Friday, February 6, 2009

Contract Brewing, Part IV - Some Thoughts From The Industry

OK, I know everyone's eyes are starting to glaze over from all the contract brewing talk and this is the last one, I promise. Heck, I didn't even write this one. I asked Ron Extract, Vice President with Shelton Brothers Importers, some questions about contract brewing. Shelton's lineup contains a number of European breweries, brewers and beers that are contract brewed or are contract brewers. For example, Shelton imports Mikkeller, a highly regarded Danish brewer who contract brews at top-end breweries all over the world. For example, his recent collaboration with Three Floyds, the Oatgoop.

I asked Ron to answer some questions about contract brewing, hoping he might have some insight from an industry perspective. Oh did he ever. I'll basically set up the questions and stay out of Ron's way on this one.

MBR: Are European and American attitudes on contract brewing different?
Ron Extract: Oddly enough, I'm not sure I've ever really thought about this question in exactly these terms, and I can't say that I've ever really discussed the issue with many European consumers who aren't also actively involved in one aspect or another of the trade. It probably depends on where in Europe you are and what sort of history there is with respect to contract brewing and all its variations, but my general sense is that in most of Europe, the attitude is likely to be a bit less cut and dry than it tends to be among a lot of American consumers.

MBR: Where does "alternating premises" or "alternating proprietor" brewing fall in the "contract brewing" universe? Is this arrangement lumped in with "contract brewing" or is it considered something different?
RE: I'll confess that I wasn't really familiar with these terms, which, itself, says something, I think. If, as a member of the trade who works closely with small brewers, I didn't know what they meant, what are the chances that the average consumer is going to know? So if you're asking about public attitudes, I'm not sure how much of a distinction is really going to exist between these arrangements and "contract brewing" in a broader sense. I think that for most people who pay attention to such things, if they see a bottle with an unfamiliar "brewery" name but a familiar address, the immediate assumption is going to be that it's a "contract brew" with all the negative connotations that may carry, and the burden of proof is going to be on the producer and/or brand owner to prove otherwise.

Alternating premises or alternating proprietorship type setups do seem to require a lot more direct involvement on the part of the non-facility-owner, which ought to address some of the typical concerns about contract brewing, so I think that once the issue is explained, most people would probably be willing to accept alternating proprietors as "real" brewers, but that doesn't necessarily mean that other forms of contract brewing aren't "real". Commercial brewing is very rarely a one-person operation, and whenever you have an end-product that is the result of the collective efforts of multiple individuals, the proper assignment of authorship becomes a rather complicated task. [ed note:this 'assignment of authorship' issue is a pretty interesting one and reminds me of some comments from Aran Madden, I think that was in our podcast yesterday, about the creative process or the perceived lack of 'soul' in contract brewing]

MBR: Could you specifically address some of the ethical issues related to disclosure of contract brewing/alternating premises relationships and the consumer expectation of contract brewing/alternating premises disclosure.
RE: Much of the American public's problem with contract brewing, I think, stems from what I believe is a rather legitimate sense of having been lied to in the past. Countless beers have found their way to retail shelves over the years, pretending to be something other than what they are. Familiar brands like Foster's and Guiness have banked heavily on their respective national identities, and the prominence of the word "Imported" on the label, without going out of their way to tell American consumers that what they were drinking was actually coming from Canada, rather than Australia or Ireland. Worse yet, rights to brand names like "Löwenbräu", "Andechs", and place specific names like "Augsburger" or even "Budweiser" were gobbled up by American companies, who then proceeded to apply them to products with absolutely no semblance to those that bore them overseas. With the consolidation of regional breweries, even more brands changed hands, and beer-drinkers around the country, if they were paying attention (and if breweries were being honest), discovered some of their favorite home-town brews coming from factories far from the towns these brands once called home.

