Beer Marketer's Insights
Taproom Roundup: Founder's Diversity Plans, Detroit Re-Opening; Ska to Boulder; Green Flash NE
Busy busy times in the taproom comings and goings of major national and regional craft players.
Founders is joining the hazy craze with new year round beer, Unraveled IPA, co announced. Unraveled IPA, a juicy IPA with 6.6% ABV with 50 IBUs, will launch Feb 2020 in 6pk cans and draft nationwide. It was originally brewed as part of its Mothership Series under "Mucho Lupu" moniker. Gotta note, Founders is one of the last top tier craft cos to launch a year-round hazy IPA. Both Lagunitas and Elysian recently announced their first year-round hazies too, with Lagunitas Hazy Memory double IPA and Elysian Contact Haze. With Founders, nearly every top-15 craft brewer has (at least) one, including: Sam Adams, Sierra Nevada, Lagunitas, New Belgium, Founders, Shiner, Firestone Walker, Bell's, Stone and Deschutes. CANarchy's Oskar Blues recently launched a hazy low calorie IPA called One-y, to join its Can-O-Bliss IPA series. CO's Avery, under Mahou San Miguel umbrella with Founders, launched several hazy IPAs including new Pacer IPA with 100 cals too. Tho its not quite an IPA, Harpoon hazy pale ale has already become a sizable brand for co in its first full year. Boulevard launched Space Camper this year as well. And several other established craft cos further down the list have launched their own hazy IPAs with varying degrees of focus.
Hardywood Closing Charlottesville Pilot Brewery; More Resources to Distribution; +14% YTD
Here's one you don't see much these days: Hardywood Brewery is closing its satellite pilot brewery and taproom in order to focus more resources and investment in the distribution side of its biz. Hardywood will close its 3,367 sq-ft Pilot Brewery and Taproom in Charlottesville, VA on Dec 23 and "relocate," as its larger brewery and hq "has become a major draw" and "wholesale sales have grown significantly," co announced on Facebook earlier this week. This will also allow "more cohesive and streamlined innovation," co-founder Eric McKay shared with CBN. Since opening West Creek brewery in Apr 2018, that space hosted over 150K visitors in its first year. And continued growth is "requiring increasing investment and focus in the distribution side of our business." All Charlottesville employees "have been invited to remain" with the co in relocated roles. And notably, Hardywood will look to lease the space to another company starting Jan 2020.
Drizly Retailers Expect to Stock More Craft in 2023; Yet RTDs/Seltzers "Permanently Changed" Shelves
An increasing number of retailers using Drizly delivery service view craft beer (and wine) as "poised for a comeback," according to Drizly 2022 Retail Report. "Retailers are bullish" on craft beer, "with 35% of respondents citing craft beer as the top trending adult beverage category for 2023" (our emphasis), wrote Drizly. That's sharply different from current scan trends, perhaps a function of Drizly retailer universe that tilts toward indie liquor stores. Another difference from reports of chain resets: nearly 60% of respondents singled out IPA for planned "additional cooler and shelf space next year," and nearly 40% adding space for seasonals. IPAs actually lost 1% of share on Drizly platforms for 12 mos, but could be gearing up to gain some of that back. Plus, "locally made products" are still #1 attribute for retailers in determining how to stock their shelves.
Want a marker of a dynamic industry? How about 6 newcomers rounding out the top 10 growth brands in beer compared to yr ago. Seltzers still make up 4 of top 10 in IRI MULC scans yr-to-date thru 10/30. Yet this yr the top 3 are all beer. Quite the contrast from 2021, when #2-4 growth brands were seltzers thru Oct 31 (as well as 6 of top 10). And perhaps a sneak peak of 2023, as brewers shift spending back to beer and focus on fewer innovations.
On-Premise Share Still 1.5-Pts Below Pre-Covid Norm; Outlets Down; Labor, To-Go Laws Add Pressure
In 2019, on-premise biz held about 15 share of US beer volume, but this yr that figure still around 13.5, Beer Inst research veep Danelle Kosmal shared during Beer Insights Seminar on Monday. Beer is "just not back to where we need to be on premise," she said. But "total restaurant and bar sales are back," Beer Assn chief economist Bart Watson noted. "People are spending as much at bars and restaurants, controlling for inflation, controlling for trend," he added, but "the beer business hasn't kept up with it."
ABI Will Buy Rest of CBA for $220 Mil; $16.50/Share Offer Expected to Close in 2020; #1 in Craft
ABI has agreed to acquire remaining shares of Craft Brew Alliance "for $16.50 per share, in cash," cos jointly announced late today leading up to CBA's Q3 report tomorrow afternoon. CBA stock was in a world of hurt after ABI opted to not buy remaining shares of CBA for qualifying offer of $24.50/share. Stock price plummeted to as low as $7.22/share in aftermath, and hadn't improved much since, reaching $7.33/share as market closed today. So, while investors won't get the initial big return it hoped for, ABI offer digs CBA out of a hole and provides a clear path forward once again, while co pays 1/3 less for the 700K-bbl brewer. ABI owns 31.2% stake currently. So it will pay approx $220 mil for other 68.8% of co. In just 2.5 mos, AB paid not quite $100 mi less for same co, not including $20 mil fee for letting initial deadline pass. Deal is subject to "customary closing conditions," including approval from shareholders "not affiliated with A-B" as well as "certain regulatory approvals," i.e. Dept of Justice review. Cos expect transaction to close sometime "in 2020."
New Dedicated Non-Alc Craft Brewer, Hairless Dog, Nabs National Total Wine & More Placement
Based in Minneapolis, Hairless Dog established in 2018 focused on non-alcoholic craft styles. But co's non-alc Black Ale and IPA brands recently ok'd for distribution to over 200 Total Wine & More stores in 24 states, the Star Tribune wrote. It's first 0.0% ABV craft brand that Total Wine "felt had the quality and taste to carry nationwide," buyer told paper. Contract brewed in Stevens Point, co significantly boosting production to meet Total's orders. Separately, about 30 MN-based brewers experimenting with non-alc beers at small scale, using equipment created by St Paul-based ABV Technology, paper found. ABV Tech created machine that used vacuum to remove alcohol, rather than high heat, founder explained. Fulton Brewing and Bauhaus Brew Labs among MN brewers using the tech, which co hopes to sell to breweries in Colo, Tex, Calif and Cana
A couple of limited nitro items in Southern Tier's can lineup recalled last week, co announced. "Inconsistent nitrogen gas pressures" affected 4-pks of 16oz cans of Pumking Nitro and 4-pks of 12oz cans of Nitro Chocolate Milkshake in co's specialty stout Blackwater series. Impacted just "a couple lots" of each beer on "new packaging equipment," filling with "slightly too much nitrogen" that could cause cans to burst. Southern Tier (and parent co ABV) offering full refunds.
SF Shifts: Seven Stills Opens Huge Mission Bay Spot; Fort Point to Rebrand, Renovate Black Sands
Pair of notable changes in San Francisco brewery/taproom world. First, huge new 22K sq-ft combo brewery, distillery and restaurant for Seven Stills opened at end of last wk. Located in Mission Bay area, large space with lots of room for private parties about a 15-min walk from Chase Center (SF Warriors) and Oracle Park (Giants), according to Eater write-up. Pics reveal sparkling, high-end space that's apparently already booked up for "so many tech parties," co-founder Tim Obert told site. Enough room for "several hundred people," Eater wrote. And co operates 2 other locations, including Mission District spot vacated by Almanac earlier this yr.