Should breweries expand distribution before suppling their own locale?

It is much easier to sell beer outside the United States. Our shelves are packed to the max. Shipping overseas is the next phase of "craft beer."

Stone opened a brewery in Europe. Lagunitas has said selling beer in South America will be end game. China/Japan sure why not. I think it is a much better proposition to test new waters for sales rather then swimming with the sharks.

 

OK, I'm curious... your ID says you're from Spain... Why are you asking about a brewery from Mississippi?

 

“What are your views on breweries exporting out of the country when their capacity is insufficient for other states? Or breweries not exporting at all?”

Today’s craft beer market is hyper-competitive. I think breweries should sell their beers wherever they can. If exporting the beer results in increased sales I say “good for them”.

By the end of this year there will be 8,000+ craft breweries in the US. They will need to take an ‘all options are on the table’ approach to have sustainable businesses.

Cheers!

 

If brewers are selling their beers overseas while they're selling less than they could in the U.S. I see that as a problem in that they're not getting as much attention as they could be in a highly competitive market (marketing: seen, in hand, word of mouth, etc.) which could then lead to them losing ground in the end. However, if they've exhausted their leads locally and aren't at maximum production then I see no reason to not go over seas. Who knows what might happen? Laying the groundwork now in another country could lead to great things. Or not. But if the brewery is good enough they should be able to start over if their foreign market falls through, and if they're not that good then they've at least taken what they could have while they had the chance.

 

I don't care where they sell it so long as I can get it.

 

What does enough for its own state mean? Does that mean if I live in the same state as a certain brewery I am more entitled to their beer than people in other states?

Breweries exist to make money, period. If an opportunity to make money and expand into another territory comes along, as a business they should take advantage of the opportunity and start shipping the beers.

 

"Enough beer" ? Judging from all the old "out of code" beers clogging up the shelves and coolers, it seems a lot of breweries have "too much" beer for their own and neighboring states....

 

I'm guessing they're not shipping beers out to China to waste away on shelves out there. If they have demand for their beers in China, well that's terrific. If there was really lots of demand locally, of course they'd be taking care of that first since obviously less freight costs = more margin. I'm not sure how great of an idea it is for a Mississippi brewery to distribute to other states unless everyone's clamoring for their beers.

 

Especially if you can be an early entrant in growing regional market, like China or South America.

 

Absolutely not. We just lost Council Brewing in San Diego last year due to their distribution plans with China falling through. They had expanded to a new location to get on-board with the distribution deal and the extra overhead on the new location cost the company everything.

 

they *should* do whatever fits their business plan and keeps them supplying their employees and suppliers. So whatever it takes to stay in business. There's more than one way to run a brewery.

 

If it's okay with the brewery and its new foreign market, it's okay with me. If the brewery is making a profit, well, that's the name of the game.

 

He was listening to a podcast, and the interviewee was from Mississippi.

Up here in the PNW, there's a guy who, maybe 3-4 times a year, buys a bunch of the plastic, non-reusable kegs. Then he contacts various regional breweries, buys the beer, has the kegs filled, and ships them to Japan. Breweries would be silly to not take the chance to sell off a few extra dozen barrels of beer a few times a year.

Is making overseas sales a cornerstone of your business a good idea? That answer is above my paygrade, but, if the chance is there, and you're not putting your business at risk, why not give it a shot?

 

Chances are that brewery won’t have to pay shipping costs to China. Usually an exporter who distributes to China will deal with international shipping and the resulting cost.

 

If it works for them, and they are taking care of what they have the capability of, market wise, and budget wise as a brewery. More power to them.
It probably makes more sense financially to ship abroad than to take on the sales staff required to expand their distribution footprint beyond a certain range.

 

Part of me thinks that they need to support their customer base. If that happens to be local then the locals should have first shot at it. Another part of me knows that its hard to earn a place in the craft beer scene and I don't blame them for reaching out to other places.

I would be some put out if my favorite local breweries ran out of my favorites and were shipping overseas.

 

Yeah, I know he could have (probably did) hear it via the internet/podcast, etc. That still doesn't explain why he was concerned about the business practices of some brewery in Mississippi.

 

Just a topic for discussion. Ideas for threads come from all places.

 

That's true and Mississippi is truly a fascinating place. This time I'm not joking.....I would like to know how Lazy Magnolia translates into some Chinese language or Spanish.