During the weeklong trip — which made stops at SweetWater Brewing in Atlanta, Fullsteam Brewery in Durham, North Carolina and Devils Backbone Brewing Company in Lexington, Virginia – brewers and wholesalers shared their personal insights into growing successful craft brands.
Many of the 200 brewers, distributors, suppliers, bankers and private investors that joined us at each location were looking for insight into how they could manage and make sense of craft’s impressive growth in the past five years.
Throughout our discussions with established craft wholesalers like Tryon Distributing and Savannah Distributing, among others, as well as our conversations with successful craft brewery owners like SweetWater’s Freddy Bensch and Steve Crandall, the founder of Devils Backbone, some common characteristics that exemplify successful craft operations emerged.
One critical element of SweetWater’s success has been the company’s relentless focus on its home market.
“For the first seven or eight years we got started, all we really did was try to support the Atlanta market, the Georgia market and create a beachhead,” Bensch told the Brew Talks crowd.
Going deep before going wide had its benefits, including fresher beer and more control over the product in the customers’ hands. But a less obvious benefit of staying local, and a critical element to SweetWater’s early success, was the ability to create a culture and identity amongst brewery employees – especially one that also resonated with its consumer base.
“Don’t be afraid to fail,” said Bensch. “Be true to yourself, be true to what is important to you and share that with the customer out there.”
It’s a philosophy that continues to guide Bensch and the entire SweetWater staff, even after 17 years.
The concept of failure also emerged in our discussion with Tryon’s Brad Johnston and Mims Distributing’s, Jeff Mims.
“If you aren’t building new brands, you’re failing,” said Mims.
Nonetheless, sometimes failure is unavoidable and ultimately its craft breweries that end up paying the price if the beer doesn’t move, Johnston said.
“If it is a brewery that is not working, it going to be out the door,” he said.
So how do distributors determine when that wholesale arrangement isn’t working?
“We look at the points of distribution,” said Mims. “Have we done what we owe the brewers? Have we done our homework? We analyze the rate of sale – if you aren’t doing a six-pack per week (at a single retail outlet), you are going to have trouble.”
Devils Backbone hasn’t had trouble meeting that six-pack per week benchmark. In fact, the brewery is struggling to keep pace.
“We have not been able to keep up with demand and that has affected every piece of the business,” said Hayes Humphreys the brewery’s COO.
That’s why Devils Backbone, much like SweetWater during its formative years, has opted initially for a more locally focused approach to distribution.
“I don’t think you should spread your market too thin,” said company founder Steve Crandall. “We have made a very conscious decision to try and stay in a very small footprint until we do get capacity up.”
So what will the future look like when Devils Backbone is able to fill all of the orders?
“You hear the bubble talks,” said Crandall. “there is a lot of stuff going on in the craft brewing world right now and it does make you stop and pause and think. We feel confident that this business has a lot of room for growth, not just for us but for a lot of people in the business.”
And if the bubble does burst, Humphreys said he’s not too worried about where Devils Backbone will end up.
“It really doesn’t matter where craft is going necessarily,” he said. “There is always room in markets for good products, from companies that are doing it right. Even if craft is maxed out today, the mission for us remains the same. Best product, every day, done in the right way. If craft’s got a huge ceiling and tons of room to grow, that is good for us. If it doesn’t, then we still need to do the same things.”
Video playback from every stop during the Brew Talks Southeast Tour is now available on the Brewbound YouTube Channel.