New law may boost Arizona craft-beer industry sales

Discussion in 'US - West' started by Worldset, Jun 24, 2012.

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  1. Worldset

    Worldset Initiate (0) May 20, 2012 Canada (SK)

    by Ryan Randazzo - Jun. 23, 2012 02:10 PM
    The Republic |

    The growing Arizona craft-beer industry could boost sales in August when a new law allows restaurants, bars and liquor stores to sell glass "growlers" of draft beer to take home.

    Currently, only microbreweries and brewpubs can sell the reusable half-gallon containers filled with their own beers.

    Under the law, a variety of businesses with liquor licenses will be able to fill growlers, allowing people to bring home beer not available in bottles or cans.

    Even though some microbreweries sell bottles or cans of their beers, they sell much more beer in kegs to other vendors. The only way to take home specialty seasonal beers, such as the Pumpkin Porter that Four Peaks Brewing Co. in Tempe makes in the fall, has been to visit the brewery for a growler.

    In August, beer lovers will be able to take home a small jug of their favorite brews from Four Peaks, Papago Brewing Co. and others without visiting the source because other stores and bars with those beers on tap can offer growlers.

    It's even possible that shoppers could find Walgreens drugstores installing taps and offering growlers because the chain was a proponent of the new Arizona law.

    Some brewers, especially those that don't can or bottle, anticipate they will sell more locally made beer with the change. Others are skeptical and concerned about how their specialty products will be sold and packaged.

    "We are definitely for it," said Ron Kloth, owner of Papago Brewing Co. at Scottsdale and McDowell roads. "I think it will definitely help draft sales."

    He plans to begin brewing about 20 percent more of his Orange Blossom wheat beer after the law takes effect, anticipating that patrons at various bars where the brew is available on tap will start taking half-gallons home.

    "People like having draft beer at home, and this is a good way to do it," he said. "It is economical for bars and for customers."

    Papago does not package Orange Blossom in bottles or cans.

    Unlike some brewers, Papago offers several other specialty beers on 30 taps from Arizona and beyond, and Kloth expects the change to help him sell much more of that beer at his bar.

    He plans to fill any growler customers bring in with almost any beer on tap, except for some specialty kegs that are in short supply or those that require special carbonation.

    The law will allow growlers no larger than one gallon, although most in use by microbreweries today are half that size.

    Beer lovers are excited about the change.

    "It's about time," said Clay Hoerner, 39, of Scottsdale, as he purchased a $12 refill for a growler of Orange Blossom at Papago on Wednesday. "I don't want to buy a different growler for every different bar."

    Alexis and Shane Butler, twentysomethings from north Phoenix, also picked up a growler of Orange Blossom for a dinner party that night, their second refill of the week.

    They might be able to get their Orange Blossom fix closer to home after Aug. 2.

    "It would be nice if I could go pick it up at Yard House," Alexis said.

    Opening the market

    The change in law is likely to increase the number of outlets that offer draft beer, especially because it was not the craft brewers that pushed for the change.

    The Arizona Department of Liquor License and Control, on behalf of Walgreens, asked for the wording to be added to a broad liquor bill at the Legislature.

    Walgreens officials were hesitant to disclose their plans in Arizona. The company has small growler bars at four of its New York City drugstores operating under the Duane Reade name, a chain acquired by Walgreens in 2009.

    "In order for Walgreens to potentially respond to changing customer tastes and market opportunities, we supported legislation in Arizona that allows retailers to try alternate packaging of craft beers that has had success in other markets," spokesman Robert Elfinger said from the company's Illinois headquarters. "We haven't come to any decisions whether or not growlers would be an option for any of our Arizona stores, but we would like to have the option to respond to customer demand."

    Other retailers that could set up growler stations include Total Wine, BevMo and Whole Foods, said Chuck Noll, master of fine beer with World Class Beer, a division of Crescent Crown Distributing.

    "We are waiting to see exactly what accounts will get on board and which aren't," he said. "Total Wine or BevMo could put in growler stations. That is where it could get interesting."

