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Green Flash consolidating workforce and distribution network

Jan 15

It’s easy to look at a seemingly successful large brewing company, see their beers (and those of their acquired brands) on the taps and shelves all over the county, knowing they are also distributed throughout most of the country, and assume all is well. But even though the craft-beer boom is in full swing, with a record number of new breweries opening throughout the nation, the industry has never been more challenging, especially for regional breweries ranking among the nation’s largest.

Last January, Mira Mesa-based Green Flash Brewing—which also operates a satellite barrel-aging brewery in Poway as well as a production brewery in Virginia Beach, Virginia, and a soon-to-open brewpub in Lincoln, Nebraska—laid off around 25 employees. Given Green Flash’s status as the 37th largest craft brewing company in the U.S., this was big news. And so, too, is today’s announcement that the company has made the difficult decision to let go of 15% of its workforce.

That percentage equates to 33 employees. Owner Mike Hinkley says that while no Green Flash tasting room or Alpine Beer Co. (a brand acquired by Green Flash in November 2014) staff will be impacted, it will touch on other departments, primarily those serving business administration functions—marketing, events and the like—in both San Diego and Virginia Beach.

“I am greatly saddened by folks having to leave the company. We simply could not compete effectively with such broad geographic reach,” says Hinkley. “We will soon discontinue shipments to distributors that currently constitute about 18% of our wholesale trade revenue. With that reduction in revenue, we have to reduce expenses accordingly.”

Hinkley reports the company has decided to consolidate distribution, reconfiguring to best serve locales nearer to its production facilities. Moving forward, beer brewed and packaged at Green Flash’s Mira Mesa facility will be shipped to California, Arizona, Hawaii, Nebraska, Nevada, Texas and Utah, while Virginia product will ship in-state as well as to Delaware, Maryland, New Jersey, New York, Ohio, Pennsylvania and Tennessee. According to a press release, the refocus will enhance the company’s operations and ability to provide consumers with fresh beer.

When asked what factors led to the need to reconfigure distribution and consolidate Green Flash’s workforce, Hinkley responded, “The industry has continued to grow more crowded and complex in recent years. Big Beer’s acquisitions and consolidation of the biggest brewers created pressure from the top. Thousands of small brewers opening across the country created pressure from the bottom. Under those conditions, we are pulling back into the territory where we are the strongest and concentrating our resources.”

When asked about the future of Green Flash’s Poway-based Cellar 3 barrel-aged beer operation, Hinkley says it will remain open and that, months ago, the decision was made that, despite management’s belief that the beers are of high quality, the amount of beer that is packaged there and shipped to retailers will be reduced significantly.

Even in the midst of consolidation, Hinkley and company are looking to the future with optimism. The Lincoln brewpub is on-schedule with a February opening timeframe confirmed. Head brewer Jeff Hanson (formerly of Omaha’s Brickway Brewery and Upstream Brewing, and Boulevard Brewing) will create Green Flash core beers under brewmaster Eric Jensen’s supervision, as well as beers of his own devising, and that facility will eventually supply the entire state of Nebraska with Green Flash product.

Should this prove a viable business model, Hinkley says they will look to replicate it elsewhere, but there are no plans for such expansion in the immediate future. For now, the company will focus on its revised approach to distribution—it had distributed to 50 states, 35 more than the count listed on its newly announced business plan.

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10 Responses to “Green Flash consolidating workforce and distribution network”

  1. Jz

    It was partially when Chuck left and a LOT more to do with the beers they chose to come out with after discontinuing Palate Wrecker, Green Bullet, and Double Stout. Their arrogance worked against them when they were one of the last companies to transition out of a 4 packand they used to scream from the mountaintops about how they would never make a session beer…. you just needed to drink less! I truly do believe that if they just dialed in and made Nelson the flagship instead of wcipa or gfb theyd be in way better shape.

  2. Dave Blickenstaff

    Put Cellar 3 up for sale.

    • Ben Acord

      Give me a call I lost your number

  3. bill

    Except that was not their only job. They also had to, you know, run a brewery.

  4. Bruce Vanet

    Re constructing their business model signs great. The picture their missing. We pay more for local to feed local. I don’t want a regular beer from out of state. A seasonal every half year, sorting unique would suffice. Otherwise, I’m going to my home town brewery. I’m paying to feed local.

    • Bruce Vanet

      An edit would be needed here. I’m not incapable just…. beer

  5. Tim

    Just make sure Green Flash remains in South Jersey.

  6. Brent

    Literally *all* they had to do was figure out how to make Alpine Nelson the same as it was when they bought Alpine, at a larger scale, and they’d be as successful as a brewery could ever be.

    YOU HAD ONE JOB!!

    • David

      I’d agree. Not sure if it was Silva’s departure or something else, but I can’t remember the last time I got excited about a GF beer. The Alpine thing was kind of a bust, and kind of killed the magic that once was.

    • Rebecca Gomes

      That’s a ridiculous statement. You obviously have no working knowledge of the national beer market and the issues breweries are facing as the local beer market continues to grow.