Harpoon is a household name here in Boston. It’s our pride and joy of the craft beer movement—a nationally recognized brand, headquartered right here in our own little hub.
So it’s no surprise that its founder, Rich Doyle, is somewhat of a local celebrity. As a craft beer connoisseur and enthusiast at heart, he’s also an innovative entrepreneur who knows how to build a lasting business.
We caught up with Rich last month to discuss his latest venture, Enjoy Beer, and also to chat about the history and future of the craft beer movement.
“What we’re trying to do is help breweries that have been successful and have already had some scale, have demonstrated a strong regional and local following, and basically allow them to continue to be competitive,” Doyle explains of Enjoy Beer, which he launched earlier this year.
Due to the immense growth of the craft beer industry, brewers have a greater opportunity than ever before, but due to competition, it can be hard to grow beyond a certain level. According to Doyle, local breweries need to deal with competition both above and below them. Specifically, “above them are the international strategic players that have huge scale advantage in production, distribution, sales and marketing, and capital. And then underneath them, as the world of consumer products gets more and more localized, you have super local microbreweries who nip away at your local standing.”
The growth of craft beer has gotten to a point where even at a local level, you may be too big to be the local go-to, while also being far from large enough to compete with the big guys, “take a city like New York for example—it’s become difficult to be ‘the beer of the city’ because now there are people in a borough or a block or a neighborhood who take away your claim to represent that city.”
“What Enjoy Beer does is allow small craft breweries to continue their success and growth in a local market by giving them resources and access to scale,” says Doyle.
Doyle describes a number of ways in which Enjoy Beer can help cross the chasm from local brewery to the next level of scale. Selling to national accounts is one way, which Enjoy Beer helps achieve through existing relationships, multi-brand negotiating leverage, and experience in market research and analytics which local breweries typically don’t have access to.
Streamlining operations with salesforce integration across Enjoy Beer’s brand relationships is a key growth factor as well, explains Doyle, as growing a salesforce becomes much more complex, and expensive, when expanding into secondary markets: “They can handle the competition and scale disadvantage in a local market, but when they get into the regional market they get multiple states away from their home base and can become much less profitable pretty quickly. Some of that has to do with the scale of the salesforce, either spread out too thin to be effective, or it is concentrated but they’re not very profitable.” Doyle’s team is helping to solve this problem by enabling partner breweries to utilize Enjoy Beer’s national presence and salesforce relationships in each specific market.
Enjoy Beer also advises on brewing best practices and quality control, as well as wholesale management, either in existing markets or for expansion, “we can create a certain amount of negotiating leverage by having multiple brands.” Through its common ownership economics, Enjoy Beer also presents an opportunity for craft breweries to diversify across regions and brands, providing upside exposure to other partner breweries.
There’s a generally accepted belief that the craft beer industry will double over the next 10 years, an important trend to keep in mind when considering options for growing with the market. But, although the growth rates predict a positive outlook for the industry broadly, this doesn’t apply to everyone, and as Doyle explains “there’s no crystal ball and no one knows who is going to grow that way. Each brand will not grow according to the industry growth rate.”
Partnership is a valuable path to consider, and when doing so, Doyle advises to think about priorities in terms of control, “one of the issues that comes up pretty quickly is control. So I always talk about ‘control of what?’ What specifically don’t you want to give up control of? There are trademark laws, parking spaces, compensation, what goes in the bottle, what name is on the bottle, there’s a whole range of things. And when you start talking about that, you realize you really care about some things and are willing to give up others.” Knowing where your priorities are can help with building a platform for long-term partnership.
Of course, one option to consider is partnering with Enjoy Beer, which offers independent breweries the best of all worlds. It’s an opportunity to run your own business strategically, having the resources to really scale, without giving up control of your brand.
For more information on Enjoy Beer, visit http://www.enjoybeer.com