    The craft-beer industry in Arizona has been growing at more than 20 percent a year for the past three years, according to a report by Northern Arizona University. It has grown even as overall beer sales in the U.S. dropped 1.3 percent last year, according to the Brewer's Association.

    Craft brewing had a total economic benefit to Arizona of $278 million last year, according to the NAU report for the Arizona Craft Brewers Guild. The total economic-benefit figures include restaurant sales and indirect economic activity associated with the industry.

    The 33 Arizona brewers made about 3.7 million gallons of beer and sold it for an average of more than $10 a gallon, mostly in kegs. It's more expensive purchased by the pint or growler.

    Some are concerned

    Some brewers are less optimistic about selling more beer and more concerned about how their brews will be handled if barkeeps around the state are pouring growlers.

    Dirty glassware can affect the beer's flavor and carbonation, and now the beer inside a growler won't necessarily match that of the brewery.

    "There is an issue with product quality," said Urs Riner, head brewer at Mother Road Brewing Co. in Flagstaff, which offers some of its products in bottles. "Beer is alive. It can thrive, and it can die. If it sits on a warm shelf in sunlight, it will die. If it is kept cold, dark and happy, it will thrive."

    He said brewers will have to educate new retailers and possibly bar workers .

    "Good beer will provide (those retailers) with good profits," he said. "Bad beer will put both of us out of business, not just the brewery."

    Mother Road is one of the few locations in the state that, because of ambiguity in laws regarding growlers, will currently fill growlers from other brewers with its beer.

    Riner said he sees marketing and partnership potential in growler labels with multiple breweries, but other brewers are not so optimistic.

    Roxane Nielsen of Prescott Brewing Co. said that she is concerned that growlers might not be cleaned well and won't offer beer as good as the cans her brewery sells. She also is concerned about labeling.

    She and her husband, co-owners of the brewery, still are deciding if they want people putting their beer in growlers.

    "At this point in time, I don't know that I want to put our beer in somebody else's bottle, or for somebody else to put beer in my bottle," she said.

    Popularity to be seen

    Filling growlers is certain to give some beer aficionados more access to specialty beers to drink at home, rather than at the bar, but some insiders doubt it will dramatically change the Arizona brewing landscape.

    Patrick Fields, president of Old World Brewery at 25th Avenue near Van Buren Street in Phoenix, said more beer could be sold with growlers.

    But he worries that popular out-of-state brands such as Bend, Ore.-based Deschutes Brewery and the major breweries will continue to dominate regional taps.

    "We can't get the local bars and restaurants here to put local beer on tap," he said. "The main brands own the real estate on taps."

    He said he is considering a Southern California location where craft beer is more popular.

    "This law could have its day in the sun if you get drive-through growler stations where a guy has 46 taps and you can bring a growler for him to fill," he said. "These are things that happen in mature craft-beer markets. This is a long way from that."

    The change in law prohibits filling growlers at drive-through or walk-up windows.

    Others see it as a niche.

    "Bottling and canning is better packaging than growlers," said Jerry Gantt, executive director of the Arizona Craft Brewers Guild. "The only reason I would buy a growler of something is if it were not available in a bottle or can. And a half gallon is a lot of beer to drink, for me. The bottom part is going to get a bit funky in the refrigerator before I can drink it again."

    Growlers might not increase the amount of beer sold but could make the sales a bit safer for drivers, he said. "(Bartenders) like the idea of growlers because they can send people home (with a growler) before they drink too much," he said. "That is probably a good thing."

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  2. Worldset

    Worldset Initiate (0) May 20, 2012 Canada (SK)

    Interesting points...

    - Walgreens installing taps for growler refills? Don't see that happening.

    - I guess I'm in the minority, but the idea of having to wash and clean my own growler, drive it to a store to get it filled seems like a huge hassle vs. just buying something already available in bottles and cans.

    - Growler stations at Total Wine and BevMo sounds cool, but again, they have so much selection available, I would rather just grab something off the shelf.

    - Wouldn't this "draft beer at home" go flat pretty quick?