People, as a general rule, don't like feeling as though they're being misled. Unfortunately, questions such as "who actually brews it" and "where's it made" may not always be quite as straightforward as they first seem, and can't always be answered in 25 words or less. If your local brewer, after meeting with some solid success, is able to raise enough capital to take over the old school regional brewery 10 miles up the road, and to hire its highly talented by underutilized head brewer, no one is likely to cry foul. But what if, instead of buying the old regional brewery outright, our brewer instead negotiates a contract to have that brewery make his beer, which, in turn, capitalizing on the otherwise underutilized skills of their talented head brewer. In both cases, the beer is being made by the same person, at the same facility, but the difference in ownership somehow gives the one scenario a very different feel than the other. Drawing on this example further, would it be completely unethical, in either scenario, for our brewer not to want to spend thousands of dollars to print new labels, or to waste his existing stock because the beer was now being made a few miles from where it had been made before, and to opt, instead, to rent a PO Box that would allow him to continue using his previous address? What if some of the beer is still being made at the old location. Is it really ethically necessary for him to print two different sets of labels with the names of neighboring towns, even if it isn't legally required?

Even if everyone involved is as honest as possible about where the beer is being made, though, further complications arise in trying to say, definitively, who is making it. Normally, the answer that one expects to this question is not the name of an individual, but that of a company, however, not all company names will suffice, and the criteria for what constitutes a "real" brewing company are sometimes rather difficult to pin down. The success of brands such as Struise and Mikkeller has helped warm knowledgeable beer drinkers to the idea that "real" brewers don't necessarily have to own their own facilities or equipment, but at the same time, there's still a distinct sense that the marketing company that comes up with an idea for a name or label and contracts a brewery to fill the bottles without particular regard to what's in them is clearly not "real". But what about someone who lacks a technical knowledge of commercial brewing but has a very specific idea of how they want their beer to taste? What about a homebrewer who's competent to make 5 gallons, but needs the help of professionals to translate his or her recipe to a professional scale? In the case of the marketing company with the clever label idea, most, I think would call their beer "real" if they were find a space, buy some equipment, hire a talented brewer, and give that person free reign, but again, how does that really differ, in creative terms, from finding a highly regarded, existing brewery to fill the bottles as they see fit?

One more complexity that needs to be considered is the issue of corporate ownership. The last few years have seen an ever increasing number of small, independent brewers gobbled up by international giants. Whenever this happens, questions inevitably arise as to what this change of ownership is likely to mean with respect to the quality of the beer, and as with so many other factors in brewing, the answer is, "it depends." In spite of corporate interests, some craft brewers may continue to operate with full autonomy, maintaining control of what they make, how they make it, and what ingredients they use, but this isn't how things usually go. Most larger corporations will seek to optimize efficiencies, which tends to be shorthand for cutting as many corners as possible -- using cheaper ingredients, shortening brewing cycles, using high-volume cylindro-conical fermenters, etc... while trying very hard to convey the message that nothing has changed. Their beer may very well be brewed where it says its brewed, but that doesn't necessarily mean that it is what it says it is.

As I see it, this ultimately leaves discerning beer drinkers with the following options:

1. Drink the brands you know and love, but bear in mind that whenever it tastes like something's changed, it probably has. Maybe you just got a bad sample, or maybe the beer in question isn't what it used to be. If you keep coming back to it and keep finding yourself disappointed, it's probably time to try something else.
2. Do your homework. If you really care about how your beer is made, what sort of ingredients are used, or who is ultimately profiting from its purchase, seek out that information, and don't necessarily take it for grated that the answers you're given will always be true. Things can sometimes change rather quickly in the craft beer business and not every brewer is always eager to divulge his or her secrets. If you're touring a brewery that claims not to use spices and happen to see several large bags of coriander, ask yourself why they're there. If a brewery with a 20 barrel brewhouse that isn't even in use when you go to visit, claims to be making 50,000 barrels a year, ask yourself whether they're really brewing 7 times a day, or if maybe, some of that beer is being made somewhere else.

MBR - this is where it ends; honestly, Ron has better things to do than spend all day answering my questions, so I really appreciate the information that he was able to provide. I think there are definitely some interesting areas to follow-up and the whole idea of corporate ownership is one that we didn't even touch on but is, as you can see, hugely related to the public perceptions on contract brewing.

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