E-Malt.com News article: USA, CO & KY: Faster than expected sales growth makes New Belgium Brewing delay distribution in Kentucky

Faster than expected sales growth this year has New Belgium Brewing applying the brakes to some of its territorial expansion, Northern Colorado Business Report posted on August 1.

The Fort Collins-based craft brewery on August 1 announced that it has already signed deals with 10 distributing partners in the state of Kentucky. But actual distribution in that state, originally slated to start this year, won't occur now until New Belgium's second brewery in Asheville, N.C., begins operating late next year.

"In Fort Collins, we're having a really good year, which is awesome," New Belgium spokesman Bryan Simpson said. "But we're also bumping into capacity."

New Belgium brewed 792,000 barrels of beer last year. Simpson said capacity in Fort Collins is about 950,000 depending on the portfolio mix of beers being brewed and the requirements of each. He said the company at this point is projecting production to be in the high 800,000s for 2014.

A recent packaging makeover and the launch of a new year-round beer, Snapshot Wheat, have been more successful than expected in driving sales, Simpson said. Launches into Ohio and Florida last year have been contributing factors in sales growth.

"So we're ahead of forecast and had to adjust the schedule," Simpson said. "It's a good problem to have I suppose."

New Belgium distributes to 37 states, the exceptions being Kentucky, Oklahoma, Hawaii and several in the Northeast. The plan was to add Kentucky and Hawaii this year. While Kentucky will come online as soon as the Asheville brewery is up and running, Simpson said there are no definitive plans for Hawaii at this time.

But he also said that once Ashville opens - with a capacity of 500,000 barrels per year - expansion plans accelerate once again.

"We have, after that, a fairly aggressive plan to open up the rest of the U.S.," Simpson said. "By 2018, we should be (in all 50 states)."

The recent deals with the Kentucky wholesalers are part of an effort by New Belgium to begin its distributor selection process earlier than the company has in the past.

"This allows us plenty of time for planning so that we can really hit the ground running when we open these new territories," New Belgium sales co-pilot Brian Krueger said in a release.

"Kentucky has been on the horizon for a while now so we're excited to be moving on to the next stage."


06 August, 2014