expr:class='"loading" + data:blog.mobileClass'>

Tuesday, June 30, 2015

Laurelwood's Red Elephant Cans: The Backstory

The release of Laurelwood's first canned beer, Red Elephant IRA, is a sort of milestone in a journey that began several years ago. The goal of that journey is to keep the Laurelwood family of brands fresh and on the minds of craft beer fans. But there's more to the story.

First the beer. They've been brewing Red Elephant as a seasonal for at least a few years. It packs a bit of a punch at 7.0% ABV and 70 IBU. I thought it an odd choice, given the summer release. But there are reasons for everything..which I shall get to in due time. In fact, the beer is quite refreshing in our warm weather, and also full of flavor. In short, great stuff.

Laurelwood's move to cans follows its move to six-packs of 12 ounce bottles that happened roughly two years ago. It's the logical next step because the six packs of Workhorse and Free Range Red have been a gigantic hit in both Oregon and Washington.

"The move to six-packs of bottles was specifically designed as a growth vehicle," said Mike De Kalb, founder and owner of Laurelwood. "Sales of 22 ounce bottles were stuck because our production was maxed out. I saw six-packs as the best option."

Strangely enough, De Kalb didn't find much support for his plan.

"No one liked the idea," he said. "Our distributors told me I was nuts. They said we were too small, didn't have enough sales staff, didn't have shelf placement or a big chain presence. I even struggled to convince my own people that six-packs were a good idea."

Of course, the partial key to winning over hearts and minds was the deal De Kalb signed with the Craft Brew Alliance in 2013. He was leery of the cost and risk associated with building a production brewery. The way he avoided that and still got his beer into six-packs was the deal with the CBA, which agreed to contract brew Workhorse and Free Range Red for that packaging.

The production numbers for the two beers are obscure. You won't find them anywhere in OLCC data because the beer is brewed at the CBA's Woodinville, Wash. facility. So the numbers are buried in Washington production stats in the CBA column or row. And the numbers are significant.

"We brewed about 12,000 barrels in Woodinville in 2014," De Kalb says. "We're on pace to brew around 18,000 barrels this year." (Roughly 75 percent of that beer comes back to Oregon, a shocking detail in my mind because I thought more of that beer stayed in Seattle. Oh well.)

To understand what the CBA deal has meant to Laurelwood, look no further than OLCC production stats. Laurelwood brewed an average of 5,000 barrels at its Sandy Blvd location in 2013 and 2014. Keep in mind that not everything they brewed there is tracked by OLCC stats. Beer sold out of state, for instance. Still, the CBA contract has doubled and will very soon triple Laurelwood's Oregon production. Are they selling some beer or what?

The bottom line is that six packs remain the most widely accepted packaging in the industry. Distributors, retailers and consumers all like six packs. If you don't know, Full Sail started this in 1987, when they bravely launched their brand with six-packs. Others eventually followed. Today, many breweries are seeing good results with packaged product.

Given the success of the bottles, you might wonder why De Kalb and Co. would want to move to cans. And why Red Elephant is the beer? Fair questions.

"I like cans," he said. "They're lighter, they reduce oxidation and I just think they keep the product fresher. Our move there is the same as the six-pack bottles...another growth vehicle.  If you're not growing, you're not getting mentioned, there's nowhere for your people to grow and consumers forget about you. You can only sell so much beer over your own bar."

De Kalb initially hoped to do two styles in cans. Distributors like having two brands in similar packaging, he says. But he didn't want to compete against himself by putting Workhorse in cans. He thought they would do Mother Lode Golden Ale and Red Elephant.

That plan fell through when they discovered a long list of beers out there named Mother Lode Golden Ale. They felt it best to steer away from a name that might result in legal challenges now or down the road. That left Red Elephant, a bold, year-round beer.

It took nearly six months to get the project off the ground. They had to get label approvals and have cans fabricated. Cans are a lot cheaper than bottles. That's the good news. The bad news is you have to order a lot of them at one time. Laurelwood bought 80,000 to start with. 

