Denver-based Tivoli Brewing has announced plans to shutter its 6-year-old distribution business over the course of the next 60 days.
Ken Hehir, who joined Tivoli as CEO in March after serving as marketing director for North American Breweries’ Pyramid Breweries, told Brewbound that he spent his first 90 days on the job assessing all areas of the business. He concluded that the company’s primary focus should be on brewing, and that it should shut down the distribution division.
“We really didn’t have the scale, it wasn’t an efficient operation and it would have required an enormous investment to bring it up to par with the competition in the Colorado market,” he said. “It was not an easy decision. It never is when it affects people’s livelihoods. But in terms of a cold, hard business decision, it’s just something that we had to do.”
Tivoli informed its beverage partners, as well as the division’s 20 employees, of the decision to close about a month ago. About half of the employees affected were either hired for other roles within the brewery or have accepted positions outside of the company, Hehir said, adding that the company is currently helping the remaining displaced workers find new jobs.
The company also plans to give up the distribution rights to some of the brands it sold, while selling others, Hehir said.
“We are obviously working closely with them to try to find them new homes,” he said. “Some of those discussions are in an advanced stage, so I can’t single out any individuals since those are ongoing discussions.”
Hehir declined to discuss the size of Tivoli’s distribution business, but its service area covered Denver, Aurora, Colorado Springs, Fort Collins, Aspen and Grand Junction, among other territories. The company’s brand portfolio comprised 19 small beer companies, including Chicago’s Pipeworks Brewing, two cideries and six wine and spirits companies. The majority of those brands are located in Colorado.
In the meantime, Tivoli will continue to operate its wholesale business for the next 45 to 60 days, Hehir said, in order to give its brands time to find new distribution partners.
As for the Tivoli brand itself, Elite Brands will begin selling the brewery’s offerings from the metro Denver area south to the New Mexico border on June 18. Elite Brands will also cover Summit and Eagle counties beginning, while High Country Beverage will sell Tivoli’s beer in northern and western Colorado.
Moving forward, the goal is to reestablish the Tivoli brand, which was originally founded in 1859 and resurrected in 2015 after a 45-year absence, inside of Colorado, Hehir said.
“We have an investment to make both in the brewery, and our people, and the brands with a more comprehensive marketing plan behind it,” he said. “It’s a really cool brand story; we just have to finish telling the story and tell it effectively.”
Hehir said another reason for closing the distribution business was due to growing sales of Tivoli beer, which increased 30 percent, to 2,750 barrels in 2017, according to the Brewers Association.
“Year-to-date, we’re up 90 percent across Tivoli brands,” he added, “so we have momentum, and we really want to build on that momentum both on the sales and marketing sides.”
A press release with additional details is included below.
Tivoli Brewing Co. to focus on Brewery & Brands, Appoints Elite Brands of Colorado and High Country Beverage. Closing Tivoli Distributing.
After a detailed strategic review, Tivoli Brewing Co has decided to reshape our business to align with our long term vision to invest in and grow Tivoli Brewing Co. and the Tivoli Brand. To better serve this vision for our own brand, and our supplier partner brands, we have made the difficult decision to close down the business operations of Tivoli Distributing Company over the next 60 days.
We are actively pursuing opportunities for our Distribution Company employees with Tivoli Brewing Co and external sources. We will also be working with our supplier brands to ensure a smooth transition period as they make alternative distribution arrangements and those details will be announced as they are finalized.
We are pleased to announce that to support our long term growth ambition, effective June 18th 2018, Tivoli Brewing Co. will be distributed in Colorado by Elite Brands of Colorado and High Country Beverage. Both companies share our values and our long term ambitions for the Tivoli Brand in the progressive Colorado beer landscape and we are anticipating great things from our new relationships. Ken Hehir CEO