E-Malt.com News article: USA, VA: Stone Brewing Co. to produce all Sapporo beer’s US products at its Richmond facility

Stone Brewing Co. anticipates it will be making Sapporo beer at its Richmond brewery before the end of the year. It expects to produce all of the Japanese brand’s U.S. products plus the iconic 22-ounce chalice-shaped steel can, the Richmond Times-Dispatch reported on March 28.

Stone is closing in on a doubling of its brewing capacity to serve the new product line while also leasing a new warehouse space in Henrico County and beginning the process to double its Richmond workforce.

The Japanese beer giant acquired Stone in August 2022 for a reported $165 million.

Once fully operational, the Richmond Stone brewery will make about 40% of the company’s total domestic output, with the remaining 60% being made out of Stone’s California operations — southern California is the beer’s highest demand center in the U.S.

Part of the estimated $33 million of capital upgrades in Richmond is a new canning line to hold Japanese beers. The brewery is also expanding its basic infrastructure, including the boiler, water systems, cold box storage and silos for grain storage.

The first post-acquisition expansion effort was the leasing of a warehouse at 943 S. Airport Drive, where the company will have a majority of the space — 149,030 square feet. It will hold inbound ingredients, packaging materials, outbound finished beer and miscellaneous merchandise.

Stone is primarily known for making IPAs, while the flagship Sapporo products are in the form of a lager. The brewing processes are distinct. Stone’s IPAs get their flavor from a much heavier use of hops in the mixture of ingredients. Sapporo uses more yeast and does not contain as much hops. They take different times to mature, have different filtration requirements and have different alcohol content.

Stone’s combined output between East and West Coast operations is set to double from its current rate to about 720,000 barrels per year.

As part of the acquisition, Sapporo left Stone to appoint leaders for the new project from within. The company’s Nicole Williams and Robert Kuntz were promoted to senior director of brewing operations in Escondido, Calif., and Richmond, respectively, to lead the new productions.

Both Sapporo and Stone are coming off of a stellar growth period in the broader market, according to data by Nielsen. In March, Sapporo sales had increased 8.5% over the previous 13 weeks, while Stone’s increased 11.2% and total imports increased 1.6%. Craft sales dipped 7.3% while beer overall was down 3%.

Stone’s responsibilities include marketing efforts for Sapporo. Sean Monahan, Stone’s chief operating officer, said the goal is to reposition Sapporo from a niche lager, often seen as a beer to pair with sushi, to a beer that’s fitting for any occasion.

“If you’re having a Heineken or a Stella, why not have a Sapporo as part of that same drinking occasion?” Monahan said. “It certainly earns it from a quality perspective, so we’re just trying to reframe where that brand lives versus the historical ‘Yeah, it’s my sushi beer.’”

Monahan added that the partnership with Stone should save Sapporo a lot of money on shipping fees due to the shortened supply line, and that Sapporo will be a lot fresher once it hits shelves across the U.S.

To meet the new production demands, Stone is planning to double its local workforce, which is currently around 79 employees. Those new workers will help on the manufacturing side, in brewing and packaging, and warehousing side of the business. The company’s total U.S. workforce currently is about 750 people between the East and West Coasts.

Sapporo production in Richmond is scheduled to start during the fourth quarter of 2023, with increased production after that.

Although Stone Brewing has been a mainstay in the drink industry for more than 20 years, its 200,000-square-foot facility in Fulton Hill has been around for only six years.

Richmond solidified Stone Brewing as an economic anchor back in 2014-2015, when the city agreed to bond $23 million on behalf of Stone Brewing and help build a brewing facility on Williamsburg Road, which the company leases from the city’s economic development authority.

An additional $8 million was pledged to renovate the warehouse for a bistro at the Richmond Intermediate Terminal on the James River. A Stone spokesperson said the company has yet to receive that funding. As a part of the agreement, Stone would repay that money with interest. The bistro still has yet to be built.

Stone previously told the Richmond Times-Dispatch that it is in touch with the Richmond EDA with plans for a finalized project. The spokesperson said that plan is still unmoved as of this week.


29 March, 2023