Building Craft Beer Brands: A Talk With Award-Winning Distributors

Beer Bloggers & Writers Conference 2015

1. Building Craft Beer Brands: A Talk With Award-Winning Distributors Moderated By: Kathleen Joyce National Beer Wholesalers Association @ NBWABeer

2. Who NBWA Represents 3,300 Independent Beer Distributors 130,000 Beer Distribution Employees Representing ALL Brands

3. Top 5 Reasons to Get to Know Your Local Beer Distributor Product News Market Expertise Unique Industry Perspective Great Facilities Event Support

4. Top 5 Reasons to Get to Know Your Local Beer Distributor Product News Market Expertise Unique Industry Perspective Great Facilities Event Support

5. Meet the Panelists Matt Abdoney Craft. Specialty. Import. Marketing & Brand Manager @ JJTaylorFL   Tampa, FL Robbie Maletis, Jr. Business Analyst @ MaletisBeverage Portland, OR Brad Johnston President @ TryonHH Charlotte, NC

6. Home to 23 Florida Craft Breweries including Tampa’s own Cigar City Brewing and Florida’s oldest Craft Brewery, Dunedin Brewery. J.J. Taylor is the largest single output beer distributor under one roof in the United States with 4 locations across the state of Florida. Our largest warehouse is located in Tampa with additional locations in Ft. Myers and Treasure Coast. Our Corporate Office is based in Jupiter. First Wholesaler Member of the Florida Brewers Guild Long time member of the NBWA and BA 20% of the 20 million cases we distribute are craft…and growing! Craft beer accounts for only 7% of the beer sales in Florida. J.J. Taylor Distributing Florida, Inc. distributes beer brands from over 75 Domestic, Craft and Import suppliers and serves more than 11,000 retail customers in 17 Florida counties. J.J. Taylor Distributing is committed to being “First Choice” to our employees, customers and suppliers and creating value through optimal growth as the “variety leader” in the beverage industry.

7. J.J. Taylor Distributing Florida, Inc. distribute brands from 78 unique brewery partners Top 10 Suppliers, these partners account for 96% of our total business 1. MillerCoors 2. Yuengling 3. Heineken USA 4. Boston Beer Co. (American Craft) 5. Pabst Brewing Co. 6. Guinness Import Co. 7. Mike’s Hard Beverage Co. 8. Cigar City Brewing (Local Craft) 9. New Belgium Brewing (American Craft) 10. Sierra Nevada Brewing Co. (American Craft) 23 Florida / Local Breweries, 1.7% of our total business 1. Cigar City Brewing, Tampa FL 2. Florida Beer Co, Cape Canaveral FL 3. JDub’s Brewing Co., Sarasota FL 4. St. Pete Brewing Co., St. Petersburg FL 47 American Craft Breweries, 20.7% of our total business 14 of the BA’s Top 25 Domestic Craft Brewing Companies are in the J.J. Taylor FL portfolio 8 of the Top 10 volume breweries are distributed in FL, J.J. Taylor represents all 8 ( Yuengling , Boston Beer, Sierra Nevada, New Belgium, Gambrinus , Lagunitas , Bell’s & Stone)

8. Winner 2014 Craft Beer Distributor of the Year Winner 2011 Craft Beer Distributor Achievement Award Winner 2015 Sustainable Business Award J.J. Taylor operates two Compressed Natural Gas filing stations, one in Tampa & one in Ft. Myers Two thirds of our fleet currently runs on Compressed Natural Gas

9. Fourth generation, family owned and operated company founded in 1935 Facilities: Portland, OR and Vancouver, WA Territory: Greater Portland, Oregon and Southwest Washington area. Employees: Approximately 350 About Maletis Beverage Chris Maletis Senior, third from left Maletis Beverage Fest on the Edge Event Portfolio The Maletis Beverage portfolio consists of 39 craft brewers . Our portfolio consists of 21 Oregon brewers, 6 California brewers, 4 Washington brewers, 1 Montana brewer, 1 Colorado brewer, 1 New York brewer, 1 Utah brewer, 1 Hawaii , 1 Illinois , 1 Rhode Island , and 1 Missouri brewer. Our portfolio consists of brewpubs , microbrewers, regional and large brewers.

