Brewbound Podcast: Molson Coors Buys a Brewery’s IP, the BA Elects New Board Members and Krampus Talk

[00:00:00] Justin Kendall: Heading to CBC? Kick things off the day before The Brewbound's meetup at Love City Brewing in Philly, Sunday, April 19th from 5 to 7 p.m. Connect with beer industry leaders, grab a drink, and catch up with The Brewbound team. It's free to attend and walking distance from the convention center. Head The Brewbound.com slash lovecity.rsvp. And don't forget to catch The Brewbound team at booth 956 during CBC. Molson Coors buys a brewery, the BA announces new board members, and Americans have a dream of owning a brewery. Next on The Brewbound Podcast. Hello and welcome to The Brewbound Podcast. I'm Justin Kendall.

[00:00:52] Jessica Infante: I'm Jessica Infante. And I'm Zoe Licata.

[00:00:55] Justin Kendall: And this week, we're going to break down all of the news of the last week, some of the things you might have missed during the Thanksgiving holiday, and a whole lot more. But first, we've got to plug Brewbound Live. That's coming up December 11th and 12th. This is the last time you'll have to hear us plug the event. Congratulations, everybody. We've made The Brewbound Live is one week away. Looking forward to it. Lots of great speakers. We've got people from Beatbox, Dogfish Head, Allagash, NIQ, Three Tier Beverages, Bump Williams Consulting, Dahl Distributing, Gulf Distributing. I'm not going to go through all of them. We already did that on an episode. Very much looking forward to this. We've added Applebee's to our one-on-one retailer meetings. We've got the Pitch Slam competition. We've got a whole bunch of networking events. We're going to be at Juneshine on the 10th. We're going to be at Firestone Walker on the 11th. Lots of things going on and you'll get to hear all about them if you didn't make it the week after, or you'll be able to watch on our live stream, except for the parties. You don't get to watch those.

[00:01:56] The Brewbound: Can you imagine?

[00:01:57] Justin Kendall: It would be so bad.

[00:01:58] Jessica Infante: So bad. It's very like big brother-esque. Right? I mean, you could probably get a little bit of potential tea out of it though, seeing who's socializing with who.

[00:02:08] The Brewbound: That's true. Cause you know, you'll see some of those conversations happening and then all of a sudden months down the road, you hear about various deals that have happened. So maybe, you know, a live cam, not a bad idea.

[00:02:23] Justin Kendall: I know, I mean, I don't wanna name names, but we've seen people talking to people at events that we've been to and then it's like, oh yeah, that's why.

[00:02:35] The Brewbound: Intelligent creeping.

[00:02:37] Justin Kendall: Yep. Well, you can get your tickets still The Brewbound.com. We hope to see you and Marina Del Rey. With that, let's get to the news. And you know, you can't fully get out of craft brewing, I guess. They're not really calling this a craft beer deal, but Molson Coors is buying a brewery, or at least the intellectual property in Chicago, of Cruz Blanca. They've already got a relationship with them. They were producing at Revolver. Of course, Revolver is Now owned by Tilray, update your maps or your flowcharts. But yes, they have acquired the IP for Cruz Blanca. This broke right before the Thanksgiving holiday. Doug Velicky of Beer Crunchers had this first. Yeah, kind of surprising but not fully surprising given that I sat in on the distributor meeting and there was a section dedicated to Cruz Blanca.

[00:03:30] The Brewbound: You came back from that meeting kind of like, hey, we really need to talk about Cruz Blanca. And I was like, we need to talk about what? It makes sense. I mean, look, Mexican imports are a very rare bright spot in beer scan data. So this to me feels logical, but Justin, like you said, it's just the IP. It's not the brewery. The brewery is staying with the owners who are going to, or the founders who no longer are the, you know what I mean.