Certainly the most surprising aspect of this story is that Red Elephant is brewed and canned (via a mobile system) at Laurelwood's Sandy location. The success of the CBA-brewed beers and the relatively small (15 bbl) size of the Sandy brewery might lead one to think Red Elephant is being produced the same way. Not so.

It turns out the Woodinville brewery does not have a canning line. The CBA's Portland facility (Widmer) has a canning line, but can't produce the beers Laurelwood wants to can. I've heard differing explanations for that. Nothing I can share here. The bottom line is that Laurelwood is managing the production and packaging of this beer in-house for now.

"It's a challenge for us," De Kalb admitted. "We can't accommodate the mobile bottler (for 22 ounce bottles) and the mobile canning folks in the same week. It disrupts the flow of things on our brew deck. So we're doing our best to make it work. It's a juggling act."

Because production is somewhat limited, you won't be finding Red Elephant cans in the larger chains like Fred Meyer, Safeway, etc. Where you will find it is at local bottleshops and places like New Seasons, Whole Foods and Zupan's. 

"Red Elephant will be year-round in cans," De Kalb says. "Will it always be on tap at our pubs?  Probably, but I can't guarantee it. Shane [Watterson] and his crew are doing a great job of pumping out seasonals while keeping up with the bottling and canning program. These are wild times."

Frankly speaking, I'm pleased to see Laurelwood beer in a can, my preferred packaging. Hopefully, they'll find a way to move Workhorse and Free Range Red to cans at some point. I have no idea how or when that might happen, but I'd love to see it. Keep the faith.

Saturday, June 27, 2015

Business as Usual at Anheuser-Busch: The Beck's Case

There's been a bit of chatter this week regarding Anheuser-Busch's proposed settlement in a class action suit involving Becks Beer. It's best to not get too bogged down in the details, because there's not much skin in the deal for the plaintiffs or class. Lawyers are the big winners.

The important thing is to look at what the cynical charlatans at AB have been doing since they acquired Beck's a few year ago. And what they've been doing is selling Beck's without making it clear to consumers that the beer is made in the US, not imported.

Let's be perfectly clear on one thing: The people who sued AB didn't do so on grounds that the beer sucked. Nope. They sued because they felt they were duped into paying more for beer that appeared to be imported. They could have just bought a crappy domestic brand on the cheap.

For their part, AB says they follow the German recipe for Beck's and that the quality of the beer remains excellent. Oh sure, they subbed in some US-sourced ingredients that were cheaper and easier to get. But the beer is the same. Right.

It turns out the Beck's case isn't even AB's first class action run-in of the year. Back in January, they settled a lawsuit involving Kirin Ichiban, That was a case where AB, this time as part of a joint venture with Kirin, was producing Ichiban in the US...while continuing to market and sell it as an import. Duped consumers objected and won.

The fact is, AB's special expertise lies in manufacturing efficiencies and cost-cutting. They gobble up brands, often shutting down plants, and move production to giant factory breweries. That's why a lot of people worry about them buying craft brands. They don't mind cheaping things out and misrepresenting a product if there's a buck in it for them.

In the case of Beck's and Kirin Ichiban, labeling and packaging identifying the beer as being a "Product of the USA" were either extremely small and hard to read or obscured more or less completely. The more obvious labeling suggested the beers were imported. Go figure.

I have a hard time understanding how such shoddy labeling could have made it through regulatory scrutiny. But, then, this is probably just another example of a dysfunctional regulatory system that forces consumers to seek legal remedy when they get ripped off by giant corporations.

Regardless, the real bully in the China shop is Anheuser-Busch, which knowingly duped consumers into thinking something that wasn't true. And don't assume for a second that a settlement or two will change anything. These schmucks are good at this kind of thing. They have a lot of experience.

Tuesday, June 23, 2015

New Nephews, Beer and Baseball: A Seattle Sojourn

Last week's visit to Safeco Field in Seattle was a follow-up to our August 2014 visit to AT&T Park in San Francisco. The Giants won another World Series title in the interim and they were coming to the Northwest. Great news. You wonder if the Mariners will ever win a title. Oh, never mind.

