Wednesday, November 10, 2010

The Not-So-Long Downhill Run Of Stone Brewing Co In Wisconsin

BeerNews.org is reporting that Stone Brewing Company will be exiting the state due to, well, let's be honest, lack of interest. To quote a Stone rep: "WI: We are exiting the state due to challenges in keeping a volume flow that would ensure frequent shipments of fresh beer."

On the other hand, Stone is looking at getting into Minnesota: "MN: Indeed, we are researching the market and talking about potential with some folks." So, our loss is their gain, I guess.

I'm somewhat conflicted about this news. I mean the bad news is that one of the best, and one of my favorite, breweries in the country will no longer be available. The good news is that product won't be sitting on the shelves and we won't have to suffer with half-assed product support from a company that doesn't care about our market. Towards the end here, we were barely getting seasonal releases, we didn't get any Vertical Epic or Anniversary releases. Conversations with retailers in the Madison area reveals that a Stone rep hadn't been through in probably close to a year or more. Moreover, the distributor (GenBev here in Madison) wasn't pushing it (favoring to foist Supper Club on us instead) and general consumers weren't demanding it.

The other thing this means is that Wisconsin breweries are doing a good job of selling in the state. Consumers are foregoing out-of-state breweries for quality offerings from O'So, Furthermore, Central Waters, Lakefront, and Pearl Street - not to mention Capital and New Glarus. Stone is only the most high profile of a number of breweries that have tested the water here in Wisconsin, just to turn tail and leave - Steamworks comes to mind.

So, one of my favorite deals in the city - Double Bastard on tap at Jordan's at Happy Hour for $3 a glass - is going away. A shame. Guess I'll to pick some up in Minnesota or Illinois when I'm there.

29 comments:

  1. I'm not sure what you mean about not getting any Stone anniversary in the area. I love in Iowa but come up to Madison 2-3x year for work. When I do, I stock up on beer I can't get in Iowa, especially Stone and 3 Floyds. I was up in September and picked up 4 bottles of Stone 14th Anniversary Emperial Pale Ale at Woodman's. Steve's also had a good selection.

    I am very sad I won't be able to get Stone products in WI anymore.

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  2. I also picked bottles of 13 and 14 year old Ann. Ales in Madison. In fact I think I might have snagged the last one from Steves on Monday. So its not like they flew out the door.

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  3. Decent enough beer, but definitely NOT worth the price each offering was set at in stores, regardless of what it was. How long do you think those $16 sixers of Oaked Arrogant Bastard have been sitting on the shelf? Freshness - doubtful.

    I completely understand the need to pull out of WI, but in my opinion, not a big loss to WI as a whole.

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  4. not surprised....I just hope they don't take The Bruery stuff with them when they leave...

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  5. Their beer was decent, but probably too agressive for most Wisconsin pallets. We're a bunch behind in the state in terms of craft beer, especially on the hoppy side. Thankfully Ale Asylum has us covered there making a nice selection of hopped up brews. I would like to see some of the other good west coast hoppy brews make it here like Green Flash, Port, Pizza Port, etc, but I'm thinking that won't be happening.

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  6. Fair enough on the Anniversary stuff - my point was more to the modestly outlying areas of the state - I should have lumped the "Anniversary" in with the "seasonals" as "barely" because Madison (and I presume Milwaukee) received SOME, but you get even a little outside of those areas and they were few and far between. Vertical Epic was a no-go.

    There's been some rumblings about Stone simply being unsatisfied with their distributor. But, frankly, I think there was enough dissatisfaction to go around that it was probably the right move for Stone to just pull out of the state for the time being and re-evaluate their presence here.

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  7. Jeff, what are you implying with your "foisting" Supper Club upon us comment?

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  8. I would agree if Stone was not happy with the distributor there are better ways to address it than just pulling out. Wisconsin is a difficult state to distribute in, I'm sure. You essentially have 3-4 large metropolitan areas with a lot of rural areas in between. Plus, add the large volume of quality WI brewers, it's probably tough to move product, even something as good as Stone's.

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  9. I do think it was a brewery driven issue in that there wasn't much support of the market by Stone. In many discussions with the distributors in wisconsin (they were carried by GB and Beechwood) the struggle with pricing and timely shipment of product were major problems that were never addressed by the brewery. I really won't miss them - good beers, but not the best.

    FWIW-the Madison market did get the 10-10-10 vertical this year....10cases. yep, Stone decided that 120 bottles was enough to support the market. At least we got more than the ZERO we got last year of the 9-9-9. I will miss the Double Bastard, but I went years without it before it got here also.

    Cheers!