    - I think the guy from Mother Road makes a good point about freshness and quality. The guy from Prescott makes a good point about cleanliness.

    - Old World Brewery hints about moving to Southern California and says they can't get local bars and restaurants here to put their beer on tap.

    - The point about the bottom portion of your growler getting "funky" seems spot on.
  3. Jefeipa

    Jefeipa Initiate (0) May 6, 2009 Arizona

    The reason Old World beer can get put on tap in AZ because there beer SUCKS!!!
  4. Worldset

    Worldset Initiate (0) May 20, 2012 Canada (SK)

    they say in the article the reason they can't get into local bars and restaurants is because the main brands "own the real estate on taps"
  5. bigbelcher

    bigbelcher Initiate (0) Jul 10, 2003 Arizona

    A pretty decent article ruined by someone whom is clearly delusional when it comes to his beer. Honestly, the main brands own the real estate on taps? Really now. Someone better tell Papago, Tops, WFM, The Hungry Monk or any of the other beer places that they don't own their taps and can't put on local beers!!!!

    Can someone tell me where why Four Peaks is building a second brewery if there is no support for local beer?
    SunDevilBeer likes this.
  6. AZeagle

    AZeagle Initiate (0) Feb 23, 2005 Arizona

    Worldset - A couple of answers:

    Walgreens already does growler fills in some of their New York stores. They were the biggest proponent of the AZ law.

    I think a lot of Growler sales may be on beers not normally available in package like Papago Orange Blossom or Sun Up Trooper IPA. Not really too much trouble to wash your growler out if you take care of it as soon as it is empty.

    A properly filled growler can last a decent amount of time unopened. Once you open it, oxidation starts and it should be consumed in 24 hours or less.

    Quality is an issue with all beer. Draft lines that aren't cleaned properly, bottled beer that is store incorrectly. This is just another type of serving vessel that has its own unique quality issues.
  7. Jefeipa

    Jefeipa Initiate (0) May 6, 2009 Arizona

    If they had a good product their beer would be on tap places. Look at Four Peaks and San Tan almost every places has their beer on tap.
  8. yemenmocha

    yemenmocha Poo-Bah (2,902) Jun 18, 2002 Arizona

    We had draft/growlers to go at liquor stores back in the 90's in Chicago, so it's nothing new. Many states have this, and it's just nice to have the draft version of something that you don't normally see - for example, many Belgians. Most states with the bigger chain liquor stores also have reasonable prices for these growlers. I visit family in the NYC area and even in Jersey the liquor stores have draft to go options.

    If your growler is sealed you should be alright for a few days, but once it is opened you're best to finish it in that session. Also if you give it a nice rinse right after you finish it, then there's little labor involved in getting it clean.

    Re: Old Wolrd - IMO too many places have it, and it does really suck. Look at RB and BA reviews for others' opinions if anyone distrusts mine. It is really, really bad. I wish them nothing but miserable failure, and it's disgusting that they put their garbage on the market and honestly expect the craft beer community to buy their swill.

    Major plus - if places rotate their growler to go taps often, this is another way to know you're getting a fresh craft beer.
  9. yemenmocha

    yemenmocha Poo-Bah (2,902) Jun 18, 2002 Arizona

    I've made that point numerous times in the past that there's a barrier to entry out there that's harder than many people think. I don't mind Four Peaks occupying that spot so much, but I confess that I'm annoyed that SanTan is getting a greater marketshare. I'm more hopeful for North Mountain Brewing or several other new ones coming this next year or so.

