Blank Slate Brewing Company joined the Cincinnati brewing scene in Spring of 2012, and I sat down with him in the fall of that year. Realizing it’s been three years since then, we sat down for another interview recently. Scott and I talked for a long time, this is a long post please bear with it, it’s worth it. Also, hang tight for later this week or next when I’ll post part 2. Today, though, it’s all about Blank Slate Brewing Company!
Ohio is receiving lots of distribution from new (to us) breweries at the end of 2013. New Belgium, Deschutes, and others will be here before the end of the year but it’s getting kicked off with Clown Shoes. Clown Shoes is a contract brewing operation out of Massachusetts that’s known for somewhat insensitive beer names like Tramp Stamp, Lubrication, and Brown Angel. Controversial names haven’t stopped them from making big and interesting beers for a few years distributing them to a variety of states before finally coming here.
Clown Shoes is initially gracing Ohio with 6 different brews: Galactica and Hoppy Feet are here in 4-packs of 12 oz bottles, Chocolate Sombrero, Genghis Pecan, and Muffin Top are all in 22 oz bombers, finally Tramp Stamp is draft only, at least for now. I did a review of a bottle of Tramp Stamp that I brought back from Georgia last year, you can read that here. I also had a bottle of their Chocolate Sombrero which, in short, is a spicy chocolate imperial stout starting out with some heat that slowly builds and adds in rich chocolate as the glass warms. I have yet to have Genghis Pecan or Muffin Top and my thoughts on Galactica and Hoppy Feet are just below!
This is my follow-up to the 3-Tier system introduction. I started off with an overview of the 3-tiers, but now we’re going to dig into the top, and most exciting, tier. Breweries are where all the magic happens!
Besides being where the magic happens breweries are also the easiest tier to discuss because all they need to do is make beer. OK, so making beer is difficult but that’s far beyond the scope of the 3-tier system. For their role in the 3-tier system, it really is just a matter of producing a product and making money from it. Depending on the local state laws, there are a couple of ways that they can make that money. Some states allow breweries to sell their beer themselves out of the brewery, like Ohio’s tap rooms. Other states allow them to sell it themselves around their state, aka self-distribute. Both of these are less common routes for breweries to make money. Most brewers depend on a third-party to buy their product then sell it to everyone else, to distribute the beer.
The Role of the Distributor
The upsides to signing with a distributor are that brewers get to focus on making the best beer they can. They make the beer and sell it to their distributor who takes it from there. Without a distributor, brewers would need to find their own way into meeting bar or store owners and convincing them to carry their product. That also means that every bar would have one more account to deal with and keep track of. In talking with store owners they prefer dealing with one company selling many products. Distributors simplify the process of well, distribution.
Of course, that’s a bit of an oversimplification as the breweries have to manage the relationship with the distributor and do plenty of marketing themselves. Also, many distributors provide far more services than just selling beer. Like providing signage or having a representative pour at beer fests and storing all those kegs/cans till the retailers are ready for them
3-tiers let this become the distributors problem instead of the breweries
Brewery Self-Distribution
The alternative to that is self-distribution. Ohio, Indiana, and about 30 others states allow self-distribution. I recently discussed self-distribution recently with Cellar Dweller and Listermann. I also covered this topic with Scott LaFollette from Blank Slate Brewing Company who self-distributed for the first six months.
What everyone made clear was that self-distribution had some distinct advantages in a better overall view of the business, a better relationship with customers and slightly higher margins. However, all of that results in less time for them to focus on making beer or having to hire delivery people and buy trucks for them to drive.
Franchise Law
Lastly, all brewers I talked to had strong feelings about franchise law. In a vast oversimplification franchise law means that the brewery gets stuck with the distributor forever. If I can stick to my plan then this fall there will be a post on Learning About Beer: Franchise Law where I will break down this controversial subject. Also planned for late September or August will be the next tier, Distribution!
Many thanks to all the brewers who were interviewed about this.
BrewMinds 