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  11. Kirby, I don't want to speak for Jeff and this isn't really germane to the Stone issue, but Supper Club is a beer that wouldn't really get noticed without the massive marketing effort that has been behind it. It's inoffensive enough for BMC drinkers to manage and trades on Wisconsin nostalgia but, like the label says, it's "not bad." Spotted Cow has earned it's boring stall in the market place, due to years of exposure, but Capitol appears to have bought it's ride on the blandwagon.

    As for Stone, I've never been a big fan. While I'm not a big fan of bland beers, I can't really get behind the extremely hoppy beers, either. I like hoppy beers, and even some very hoppy beers, but extremely hoppy just triggers my gag reflex. I don't want to struggle to drink a damn beer. Maybe I just didn't try the right Stone beer, but maybe I didn't want to waste any more cash on undrinkable choke-juice.

    I don't know if I'm an average beer buyer, but I always head straight for the local beers selection. There are loads of great beers from WI that I love, and new, interesting beers are coming out all the time. Capitol, New Glarus, Ale Asylum, Potosi and O'so are just some of the breweries who have semi-permanent homes in my beer fridge. Add in a Dogfish Head and a couple specialty bottles, and there isn't room for much more.

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  12. Stone too hoppy for the midwest??? I never really got that from any stone beers I had. They were fine...but I certainly wouldn't call them too hoppy? There are plenty of hopped up midwest beers that fill my fridge...esp. from Tyranena, Central Waters, Bells, FOunders, Ale Asylum to name a few...
    Not sure how you can say we are behind, other than taste is subjective...maybe we just have more sophisticated beer pallettes...

    As far as Stone pulling out...I think what it really speaks to is overdistribution of a brand. Put yourself into too many long distance markets...and you're bound to lose some quality in sales, distribution, freshness, etc. Hurts even more when your beer isn't anything you can't get here...the hype wears thin after awhile.
    Drink local!

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  13. You know it's interesting - last week I wrote about Goose Island brewing at RedHook in Vermont for East Coast distribution. Does that make Goose Island a "local" beer if you're in Vermont? What if Stone contracted at City in LaCrosse? Would that make it a local beer? It would certainly lower demands made by distance and address the shelf/freshness issues.

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  14. Even if they did start brewing closer to the midwest market...if the brewery doesn't promote their product, who will? I never met a Stone brewery rep the entire time they were distributed here - I've met a number of brewery reps from just as far away, but never stone. They had the big launch party and then didn't ship the vertical (one of their best known seasonal projects). That shows a lack of concern for the market right from the start.

    The distant market issue is also interesting - I don't know what their annual production is, but if they are distributed in...say...30 states, they need to deal with at least 30 distributors. That's 30 contracts to be negotiated, 30 different wholesale accounts to plan production around and allocate limited product to. Then in each market you have countless retail accounts that have their own concerns and desires to be addressed. If the brewery really wants to do a good job of taking care of all of its markets/accounts it involves a LOT of time, energy, money and relationship building...it's not surprising to me that the decision was made to eliminate one market to be able to support either an existing market more efficiently or develop a new market that has expressed a desire to see their products.

    Allagash left the state over 2yrs ago and reallocated the Wisconsin bound beers to other markets that wanted more product. We didn't support them as strongly as they wanted and they left. Good business practice when you have a limited amount of the product to sell. Stone is looking to do something similar - good for them.

    New Glarus keeps their product in one market, Wisconsin, and with a smaller number of distributors. They don't have to send a brewery rep to 8, 9, 10, 15 different states to promote their products (of course Stone didn't do that either). It lowers their operating expenses/overheads and they are running more efficiently and with fewer distributor headaches as well. Good business practice that is in line with their business plan and keeps them operating.

    In other words, don't try to figure out why a brewery leaves a particular market - it's their business and they can do whatever they want (within the law, eh Jeff?). Allagash left, Boulevard left, Two Brothers left, Stone left, who's next?

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  15. I think Stone made a mistake by trying to go "all in" in Wisconsin with a huge push right away with all of their products. If they had trickled in a few products (Arrogant Bastard certainly, with a few others) then added others if the market demanded it, they could still distribute here.
    I agree that the "freshness" issue is a euphemism for lack of sales; if a beer sits on the shelf or at the distributors for months without selling, it won't be fresh when the consumer gets it. With so many great craft beers already available here there was only going to be so much shelf/tap space for Stone, and when they came here trying to sell everything in their huge portfolio, bars and liquor stores could only choose a few of their products to get behind. If they had come in with two or three products and waited a few months for the "OMG STONE IS HERE!!!1!" sales to die down, they would have had a good idea of just how much beer they could sell here, and make a decision about how many brands to market based on that.
    As for the "what makes a beer local" question, that's an interesting one, but in this case, doesn't matter if it's made in LaCrosse or California, if it isn't selling, it won't be very fresh on the shelves.

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  16. I honestly hadn't noticed that Two Brother's left. That's too bad, I liked the Domane DuPage.