[00:03:58] Justin Kendall: Yeah, but they're still involved and they're going to be brewing the beer and serving as an ambassador, at least involved in the innovation pipeline of the brewery going forward. But you know what? You don't have to do with the Mexican inspired American produced beer. You don't have to pay tariffs on it.

[00:04:18] The Brewbound: You don't have to pay tariffs. So smart.

[00:04:22] Justin Kendall: Remember when most of course had a deal for Sol, by the way, and still does, right?

[00:04:27] The Brewbound: Yeah. I mean, this predates me, but I think Sol is theirs. I believe you.

[00:04:32] Justin Kendall: They struck a deal on it. Yeah. I can't remember it, but it's like you can see what happened with or what didn't happen with that brand, where it falls on their priority list. I've got a lot of questions on this because they are taking on a 500 barrel brewery. This is a brand that outside of Chicago, not a lot of people, even in Chicago, probably a lot of people don't know a whole lot about Cruz Blanca. And I'm very curious how much time they give this to work. To me, the clock is ticking now on Cruz Blanca. And I don't want to like rain on anybody's parade. It just feels like the reality of where we are with these types of deals. And what we saw before with like St. Archer Gold, when they decided they were going to make St. Archer Gold a national play, they were going to make it a Michelob Ultra Challenger, and they gave it a Super Bowl ad, and they gave it a big marketing push. Now St. Archer's on the scrap heap.

[00:05:36] The Brewbound: Right, well then they gave it what, like six months?

[00:05:38] Justin Kendall: Yeah, I mean, it really wasn't a fair amount of time to dedicate to this. But I mean, look at this, and then also look at what they did. They divested of their craft breweries. They shut down production in Chippewa Falls of lining kugels. They moved all that to Milwaukee. They shut down the 10th Street Brewery in Milwaukee that was also doing craft production. This is a company that's really kind of tightened up its above premium portfolio and button things up. And here they do have, you know, something that is aimed at. Hispanic American consumer. And I, you know, I think it's a good play, but I also think it's one that doesn't have a lot of brand awareness coming in and they're going to have to pump a whole lot of marketing dollars in this to build that awareness. And I just wonder how committed they will be to doing that.

[00:06:41] The Brewbound: yeah i mean this is a funny one because you know like you can build you can buy or you can borrow and this deal seems like a strange combination of all three of those things and you're right they did appear to be entirely out of craft and this maybe isn't really craft it's craft adjacent it's like a craft adjacent import adjacent It's its own thing.

[00:07:04] Jessica Infante: I mean, they seem to be making a point of acknowledging that it's not really a craft deal, which I think kind of points to what their strategy with it is going to be. They don't see this as handling this the same as their previous craft brands that they got rid of. It feels almost like a safety net to me of like, not necessarily safety net, but like a potential brand that they could use should something, God forbid, happen with some of these Mexican import brands. Like this is something where like, hey, there's a possibility that if disaster happens here, we can capitalize on that. And they don't, it's such a small brand that it's not necessarily a massive risk to have that as that option. Great point, Zoe. It's like a trial balloon.

[00:07:49] Justin Kendall: Well, I mean, when you look at what Constellation has and what they're required to do, they're required to produce Modelo and Corona in Mexico. They don't have a choice. It was part of the consent decree. And so they're not going to be moving production to avoid tariffs. And so if they're raising price to offset here, it's a rough situation, I think.

[00:08:16] The Brewbound: I mean, also maybe this tells us something about how Molson Coors view sole, like maybe they don't see sole as being very above premium. So this is their leveling up of that.

[00:08:28] Justin Kendall: Yeah, this will go in that portfolio with Blue Moon and Peroni, which isn't going to have to worry about tariffs either, I don't think. I mean, they're producing it all here, except for the non-ALC, right?

[00:08:40] Jessica Infante: Yeah, Peroni 00 is still produced in Italy.

[00:08:44] Molson Coors: Well, that's what's going on with Molson Coors.

