arm, ABI plans to open 15 small breweries within hotels operated by The Indian Hotels Company Limited (IHCL), largest hospitality co in Southeast Asia, per Beverage Daily. IHCL has almost 200 hotels across 12 countries in the region. Focused on "top urban cities in India," the 15 coming microbreweries "will celebrate the spirit of new India," according to release. First will be in Bengaluru, followed by openings in Goa, Mumbai and Hyderabad.
Sierra Nevada is setting up to celebrate its 40th anniversary while showcasing founder Ken Grossman's one-of-a-kind ingenuity in the process. Sierra Nevada will bring its original brewhouse hand-built by Ken on the road to various mkts thruout next year while driving it across the country and actively brewing on the old system, Ken and co announced at GABF last Thursday. Ken initially used "recycled dairy equipment he'd foraged from scrapyards along the Pacific Coast" and hand-drilled 4,000 holes into the mash tun in order to create the 10-bbl brewhouse from scratch. It was meant to brew 2,500 bbls/yr, but Ken found ways to squeeze 10K bbls/yr before upgrading/expanding and selling the original brewhouse to Mad River Brewing, who eventually reached 13K bbls/yr on the system, he shared. Sierra worked out a deal to trade with Mad River for the original brewhouse last year, and Ken welded the wheels onto the brewhouse for its "maiden voyage" to Denver to be showcased at GABF last week. Sierra Nevada will choose select locations to bring the brewhouse thruout the year starting with San Fran Beer Week in Feb 2020 and Homebrew Con in Nashville next Jun, per release. Co will also "park at breweries…and other spots" thruout the country, Ken noted.
Latest set of craft brewer expansion clips reveal plans to go deeper at home. In each case, below set of stories feature brewers finding new sites or building out existing locations both to expand reasons for visitors to stop in and, yes, to make more beer too. Capacity expansions continue to be fewer and farther between than they were 3-4 years ago. That said, brewers are coming up with other ways to invest in real estate and build their presence in their most important markets.
The Odells Will Retire, Sell Stakes, Remain on the Board; Eric Smith Steps Up as CEO; Up 6% YTD
Odell Brewing will officially transition into a next phase of both leadership and ownership as the three founders, Wynne, Doug and Corkie Odell, plan to step away from day-to-day operations in Jan 2020 and retire by June 2020, Wynne confirmed with CBN. Longtime Odell vet Eric Smith (Smitty) has been working with Wynne as co-CEO since Jan 2019 and will assume CEO role in Jan 2020. Each of the Odells will remain on the board of directors for time being until three other key execs "we've sold to" have essentially "paid us off," Wynne explained. Recall, Odell Brewing formed an ESOP (employee stock ownership plan) back in Jul 2015, then selling 70% stake to employees. Once remaining stake is officially sold, founders will hold onto 2 board member seats while the other execs retain 3 seats, Wynne noted. Each retain voting rights going forward as well. Plus, "we're the landlords here," so "they've gotta pay us rent," she added. All told, "all three of us have the name Odell" and "live in Fort Collins," she emphasized. So "even if we're not actively involved" they're "always associated" and "really excited how this transition has played out" since they've been "working on it for six years now." Wynne sits on Brewers Assn board of directors thru next year too.
Distrib Alignment is Biggest Challenge for Dogfish, Sez Sam C; Letters Out; CollaBEErations & More
This year's Boston Beer GABF media brunch was different. Founder/chairman Jim Koch was not at the festival, in his memory, for the first time since 1984 (he was at Oktoberfest in Germany instead), per pre-recorded video shared at the brunch. Therefore, the latest brands and plans from Sam Adams, and/or thoughts on latest industry happenings from Jim were not the focus of this meet up. Instead, it was Dogfish founder Sam Calagione's show, talking about everything from the reasons for merging with Boston Beer to new collaboration brews and even the challenges along the way.
Craft $$ Up 2.6% for 4 Wks Thru Sep 8 in IRI; Ebbs and Flows for Top Cos; Lagunitas IPA Jumps +9%
While total beer category saw sizable boost in latest IRI (following latest data restatement), not much change in overall craft trends in IRI data thru latest period. Total IRI craft $$ sales grew 2.6% and volume up 1.6% for 4 wks vs $$ up 2.8% and volume +1.7% YTD thru Sep 8 in IRI multi-outlet + convenience data. Excluding Blue Moon, Shock Top and Leinenkugel, total craft $$ up 5% and volume +4% for both 4 wks and YTD as well. Yet while not much change visible overall, a handful of notable swings (in both directions) occurred among top craft cos in scans.
Reserve your seat now for the 2019 Beer INSIGHTS Seminar, our 26th annual fall meeting, to be held on the evening of Nov 17 and all day Nov 18 at New York City's Convene, a state-of-the-art meeting and event venue. You'll get cutting-edge content and plenty of time to network. Boston Beer chairman Jim Koch and Dogfish Head founder Sam Calagione will jointly share the stage to talk about the progress of their merger and much more. Recently added: panel of leading distrib execs that were once leading brewery execs, Manhattan Beer COO Ed McBrien and Chesapeake Bev CEO Evan Athanas. Also, a wide-ranging legal discussion with leading atty McDermott Will & Emery's Marc Sorini.
CO's Boulder Beer is latest to drastically revamp biz plans in order to stay afloat in this competitive craft environment. The state's oldest craft brewery, in midst of its 40th anniversary in biz, "will cease packaging and selling beer throughout its multi-state distribution region…and operate only as a brewpub," reported Westword. Co will layoff 20 of its 50 employees, sell off its canning and bottling lines while sitting on its 50-bbl brewhouse. Boulder has gone thru variety of locations, names and ownership groups in the past, paper points out. But this is more severe, it seems. "There is a lot that is up in the air right now, but there is a chunk of staff that won't have a place anymore," said spokeswoman Tess McFadden. Ownership group led by local restaurant and brewery investor Gina Day "looked at wide variety of options, but felt this was the most viable decision," paper added citing Tess. Notably, package sales "started well" for Boulder due to law changes that allowed full strength beer sold in grocery channel in CO. But "things declined rapidly after that" as "we are exactly the wrong size" to compete in this environment, she sez.
Wicked Weed Expansions: $18+ Mil in Cap-Ex; 340 Employees; Airport Bar, Kiosks & More Retail
Separately AB's Wicked Weed in full-on expansion mode lately, pushing for growth in several aspects of its biz, Asheville Citizen Times highlighted in recent article. Since Wicked Weed sold to AB a little over 2 yrs ago, co received "at least" $18 mil in cap-ex funding, jumped to 340 total employees (including 315 in Asheville area) and continues to expand existing outposts and into new locations alike. Wicked Weed added new canning line and opened its first fine-dining restaurant, Cultura, earlier this yr, located "next to a greatly expanded Funkatorium, which now has an event space and beer garden," noted paper. More retail "projects are in the works" too, such as a Wicked Weed bar in E Concourse of Charlotte Douglass Intl Airport opening this Nov, and "some stadium kiosks in Atlanta." Indeed, "we're going to keep making more retail experiences where our cool side projects will show up," co-founder Walt Dickinson told paper. Co's leaning further into sour program projects too, with new Cultura line of spontaneously fermented brews, while continuing to experiment all over the map. All while Wicked Weed is rapidly growing sales and accelerating thruout this year in natl scan data. Its $$ grew 197.5% YTD thru Sep 8 in IRI mutli-outlet + convenience data, including +234% for latest 13 wks.

