Article on craft breweries in Canada

markaberrant · Post by **markaberrant** » Fri Dec 16, 2011 1:28 pm

matt7215 wrote:
bufordsbest wrote:
matt7215 wrote:however many people in the US are predicting that 2012 will be the year the bubble pops.......
is there an article or source you can point to?
there was one that was posted on ratebeer not to long ago, ill go try to find the link

Yeah, I don't know of any links, but it was a hot topic at this year's Craft Brewers Conference. I have said similar things on this message board and got "poo-poo'ed" as usual for my "negative attitude."

markaberrant · Post by **markaberrant** » Fri Dec 16, 2011 1:39 pm

Rob Creighton wrote:I have often made the point to the wonderful folks who are willing to lay everything on the line to start a small business in a volatile, massively over regulated market that you need a million to start a 5000 hl brewery. 500 grand to buy equipment and convert the leasehold and 500 grand to survive the first year. Remember, this is a local, small business... not a national tech startup.

The Spearhead effort falls into neither category. It is a marketing effort designed to sell you brand equity without committing to the capital investment. Look at the website. An unbelievably large corporate structure for zero assets other than a few decorated vehicles parked at Cool Brewing. I can see where the 500 grand is going. It is a proven recipe with Sam Adams as long as the product meets sales expectations.

I wish them all the best but my respect goes to the folks who make the commitment to actually craft a beer and not a tagline. I have often called Steve at Beau's a sleazy marketing knob but he does it incredibly well and put it all on the line to get there. Good on him.

Thank you for your informative thoughts, I was just about to ask the question, "what the hell has Spearhead spent half a million dollars on?" They have a single beer, available on draft only, with a limited number of accounts, and have it brewed on contract.

And I agree on the million dollar investment to get a brewery off the ground. I have been arguing this recently with many of my friends. Sure, the nano brewery approach is appealling for those looking to get their foot in the door to capitalize on a hot market, but it is not a sustainable model... nano breweries are just too damn inefficient and labour intensive. While you can get away with small scale brewing at a brewpub, you are running a brewery AND a restaurant, so you really aren't lowering investment costs or management effort.

bufordsbest · Post by **bufordsbest** » Fri Dec 16, 2011 2:44 pm

markaberrant wrote:
matt7215 wrote:
bufordsbest wrote: is there an article or source you can point to?
there was one that was posted on ratebeer not to long ago, ill go try to find the link
Yeah, I don't know of any links, but it was a hot topic at this year's Craft Brewers Conference. I have said similar things on this message board and got "poo-poo'ed" as usual for my "negative attitude."

is this the article?
http://www.ratebeer.com/forums/when-did ... 186958.htm

matt7215 · Post by **matt7215** » Fri Dec 16, 2011 3:50 pm

bufordsbest wrote:
markaberrant wrote:
matt7215 wrote: there was one that was posted on ratebeer not to long ago, ill go try to find the link
Yeah, I don't know of any links, but it was a hot topic at this year's Craft Brewers Conference. I have said similar things on this message board and got "poo-poo'ed" as usual for my "negative attitude."
is this the article?
http://www.ratebeer.com/forums/when-did ... 186958.htm

no it was a blog post or an article in a brewing magazine not a RB thread, i beleive it was referencing the Craft Brewers Conference, if i find it ill post the link

Rob Creighton · Post by **Rob Creighton** » Fri Dec 16, 2011 3:52 pm

markaberrant wrote: I was just about to ask the question, "what the hell has Spearhead spent half a million dollars on?"

From their website, this company has:

a president
a chief financial officer
a chief communications officer
a brewmaster
2 (count ‘em – 2) VP’s of sales
a business manager (what the hell is a business manager?)
and 3 sales reps while only selling kegs.

They better have a lot more than half a mill to keep this crowd employed. What happened to the young kid/sommelier/asst. brewer?

This reminds me of Brick in its last years under Jim Brickman. I believe they had 7 VP's and the shareholders were always wondering why they couldn't make any money.

Malcolm · Post by **Malcolm** » Fri Dec 16, 2011 4:15 pm

JeffPorter wrote:Man, Spearhead started heavy marketing before the kegs were tapped.

I remember being at one launch where they were doling out free samples. One woman at the bar said that it was a "really good... what is it a pale ale?".

The rep quickly turned and replied with "Clinton-like" pointing, as though he was giving elocution lessons and said: "Say it with me: Hawaiian. Style. Pale. Ale." She repeated the words. He smiled, said "good", and then gave her a shirt.

I always thought that that was kind of dickish and condescending...not reflective of the organization as a whole I'm sure, but I think that one rep got a little carried away with "getting the word out".

Over the top, actually. I wonder if that was the same launch where they started free pouring their beer at bar customers' tables, which is not a smart move.

markaberrant · Post by **markaberrant** » Fri Dec 16, 2011 5:04 pm

Rob Creighton wrote:
markaberrant wrote: I was just about to ask the question, "what the hell has Spearhead spent half a million dollars on?"

From their website, this company has:

a president
a chief financial officer
a chief communications officer
a brewmaster
2 (count ‘em – 2) VP’s of sales
a business manager (what the hell is a business manager?)
and 3 sales reps while only selling kegs.

They better have a lot more than half a mill to keep this crowd employed. What happened to the young kid/sommelier/asst. brewer?

This reminds me of Brick in its last years under Jim Brickman. I believe they had 7 VP's and the shareholders were always wondering why they couldn't make any money.

Yeah, it was a leading question, and I was too lazy to bother looking at their website to collect the info. And like I said, when I have presented such info/commentary in the past regarding Spearhead, it was met with, "you are so negative, give them a chance," so it is nice seeing this coming from someone else. Thanks again!

And that young buck they had was certainly entertaining... would be the perfect candidate for an over the top reality show of some sort.

UPDATE: the "org structure" you posted reminds me of Brecknock Organic Brewery that started up a couple years ago in Saskatchewan. Contract brewed as well, and about as deceiving as Minhas in regards to their marketing of so called "organic" beer. I still see some of their beer in Alberta, but I am pretty sure it is just old product.

Tapsucker · Post by **Tapsucker** » Fri Dec 16, 2011 5:10 pm

Having worked for a VC funded company after years of entrepreneurship, I was startled by how VCs insisted on wasting money. Every hire was justified by 'you have to hit the ground running', even if those people were not needed yet. Once we ran out of money funding idle hires that we were not ready for yet, they went and did the same at other companies.

I suspect Dimitri's banking background might be clouding the understanding that a start-up is just that; a start-up and that it has to grow into an enterprise before enterprise infrastructure should be in place.

On the other hand, "go bold or go home" is not so bad an approach either...

GregClow · Post by **GregClow** » Sat Dec 17, 2011 4:40 pm

Rob Creighton wrote:What happened to the young kid/sommelier/asst. brewer?

Stephen Rich? He was let go about a month ago.