[00:09:08] Justin Kendall: What's going on with the Brewers Association is we've got three new board members, or sort of new, some repeats in here, but what's going on here because I think we're supposed to have more than three board members.

[00:09:20] Jessica Infante: Yeah, we had this was another like late breaking right before the holiday news dump of the three new board members, like you said, kind of new board members at the Brewers Association. We thought there was going to be four and it was advertised that they were looking or had elections for a pub brewery seat, a taproom brewery seat and two packaging brewery seats. It turns out there's only one packaging brewery seat. And the reason for the mix-up, according to a BAA spokesperson that we talked to, is they kind of neglected to pay attention to the bylaws changes that they made earlier this year. where they had cut some of the amount of board seats. They're going through this kind of slow cut of some of those seats throughout the next few years. And one of the packaging brewery seats was one of those ones that got cut for next year. And so that seat does not exist. There were a lot of candidates up for these, what they thought were two seats. The one seat ended up going to Bill Butcher, who is the president at Port City Brewing. And there were, according to the BA, two folks who were kind of neck and neck for the non-existent packaging brewer seat. And so they will be up for more permanent seats in the future BA board meeting that happens later this year. They didn't share who those people were, but Yeah, a bit of a mix-up on the BAs end. Classic mix-up.

[00:10:48] Justin Kendall: Yeah. Yeah. So we've got Bill Butcher coming in. We've got Leah Cheston from Wright Proper is back. And Tommy Arthur from the Lost Abbey is back as well, right?

[00:10:58] Jessica Infante: Yeah. And Tommy Arthur was previously a board member but in a different class because of the changes to the Lost Abbey and how their business structure is. He is now with Tap Rooms.

[00:11:08] Justin Kendall: Should be interesting to see what comes out of the BA board meeting on the 12th and how those at-large appointments are doled out, I guess.

[00:11:17] Jessica Infante: Normally, I don't think we would be as interested in some of these election processes, but this has added another element of, oh, interesting. So we'll see what happens with those at-large seats. One thing to look for is Leah Cheston. Because of term limits, this would be her last one before she'd have to take a year off. So she is currently the chair of the board. So that is one thing we can monitor.

[00:11:42] The Brewbound: The chair always speaks at CBC and it's always a different person. But Lee is the first ever chair to represent the pub brewer class, which is very exciting. And she's only the second woman and the first woman since I want to say Kim Jordan chaired in 2007, which is the year I graduated from college and I am old AF. So it's been a while.

[00:12:03] Justin Kendall: Well, in other craft news, Jess, you got to catch up with Olde Mecklenburg and they've got a collaboration and a new taproom on the way.

[00:12:11] The Brewbound: Yeah, kind of too. So always good to catch up with those guys. Olde Mecklenburg, if you don't know, is the oldest craft brewery in Charlotte, which has become quite a craft destination. So they've been through it, you know, they are partnering with, I'm going to screw this up because I do not speak German, but they partnered with Stortebecker Brau Manufaktur, which is a craft brewery in the German state of Oh boy, Mecklenburg-Vorpommern. I learned a lot of fun things while researching this story. Olde Mecklenburg takes its name because Charlotte, the city that it's in, is Olde Mecklenburg County. Mecklenburg County takes its name from Germany's Mecklenburg-Vorpommern, which I think also is where Pomeranians come from. And it is the home, the ancestral home of Queen Charlotte, who was the wife of King George III, who was the British king at the time of the American Revolution, but before the American Revolution is when the colonies were founded. And North Carolina is of course one of the 13 original. A lot of geography, a lot of history. I'm a big dork, so I enjoyed writing that paragraph. But two breweries partnered up to release a black lager, which came out on Black Friday. I love a black lager, so I was excited to hear about this. But all of that news is really just kind of a jumping off point to check in with Old Meck and see what's up with them. OMB, we last caught up with them about two years ago. They were refreshing the whole brand and getting ready to launch statewide distribution in North Carolina, which they did with the AB network. COO Jim Birch said that's going well. At the time of our last touch base, they had also launched an IPA. And this was interesting to me because we talked a lot about that IPA. It was called, and it still exists, but it was called Unforeseen with the number four, the letter, you know, four spelled like the number. un-F-O-U-R-C. Because they are a very Reinheitsgebot-driven brewery, they mostly just brew traditional German styles. They don't really ever dabble in adjuncts or anything like that. So they had never made an IPA for wide distribution before, hence the name. And Jim said it worked out really well at first, but then sales started to fall off as IPA hunters moved on. I think that's probably not surprising news to anybody and it's going to be deprioritized from being in their core portfolio, but they're sticking to the basics. They did record a decline in scan data, but Jim said they're not too worried about it because that's just the state of things. So in the packaging refresh, they modernized the look and feel a little bit and they downplayed how big Charlotte was because they were really setting themselves up to become a statewide brand. And he said that, quote, we achieved more points of distribution and feedback has uniformly been positive with respect to branding. So sounds like the project went well.

