Halifax West’s Post

The stark reality of how hard it is to make an Irish Whiskey distillery work is sure to flood the wider distilling industry's feeds after today's announcement of Waterford Distillery being placed into receivership. This won't be surprising to many who are close to the industry here in Ireland as it was widely rumored that the business was in trouble. Without knowing its ins and outs, some lessons/reminders can be alluded to.... 1. It is incredibly cash-intensive to run any distillery, never mind one of this scale. With the ability to run at 1million LPA+, that's a lot of barley, a lot of water, a lot of energy to heat, a lot of casks to purchase, then fill, transport and store. Add in the expense of producing single farm spirits and your costs continue to increase. I wouldn't be sure of the exact figures but an educated guess would put it in the millions per year. 2. Creating an amazing brand, being bulletproof on your identity and releasing adventurous products isn't enough to make the business a success. I have critiqued Waterford in the past for releasing too many products and arguably overcomplicating the importance of its terroir project. Regardless of this, their recent focus on Cuveés has seen the release of some truly outstanding products... Too little, too late? Maybe, but there is certainly more to it than that. The lesson in that is, there're many brands popping up that don't have an ounce of the originality, authenticity, transparency or outright beauty (in terms of brand execution) that Waterford have, and if I were those brands, I'd be incredibly worried about the future of my product. Even with an apparent failure, Waterford Distillery set a standard that should be aspired to. 3. Mark Reynier cited that not having the right partner in the US caused a drop in sales in recent years, and through my work in the US I can attest to this. Your choice of distribution partner is vital to the success of your brand, you should be spending the time and whatever money you can doing market research, properly segmenting your potential markets and becoming laser-focused on your target partners. This should in turn feed into your positioning, allowing you then to set clear objectives for the business. I'm not saying that Waterford did or didn't do this, I'm saying that other young brands/businesses should. To bring my thoughts to a close, I hope this doesn't adversely affect their team too much as I know them to be graciously kind, fun and talented people. I will be massively shocked if this is the last we see of Waterford Distillery, I truly believe they were just beginning to land on a product proposition that was going to bring to life the great work their team had done to date in creating what I think is truly incredibly spirit, with an outstanding wood program that will eventually set the whiskey world alight. Perhaps one of our multinational friends will see this potential and fancy a bash at a comeback story... I know I'd be keen.

Support your local businesses. Brewery, bar, liquor store, restaurant, pool supply shop...whatever it is you shop for. Shop local when you can. Shop local when they deserve it... The beer business has been rocky the past few years. According to the Brewers Association in 2023 there are more breweries than ever (9,761), while annual openings are decreasing year over year (495), and closures increased (418). Can you think of a brewery that closed lately? I can! Any that surprised you? Covid, variable interest rates loans, lots of breweries have tons of investors/partners....it's tough out there. I'm curious how 2024 data shakes out but I'd guess more of the same. I'm on record on Youtube: The Business of Craft Beer F**king Sucks. We are growing here at TailGate Brewery, we don't make that a secret. But "success" in small business is an interesting dynamic. I see a lot "oh they're always busy, they don't need my business." I hear it all the time about other local businesses too. But just because their parking lot is full at peak hours, does not mean they don't need your business! Ever wonder why Wednesdays are Half Priced Pizza in the taprooms? It's not as busy as Fridays! Craft beer is not in the completion game. We don't hang up our safety glasses and slap each others' backs til we die drunk from all the beer we brewed. Every day is a start from zero. Every day we have to make sure our trajectory continues. Because in our case, we built a pretty big organization that is growing! And like a teenager, that growing business needs to eat! That means we have to maintain that level of growth that got us here. To me that starts with being better than we were yesterday. So whether it's us, or whatever your local business is: support them. We are growing when the industry is loud about some shaky times. But just like every other business - it's you that decides if we continue to grow or not. Pro tip: Money's tight but you want to help your local business? A 5 star review on any online platform is the single most valuable thing you can do for a local business. Trust me.

