Category Archives: Distribution

Welcome Alosta Brewing; Quick Anecdote on Self-Distribution

This evening I had occasion to visit the 5-days-old Alosta Brewing in Covina, CA. They are Covina’s first microbrewery. (Nearby West Covina features a BJ’s that used to be a prominent brewing location for the company and remains licensed as a brewpub.) The opening process for the fledgling outfit has been long and painstaking, requiring a mid-game switch in locations, much negotiating, and a lot of waiting. After all, though, they are open for business and report a very successful first week so far. At least two local brewers were in the tap room sampling Alosta’s beer when I arrived.

Current offerings include a blonde, a British pale, a strong British pale, and a brown porter. Upcoming are an oatmeal stout and a saison. The brewers/owners include members of the Crown of the Valley Brewing Society, a homebrewing organization in operation since 1988.

While I stood in the tasting room,  a call came in from a nearby pub requesting another keg of the blonde ale. In minutes, a keg was loaded and ready to move. “We can deliver a keg faster than we would be able to get a pizza,” one of the owners exclaimed.

In California, brewers can sell their beer to retail licensees directly without limit. Many states either do not allow this at all, or place caps on the amount of beer that can be self-distributed.

For a brewery just starting up, the ability to be immediately responsive to local retailers seems like an important benefit. As a brewery grows, self-distribution becomes less efficient. But in moments like the one I witnessed, it means the just-opened brewery’s beer can remain on tap through a busy Saturday evening at a popular pub with many great craft tap handles.

Language Shows Changing Power Relationships in Beer Distribution

Many states have protections for distributors, including some that require a brewer to renew its distribution agreement with the distributor unless the brewer can show “good cause” for ending the relationship. This of course interferes with a brewer’s freedom to choose how its beer will be handled, marketed, and placed for retail sale. The interference, historically, was justified by the power differential between large manufacturers with national presence and the small, independent, family-owned distributors that operated within particular geographic areas.

The three-tier system is now faced with breweries who are the smallest fish in the pond, with distributors being large and powerful (in many cases), and many retailers, too, being quite muscle-y: BevMo, for example.

Language itself can reveal a lot about how power dynamics have changed. One sentence in particular spurred this post:

@CraftBrewingBusiness sent out this tweet:

Stone Distributing takes Mother Earth Brew Co. under its wing http://www.craftbrewingbusiness.com/?p=11460.

Stone is no giant in wholesaling and craft brewers sign with them because they too are craft brewers and have a reputation for working well with fellow, smaller breweries. But the statement reveals a lot about a small brewer’s decision for the first time to cast a wider net and use distribution channels to sell beer. The language also reveals a lot about perceptions of Stone’s distributing business: it conveys the perception that Stone has a benevolent (if gargoyle-y) wing in the first place.

There are other examples as well (also happening to show that positive perceptions of Stone are long-lived).

When The Bruery signed with Stone in 2008, Patrick Rue posted on his company’s blog:

“This last Tuesday I … signed a distribution agreement! I cannot express in words how excited and happy I am about this.”

Now, taken out of context, if that statement were made in a traditional setting, with powerful manufacturers and small, independent distributors, who would be making that statement? Landing a contract to distribute Coors, Miller, or Bud would mean the world to a small company (I’m sure it still does). Now, such agreements can mean the world to small brewers who want to take the next step in growing their business.

A common usage to report a distribution agreement between a small brewer and a distributor seems to be “signed with.” For example, “Santa Clara Valley Brewing, which has been serving up some of the South Bay Area’s best brews, has just signed with California Craft Distributors™ to bring its golden goodness to the Golden State” (link). This phrasing is commonly found in pro sports, to report an individual player signing with an (obviously larger) organization. California Craft Distributors describes itself as “a  boutique distribution company which focuses on hand selling craft beer statewide in California.” This example further highlights the importance of distributor choice for a small brewer–since the laws add protections for the distributor, using other craft brewers or smaller distributors who will focus their time and energy on understanding and promoting smaller brands is key.

It bears mentioning that in CA, small brewers can self-distribute. Thus, they can get away with on-site sales and self-distributing to the local area for a while before they have to make the decision to use a distributor for the next step of growth. Not all brewers have this privilege, or to the extent that CA small brewers have it. Brewers Association has begun collecting information on the various self-distribution rights (or lack thereof) here.