[00:15:04] Jessica Infante: You said Pomeranian, and I feel like we have to mention, because Pugs are kind of connected to our podcast, back to the Noodle days, Rest in Power Noodle. A pug, Vito, became the first pug ever to win the National Dog Show. I am so glad you mentioned this. So I feel like, yeah, it's on theme a little bit with our podcast. I feel like if there's pug news, we have to bring it up.

[00:15:26] The Brewbound: Absolutely. And I love that his name is Vito.

[00:15:29] Jessica Infante: Adorable. So well done, Vito.

[00:15:30] Justin Kendall: Well, you can't read about Vito, but you can read these stories The Brewbound.com. Brewbound Insiders are getting a first look at a new report on draft beer from Draftline Technologies and CGA. You can read all about how draft beer has outperformed packaged products. So that's up there. But before we get out of here, I think we have to talk about Americans and their dreams. And apparently in five states, those dreams include owning a brewery. And this is brought to us by MarketBeat, a survey that they did. And MarketBeat is one of those media companies that puts out like these things that we usually ignore, except for this time. And this time it just kind of, I don't know why I'm talking about it. of this, but it's an interesting dream to have at this point.

[00:16:21] Jessica Infante: It's a nice reminder that not everybody is in the beer industry every day. And we've commented many times about how we would not want to start a brewery right now, but folks out there still see it as this beautiful, idyllic life of selling craft beer, I guess. It still exists in 2024.

[00:16:42] The Brewbound: I mean, look, how many times you tell somebody what you do and they're like, that's so cool. And you're like, yes. And it is, it is. But people don't, they think like, oh, there's a million breweries now, they must be doing great. And no, I mean, look, in my crazy brain, I would love to be a baker, but I know what that entails.

[00:17:00] Justin Kendall: Those states include Alaska, Illinois, Michigan, North Carolina, and South Carolina. That's the five. Bless their hearts. Hey, you know, it's not California, which I would have guessed might be up there.

[00:17:16] Jessica Infante: Maybe they recognize there's plenty over there already.

[00:17:19] The Brewbound: Look, it's nice to have a dream, but one that involves basically endless amounts of needed capital and also extremely taxing physical labor maybe should be reconsidered.

[00:17:31] Justin Kendall: Very tight margins. Maybe the advice to those folks, open a tap room. If you're going to do it and just sell over your bar, don't get into distribution. Or just don't? Is that what you're gonna say?

[00:17:45] Jessica Infante: Just go to the breweries that already exist. Go support them with your money instead of just losing yours to nothing.

[00:17:53] Justin Kendall: I'm sure in some of those states there is a GoFundMe right now where you could be part of an ownership of a brewery.

[00:18:03] Jessica Infante: North Carolina, man, there are so many now. Go support those breweries that are not doing so hot right now.

[00:18:09] Justin Kendall: Exactly. They need the help right now. So maybe that's the positive message that we can end on here.