🚨 Major NA #beer News: On Tuesday, Athletic Brewing Co. announced it closed a $50 million equity financing round led by private equity firm General Atlantic, with participation from other investors. As part of the transaction, General Atlantic assumed a seat on Athletic’s board of managers. According to a press release, the company plans to use the funding to drive long-term growth. This includes renovating the recently purchased Ballast Point brewing facility in San Diego and expanding distribution to new international markets. Athletic is America’s fastest-growing non-alcoholic beer brand with over 19 percent of the category’s total market share, and according to NielsenIQ, is currently driving 32 percent of the category’s growth. Read more at VP Pro: https://lnkd.in/eAAeqF3q

"American breweries are currently at about half their capacity. That’s not good! But it’s actually worse that in looks because growth has been dead flat for three years. Were the industry growing, it would need headspace, so to speak, for future expansion. Here’s Bart: “When you’re growing rapidly, excess capacity is a good thing so you can keep up with that growth. Athletic has a lot of excess capacity right now with the purchase of that former Ballast Point facility, but no one thinks that’s an issue. So the ratio in the mid-2010s was different because brewers were rapidly growing into it. As I pointed out in 2015, the 2012 and 2014 ratios look the same, but 2014 production was actually bigger than 2012 total capacity. “So you need to understand the capacity number in the context of its time. If we were growing 18% again right now, even 51% might not be that bad (at 18% you’d use up all that excess capacity in 4 years), but at static or negative growth, it’s a lot worse, because it represents investments that aren’t being utilized.” I don’t have a lot more to add to this, except to say that if you want to open a brewery in the next few years, you might consider starting a contract brewery or alternating proprietorship. Not only would it save you a ton of money at the outset, but you might be doing another brewery a favor in helping them fill up those tanks." https://lnkd.in/esCxj5RU

"American breweries are currently at about half their capacity. That’s not good! But it’s actually worse that in looks because growth has been dead flat for three years. Were the industry growing, it would need headspace, so to speak, for future expansion. Here’s Bart: “When you’re growing rapidly, excess capacity is a good thing so you can keep up with that growth. Athletic has a lot of excess capacity right now with the purchase of that former Ballast Point facility, but no one thinks that’s an issue. So the ratio in the mid-2010s was different because brewers were rapidly growing into it. As I pointed out in 2015, the 2012 and 2014 ratios look the same, but 2014 production was actually bigger than 2012 total capacity. “So you need to understand the capacity number in the context of its time. If we were growing 18% again right now, even 51% might not be that bad (at 18% you’d use up all that excess capacity in 4 years), but at static or negative growth, it’s a lot worse, because it represents investments that aren’t being utilized.” I don’t have a lot more to add to this, except to say that if you want to open a brewery in the next few years, you might consider starting a contract brewery or alternating proprietorship. Not only would it save you a ton of money at the outset, but you might be doing another brewery a favor in helping them fill up those tanks." https://lnkd.in/eyaEsTDA

TailGate Brewery distributes in Tennessee only. Why? Since 2014, we've *only* distributed in Tennessee. The "*only*" is because we used to have a really neat niche of distribution in the UK of all places. But that was pretty small potatoes, and was really just too cool to pass up. We enjoyed a cult following for some of our core beers, and we were able to participate with the Brewers Association's export and development program. These days, it's all Tennessee. On the topic of craft beer distribution, I like the saying: "a mile wide and an inch deep." Since we opened in West Nashville in 2014, a lot of breweries were able to grow by opening new distribution markets in a nearby state. But what's interesting is, everyone was opening new markets. So what happened was: a brewery would send a truck of beer, enjoy the bump in sales...and never get a reorder. That beer would sit, go out of code, have to get bought back....all sorts of nightmares. But the brewery could launch another state to help smooth the bumps. Right? Eventually, your distribution footprint becomes huge. It's spread all over, but has no depth. The distribution footprint becomes....a mile wide and an inch deep. We had no crystal ball in 2014, but we could see which way the wind was blowing. Other states have other laws. The distributor end of the three tier system can be about as fair as robber barons in the early 19th century. And trying to manage all sorts of operations 4-10 hrs away? Forget about it. We chose home. All things change. All things evolve. But sitting here today, we're Tennessee only. And we have no real designs on other states. Yes we get asked a lot to expand. Yes we have opportunities to expand. But there's not real measurement when that time will be. But for now? We're here to continue our business plan of: Be the The Best Brewery in Tennessee. From there? We'll see.

