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07.2009

Massachusetts Beverage Business

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archivedFeaturedArticles

CRAFT NAVIGATES NEW WATERS

Article By: Andy Crouch

Despite long-standing concerns with the economy the domestic beer segment overall, and the craft beer set in particular, continues to perform well for retailers and distributors. Nudging up one half percent, the beer industry fought against strong and troubling economic trends, especially in the second half of 2OO8. Craft brewers especially benefited from a possible trading down from more expensive wine products, with a nearly six percent increase in volume and ten percent in sales dollars. All of this while import sales dropped nearly four percent for the year. Taken together, the American beer market continues to strengthen its position against foreign brands, all while poaching customers from other beverage alcohol segments.

In the middle of this renaissance, a number of groups are working hard to promote the interests of smaller brewers, sometimes to the exclusion of other members of the beer category. The renewed focus on business matters demonstrates the category’s coming of age in a time when competitive economic forces and consolidation efforts are growing to new heights.

CRAFT BREWERS CONFERENCE
In April, more than twenty five hundred brewers, retailers, and distributors poured into Boston for the annual Craft Brewers Conference, sponsored by the Brewers Association. The attendees heard speakers and seminars on a range of topics, including technical brewing practices, upcoming legal and administrative rule changes, and how to improve relationships with retailers and distributors.

Local brewers and distributors graciously played host to the attendees, who came from as far as Denmark, Australia and Japan. The Massachusetts Brewers Guild hosted an industry cask night event, which featured beers from throughout New England being poured at the de facto conference headquarters at the Harpoon Brewery in the South Boston waterfront. Rich Doyle, co-founder of Harpoon and present chairman of the Brewers Association’s Board of Directors, welcomed attendees to Boston at several events held at the brewery throughout the conference week.

“Boston is the perfect place to host the Craft Brewers Conference, because of where we have been and where we are going as a beer city,” Rob Martin, President of the Massachusetts Brewers Guild and owner of Ipswich Ale Brewery said in a release. “We have two of the oldest craft breweries in the United States, being Boston Beer and Harpoon Brewery, and we also have some of the newest. Both the city of Boston and the conference will uniquely benefit from our 3OO years of brewing history going all the way back to the times of the Pilgrims.”

The Cambridge Brewing Company and Mayflower Brewing Company of Plymouth collaborated on a beer brewed specially for the conference. The Audacity of Hops, which was created by Cambridge’s Will Meyers with help from Mayflower’s Matthew Steinberg, was brewed at Mayflower in a rollicking event that saw brewers from across the region show up and lend a hand. The beer was the official offering of the conference and each attendee left with a bottle, while select local beer bars poured Audacity on tap.

In addition to the conference events, the Boston area beer scene played host to innumerable events, from a slew of tastings at Julio’s Liquors in Westborough to a cheese and beer pairing and dinners at the Cambridge Common restaurant.

The conference offered craft brewers the chance to celebrate a few of the industry’s top proponents. The Brewers Association Recognition Award was given to Ken Allen, founder of the Anderson Valley Brewing Company in Boonville, California. A former Chairman of the Association of Brewers, the precursor organization to the Brewers Association, Ken has been a longtime supporter of the industry. Dick Cantwell, Head Brewer at Elysian Brewing Company and a member of the association’s Board of Directors, said of Allen, “Despite the fact that Ken’s brewery is thirty two windy miles from wherever, his beer, his voice and his efforts have been central to craft brewing’s credibility and progress.” Cantwell presented the Russell Schehrer Award for Innovation in Brewing to Steve Parkes of the American Brewers Guild and the Otter Creek Brewing Company in Vermont. The award is named for Russell Schehrer, a brewer who passed away in 1996 at thirty eight years of age. Schehrer was a founding partner and original head brewer at Colorado’s first brewpub, Wynkoop Brewing Company, and was one of the first brewers to produce mead, doppel alt, cream stout, and chili beer. Parkes received the award for demonstrating creativity, excellence in brewing and substantial contributions to the craft brewing community, as well as serving as lead educator for many brewers as head of the Brewers Guild. “Not only is Steve a great brewer with an impressive resumé, his service as an educator through the American Brewers Guild has brought hundreds of brewers into the craft ranks,” said Cantwell. The association’s final award, the FX Matt Defense of the Industry Award, was presented to Eric Wallace of the Lefthand Brewing Company of Longmont, Colorado, for his efforts to defeat anti-craft beer legislation in his home state. “Eric’s recent efforts with the Colorado grocery bill were instrumental in keeping the historic relationship between the independent retailer and the craft brewer intact,” said Cantwell.

Compared to the conferences of previous years, distributor attendance at the Boston conference was up considerably. Many attendees remarked that while they might have had trouble securing the interest of distributors five or more years ago, the situation has recently reversed itself. More than two hundred and twenty distributors from across the country arrived in Boston before the Craft Brewers Conference commenced in order to attend the Craft Beer Wholesalers Conference. Sponsored in part by the National Beer Wholesalers Association, the wholesalers conference had previously attracted as few as thirty five participants. Fast-forward to 2OO9 and the conference had to waitlist many would-be attendees.