This wasn't just a baseball and beer trip. We made a detour to Port Orchard, home of my sister. Her family has had a series of dogs named after baseball players. Buhner passed away last year. Griffey is the new arrival. Quite a boy.

Part of the pregame festivities involved sipping local 7 Seas beer and tossing a baseball around the yard...you never know when a foul ball might come your way in the game. Griffey was ever-present and wanted to  join the action, stealing the ball at one point. Good dog!

Next came the ferry ride across Puget Sound to Seattle. These rides can be wild in rough weather, but this was a perfect day and a lot of folks enjoyed the ride on the outdoor deck. By way of comparison, our ride down San Francisco Bay on a fast ferry in August was a bit too chilly to enjoy from the deck without a parka. Mark Twain had San Francisco summers right.

For anyone not in the know, craft beer has found its way onto the Washington ferry system. After a short wait, we procured several (plastic) glasses of Redhook ESB. There weren't a lot of choices, but I can tell you that beer hit the spot on the hour-long crossing. Not so long ago the only beer you're drinking on a ride like that is some macro garbage. Check it out in your DeLorean if you don't believe me. We've come a long way.

Our final pregame stop was Pyramid Brewing, across the street from Safeco. A lot of beer snobs love to beat up Pyramid. And, yeah, I'm a beer snob, which means I should pile on. But I've been impressed with some of their beers and particularly the value they bring to the table at a time when craft beer prices are escalating. Anyway, I ordered a CDA from the Small Batch list. I assume this was a version of Discord, which I've always liked and is no longer bottled. Pleasant surprise.

Across the street at Safeco Field. there's plenty of good beer to be had. But don't expect to find it instantly. I ran into a two young Giants fans packing pounders of Rainier. "Best deal in the park," they told me. Moments later, I spied a vendor hawking Blue Moon, Coors Light and Rainier. Not quite what I had in mind. Sorry.

One of the odd things they do at Safeco is position beer and food vendors on the field side of the concourse. This has the effect of darkening the concourse and blocking views of the field for fans there. I've only been to two other major league ballparks...AT&T and the place where the Phillies play in Philadelphia. I don't recall a similar positioning of vendors in either of those ballparks. I suppose there's a reason Safeco does this, but I hesitate to speculate.

A few minutes into my walk I stumbled on a vendor selling Pike IPA. Might as well drink local, I figured. I paid $10 for a brimming pint and headed to my seat. On the way back, I came upon vendors selling Bale Breaker and Laurelwood Workhorse, among others. I'd missed these guys on my way out due to the mess that is Safeco's concourse. Oh well. First world problems. The thing is, there's good beer here if you look for it.

The game itself turned into a walkover...a 7-0 beatdown for the Giants. So the two teams split their season series 2-2. Fine. I doubt we'll see the Giants up this way again for a while and I'm ambivalent about making the trip to Seattle for a Mariners game. I like some of the players on this team, but the organization has "amateur" written all over it.

In retrospect, meeting my new nephew was probably the highlight of the trip. I know I'll see him before I see the Mariners or Giants again.

Wednesday, June 17, 2015

Oregon's Brewpub Bill at 30: What Almost Never Was

Thirty years ago today, Oregon's beer landscape was forever changed. The thing that fueled the coming change was the Brewpub Bill, which was altogether under-appreciated at the time, except among the folks who pushed for its passage.

In fact, the modern craft beer industry in Oregon owes its existence to the Brewpub Bill, otherwise known as SB 813. Without the law, craft beer would have been confined to the shadows and margins of taverns and bars. Brewpubs changed the game completely.

Please recall that Oregon had only two craft breweries in 1985...Bridgeport (then known as Columbia River Brewing) and Widmer. The existing law prevented them from selling any beer directly to customers. They could self-distribute to bars and taverns or go through a distributor. But distributors weren't remotely interested in craft beer in those days. Thus, the challenge.

