Beer Marketer's Insights
USA Today is latest mainstream news outlet to dive into various supply chain challenges and implications for smaller US brewers in lengthy article published over the weekend. Article is largely review for those following the saga, highlighting "confluence of inflation and several supply chain issues" including CO2, malted barley, shipping costs, etc., citing much of Brewers Assn's previous reports. "All this could lead to higher beer prices" and "some of your favorite beers being out of stock or not on tap," sez USA Today. And "this could certainly be a factor in closures," BA chief economist Bart Watson told paper separately. "What's unprecedented is the number of areas where we are seeing challenges," Bart added, as paper cited Bart's recent Tweet showcasing rise of input costs for paperboard, aluminum cans, CO2, general freight trucking and malt.
Montauk Brewing continues to get strong lift from NJ launch with Kohler earlier this yr, including recently added big new account. Indeed, Montauk flagship Wave Chaser IPA is now sold on tap at two different sections of MetLife Stadium, home of NY Giants and Jets, co announced on social media. Montauk beer continues to post solid growth in tracked scan data this yr too as it climbs ranks among craft cos in limited footprint. Tho double-digit drops from Montauk hard seltzer family is draggin' overall trend.
Comin' off its 3d year on Inc 5000's fastest growing indie cos, ME's Mast Landing will expand into new location in South Portland, co announced late last week. This marks its 3d location on top of original spot in Westbrook, ME and an 11K sq-ft location in Freeport opened just last year. New location was previously occupied by Rwanda Bean Coffee Roasters, and "pending approval from the town," co expects to open by year-end. Space is relatively limited so Mast Landing products will be brought in from main production facility in Westbrook, including beer, hard cider, hard seltzer, wine and "period guest beers," per release. "As Mast Landing continues to grow, our goal has always been to do so in a smart & patient way," wrote CEO Ian Dorsey in statement. "The SoPo tasting room will follow through on that vision by giving us a chance to get closer to folks who have long supported us," he added. Mast Landing continues to grow distribution presence too, now sold thruout New England, plus NY, Mid-Atlantic region, and "variety of further reaching states." Mast Landing grew revs 95% over 3 yrs thru 2021, per Inc 5000, as volume nearly doubled to 10,500 bbls in 2021, according to Brewers Assn est.
Small Brewer Takes NJ ABC to Court, Claiming Restrictive "Special Ruling" Improper, Unconstitutional
Attempts by New Jersey regulators to rein in small brewers continue to create tension in the state, leading not only to new legislative proposals aimed at clarifying or changing license privileges, but now to a lawsuit, filed last wk in state's Superior Ct of appeals. The state Alc Bev Control division's "Special Ruling" that finally took effect July 1 was enacted improperly, not following formal notice-and-comment procedures, according to lawsuit filed by Death of the Fox Brewing last wk. Further, one of the ruling's restrictions violates state and fed free speech protections, argues the brewer, represented pro bono by the Pacific Legal Foundation, which prides itself on defending Americans from "government overreach and abuse."
Just a month after Milwaukee Brewing announced impending closures of its on-premise outlets and pending, separate sales of its facility and its intellectual property, both deals are done. Eagle Park Brewing announced acquisition of Milwaukee Brewing brands and recipes this morning. Deal announced just a few days after Chicago-based Pilot Project shared news of acquisition of the former Milwaukee (MKE) brewery, taproom and restaurant (see last issue). The deal will bring MKE beers back to shelves and help Eagle Park fill the 20+K sq-ft facility it opened in mid-2020. That said, co will look for a place within city of Milwaukee to both produce MKE beers and operate a taproom for the brand, owners told the city's Biz Journal and Journal Sentinel.