“The high level of interest in this meeting highlights the strong desire of beer distributors to work with craft brewers to get new and innovative beers,” said NBWA President Craig Purser in a release. “American consumers enjoy the vast choice of flavors and styles, and America’s beer distributors are proud to work with craft brewers to get their products to market.” Purser attended the conference, along with NBWA Chairman Phil Terry and several other leaders of the group.

The main conference’s events relating to wholesaler issues were packed throughout the week. Brewers from facilities small and large attended in order to learn how to better present their beers to inquiring distributors and how to more effectively service their new markets. “It’s great to see so many distributors, from the largest to the smallest, in attendance educating themselves on the craft segment and ensuring that this category is getting the proper amount of attention in their markets,” said Purser. “Charlie Papazian and his team at BA do a great job putting this meeting together.”

The NBWA was quick to point out its history of working with the Brewers Association and smaller brewers, a point that would have been unlikely to be made a decade ago. In realizing the importance of fruitful business collaborations with their distributor partners, the Brewers Association has focused a great deal of attention in recent years to targeting its efforts on beer wholesalers. At the annual Great American Beer Festival, the NBWA and the Brewers Association have for the last three years jointly presented a Craft Beer Distributor of the Year Award to honor distributors that undertake the greatest efforts to promote craft beer.

SAVOR RETURNS
For the second year, the Brewers Association has teamed up with brewers, the National Beer Wholesalers Association and other sponsors to present SAVOR, a beer and food pairing in the nation’s capital. Downsized to a single day from last year’s multi-day event, the SAVOR event offered consumers, and more importantly the national media, the opportunity to sample more than one hundred and thirty beers from sixty-eight breweries, all paired with more than thirty-five sweet and savory bite size appetizers.

This year’s event featured luminaries from the beer world in a host of casual, personal salons designed to give attendees an inside view of topics associated with beer. Sam Calagione of the Dogfish Head Craft Brewery hosted Ancient Ales in the Modern World while Greg Koch of the Stone Brewing Company and Adam Avery of Avery Brewing Company led a private tasting entitled, Bombastic Beers, Collusive Collaborations and Tall Tales. From New England, Rob Tod of the Allagash Brewing Company and Jim Koch of Boston Beer Company also participated.

INDEPENDENT STREAK
AMERICAN CRAFT BEER WEEK
A few issues back, I profiled Dick Cantwell, co-founder of the Elysian Brewing Company of Seattle, Washington. In that interview, Cantwell let slip that the Brewers Association was considering a campaign designed to blunt the sales juggernaut that is the Blue Moon line of beers from MillerCoors. Growing by double digit rates for several years and now purportedly near a million barrels of beer per year, Blue Moon Belgian White has long worried craft brewers, leading to a spate of recent similar product releases from craft breweries, including local Harpoon. Cantwell suggested that the association was going to produce a ‘who makes your beer’ campaign in an attempt to better inform consumers that Blue Moon is made by MillerCoors and not a smaller craft outfit.

When I discussed the matter with Julia Herz, the Brewers Association’s Craft Beer Program Director, she denied that the association had any such plan. The association, however, has registered whobrewsyourbeer.com. In a follow-up inquiry, Herz reiterated that the Brewers Association didn’t have a campaign planned, at least for 2OO8 or 2OO9, but acknowledged registering the website. “I personally feel it is increasingly more important for beer drinkers to ask what brewing company makes the beer they might enjoy, because that information is not always readily available on the label,” Herz said.

While nothing has come of the issue to date, the association has included a Declaration of Beer Independence as part of its annual American Craft Beer Week plans. The week allows craft brewers to provide special brewery tours, sponsor food and beer pairings, and to generally promote their efforts to a wider audience in a celebration of its products. As part of its language, the Declaration posits that the signer declares his intention to “practice the concept of ‘Informed Consumption’ which has me deserving to know if my beer comes from a small and independent brewer or if it is owned by a mass production brewing company. I want to know why so many of my local beer brands are not available in many of my favorite restaurants, bars and beer stores, and I encourage beer sellers to offer a wide selection of beer styles and beer brands that includes beer from my local and regional breweries.”

As further proof of the sustained success of craft beer, the NBWA is a strong supporter of American Craft Beer Week. “Craft Beer Week is a great opportunity to recognize the unparalleled number of types, styles and flavors of beer available in the marketplace due in large part to American craft beer,” said NBWA’s Purser. The celebration was changed to a weeklong event in 2OO6 after the United States Congress recognized craft beer with a house resolution.

“Today, ninety-seven percent of the more than fifteen hundred US breweries are small and independent craft brewers,” said Herz of the Brewers Association in a release. “American Craft Beer Week . . . is a time to celebrate everything these breweries contribute to our country and culture, and to also celebrate the diversity of beer styles and brands available today.” The association is using the event to tout the economic benefits delivered by craft brewers, which the group reports provide nearly 1OO,OOO jobs. Despite the success of craft brewers in recent years, the Brewers Association hopes, through its conference, the SAVOR event and American Craft Beer Week, to promote craft beer and to remind legislators and the public that they still face difficulties with access to ingredients, raw materials and to the market place.


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