SCENE – How local craft breweries distribute their products | South Minn scene
If you drink a beer made in Minnesota, you can be sure it is craft beer. Local breweries are welcoming places, where it’s not uncommon to see babies, dogs and non-drinkers having fun.
Distribution is one of the most important, yet often overlooked, elements of the operation and success of a craft brewery. Beer dispensers primarily function as a delivery and storage mechanism. Most distributors do little, if any, sales and promotion of the beers in their portfolio, with the exception of the two or three best-selling brands.
Therefore, it is imperative that the craft brewer knows and understands the second level of business (distribution), to ensure that their products are marketed adequately.
One of the options brewers have to ensure good distribution is to distribute themselves. Self-distribution requires management focus, additional staff and equipment, and an investment of time and money.
The distribution of beer, with its own characteristics, language and terms, is very different from the brewing activity. You can brew the best of products and have excellent packaging, but without good distribution it will not be appreciated by the end consumer.
LTS BREWING COMPANY, ROCHESTER
Owners Brandon Schulz and Jeff Werning have a brewery and they mainly make beers. However, they also make their own craft sodas, hard seltzers, beer cocktails, and mocktails.
“We mainly use 750ml cans for packaged products. We’ve also used 750ml glass bottles in the past, but the market seems to be moving away from glass, so we don’t do that much anymore,” Schulz said.
The last two years have been very difficult for the company. The guys are hoping the market will continue to rally this spring and summer. Short-term plans include ongoing upgrades to the dining room and patio.
Schulz said their business has always been cyclical, seasonally based, and variable, depending on the weather on top of that. They’ve always needed to monitor the speed at which product is moving to keep the full, delicious product from their faucet lines flowing.
“We have good excess capacity in our brewery, so we can handle that without too much trouble,” Schulz added.
Thoughts on the Free the Growler Bill: “I think it’s a small step in the right direction for Minnesota’s liquor law. It’s disappointing that the packaged goods sales volume limitation was included in the bill – 128 ounces per person per day probably doesn’t make a business case for starting to pack in 12/16 ounce cans works for people who don’t already do it for other reasons for distribution. The restrictions are also complicated enough that customers don’t understand them, and we’re going to have to educate them and manage their expectations of the experience we can deliver. I’m glad all breweries of Minnesota can sell growlers and crowlers now, as they should have been from the beginning.—Brandon Schulz
FORAGER BREWERY, ROCHESTER
Due to Minnesota beer distribution laws, about two years ago Forager established a sister distribution brewery, Humble Forager Brewery, through which they distribute their beer.
Humble Forager beer is based on the original recipes of the Forager brewery.
“We had to have a separate company with different owners to do this. So far so good, and if you see Humble Forager beer on the shelf or on tap in southern Minnesota, this is it,” a Forager spokesperson said.
Thoughts on the Free the Growler Bill: “Forager Brewery, as a brewery, is not included in the new ‘Free the Growler’ distribution law, so the change makes no difference to us,” said Barb.
Montgomery Brewing is owned by Chuck Dorsey and its head brewer is Josh Kaderlik. The head of distribution is Lindsay Simon. The company produces beer, with a focus on IPAs and sours, but it produces the full gambit – blonde, amber, dark, stout, and many more.
Dorsey provides 16 oz. for dispensing cans. Growlers, crowlers and 16 oz. cans are the take-out options at the bar.
“It’s a crazy job. Margins are really tight because all of our materials have gone up. But we continue to grow. We’re getting a bigger brewing system this year to keep up with distribution,” Dorsey said. The place has always had a small system, which was spinning new beers all the time. Dorsey and his team focus on keeping fermenters full.
Thoughts on the Free the Growler Bill: “That’s awesome! We’re one of the last states in the country allowed to do this. It’s silly that breweries in Minnesota can only sell to customers visiting their bar a 13% barrel-aged stout in a 25 oz (750 ml) or 64-ounce container This new law isn’t perfect, but it’s a good start It makes sense to have container sizes additional” — Chuck Dorsey
MINERAL SPRINGS BREWERY, OWATONNA
Mineral Springs Brewery is owned by Rod Baker, Bill Cronin and Mark Sebring. They have a fully operational brewery and tavern, selling a variety of fermented products (beer, seltzer water). They also sell growlers and crowlers at this time.
“We’re doing great. Owatonna has been incredibly supportive considering we opened just before COVID. We’re so grateful,” Sebring said.
MSB has a regular brew cycle which is changed based on the season and customer response.
“We’ve only just entered our first ‘normal’ year due to the disruptive aspects of COVID, so we’re still learning some of the flow/need.
Thoughts on the Free the Growler Bill: “We were pretty neutral on the growler article because it only involved five of the largest breweries in the state. to fill the smaller sized cans/bottles that were also part of that bill so we’re not currently taking advantage of that either I anticipate we’ll be spending a few dollars in the near future to take advantage of this added flexibility For us, however, our primary focus is on our reception hall experience, having great food trucks/entertainment and having welcoming and knowledgeable staff on site. We will likely continue to be more of a hall-centric model. to eat with limited distribution. In that vein, this law is positive for us but not too impactful. — Boulanger, Cronin, Sebring
SCHRAM COMPANIES, WACONIA
Owners Aaron and Ashley Schram provide wine and beer. They use bottles for wines and cans for their beer.
“All of our sites are doing well and are experiencing successes and challenges each in their own way. Everyone has followed their own path over the past few years, because every company is different. Overall, we see success. Our downtown location, AxeBridge, has been a bit slower to come back as people are just starting to pick up downtown business,” Ashley explained.
Recently, the Schrams signed with a wine distribution partner solely for their wines and this has opened many doors of opportunity for them. They bring wine to places that have never had Minnesota wine before.
“Beer, we’re still doing small-scale self-distribution for testing, but we’ll most likely expand the reach soon with our relationships that we’re building,” Ashley said.
Managing the product and preparing for growth can be a real challenge. For wine, the Schrams have to plan typically 18 months ahead and that can be tricky with all the rapid changes that are happening. Beer is easier because you can scale production up or down more quickly to respond to trends; and because they can follow precedents set in the past and can plan ahead for the seasons.
Thoughts on the Free the Growler Bill: “I would like to give primary credit to Jim Nash, as he has been working on this project for years and truly deserves credit for the hard work that he and other authors of the law worked ; with boots on the ground talking to business owners. I think this helps breweries in a number of ways, the most important being the ability to not be limited to a single crowler size, but to have 12 ounce cans or bottles. We all know those sizes are the standard for people and being able to sell them in that size provides a level playing field for breweries I know the big breweries have gained the most with the lifting of these restrictions but it’s the removal of the size restrictions that the majority breweries have benefited from it. It’s a great piece of legislation that took years of fighting for; most customers and people would agree that it should have been common sense.” —Ashley Schram
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