It’s not that the San Diego brewery hasn’t grown: Ballast Point made the Brewers Association’s list of the 50 largest craft brewers for the first time this year, having sold 88,204 barrels in 2013, up 86 percent over the previous year. Rather, Ballast Point has expanded its presence by digging deeper in the grocery channel, a strategy that the company is leaning on for new sales.
Sparked by growth in Safeway, Vons, Ralphs and Albertsons, Ballast Point shifted focus to building out where it already sells beer, specifically in the big national chains.
“We’ve hunkered down in the markets that we’re in,” said Kight. “National chains are taking notice of some of the smaller craft brands like Ballast Point. It actually is just kind of starting on its own. It’s kind of snowballing on us right nowÔÇª Even in our home markets, up until about a year and a half ago [we weren’t in chains].”
In an email to Brewbound, Ballast Point president Jim Buechler added, “Big national chains seem to be more and more focused on the craft segment (perhaps availing themselves of the growth of craft in general). With our new facility, we’ve been able to better satisfy demand.”
That’s not to say the company won’t continue to expand geographically. Earlier this month, Ballast Point re-launched in Colorado with Elite Brands after leaving the state in 2009. Kight also hinted that Wisconsin could come online down the road.
In its existing footprint, however, there could be a shuffling of wholesalers as a result of the brewery’s focus on chains. So critical is the national chain game to Ballast Point’s business plan, it could potentially cost wholesaler partners the brand entirely if they aren’t willing to explore the space.
Kight laid bare the need for an invigorated approach in a recent meeting with a sales representative from Freedom Beverage Co., a Ballast Point distributor partner in North Carolina.
“We were out to dinner and I said, ‘Dude, you don’t cover the chains,’” Kight said. “He does the whole state, but it’s too much for him to get to the chains. ‘At some point man,’ I said, ‘I’m probably going to have to take the brand away from you.’”
Freedom remains a wholesaler of Ballast Point, but Greg Truell, Freedom’s operations manager, said he’s not sure for how much longer his company will retain the brand.
“They want to go with the wholesaler that does big box stores,” he said. “We’re not going to change our business model to work around breweries. We’re not going to do thatÔÇª When they get too big for us, we say bye.”
So who might pick up the slack if Ballast Point bolts Freedom? The answer may lay in a recently inked agreement between the brewery and Mims Distributing for coverage in the nine-county area that makes up North Carolina’s Triangle Region.
Jeff Mims, the chief sales officer for the distributor, declined to comment on anything specific relating to Ballast Point, but did note that as a MillerCoors house, “chains are very important to us.”
“We’re going to end up primarily with MillerCoors houses or Miller houses in the state of North Carolina relatively quickly,” added Kight.