The people who made the Brewpub Bill happen went on to become the pioneers of craft beer here. They conceived the idea, helped write the bill and lobbied for its passage. You may recognize a name or two: Dick and Nancy Ponzi, Karl Ockert, Kurt and Rob Widmer, Mike and Brian McMenamin, Art Larrance and Fred Bowman. These folks paved the way for everyone who came later.

Researching my book on Portland's beer history, I discovered the pioneers did not accurately recall how the Brewpub legislation became law. The original bill introduced in the Oregon House ran into opposition in the Senate and stalled. Its language was later inserted into another bill, SB 813, that became law. But no one knew how that happened. It's quite a story.

There was very little media coverage of the bill's passage. When the Oregonian listed the significant legislative achievements of the 1985 session, SB 813 (which addressed liquor licenses in bed & breakfasts) received no mention. Yet the law helped jump-start what would evolve into a multi-billion dollar industry. Pretty funny, I think.

For the intensely curious, the Brewpub Bill gets full coverage in my book, which you can buy by following the link at the upper right on this page. Or you can check it out at the library, which has many copies. A Cliffs Notes version of the story appears in today's Willamette Week, with thanks to Martin Cizmar. It's a great place to start if you want to know more.

My parting comment is this: It's important for craft beer fans to know this history and to understand the debt owed a small group of entrepreneurs who made the Brewpub Bill happen. Cheers to 30 fantastic years and counting, folks!

Monday, June 15, 2015

Don Younger and the Breakdown of Local Beer

Most who stop by here know the craft beer industry as it exists today was largely built on the connection between local communities and good beer. As Don Younger famously quipped when talking about why we love Oregon beer, "It's not just because the beer is good; it's because it's ours."

In fact, interest in local beer is apparently growing, particularly among the Millennial demographic. Nielsen stats included in an article written by a friend of mine, Jason Notte, suggest Millennials (21-34) are more likely (53 to 45 percent) to prefer local beer than the demographic that includes all legal aged drinkers (read that older drinkers).

Don't read too much into those numbers. They're about what we should expect. Because folks over 40 are typically less engaged in the sort of fad-driven scenes that kids live for. Craft beer is part of that and something older folks don't care as much about. So these numbers aren't really so surprising.

Still, the Millennial interest in local beer is great for the 3,400 operating breweries who have a dedicated clientele. According to Notte's article, 75 percent of drinking aged Americans now live within 10 miles of a brewery. With 2,000 additional breweries on the way, you have to wonder when the number will be 5 miles. Or less. That's pretty wild considering where we were 30 years ago.

The most perplexing aspect of this story is the fact that growth is effectively undermining the local premise upon which the industry was built. Here's how:

First, there's the growing number of small breweries and brewpubs. The more of these we have, the more they compete for the same customers, which means they eventually look outside their own areas for business. Keep in mind that these are relatively low profit ventures. If you own a brewpub, your path to fame and fortune is through scale and expanded reach.

Second, there are the large brewers, who are expanding market share by building breweries far from their home markets. Sierra Nevada, New Belgium, and Widmer are among those who have already done this. More soon will. Because they're aware of the local preference, these brewers strive to produce beers that appear to be local wherever they are. Thus morphing the definition of local.

The contradiction is clear: Despite the fact that beer fans apparently prefer locally made beer, industry trends mean craft beer is becoming less local. What this means going forward is unclear.

Getting back to the opening, it's fair to wonder what Don Younger would think about this. As I've said here before, I never met Don. My guess is he'd be ecstatic about the growth craft beer has seen in recent years. And troubled by what's happening to the concept of local production. Just a guess.

Monday, June 8, 2015

Fruit Beer Festival Turns Five, Expands Venue and Hours

The barrage of summer beer festivals is here. So you can expect to see some sort of festival every weekend and even some weekdays. Some of these are "me-too" events, thrown together in hopes of making a few bucks on the wave of craft beer popularity. Some are more authentic.