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  17. Great comments. I read an article recently - not sure where (Motley Fool, maybe?) - that said that Boston Beer (Sam Adams) has something like 240 reps around the United States - it is by far the biggest portion of their employees. That's almost 5 reps per state. How many reps do you think Stone has on the payroll for the entire MIDWEST?

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  18. I think they had one that covered 5? states. Lots of geography to cover....
    New Belgium - I think they have 3 reps for Wisconsin alone (and it seems like they all went to UW-LaCrosse!?!) A sales team/staff/force adds huge expenses to a brewery for not a huge return, but the beer doesn't sell itself (i.e. stone in wisconsin).

    One more reason New Glarus chooses to not distribute out of state.

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  19. That's apples and oranges, though, isn't it, Jeff? You might just as well count Bud reps and compare with Sam Adams.

    I'm disappointed to hear Two Brothers has left as well, but then again, I hadn't noticed yet...

    How long ago did Boulevard leave? I'm sure I've seen some stock left at Woodman's East recently. Two Brothers, as well, but I'm not 100% sure.

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  20. I don't think it's unfair to point to two craft breweries (to the extent we still consider Sam Adams a craft brewery, but that's another story for another day) and show how one is successful with a large sales team and the other, with designs on being as large as the other, is not as successful without such a sales force. The analogy to the big breweries in this regard is actually somewhat instructive - sales is one of the things that they actually do very, very well.

    Do I expect that Stone would have 200+ reps? No. Is 5 reps for every state overkill? Maybe. My only point is that Sam Adams is very successful at these kinds of introductions and it might have something to do with the amount of sales support in the territory.

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  21. Choice is always good, and Stone offered us all fine products at quite reasonable prices. Compare the cost of Rogue or Dogfishhead to Stone--Stone always beat the prices on those two breweries, especially bombers. Arrogant Bastard, Double Bastard, Ruination IPA, Smoked Porter, the Verticals...all excellent beers. Stone will be missed (but my eyes will be better off not having to read all that clever fine print on the bombers!). We've become spoiled in the Badger state--we have so many choices now, and we like to look for the "exotic" while often forgetting that there are many great brewers in this state supplying us with virtually any style that will make us happy. So, here's to beer in Wisconsin, the fine folks who brew it all, and to happiness in a full-sized pint! Cheers!

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  22. This is terrible, terrible news. My non-Wisconsin brewery purchases probably fall like this:

    1. Dogfish Head
    2. Stone

    I'd love to see a breakdown of where Stone performs poorly. People I know in Madison love Stone! I blame Milwaukee, because I can.

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  23. tyranena is the only brewery in state that is bottling up whiskey barrel aged brew at a regular price. I think they get it. Thanks to the crew of Jessie, Stacie and the crew for the innovations that Rob produces!

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  24. Steamworks didn't pull out of Wisconsin due to reception. It was a financial reorg of company from over expansion in Colorado. They had to sell there new brewery...and fell back to just the brew pub with draft...plus contracted can only production. So no Steamworks bottles anywhere...unless they hand bottle some at brew pub. To bad...they had some great beers.

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  25. Milwaukee LOVES Stone.
    I for one am quite disappointed in this news. It does open the door for Wisconsin breweries to step up and fill the void.

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  26. Milwaukee Brewing Company also produces barrel aged beer at regular prices...Baltic Porter aged in Bourbon...tasty stuff..

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  27. "tyranena is the only brewery in state that is bottling up whiskey barrel aged brew at a regular price. I think they get it."

    Which brew would that be? If you're talking brewers gone wild, those are in more expensive four packs. Maybe a little cheaper than Central Waters versions but they aren't as good. Maybe a better statement would have been Tyranena is one of the few breweries in the state that actually uses a bourbon barrel and then bottles it. I like Tyranena to an extent, but everything is some derivation of Bitter Woman or Chief Blackhawk. Those aren't bad beers but they've gone to the well way too many times.

    I didn't realize Two brothers left either. I always pick up Boulevard on trips south since you just can't get beers as big, ballsy or good as their smokestack from any Wisconsin brewery.

    As for Wisconsin breweries filling the Stone void, sure some of them are trying. Point has a so-so specialty line, Big Eddy is solid and Miller-Coors just lets them do their thing, perhaps we'll get other good ones. New Glarus is hit or miss but they don't like hops and they don't like dark beers. Capitol is like Tyranena as most one-offs are a dopplebock variation. Futhermore is pretty solid, they need their own brewery and O'so is doing a good job so far.

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  29. In all honesty, I really like Stone brewing. They offer some very flavorful beers in a wide variety and do not hold much back. When my wife told me they were leaving WI today I was pretty disappointed and they will be missed. As for those of you who find Stone brews too hoppy by Midwest brewing standards? How about Surley?

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