MC in Craft "For the Long Haul"; Evolving Blue Moon to a Brewing Platform; Streamlining Leinie SKUs
Blue Moon and Leinie commanded a clear emphasis within MC's craft portfolio at Molson Coors' Distributor Convention in Nashville this wk. But while regional craft brands took a backseat at the nationally-focused meeting, newly appointed Tenth and Blake Prexy Jeff Agase avowed his "firm belief in the resilience and permanence of the craft segment." Craft is "important," "productive" and "special," remaining a "critical part of our revitalization plan," he highlighted. It's still bigger than hard seltzer, accounting for 1 in 4 $$ spent on beer in the US. Per case distrib growth profit is almost 10% higher from MC's craft breweries than the avg across total beer/seltzer/FMB. And segment still shows the highest consumer loyalty in all of above premium beer, while the craft consumer remains "one of the least price sensitive" across alc bevs, Jeff added.
The fall show season hits with a bang this week, with Natural Products Expo East in Philadelphia followed immediately by NACS c-store expo in Las Vegas. Expo show floor will be open Thurs-Sat while NACS floor will host visitors from Sun to next Tues. Coming up behind them the following weekend are Coffee Expo NY and Natl Beer Wholesalers Assn in Chicago.
Alan Jope, who as Unilever ceo presided over three failed efforts to acquire Glaxo Smith Kline's healthcare biz, will depart at end of 2023, co disclosed over weekend. Among other developments on Jope's watch was divestment of most of Lipton tea biz and arrival of activist investor Nelson Peltz. The 35-year Unilever vet nominally is retiring. British CPG giant said its board would start formal search that will evaluate both internal and external candidates. As Reuters noted, Unilever "will be looking for a new ceo at the same time as rival Reckitt, the maker of Dettol products and Finish dish soap." At time even Starbucks' 6-month lag between recruitment of new ceo and his investiture in role has raised some eyebrows, some investors wondered about prospect of extended transition at Unilever. "Our immediate concern is that this leaves 15 months until his retirement with a ceo who might be seen to have lost credibility with employees and other stakeholders," as Reuters reported RBC analyst James Edwardes Jones worrying. Unilever responded that news would have leaked anyway. For his part, Peltz issued statement to wire service via his Trian Partners saying that, as a board member, he "looks forward to continuing to work closely with Alan until his departure and to being part of the process of choosing a new leader for the company,"
Ball Expects Solid Growth Over Next 5 Years, Driven by Energy, CSDs, New Brands Opting for Aluminum
Ball Corp reported its global volume grew 2.4% YTD thru end of Jun and leading aluminum supplier is anticipating growth in range of ~4-6% over next 5 yrs, co shared at its investor day last week. By 2027, Ball Corp pegs global demand for bev cans to increase to ~125 bil units. In alcohol products, growth is coming from new products and categories and in non-alc products growth coming from "continued strength in energy drinks and carbonated soft drinks categories" as well as continued shifting of pkg mix to cans "in advance" of legislative guideline changes on sustainability grounds. Ball noted the "can is winning" in new bev launches in US mkt. Aluminum accounted for 69.1% of new product pkg in 2018 and has grown to 83.9% YTD thru Aug 14, per IRI off-premise scan data. Meanwhile, plastics use in new products has been nearly halved from 23.9% in 2018 to 12.5% YTD thru Aug 14. Use of glass has shrunk consistently as well, down from 6.9% in 2018 to 2% of new bev products currently. Since end of 2017, can penetration in non-alc segment has grown from 48.3% to 54.4%, thru Aug 14, per IRI and up from 58.5% to 65.6% of alc product mkt. Another stat that smaller cos will take note of: From 2017 to 2021, Ball's "key accts" have grown from 59% of its biz to 66%. Those include all the big suppliers including Coke, Pepsi, Anheuser-Busch InBev, Molson Coors, Red Bull, Monster, Heineken.
CBD player Recess is doubling down on its uninfused Mood magnesium subline, making flavor and packaging changes intended to set it further apart from core line, lowering the price and preparing to onboard raft of new retailers including 11 Safeway/Albertsons banners. Move comes after Covid pandemic served as "massive accelerator" in putting alcohol-alternative brands like Recess and its Mood extension at forefront of consumers' usage occasions, said founder/ceo Ben Witte.

