Craft breweries - Does service matter?

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I have space in my home refrigerator for a six pack of APA -Shawn

I'd get a bigger fridge or get rid of some of that food stuff.

From the consumer side, I don't care how you choose your beer lineup. As long as it is good and rotating, I'll be happy. I don't want the same beer day in/day out. Rarely do I drink repeat beers in the same visit and rarely do I try a beer I've had before. I'm hoping the "beer geeks" on the business side, both brewers and retailers, do and great job of supplying me with a variety of great beers, and so far they have.

Clearly small craft brewers do not have the resources to direct market their own products. In any sane market, this is what manufacturers representatives and distributors are for, e.g. offering services to specific markets as agents for suppliers.

What services are distributors offering now for their "cut"? Just warehousing and delivery?

Is there a niche for a distributor or rep to offer more services? Like customer education and marketing? Would customers be willing to pay a little more for beer from such a distributor? The vig has to be paid somehow!

Well said Steve.

“The simple law of supply and demand does not explain why sales reps from breweries are not visiting their retailers.”
In fact is does, at it’s very simplest level. It is not a matter of opinion it is a matter of logic. If it was demanded it would be a part of almost every business plan. If it in fact was so integral the you could not sell beer without a face to face visit from the person who made the beer, it would be done.

“(When in fact I've been visited four times in the last month by brewery reps)”
How many were delivering beer on their route of self distribution? I am not at all against brewery personel coming out and doing this, I in fact do it. But most retailers I go to are very grateful I was able to take the time off of brewing and come visit and educate them and their customers about beer. None of them have ever expected it of us. We are in the beer making business not delivery, or marketing business.

“The facts of the matter are the the supply of craft beer continues to increase as does the demand, but not at the same rate. I would argue that new breweries/products far outpace the actual demand for craft beer.”
Every craft brewer I have had interactions with in the last two years has, is now, or is in the planning stages of expansion because they cannot keep up with demand. I will take it a step further and tell you every tank manufacturer I have spoken too has quoted more than three times the lead time that they were two years ago for construction of new fermentation vessels because they cannot make then fast enough. If only a few companies were this busy I would agree with you but all of us are experiencing explosive demand right now.

“The current supply allows me (and our customers) to choose from hundreds of breweries, i am hoping that breweries will differentiate themselves from the herd by providing great products and great service. “
That is proof that you have a great distribution channel. Not that there is a surplus of beer.

“but actual visits from brewery reps is not that much to ask for”
Sending an email to an info@brewery.com account is the worst way to approach a brewery (or any other manufacturer) as an account that sells that breweries product. You need to ask your distribution rep who visits your store and sells you the beer to give you a point of contact at the brewery so you can set up a meet and greet and possibly a tasting. There are far too many email bots sending millions of emails to sift through, although we sometimes try. Even a facebook message is going to get you better response than an email to a generic inbox.

“I have served beer for quite a while in the area and I've never seen someone leave an establishment because they did not carry a particular craft beer. However, I've seen people leave because the establishment did not have mass produced swill. No one to my knowledge forgoes a visit to the Charlestown Pizza Company because we don't carry Alpha King (they choose an alternative craft beer with similar characteristics).”
I drove to Indiana for years to pick up Sierra Nevada do you think the retailers in KY knew I did not by my beer from them?

“also understand why the price of craft beer is high and what factors influence the pricing, what I don't understand is the inability to provide promotional assistance with new/seasonal products that often are priced much higher than standard offerings.”
I have never met a distributor’s rep who would not go out of his or her way to help promote their products. That is their job.

“Perhaps, choosing to scale back distribution may allow you to more effectively connect with your customer base as attempting to cover five states with one individual may be either too ambitious or too financially conservative.”
Yes indeed it might, but before we go all slap happy hiring folks who’s sole focus is visiting each and every one of our accounts, it might be a good idea to become a profitable company.