    Right now, Four Peaks is the only one I care to drink, especially if the Hop Knot is the offering. I wish there were more choices from Four Peaks across the PHX metro (Yardhouse carries Oatmeal Stout, HopKnot, and one or two others). Too often it's just the Kilt Lifter and frankly I'm sick of seeing it everywhere that I always opt for the regional craft alternative - SNPA, Fat Tire, Boston Lager, etc.
  10. bennetj17

    bennetj17 Initiate (0) Oct 30, 2005 Arizona

    I'm guessing a only a few places will take advantage of this law initially. The beers I see mentioned here are already available in growlers at the respective breweries. It's not like you can't get one, you just have to drive there. If you all could get a growler of something fresh in AZ that you can't find bottled, what would it be?
  11. yemenmocha

    yemenmocha Poo-Bah (2,902) Jun 18, 2002 Arizona

    For me it's not the local beers that I want without the drive to the brewery though. I like the imported stuff from Belgium on tap, many Germans, etc. Especially for the latter you have to be careful with the dating codes. Some local places are selling bottles from 2009 on the datecode, but you need to know the system or have it available on your smartphone to know this. Draft versions largely don't have this issue if it's a place where the taps turn fast.
  12. sholland119

    sholland119 Poo-Bah (2,406) Sep 8, 2005 Pennsylvania

    Growlers are a great option to have, especially for beers that are not bottled. Properly filled and tightly capped, they can last a good long time. I opened a growler last night that was filled in late April and got perfect carbonation and great taste. Opened a year old growler a couple of months back and it still tasted good (somewhat undercarbonated but not flat, and still flavorful)

    Here in PA, growler fills from bars are convenient but pricey (usually just a bit less than 4x the retail pint price). Growler fills at TW or Bevmo, though, could be a very nice addition.
  13. papagobrewing

    papagobrewing Initiate (0) Sep 8, 2009 Arizona

    Exactly, Growler fills are just another option. The new law is getting a lot more press than I think it merits and a lot of unneeded discussion because of a dumbass comment at the end of the AZ Republic story. Laws like this are in place in other states and you don't hear squat about it. I don't think it will turn out to be that big of a deal in the long term. Certainly in most instances the better way to take home beer is that it is pre-packaged in bottles or cans, assuming it is kept cold and out of light. The statements in the story about growler cleanliness go along with line cleanliness, but if you know your growler is clean, and you know that the place you are buying your beer at knows how to maintain clean lines those issues are moot. Growler fills will allow people to enjoy a number of different beers at home that are not currently packaged. Honestly, it really doesn't make sense to get a growler of Sierra Nevada Pale Ale or some other beer that is packaged where it is designed to be stored for a couple of months and still be drinkable, but if you'd like a growler of Dragoon, Papago, or Sun Up IPA as examples now you can go to anyone who has them on tap and if they will fill it for you get it to go. It should last for a few weeks to a month or so max if it is kept cold and unopened. It isn't going to change the world but the new law makes it easier for smaller breweries beers to be enjoyed at home by more people and I think it will be a big boon to seasonal releases that aren't packaged such as Thunder Canyon Ornament Ale or Four Peaks Pumpkin Porter.
    yemenmocha and sholland119 like this.
  14. Worldset

    Worldset Initiate (0) May 20, 2012 Canada (SK)

    what's weird is that his statement about how he can't get into local bars vs. the main brands doesn't even seem relate to the rest of the article
  15. Worldset

    Worldset Initiate (0) May 20, 2012 Canada (SK)

    good points. I can see if I'm mellow mushroom (which also has a ton of local taps), I try something new and I like it... now I can take home a growler. If the business has clean lines and it's sealed and I drink it somewhat soon, I should be fine.
  16. yemenmocha

    yemenmocha Poo-Bah (2,902) Jun 18, 2002 Arizona

    The other plus for this is that we'll have COMPETITION for growler prices too. That is usually a positive for the consumer. Right now there's a restricted market whereby only brewery/brewpub locations can sell growlers.

    Rock Bottom just raised the price on its growlers too (the anniversary one. a huge increase).
  17. Worldset

    Worldset Initiate (0) May 20, 2012 Canada (SK)

    is growling pricing a better deal when you compare the cost per pint?
  18. yemenmocha

    yemenmocha Poo-Bah (2,902) Jun 18, 2002 Arizona

    vs. pints sitting at the bar, yes.

    vs. bottles to go, usually not.

