Michigan’s Atwater Brewery has realigned its distribution network in its home state, moving the brand from Kalamazoo-based Imperial Beverage into the M1 Network of 10 MillerCoors wholesalers.
In a conversation with Brewbound, Atwater owner Mark Rieth said Imperial Beverage had sold the brand across approximately 70 percent of the state since 2011. Atwater had existing agreements with two distributors in the M1 Group — Dan Henry Distributing in Lansing and Gerry’s Distributing in Port Huron. Those two distributors covered the remainder of the state, Rieth said.
The decision to transition the brand into the M1 Network was aimed at giving Atwater greater access to retail chain accounts and additional points of distribution, Rieth said.
“Imperial Beverage did a great job for us when we were a smaller brand, but they didn’t have the bandwidth or the feet on the street to service existing chain accounts and get us into all of the accounts that want our product throughout the state,” he said. “We believe we can double our points of distribution in the first year with the move into the M1 Network.”
The M1 Network includes: Alpena Beverage Co., Great Lakes Wine and Spirits, Dan Henry Distributing Co., Eastown Distributors Co., Gerry’s Distributing Co., I.H.S Distributing Co., John P. O’Sullivan Distributing Inc., Alliance Beverage, O&W, Inc., and Powers Distributing. Together, the 10 wholesalers service approximately 17,000 retailers and employ more than 4,000 people, according to a press release.
The realignment in Michigan is also part of a broader strategy to move the brand into four additional Midwestern states, Rieth told Brewbound.
“The industry is evolving and changing,” he said. “What we are trying to do is put the Atwater brand in the best position to grow and that is truly on a market-by-market basis. Access to distribution is enormous and we are trying to make some key decisions to put us in great shape for decades to come.”
Atwater products are currently sold in 21 U.S. states and three international markets. The stateside transitions could involve new agreements with various MillerCoors wholesalers, Rieth added.
“There is nothing definitive, but we are very active in four key states,” he said.
Atwater’s push to switch wholesalers in its home state – where 65 percent of its sales occur – as well as in other key markets comes at a time when numerous U.S. craft breweries have sold all or parts of their companies to strategic and private equity investors.
Four notable Michigan breweries — Short’s Brewing (Lagunitas/Heineken), Founders Brewing (Mahou San Miguel), Perrin Brewing (Oskar Blues Holding Company) and New Holland (Pabst Brewing) – have all struck deals in recent years that are, in part, aimed at strengthening distribution.
When looking at possible acquisitions, large strategic buyers like Anheuser-Busch InBev or MillerCoors will often analyze distribution footprints in an effort to see how aligned a brand is with their own “red” or “blue” networks.
When asked if the moves in Michigan — and the forthcoming transitions in the Midwest — were designed to make Atwater a more attractive acquisition target, Rieth responded by saying it was aimed at improving the “longevity of the Atwater brand.”
“These are tough decisions, but ones we need to make, especially as a regional brewer that has been doing this for 20 years,” he said. “We need to make sure we are solidified in each marketplace with a strong distributor network.”
As for a possible sale, Rieth didn’t exactly rule it out.
“Those conversations will be had if need be,” he said. “It is a changing marketplace. Do we have anything on the table right now? No. We are exploring the market, but we don’t have anything that we are planning on other than growing our brand.”
“At this point we are not planning on brewing at the Celis facility,” he said. “We have some other great opportunities that we are looking at on a larger scale.”
He added that Atwater also plans to can a 19.2 oz. version of its Dirty Blonde Ale for convenience stores in 2018. Sales of that brand are currently up “almost 30 percent” in Michigan chain stores, Rieth said.
“It is on fire,” he said. “To have your core item up almost 30 percent is significant. We are excited about that.”
Atwater produced fewer than 30,000 barrels of beer in 2016, Rieth told Brewbound. Current forecasts have the company producing about 50,000 barrels in 2018, in part because of new sales that will be added as a result of the wholesaler realignment.
A press release with additional information is included below.
Atwater Expands Reach with M1 Network Distribution Agreements
Detroit, Michigan, August 25, 2017 – Detroit’s Atwater Brewery is continuing to live its mantra, “Born in Detroit. Raised Everywhere.” with the signing of distribution agreements with the M1 Network, a group of ten established Millercoors distributors with comprehensive reach across Michigan.
“For craft brewers, finding the right distribution partners can make all the difference,” said Mark Rieth, Atwater owner. “M1 is absolutely the right partner for our size brewery and can help us deliver the award-winning lagers and specialty ales to retailers across the mitten and in the U.P. We’re anticipating close to a 30% sales increase in the state as a result.”
“To be the leading Michigan distributor requires us to represent great brands,” say Kit Wanty-Lambert, M1 Network president. “Atwater is Detroit’s largest and fastest growing brewery and offers iconic brands like Dirty Blonde, Vanilla Java Porter, Decadent Dark Chocolate Ale to name just a few. M1 has the manpower, infrastructure and relationships to help Atwater reach the next level.”
M1 Network collectively employs over 4,000 people and services approximately 17,000 Michigan accounts. Its members include: O&W, Inc., Ypsilanti; Power’s Distributing, Lake Orion; Eastown Distributing, Highland Park; Dan Henry Distributing, Lansing; HIS Distributing, Kalamazoo; Alliance Beverage, Grand Rapids; J P O’Sullivan, Flint; Gerry’s Distributing, Port Huron; Alpena Beverage, Alpena.
According to Rieth, although Atwater distributes to 21 U.S. states and Canada, it’s always been a hometown brewer and completely dedicated to its roots in Detroit, Michigan. “Brewing beer is a tough business, but it’s a business about celebrating good times,” said Rieth. “M1 Network will help us reach far more celebrations across Michigan than ever before.”
Atwater beers are also available at Atwater’s three Biergarten and Tap House locations in Detroit, Grosse Pointe and Grand Rapids.
For more information, please visit www.AtwaterBeer.com.
About Atwater Brewery
Atwater Brewery. Born in Detroit. Raised Everywhere. Atwater offers 40 styles of beer led by its popular Purple Gang Pilsner, Better Life Choices IPA, Vanilla Java Porter, Dirty Blonde and its “World Beer Cup” award winning Decadent Dark Chocolate Ale. Atwater distributes its beer to 21 states plus Canada and offers a proprietary line of craft spirits. Atwater operates three full-service tap house and biergarten locations in Detroit, Grosse Pointe and Grand Rapids, MI. Find us on Facebook or visit www.Atwaterbeer.com
About M1 Network
In 2012, a group of 10 Millercoors distributors aligned to create a seamless network across the state of Michigan. The purpose of the group is to launch, grow and resonate brands throughout Michigan with our infrastructure and community ties. We have streamlined ordering, logistics, marketing and chain calls backed by 4,000 + professionals to do the heavy lifting for you!