“Which APAs do I choose?”
I would go with the ones that my customers ask for. I would rotate until sales of certain ones indicated it would be in my companies and its employee’s best interest to keep on in terms of higher sales. With so many brand available I would at least have a couple that rotate constantly.
I really understand where you are coming from, and appreciate the feedback as to how abysmal it is sometimes working with distributors. It is in fact illegal for us to sell directly to retailers so we approach (and are forced sometimes) to believe that the distributors we sign contracts with will promote our products as well as they tell us they will. But this is what you are failing to understand. The industry is built that way and it will not change until such time that the laws are changed. You buy a product from a distributor not us. We manufacture it and fully expect the distributor to support it in every fashion expectable. It is also a little know fact that in order to end a contract with a distributor the brand must be purchased by another distributor, at least in KY. So if you sign a contract and the distributor decides they have better brands to push we the manufacturers are put over a pickle barrel. I fully hope the best for you and look forward to when CPC starts delivering za to Clay and Main.

How about taking a "local" approach to beer; only buy/sell beer made within 100 miles? There are tons of breweries within that radius and its seems they would be more willing and able to promote at CPC.

It is also a little know fact that in order to end a contract with a distributor the brand must be purchased by another distributor, at least in KY. So if you sign a contract and the distributor decides they have better brands to push we the manufacturers are put over a pickle barrel.

Wow! I did not know that. So, you can't chnage distributors unless you can line up another one that is willing to pay your current distributor? Craziness!

Can somebody explain how this helps anybody but crooked politicians and their network of cronies?

Do not take my reply as I thought you were just singling us out, and do not take my replys as I do not appreciate the business you have provided over the years. I just took the ball and ran with it since I feel we do fall into the group you are describing as do many other breweries.
I do offer my or Phil's presence at your establishment for tastings and or promotions. We can be reached at 502 584 2739 jhalbleib@bluegrassbrew.com of pdearner@bluegrassbrew.com.

Booze laws are so crazy Steve. Every state seems to have their strange twist to it.

Steve H, I disagree that small craft brewers do not have the resources to direct market their products. Many craft breweries do involve themselves directly with the promotion of their products, the best examples in our region may be Schlafly and Bells who consistently and actively promote their products in the Louisville market. Schlafly's entry into the Louisville market may be one of the best cases for breweries to learn from, because roughly six years ago it was an unknown brewery entering into Louisville. The work of Schlafly's rep at the time (John Campbell) was instrumental in Schlafly's successful venture into Louisville.

Out of the four brewery reps that visited the CPC this month, none of them were on their distribution routes and only two were self distributed. Joel Halblieb, I agree to disagree with your position on the laws of supply and demand.

I agree that craft beer is in high demand, but I will continue to hold the position that more new breweries are growing to meet that demand providing a greater range of choices for the customer/retailer and thus necessitating a change in how breweries promote their products.

Wow, the reason I have so many choices for beer is the distribution channel, not the exponential increase in the number of breweries in the past ten years. There may not be a surplus of beer, but there are a surplus of breweries. No one in the Louisville/Indiana market has the space required to stock every single offering from every brewery available to us. Thus, every retailer has to be selective about how we use our limited space. We can rely on the distributors, or the internet, or countless other sources of information; but wouldn't the brewery rather take a more active role in shepherding that decision.

Mr Halblieb this little paragraph is really the kind of thing that brought me to this position in the first place.
"Sending an email to an info@brewery.com account is the worst way to approach a brewery (or any other manufacturer) as an account that sells that breweries product. You need to ask your distribution rep who visits your store and sells you the beer to give you a point of contact at the brewery so you can set up a meet and greet and possibly a tasting. There are far too many email bots sending millions of emails to sift through, although we sometimes try. Even a facebook message is going to get you better response than an email to a generic inbox. "
What you are saying is that we have a generic inbox that is published on our website that no one even bothers to check or sift through. Sorry, but WTH??? Why bother putting a "please contact us" link up at all, why not provide your retailers/customers with real contact information, where actual people read/respond to inquiries.