    The other savings is that you can get growlers at a retail location without the pathetic expectation/entitlement for tips... a tip just to pour some liquid into a glass container.
  19. Worldset

    Worldset Initiate (0) May 20, 2012 Canada (SK)

    come on mr. mocha, you wouldn't tip a guy who filled and sealed your growlers?
  20. yemenmocha

    yemenmocha Poo-Bah (2,902) Jun 18, 2002 Arizona

    at BevMo or Total Wine, heck no. Do you tip the cashier who carefully puts your sixpacks into a case box? They also take your money, give you exact change, and usually check your I.D. if you're under some arbitrary age that is over yet nowhere near 21.
  21. SunDevilBeer

    SunDevilBeer Defender (668) May 9, 2003 Massachusetts

    Yawn. Folks in MA are clamoring for growler fill stations, but I couldn't care less. In NY most of them are gross (poorly cleaned lines) & more expensive than bottles. People get excited about them & lose their sense of math...usually these 64 oz vessels far out -price their bottle counterparts. Be careful what you wish for, AZ
  22. Jefeipa

    Jefeipa Initiate (0) May 6, 2009 Arizona

    I'm not a big on growlers. A few years ago Papago use to fill other breweries beer in growlers. The only time I got them was for a party. I don't like getting 64oz of one beer. I do like the law because I will fill probably about 2 or 3 growlers year now.
  23. blatherbeard

    blatherbeard Initiate (0) Sep 30, 2007 Texas

    Id much rather go to a bar for a growler, watch the tender pour it while talking about something, then tip them if i feel they were fun to talk to.

    then again, id be tipping anyway since id have to have at least a beer or 2 while filling lol
  24. bigbelcher

    bigbelcher Initiate (0) Jul 10, 2003 Arizona

    Mr. Mocha had better hope Walgreen's puts in growler stations soon. I'm sure his no tip attitude will wear out his welcome at Bevmo and Total Wine pretty fast.

    I was speaking with someone at WFM tonight. They are pretty excited about the new law.
  25. yemenmocha

    yemenmocha Poo-Bah (2,902) Jun 18, 2002 Arizona

    Do you normally tip the retail cashier for selling you bottles?

    In general to everyone - what magical line has been crossed when a growler has been poured at a retail store such as a BevMo, Total Wine, Walgreens, etc., vs. the countless other activities that these folks do without the expectation of tips? (or as I just said above, am I missing something? do you guys tip the guy who shows you were the Petite Sirah section is?).

    If the service industry has warped public expectations this far to include tipping retail people, God help us.
    SunDevilBeer and champ103 like this.
  26. Worldset

    Worldset Initiate (0) May 20, 2012 Canada (SK)

    you make a good point. essentially it would be the same as ordering take out, getting an order to go, etc.
  27. goatgoat

    goatgoat Initiate (0) Nov 29, 2008 Arizona

    I just moved to Arizona and I'm super excited about this. More like Texas, less like SoCal!

    For me, growlers are primarily for beers that aren't bottled/canned. I will buy more growlers if I can go to my local beer bar nearby and don't have to go to a distant brewery. I also buy more growlers if I don't have to buy a branded growler for each brewery. I can pretty easily remember to have a growler in my truck for tasty beer emergencies. It's harder to stash multiple growlers for any of the breweries I might go to. And I have more than 10 growlers (can't count them, currently in storage) from my time in SoCal and through trading; I don't want more growlers. With this additional competition from any place with a tap, I'd be surprised if many breweries maintain their "our growler only" policies.

    I'm not sure I'd tip at someplace like Total Wine. Since it is a retail and not service location? It's a gray area for me since while stocking beer on a shelf isn't any different than stocking canned tomatoes or china, pouring and packaging a growler properly does involve some specialized skill. Generally, if the credit card receipt has a place for a tip then I'll put a tip there and just wonder if I was over-generous or miserly.

    AZeagle said this, but I'll reiterate: The concern about bartenders or bars or whatever treating their beer badly and wrecking the flavor is BS. Any distributor and any retailer, whether of kegs or bottles, can treat beer badly. Dirty lines, dirty glassware, poor storage, etc, can happen at any point in the system. So unless they don't distribute their beer, at all, they are already dealing with those issues.
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