[00:18:17] Jessica Infante: You could technically fulfill your dream and probably get a little stake in this brewery by going and supporting maybe a start engine or something. And there you go.

[00:18:28] Justin Kendall: Maybe 5 to 10 percent off a trip to the brewery each time too.

[00:18:33] Jessica Infante: Yeah. Maybe you'd get a free hat.

[00:18:35] Justin Kendall: Maybe a free hat. Oh.

[00:18:36] Jessica Infante: Breweries make great merch.

[00:18:38] Justin Kendall: This is very true. And I don't know that we need to go into this, but I received this. This is Rogue's new Pacific Northwest IPA. It is 6.9%. And this is what they're calling like a new IPA style. So I wonder if I need to try this and tell you if it tastes any different than any other IPA.

[00:19:02] The Brewbound: I would like for you to do that. It's a Pacific Northwest IPA.

[00:19:06] Justin Kendall: A Pacific Northwest IPA.

[00:19:08] The Brewbound: How is that different from a West Coast IPA?

[00:19:10] Justin Kendall: Well, I'll tell you what the can says.

[00:19:11] The Brewbound: Oh, you're going to tell me now. Oh, this is so exciting. I feel like we do this like once a year.

[00:19:14] Justin Kendall: Yeah, I know. A dank piney IPA celebrating the iconic evergreens of the Pacific Northwest. I like that there's this star on here that kind of tells you that it's dank, piney, and bitter, not so malty or fruity, as you can see there. That's helpful. That's kind of cool. But I don't know. Definitely dank. You're not an IPA drinker though. No.

[00:19:47] Jessica Infante: And I also think dank is one of the worst descriptive words that we have for beer. And dank is pretty bad. Yeah.

[00:19:54] Justin Kendall: Isn't it just stolen from marijuana culture? Yes.

[00:19:58] Jessica Infante: So did you drink anything interesting over the holiday? No, we had cider mimosas and some cab and that was very unexciting, uncreative. Delicious. Delicious, very delicious.

[00:20:13] Justin Kendall: We turned it into an NPR podcast there for a second. Anything you have, Jess, over the Thanksgiving holiday?

[00:20:22] The Brewbound: I, on Thanksgiving, had a lovely pescato, which is the Italian pilsner from Rockport Brewing. And the day after Thanksgiving, we went out for dinner before Santa arrived downtown. And as one does, I drank a spicy, dirty martini.

[00:20:34] Justin Kendall: Awesome. Did Krampus take anybody away?

[00:20:38] The Brewbound: Krampus did not take anybody away, but in my quirky, spooky little town, Santa arrives and then we light the town tree and also there is Krampus.

[00:20:50] Jessica Infante: Get to have equal representation for the Christmas mythical creatures. Totally.

[00:20:57] The Brewbound: What is this? Cryptozoology? One of Cora's favorite books is Krampus Baby. It's like a little board book for babies about baby Krampus in the Alps. She loves it, wants it read to her all year. So I did get, you know, the algorithms fed me the Salzburg Austria Krampus parade. And I think one day when she's a little bit older, we're going to go.

[00:21:19] Justin Kendall: I feel like you've shared horrifying images from there before, so.

[00:21:22] The Brewbound: I have pictures of Cora with Krampus last year, so. Cora's never actually taken a picture with Santa. My mom's pretty salty about that.

[00:21:30] Jessica Infante: I feel like Krampus is way cooler. Way cooler.

[00:21:33] Justin Kendall: I totally agree. And we tried once to do Santa. We tried once to do the Easter bunny. We haven't tried before. And in fact, Sophie was asked about Santa recently and she said, He's a weirdo. And she is nearly three years old, so.

[00:21:55] Jessica Infante: Fair. I think there's something to say about Krampus is transparent about how he's kind of a monster. Santa and the Easter Bunny are coming off as they're trying to be the nicest things ever, but they're doing creepy things like sneaking into your house.