This week's Fruit Beer Festival, now in its fifth year, is a favorite of mine. You won't find most of these beers outside the festival. That's not to say every beer is great. Opinions are going to differ on the good and not-so-good. The fun is in trying some unique interpretations of what you can accomplish using fruit in beer.

The other day, I saw some people beating up the Fruit Beer Festival on social media due to overcrowding in recent years. Venue size has definitely been an issue. This wildly popular event probably needs to move to a park or similar location. Organizers, aka Burnside Brewing, prefer to keep it close to home. You can't blame them for a variety of reasons mostly related to cost.

In an effort to lessen the impact of crowds, organizers have made two key changes this year:
  • Most importantly, they've expanded the festival footprint by (they say) 40 percent. They'll do this by occupying open space immediately to the west of Burnside Brewing, including 7th Avenue and the lot across the street. Good news.
  • Last year's Friday night VIP session is history. They've opened that time slot up to the general public. With the weather cooperating nicely, Friday evening might turn out to be the perfect time to visit. The space for Friday's 4:00-9:00 p.m. session will be limited to the Burnside parking lot, which should be fine. Smart move.
Although the growing popularity of the Fruit Beer Festival will likely force organizers to move it to a larger venue at some point, the changes they've made for 2015 should help alleviate the issues they've seen in recent years. Hopefully. There isn't any additional room to expand here, so the next move will be a move. That much is clear.

The festival brewery roll call is long. You can find the list here if you feel the need. At a media preview Friday evening, we tasted a few of the beers that will be pouring. My favorites included Ecliptic's Ultra Violet Blackberry Sour Ale, Burnside's Peaches of Immortality, Fort George's Pucker Pi and Laurelwood's There Gose the Neighborhood. Fruit of the Garden of Good & Evil, a collaboration between Burnside and Reverend Nat's Hard Cider, features some nicely balanced heat thanks to several varieties of peppers. Don't miss it. 

Ticket prices are about what you've come to expect: $20 for a tasting glass and 12 tickets. Be advised that some beers will cost more than one ticket. You can buy advance tickets on the festival website here if you wish. Doing so may get you in the gate faster, but you'll pay a little more for the privilege thanks to fees. Buy tickets at the gate and you'll likely wait in line a few minutes. Your choice.

All the pertinent information is on the festival website here. It should be another great tasting experience for anyone who likes to see what brewers can do with fruit and beer.

Tuesday, June 2, 2015

Irwin to Lead General Distributing into the Future

Sometimes, you know it's the right time to make a move. That was the case this week for General Distributing, which announced that Steve "Tiny" Irwin will take over as General Manager at the end of June.

I don't mention a lot of industry gibberish here. I mostly leave that to the folks who specialize in regurgitating press releases as news. No offense to them, but that's not a my deal.

But this is a worthy move that deserves mention. Because Irwin has the knowledge, the experience and the expertise to make a big difference at General. He's the perfect guy to lead them into the future and I suspect he will do just that.

Some brief background. I met Tiny just once, a couple of months ago at an event at Belmont Station. I liked him instantly, as we rambled on about various aspects of the beer business. He has a million stories tucked away in his head, many of them funny, all of them educational.

The timing is right at General. Outgoing GM, Steve Mysinger, has done a nice job leading the company through challenging times and they are well-positioned in a brutally competitive marketplace. Mysinger will stay on as Executive VP of Special Projects, good news for General.

Irwin's sales background is extensive. He spent more than a decade with MillerCoors in roles that included distribution management and chain sales. Then he was hired as VP of Sales at Rogue, a dead end job where he lasted only a year...twice as long as the guy who replaced him. Not bad, huh? Actually, getting fired by Brett Joyce was a good thing...and a sign that Tiny will go far.

If you don't know much about General, give their website a look. They've got a rich history and their territory extends to 11 counties. In recent times, they've been engaged in building out their craft portfolio, which includes Sierra Nevada, Southern Tier, Victory and Green Flash, as well as Oregon brands Alameda, Lucky Labrador, Three Creeks, Flat Tail and many more.

It'll be interesting to see where Tiny takes these guys. Good luck to him.