I would wager that you never walked out of a restaurant though because they didn't serve Sierra Nevada, which is what you were implying in your previous post. Not that customers wouldn't seek out beers not available in their state (people used to do it for Coors too), but that they would not patronize an establishment because they did not carry a particular brewery's beer.

I know many distributor reps that I have asked about particular specialty products and they have been able to provide no new or noteworthy information about said product. In fact many times I will be more aware of new/specialty offerings than the reps themselves.
Today held a great example for this particular exchange. I spent an hour or so emailing and talking to one of my distributor's reps, after making my first attempt at an order (all based on information from their price sheet), I was told that more than half of the items I ordered were not in stock due to various reasons or had not been received by the distributor despite being available for six to eight weeks. So after careful consideration and two more attempts at making a complete order, I was on the phone with my rep and he suggested a German lager to replace a Wisconsin lager (perfectly acceptable in most cases), but I wanted a little more information about the brewery. When I asked him where the suggested beer was from, "hold on a sec, let me look" <i could hear the keys typing> "oh, they're from Germany."
You see I wanted a little more information than I could find in a thirty second google search and he simply was not able to provide that information about a product he suggested I buy and sell to my customers.

Joel Halblieb, I'm glad that you understand where I'm coming from, but just by acknowledging that the distribution process and their sales reps do a terrible job at promoting many breweries furthers my expectations that brewers need to step up their game.
You know that the distribution reps suck at promoting many of their products, yet you submit to resignation that this is simply the way it is. You could advocate that breweries be more involved in the process, but you admit defeat right away and make statements like this
"We are in the beer making business not delivery, or marketing business."
You fully expect your distributors to represent you in away that you are comfortable with?
I fully expect my distributors to not know what they are doing or what they currently have in stock in the warehouse, much less what is coming down the pipe in six months!

Sorry, but our philosophy is that pizza is best delivered from an oven, not a car

Justin, I considered the just local approach with beers, but unfortunately some of the worst service I've received has been from Indiana breweries (and not just 3 Floyds).

Mr. Halblieb, I wasn't singling out the BBC, but you do fall into the group I am describing and excepting this last post, completely reinforce my position on craft breweries providing less than stellar service to the people that actually buy and sell your products.

I would be happy to arrange a meeting of some sort to establish a specific strategy to promote your products at the CPC and I'll be contacting you relatively soon.

Thanks
Shawn

This is turning into somewhat of an epic thread, but I believe we are making a breakthrough. If for no other reason than to help others understand the beer business a little more I am going to post this one last kernel of info from my perspective.

Bud, Miller, Coors are Macro breweries which are massively profitable. Each producing millions of barrels a year.

Bells, Schlafly, and Sweetwater are Regional breweries and are very profitable at the high end and fairly at the low, Bells is in the 150k barrels a year area, and Schlafly is in the 40k a year range.

Breweries like BBC and Yazoo are Micro breweries which are marginally profitable depending if you are on the high end 15k barrels per year or the low.


I feel you have given us a compliment for our product to be talked about in the same sentence with those you pointed out. I credit all the gang Matt and I brewing, Chad on the assist and shipping and receiving, Chris, Travis, Lil Chris on the packaging side, Sonny on build out, Scott and Phil holding the front office together, David for years of believing it can happen here, and most of all the investors who put up 6 years ago and saved this brewery from the scrap yard. We will continue to provide the best service we can, all of us. Thanks

Service definitely matters. Good service like many other things in life is rarely obtained.
But the model is the model. I've learned to expect less in the beer vending business and be pleasantly suppressed when you find a distro company or brewery that provides more.

As a beer distributor, I've found this to be an interesting read. The insight into people's thoughts and expectations and how those influence their business decisions is pretty informative. While I don't agree 100% with any one person's perspective here, I do think all offer some valid points.

The answer to the question in the title of this thread "Does service matter?" is undoubtedly yes. However, I don't feel the brewery is solely responsible for servicing/promoting their brands. The economics of brewing beer generally don't allow for a large investment in sales personnel until a certain scale is reached. Their main priority is brewing great beer. To expect a brewery (even a local one) to individually work with each account where their product is sold is just unrealistic. In Louisville alone there are over 1500 licensed retailers. I don't think there are many breweries, craft or otherwise, who can manage to work those markets in any sensible manner. That is where a distributor comes in.

