Jack's Abby (2021)

Thank you for putting into words what I wanted to say in a more...polite manner.

 

The agreement most distributing brewers are forced to sign. Yes, JA agreed to a lifetime contract, but did they really have a choice?

 

I am going to share the press release that we sent out, as it answers many of the questions that have been brought up here.

March 12, 2021 - On January 14th, Jack’s Abby Brewing LLC notified Atlantic Importing Company of termination of Massachusetts distribution rights pursuant to M.G.L. Chapter 138 Section 25e 1⁄2 (Franchise Law Reform). Signed into law in January, Franchise Law Reform is a monumental piece of legislation following a compromise agreed to between the Massachusetts Brewers Guild and the Beer Distributors of Massachusetts. This law enables brewers that produce fewer than 250,000 barrels a year to leave their distributor after paying fair market value. Previously, a brewer was effectively locked to its distributor in perpetuity. This new law allows breweries to assert more control over this integral part of their business.

Based on the terms of the Franchise Law Reform legislation, we are confident in our ability to terminate our relationship with Atlantic by paying fair market value for the brand, as outlined in the law. We are concerned by the direction that the ownership of Atlantic Importing Company is taking the business based on the following actions and feel that it is essential to our survival to part ways:

• On June 22nd, 2020, Atlantic informed Jack’s Abby of its intention to lay off a significant portion of its sales staff. This was troubling to us, especially considering at the time this was communicated, Atlantic’s 2020 company wide sales were actually up in volume and dollars as compared to 2019. As of 2021, their sales department staffing levels have been reduced by about 33% compared to January 2020 levels. We believe that this reduction in staff decreases the ability for Atlantic to adequately cover retail accounts across the state.

• To that end, following these layoffs, we were presented with a list of over 1,000 accounts by Atlantic management that would no longer be serviced by Atlantic with in-person sales representatives, instead switching to an online-only ordering portal. These accounts make up about 40% of our off-premise accounts through Atlantic, a critical market especially during COVID-19, and puts 20% of our overall volume (on- and off- premise) at risk.

• After the above changes were communicated to Jack’s Abby by Atlantic management, repeated requests were made for a meeting with Sean Siegal, President/Owner of Atlantic Importing Company so he could explain why these changes were made and what the long term outlook was to get back to full staffing levels. These requests were again and again pushed off and no meeting took place until February 10, 2021, following the passing of Franchise Law Reform.

We are taking a fair and honest approach to regain control of the future of our business. We enlisted a third party economist with experience in distribution rights valuations to provide an evaluation of the fair market value for the brand, which we have offered to pay Atlantic in return for the full brand rights.

On March 1st, Atlantic Importing Company filed essentially a lawsuit known as a 25e Petition with the Alcoholic Beverages Control Commission (ABCC) to challenge our ability to terminate the relationship. Moreover, Atlantic is claiming in the ABCC proceeding that Franchise Law Reform is unconstitutional, even though the representatives of all the beer distributors agreed on the new statute, and agreed that they should and would be paid the fair market value of their distributorships. We believe their case is without merit and we are confident in a positive outcome.

 

@JacksAbbyBrewing already brought this up, but ill reiterate something most people aren't considering in regards to pandemic business for the alcohol industry...

Everyone lost $$ on draft with restaurants closing, that is a fact. But once people figured out what was going on, retail sales increased significantly and in fact made up for draft losses for retailers and distributors (brewers however dont have a way to recoup taproom draft sales). A friend of mine who is a sales manager for another distributor in Mass told me in July that at that time they were already up 30% over last year even with factoring in draft loss; up so much that they in fact brought on another sales rep.

So Atlantic claiming layoffs due to the pandemic is a completely bogus claim; they laid off people to bump up their bottom line, but the consequence of that is your suppliers may disagree with the decision, especially if they look at the actual sales numbers, which were better than the previous year. The suppliers may also not agree with the switch to certain accounts only being served via phone call or a web portal; if retail workers can show up to sell their products, why can't they show up to sell the products to the retailer? That alone is insulting and would make me inclined to not carry any of that distributors product regardless of my own brand loyalties.

At this point, even if the franchise law had not been changed, Jack's Abby actually would have ample evidence to prove negligence if it was necessary, but it isn't. Which means I hope the judge who oversees this uses Atlantics negligence and ineptitude against them when it comes to agreeing upon a price for distribution rights; the price jacks pays for their rights should be reduced for Atlantic not negotiating in good faith and for negligent practices.

Considering Atlantics supposed legal argument shows an incredible lack of self-awareness (they own a brewery, exhibit a, that also signed off on the new franchise law, where were the unconstitutional claims then? Lol their ineptitude will never cease to amaze) and lack of understanding of how most people will view this, I think Atlantic fighting this hard on this will have a serious backlash against the rest of their brands, something they're definitely not considering.

Would love to hear how Toppling Goliath, Lawson's, Exhibit A, Zero Gravity etc. feel about the situation.

 

Well though out reply @GonzoHomebrewer . Thanks for bringing up the point that retail sales increased and distributors were likely up 30% ever all regardless of draft sales being down. That is important information for the conversation

 

so, is the Mooby's beer real, if so how can i get it?

 

Hoping to get to the brewery in the next week or so to pick up something to balance my stock of Framinghammer and Brig. Has anyone had the latest batch of Marzen? How does it compare to Copper Legend? Have you tried Springdale's Ein Dussel? How is it?

 

Ein Dussel is great had one last night. Definitely recomend.
As for the marzen keller, I havent had this batch but I've had the beer before and like it. My notes said it was generally rounder and softer than CL. Velvety.

 

I think I am late to the party on this..... but why can't a brewery sign a distribution contract for whatever length they want? Are laws that archaic in MA? Do I need to start picketing the State House in a speedo to thrust change?

 

Until the law was recently changed that was essentially how it worked. I could be wrong but I think to sign a contract with any distributor in Massachusetts it’s “in perpetuity.” See the link:
https://www.beeradvocate.com/commun...-brewers-achieve-franchise-law-reform.653342/

 

Sounds pretty shady to me.... oh I mean "archaic".....

 

Anyone know if the Keller Marzen will be distributed around Boston or do I need to make a trip to the brewery to snag this? Really want to try this one.

 

We got a few 4packs left at our shop.

 

Try the JA beer finder:

https://jacksabby.com/beer-finder/

 

Thanks. Looking forward to trying them out.

 

I still occasionally feel lucky that I can buy beer on a Sunday.

 

And wouldn't ya know it, the world didn't fall apart since they abolished that dumb rule!

 

Hell, not too long ago, us CT folks had to run up to Springfield to buy beer after 8pm. OK, maybe that was long ago, but I remember it!

 

And the world won’t end if states end the “no Happy Hour” laws either