As craft brewers continue to explore more delivery methods for their products, an increasing number of companies have opted to use 4-packs in attempt to keep consumer prices competitive on higher-alcohol and specialty offerings.
Most recently, The Fort Collins Brewery announced plans to move its 8.1 percent Double Chocolate Stout from 22 oz. “bombers” into 12 oz. 4-packs. Fort Collins is joining a growing list of craft breweries adding the package, including the 11th largest craft brewer in the country, Stone Brewing Company, who added the package in August and top-30 craft brewer Odell Brewing, who added the package in January of last year.
A quick look at Symphony IRI data ending July 8th, 2012 shows dollar sales for craft-glass 4-packs up 37 percent in U.S. supermarkets, with over 9 million in sales year-to-date. Craft-can 4-packs – bolstered by successful can introductions from Sierra Nevada and New Belgium – showed even stronger Symphony IRI growth numbers, up more than 10 times the previous year in supermarkets, albeit with just $2 million in supermarket sales. Still, 22 oz. bombers remain a strong packaging option, with supermarket sales surpassing $28 million during the same time period.
While the 4-pack strategy certainly isn’t new, it does seem to be paying dividends for those taking it on. Look no further than companies like Dogfish Head or Green Flash Brewing, both of which are seeing successful shelf placement with the package.
And Fort Collins’ distribution manager Fred Winter has taken note.
“It can be easier to earn a spot on a retailer’s shelf with a four pack rather than the 22-ounce format,” he said. “It can also be a daunting task for a consumer who might have sampled two ounces at the brewery to try and finish 22 ounces in a single sitting.”
Both Stone Brewing and Fort Collins Brewery said they had received an overwhelming amount of consumer requests for the package – driving them to add the SKU.
But that doesn’t mean the decision will automatically translate into higher profit margins. Four 12 oz. bottles of Fort Collins’ Double Chocolate Stout will have a retail price ranging between $9.99 – $10.99 — the same price point as the previous 22 oz. offering. That means the company will actually take smaller margins, something Winter hopes will be offset by a higher volume of sales.
As for distribution, Double Chocolate Stout will be made available across the company’s 17-state footprint, except for Kansas, where ABV laws prohibit the sale of high strength beer. Winter also said the brewery is considering extending the package to some of its other seasonal and specialty brands, but no final decisions have been made.