They have a responsibility to promote and service the brands they sell. While not all distributor reps are created equal, I've haven't run across a clueless one in quite a while. Most see what is going on in the market and are hungry for information that can make them better at their job. Just as a retailer can struggle to get information about a particular brew, distributors are often in the same boat. Instead of focusing on servicing individual accounts, brewers would be better served focusing more attention on their distribution networks and educating the people who sell their brands about their brands. Some do a fantastic job of this. Surprisingly, others don't do it at all. We often have beers sent to us with no information beyond just the name of the beer.

Thanks Shawn for bringing up this topic. If nothing else, I think it is has forced a little introspection for all parties involved in quenching people's thirst for great beer. If anyone's interested in discussing it over a couple of pints, I'll gladly join them.

For the 3 years I ran Gumbo A Go-Go I had an exception beer rep from Bryant Distribution who was knowledgeable, informative and eager to give me any and all information he could about every little hole in the wall brewery that they distributed for. Many times I would ask for samples or more information and often I would get a visit from someone from that brewery in addition to the samples. Not only that, but my rep would regularly point me toward certain new and interesting beers. I actually learned a LOT about the craft beer market from this guy. He never told me no and would only come up empty handed if the brewery itself didn't have anything to offer him. This was usually most prevalent with POS materials like posters or table tents. He was exceptional at promoting craft beers, he would hunt down any information I needed on any beer he carried, and because of him I now have great contacts with brewers at all levels including BBC, Schlafly, and Bells.

My experience may not be typical, but it does exist out there. It may just vary from rep to rep, sadly.

I think the breweries need to understand that outlets want as much information about their beers and as much assistance in selling them as possible and distributors are the chief tool in accomplishing that goal. Distributors need to be good caretakers of the brands they carry and help smaller breweries market their product successfully. A good distributor with great sales reps makes all the difference in the success of a beer on both the brewing and selling sides.

I'll keep the discussion going and keep everyone posted on the progress of my experiment.

Allow me to make a point about Joel's references to the relative profitability of the different breweries. Size of the brewery is relevant to the size of the profit, but profit does not always equate to extra spending on the marketing end.
Bell's and Stone for instance have always provided pretty exceptional service in my memory, where as Sierra Nevada has not always extended the same kindness. Many smaller breweries that i have dealt with have offered better service than larger breweries, not necessarily by spending more money, but by being creative and thoughtful. The Bruery out of California sent a handwritten thank you note to us with a business card and contact information when we ordered our first case from them. It doesn't seem like much, but it is more than I've received from the three of the biggest of the Indiana craft breweries.
BBC has always brewed exceptional beer and although I may prefer some of the more eclectic offerings, the American Pale Ale continues to be a standard by which I judge other APAs. The hard work and dedication of the BBC and its staff have earned a place in Brewerania history, not to mention the positive impact they've had on other craft brewers, home brewers, and lovers of good beer.

Matt, I'm just tired of being pleasantly surprised, I'd rather it be the norm.

Ryan, I am glad that a distributor is reading this thread.
I don't believe it to be the sole responsibility of the brewery to market their products. I do expect them to take an active role, especially if the distributor is doing a poor job.
I also don't believe that every craft brewers has 100% coverage of every retailer, 75% is a pretty high hope.
Distributor reps have improved over the years, but they are working huge territories and often responsible for hundreds of individual products that require a lot of individual attention to represent.
I agree that brewers could benefit from directing extra attention to the distribution networks. The sad state of affairs though is that as the retailer, i often have received little more than beers with no more information than the name of the beer also.

I'd love to sit down with a few brewers and distributors to talk over pints.

