USA: Craft Brew Alliance to change strategy for Widmer Brothers

Craft Brew Alliance (CBA), which is 32.2% owned by AB InBev and the 9th largest brewing group in the United States has announced to shift focus of its Widmer Brothers brewpubs from food to beer. Widmer Brothers experienced a 4.9% decrease in brewpub sales through the first nine months of this year, which is the continuation of an ongoing trend for this brand.

The brewery plans at its brewery-restaurant in Portland, Oregon to eliminate its full service kitchen to make way for expanded small-batch brewing capabilities of its 10-barrel (11.7 hl) pilot plant, which started last year. This brewery was initially built behind a glass window, which will now be removed. By also relocating the retail store, adding a barrel room and elevating the tours, the brewery wants to put the focus in future more on beer than on food.

A side-effect of the new strategy is the need for fewer personnel, which will be cut from currently 40 to at least half of it.

Derek Hahm, CBA’s vice president of sales and brewpubs, commented on the move: “The marketplace is inundated with brewery taprooms, and the restaurant business is taking a hit. Minimum wage is increasing, guest counts are declining and the cost of goods and what goes into running restaurant is increasing.”

And he went on saying: “The food for us, in Portland, is playing less and less of a role. We are trying to reorient what we do for consumers, and in some ways food was getting in the way of that.”

The pub will still serve light snacks, but the customer experience will be more a tasting room than a restaurant in future. Construction and execution of the new strategy is expected to be complete by the second quarter of 2018.

Widmer Brothers is not the only brewery within CBA to face problems. Last year Redhook Al Brewery from Seattle, Washington sacked half of its staff (inside.beer, 19.10.2016) because of a reduced production level following a decrease in contract brewing at the site.

In November 2007, Redhook Ale Brewery and Widmer Brothers officially announced plans to merge, forming a new company called Craft Brewers Alliance, which was later renamed as Craft Brew Alliance in 2012. The merged company, which is headquartered in Portland, Oregon retained both the Redhook and Widmer brands. The two had already been working closely for several years through a licensing agreement whereby Redhook brewed Widmer beers at its Portsmouth, New Hampshire plant and distributed them on the west coast.

In 2010 the company bought Kona Brewing Company in Kona /Hawaii.

Moreover, CBA has formed strategic partnerships with Appalachian Mountain Brewery in Boone Creek, North Carolina in 2014), Cisco Brewers, Nantucket, Massachusetts in 2015 and Wynwood Brewing Company from Miami, Florida in 2016. (inside.beer, 17.12.2016)

In addition CBA has reached an agreement with Resignation Brewery in Austin, Texas in 2013 to brew and market their very successful KCCO brand.

 

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