10. 42.6% of Beer category sourced from Craft PDX $ Share by Segment PDX $ Share Chg. by Segment Source: IRI data is Dollar Sales PDX: Food - Latest 13 Weeks Ending 07-05-15.

11. PDX $ Share Evolution by Segment Source: IRI data is Dollar Sales PDX: Food - Latest 13 Weeks Ending 07-05-15. Craft: +9.61 Cider: +5.66 Imports: +0.51 Premium: -9.92 FMB: +2.15 Value: -8.36 Peak Craft Share: 48.91

12. A little about Tryon and Myself Started in 1985 with 3 people just covering Charlotte selling wine Currently we have 266 people covering all of NC selling 51% craft and 49% wine 15 years ago we purchased 4 other small wholesalers to become state wide We have 235 suppliers with over 500 brands with 4,500 SKU’s I have been on the committee running the National Craft Beer Wholesaler Symposium for the past 9 years and chaired it for 3 I am on the board of the NCBWWA

13. BREWERY STATE Smuttynose Brewery New Hampshire Boone Brewing North Carolina Duck Rabbit Fortnight Brewing Fullsteam Brewery Highland Brewing Co. Mother Earth Brewery Old Mecklenburg Brewery Triple C Brewing Co Unknown Brewing Company Rogue Ales Oregon Victory Brewing Co Pennsylvania Narragansett Brewing Co Rhode Island Quest Brewing South Carolina Uinta Brewing Company Utah Blue Mtn Barrel House Virginia Lakefront Brewery Wisconsin BREWERY STATE 21St Amendment Brewery California Anchor Anderson Valley Brewing North Coast Brewing Co. Stone Brewing Co Avery Brewing Company Colorado Great Divide Brewing Co Left Hand Brewing Co New Planet Beer Company Ska Brewing Dogfish Head Delaware Terrapin Beer Co Georgia Paulaner Hp Usa Louisiana Allagash Brewing Maine Flying Dog Brewery Maryland Heavy Seas Brewing Bells Brewery Michigan Founders Brewing New Holland Brewing

14. Tryon Executive Team and Warehouse Entrance

15. Building Craft Beer Brands: A Talk With Award-Winning Distributors

16. U.S. Breweries

17. Count of U.S. Breweries 2013 vs . 2014 Production Volume Production Volume Barrels (31 gallons) 2013 Breweries 2014 Breweries 2014 Share 0 -1,000 1,985 2,628 71.8% 1,001-7,500 552 711 19.4% 7,500-15,000 79 100 2.7% 15,001 - 60,000 102 122 3.3% 60,001-100,000 25 21 0.6% 100,001-1,999,999 48 55 1.5% 2,000,000 plus 21 21 0.6% Total 2,812 3,658 100% Source: TTB, 2012 and 2013 Brewery Production Returns. 91% of brewers produce less than 7,500 barrel and 96% of all new breweries (802 new brewers in 2014 making less than 7,500 barrels) Source : TTB and NBWA 2015.

18. Average Barrels Per Brewery 2011 to 2014 Source: TTB and NBWA, 2015. (all brewery establishments) Average craft brewer 7,000 barrels in 2014

19. 17,791 Beer Labels Approved Since 2004 Source: TTB, Public COLA registry, 2004 –2014 (Gov’t Shutdown Fall 2013).

20. Average Number of SKUs Carried by Distributors Source: NBWA DPR, various years.

21. Consumer Choice in Retail

22. …and not so much

23. Open Distribution System

24. Implications of an Open Market

25. Top Industry Challenges 2015 - 2020 Demographics and Immigration Share of Wallet and Share of Mind Blurring Lines Between Beer, Wine and Spirits The High-End Gold Rush and Overshooting the Market Small Brewer Mergers Among Peers Small Brewer Acquisitions by Big Brewers Health and Diet – Will Light Beer Rise Again? Blurring the Three-Tier Lines Within the Industry

26. Thank you! Questions? Kathleen Joyce [email protected]