Ronnie, I'm glad the Bryant rep was good when you were there. I once had Bryant ship me a holiday Belgian case that was from four years prior (as a beer nerd I appreciated that it was aged, but as a retailer I thought it was odd).
Your experience highlights one of the hidden factors that affect how breweries are received by the consumer. The really passionate people in the beer industry (like your Bryant rep) are the force driving it. People like John Campbell, Tisha Dean, Roger Baylor, Todd Antz, and countless others taking a passionate stance striving to promote and procure fantastic beers have created the beer culture in Kentuckiana. Whether they be sales reps, retailers, or restauranteurs they are the people doing the leg work of researching new beers and breweries, doing great promotion and marketing, and they used to be few and far between. Schlafly's roll out into the Louisville market can largely be accredited to the hard work of John, the raging beer promotions on Jeffersonville's riverfront are evidence of Tisha's impact, and Roger can be held responsible for the availability of brands like Stone, Rodenbach, Anderson Valley, Rogue, & countless other brands in our area, and Mr. Antz's selection speaks for itself (if I have a question about beer, that is who I ask).

The value of great beer people who can brew/educate/promote/market craft beer has led to this revolution in the brewing industry that allows us to choose from hundreds of beers in retail stores and forces restaurants to maintain a beer list that offers craft beers. It is my hope and expectation that craft brewing will not only continue to offer high quality interesting brews, but that they will offer great service that outshines that of the mass producers of high quantity swill.

Thanks again
Shawn

Update #1

We've narrowed the list by a few breweries, but several breweries have stepped up to the plate swinging. AND there is a new line on a brand new distributor bringing Shelton Brothers beers back into Indiana.

Schlafly stopped by for a tasting and pint night on Sept. 24th and NABC as usual has been very helpful with our NABC "never a repeat" draft selection.

On October 10th the staff at the CPC will be taking a tour of Oaken Barrel Brewery and hosting a beer dinner in the near future with OB.

Kentucky Ale (Lexington Brewing) will be stopping by for a tasting and pint night on Tuesday,October 11th.

And future tastings/events are in the works with Bee Creek, Upland, BBC, and Sun King.

Thanks
Shawn

UPDATE # 2

We're working on a few things for future tastings/dinners/events, but in the immediate future ------
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Upland Brewing Company ( http://uplandbeer.com/ ) will be invading the Charlestown Pizza Company on Tuesday November 8th with five draft beers starting at 5PM.

Upland has set a fine example for many Indiana breweries to follow and is probably the first Hoosier beer that many of us ever had the pleasure to drink. They've been brewing since 1998 in the highlands of Indiana and might be the only brewery in the state to actually brew lambics and real sour ales.

We'll be offering FREE tastings of Upland's great beers and a representative from Upland will be on hand to connect with the people drinking their beer

Upland Tasting & Invasion - Tuesday November 8th - 5pm - 8ish
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Bee Creek Tasting - Tuesday November 15th - 5pm - 8ish

Another fun Indiana brewery, Bee Creek ( http://beecreekbrewery.com ) will be taking over the taps at the CPC on Tuesday, November 15th.

Bee Creek is somewhere close to Brazil, Indiana and has been brewing a fine selection of beers since 2007. Their Hoosier Honey Wheat has been incredibly popular amongst the CPC regulars and at just over 7% ABV it drinks a little too much like a session beer in my humble opinion. The rest of the Bee Creek repertoire consists of a coffee stout, a session blonde ale, a nice IPA (although much more sessionable than most IPAs), and a classic wheat beer.

Bee Creek is relatively new to the southern Indiana area so we hope that everyone will come out and welcome them with a serious thirst.


We suggest that you always bring a designated driver to beer events at the CPC.

Thanks
Shawn

Great Shawn, glad to hear the brewers are interested in sharing/participating in their consumer's experience! I wonder if those who just want to brew it and forget it will find themselves losing market share to other more enthusiastic brewers.

Also, thanks for posting the upcoming events. I'll be there for Bee Creek for sure as you've peaked my interest about the session IPA. The wife and daughter love pizza so a DD is seldom a problem when the drinking whole is also a great pizza restaurant!