[00:22:11] Justin Kendall: He sees you when you're sleeping. He knows when you're awake. Okay, come on now. It's creepy.

[00:22:18] The Brewbound: Very manipulative. Jess, I don't know what you do, but we will never be an elf on the shelf family.

[00:22:23] Justin Kendall: Nope. We have this thing called peekaboo, which was like this reindeer that is sent to you by Santa and he comes out, you know, and he kinda like hangs out and he tells you, tell Santa, you know, he reports back like, hey, here's what the kid wants. So, because, you know, how would you know, you know? And I think it takes away some of that creepiness. Peekaboo was rejected in year one, year two, We're into like some acceptance of peekaboo, the reindeer, but she is not interested in having Santa come to the house. We may have negotiated Santa mailing a present, but.

[00:23:01] The Brewbound: Oh, good for him for Max. This is so funny.

[00:23:05] Justin Kendall: It's wild. And you know, when you get a kid with a birthday beforehand too, it's doubly like.

[00:23:12] The Brewbound: Just knows. Oh, I know. But maybe, maybe Sophie just wants it to be her birthday all month.

[00:23:17] Justin Kendall: It might as well be, to be honest with you.

[00:23:20] The Brewbound: It's my mom's birthday today and somebody posted on Facebook, like, oh, hope you celebrate all month. And it took a lot of restraint, but I did not write back, no bitch, my birthday's coming too.

[00:23:31] Justin Kendall: That's right. You are also a December birthday.

[00:23:34] The Brewbound: Yeah, man, my middle name's Noel.

[00:23:36] Justin Kendall: They went all in.

[00:23:37] The Brewbound: I'm going to be so old. Whenever I complain about how close my birthday is to Christmas, my mom is always like, you were nine days late, so this is your fault, technically.

[00:23:46] Jessica Infante: Because you could really control that.

[00:23:48] The Brewbound: Totally.

[00:23:48] Justin Kendall: You could have been a Thanksgiving baby. Doesn't have the same cachet.

[00:23:52] The Brewbound: Not at all. And what would your middle name be?

[00:23:54] Jessica Infante: Cranberry Sauce. Cranberry Sauce. There is, I don't know how true this was, but my parents have said that because I'm November 2nd, due date was originally October 31st. They had said that they considered naming me Wednesday if I was born on October 31st.

[00:24:10] The Brewbound: I feel like you could be, I could see this for you.

[00:24:14] Jessica Infante: I was a dark haired baby. I am not, shockingly not this bleached chemical blonde, naturally.

[00:24:22] Cruz Blanca: What?

[00:24:23] Jessica Infante: Yeah, mind blowing.

[00:24:25] The Brewbound: But you to me are a Zoe. Thank you. Ryan brought up Zoe when we were talking about baby names and I was like, there's only one Zoe for me.

[00:24:33] Jessica Infante: Thank you. It's like become a little popular and I'm a little salty about it because there were no other Zoes when I was a kid. People are recognizing it's a cool name.

[00:24:42] The Brewbound: Now there are no Jessicas. No, it's like serious. It's on the list of names that the social security administration says are in danger of dying. Wow. Oh no. Yeah.

[00:24:51] Jessica Infante: Because it was so popular, you Zoe and Justin's just still Justin.

[00:24:55] Justin Kendall: I guess.

[00:24:57] Jessica Infante: Everyone knows a few Justins, but not crazy popular.

[00:25:01] Justin Kendall: Yeah. Just kind of middle of the road. Well, I think we're stalling out here. Like you're getting some secrets here at the end. Like if you've made it this far and we will fill you in on everything that happens between now and Brewbound Live. With that, we'll be back next week with some audio from our interviews with our award winners. And then we will be back the following week to talk The Brewbound Live and everything that happened there. So with that, we'll Say we'll see you there. Thanks to our audio team. Thanks to you for listening. We'll be back.