Ballast Point brewery was sold to Constellation Brands for $1 billion in 2015 … Yet craft beer sales ‘chinks in the armor’ we’re already showing in 2015 — craft beer was over-supplied in a crowded market. Constellation had made a huge mistake. They overpaid for a business in a declining marketplace — Constellation needed to cut their losses. Its distillery business was spun off to a new company, Cutwater Spirits, in 2017 and subsequently purchased by Anheuser-Busch in 2019. Also, in 2019, Kings & Convicts announced it was buying Ballast Point from Constellation. While Constellation took a huge haircut in selling to Chicago-based brewery Kings and Convicts for an “undisclosed price and terms,” a pittance of Constellation paid for Ballast Point a mere four years earlier. Now Kings & Convicts has closed Ballast Point brewery operations and subcontracts out all brewing, canning, packaging and distribution for Ballast Point. Across town in Chicagoland, Heineken was struggling with Lagunitas’s soft-sales and heavy expenses. A month ago, Lagunitas announced they’re closing the massive Chicago brewery, taproom and merch store. There’s more, too (notably CANarchy’s sale), as Monster Brewing is closing production facilities rght and left. And none of this is because of the pandemic. Tastes and habits stated changing 10 years ago. Never expand, or buy, in a declining market. The days of wine and roses are long-past. “Cha-cha-cha-changes, turn and face the stranger changes…” — David Bowie Source: Beerconomy PRO (Coming Soon!) #Beer #CraftBeer #NonAlcoholicBeer #Cider #Microbreweries #Taprooms #Brewpubs #Taverns #ConsumerBehavior #BrandAwareness #EmergingTrends #BusinessIntelligence “The best beers are the ones we drink with friends.” — Beerconomy Cheers🍻! ✦✦✦ Stephen Carter King Chief of Growth and Marketing and Strategy, Beer Market Analyst and CEO of Beerconomy sharing beer market trends, insights, data and forecasts • Thought Catalyst • Advisor • Sherpa • Speaker • Publisher of ‘The Beerconomist’

Do you know one thing about Brewery Owners that makes me giggle? Brewery owners, have you ever noticed how when you're picking out a new brew kettle or tank, you're all in on the specs knowing exactly where its going to go and what it will do for you, but freeze up when it's time to talk rebrand and what you want to achieve with that? It's funny how that works! Here’s a quick tip to help you out: Think of a rebrand like choosing a new piece of brewing equipment. What do you want it to achieve by purchasing it? More sales? Boost your local rep? Pack out the taproom? Spread your bottles far and wide? Maybe even scoop up some awards? Setting clear goals for your rebrand is just like knowing what you need from your next big equipment purchase. It makes sure you invest in changes that really pay off, whether it’s beefing up your bottom line, expanding your distribution, or just making more people fall in love with your brews. Here are a few example goals I've been talking to breweries about recently... - Local Fame: Becoming the toast of the town - Crowded Taproom: Looking to draw more people to their membership - Bottles on Shelves: Getting a wider distribution network - Award Winner: Chasing some shiny medals. - Press Buzz: Featuring in some of the most reputable industry magazines. Choose what matters most, and then find the right partner to help you nail it. And hey, if you’re wondering where to start, I’m just a message away. #BreweryBranding #CraftBeerMarketing #RebrandingGoals #BreweryLife

The recent collapse of multiple breweries is a sad day for craft beer lovers like myself. The Australian craft beer industry was booming just a few years ago, but has been hit hard by the economic downturn, rising excise taxes, and overhead costs. These factors have made it difficult for small breweries to compete with large companies that can produce beer more cheaply. Consumers are also cutting back on spending, and some are choosing cheaper generic brands. Even though I love craft beer, there's no denying the economic realities that these breweries are facing. I hope that some of these businesses can find a way to weather the storm, but it's going to be tough. #craftbeer #australianbusiness #economics #beerlover https://lnkd.in/gDTG5iPP

📣 Investment Announcement: Otherwise Brewing 🍺 ICA is thrilled to announce our newest investment in Otherwise Brewing, an award-winning gluten-free beer brewing company in San Francisco that offers delicious craft beer in a wide range of styles. From their Guava Fresca kettle sour to their Sonic Bloom Juicy IPA, Otherwise Brewing unites beer enthusiasts, celiac-friendly folks, and everyone in between. Founded by composer and home brewer Aaron Gervais and cicerone Stellar Cassidy, Otherwise brewing was born out of a clear market opportunity in the craft beer industry and a vision of everyone getting to drink great beer, together: “There are hundreds of craft breweries in California and only a few of them are gluten-free. We saw an opportunity for growth in the craft beer industry: for people to have a gluten-free option in their fridge, too. Why wouldn’t you want to have something so that everyone can enjoy the experience together?” - Aaron Gervais Read more about Otherwise Brewing on our website or in our bio: https://lnkd.in/dUr_Fj_v #investment #announcement #icafund #seedcapital #venturecapital #impactinvesting #entrepreneurship