With 28 years under their belt, the folks at Karl Strauss Brewing Company have done a great deal: opening San Diego proper’s first post-Prohibition Era brewery, building the county’s largest network of brewpubs, contract brewing out-of-state and later bringing fermentation operations back to America’s Finest City, building venues in Orange County and Los Angeles. They could have rested on their laurels or become stagnant at any point, but founders Chris Cramer and Matt Rattner continue to look for ways to innovate and identify new revenue streams. The latest example of that is Karl Strauss’ recent establishment of its own distribution arm.
The company has been laying the framework for a distributorship for several years, but recently launched delivery of beers from its first two distributed brands, new Oceanside-based business Black Plague Brewing Company and Grantville’s four-year-old Benchmark Brewing Company. The latter’s Orange County launch took place last week, though Karl Strauss had been in talks with Benchmark for well over a year.
“We’re expanding on our on-premise, self-distribution network in San Diego and Orange County to now include a select group of local, independent breweries,” says Mark Weslar, Karl Strauss’ vice president of marketing. “Delivering our own beers on-premise has helped us develop an expertise selling to and servicing local bars and restaurants. We look forward to helping some brewery friends build their business.”
The first San Diego County brewery to go from brewing to manufacturing and distributing not only its own beers but those of fellow local brands was Stone Brewing. Founders Greg Koch and Steve Wagner often cite that as a key moment in the company’s history, and a business move that kept Stone from going out of business. After having many doors slammed in their face by distributors unwilling to take a chance on their new, small operation, they decided to do it themselves. In opening Stone Distributing Co. in the late-nineties, they brought aboard brands such as AleSmith Brewing and Coronado Brewing, later adding brands from across the country as well as numerous international brewing companies. Today, that entity is responsible for distribution of 44 brands—that like Karl Strauss’ portfolio are all independent—throughout Southern California.
Karl Strauss has no immediate plans to bring on additional brands, but plans to be selective when they do, focusing on local and independent interests representing a partnership that would make sense for all parties involved. Says Weslar, “It’s an exciting new venture, but it’s also business as usual here at Karl Strauss with all of us maintaining our focus on making, selling and distributing great beer.”
The craft-brewing industry is in a state of flux, forcing companies within it to reexamine their business models and, in the case of larger operations, alter them in order to thrive or, in some cases survive. Larger operations such as Stone Brewing, Green Flash Brewing and Karl Strauss Brewing have all had to adjust course as consumer preferences shift to smaller, local, independent breweries, and active consumer demographics begin to skew toward younger factions, many of which have only ever drunk craft beer. It’s to be expected of interests that are among the country’s 50 largest brewing companies. Though it is considerably smaller and, at its heart still a family-run business, Coronado Brewing Company has been quite vigilant over the past several years, keeping an eye on the rapidly changing market and making moves to weather an uncertain storm. The latest of those moves includes today’s announcement that CBC will purchase East Village-based brand Monkey Paw Brewing. Owner Scot Blair‘s other businesses, South Park Brewing and Hamiltons Tavern, are not part of the deal.
Blair has had lofty aspirations for his beer-making business since opening it in 2011, but was not satisfied with progress toward increased production and distribution. He examined a number of options for meeting those goals, including acquisition, but says he wouldn’t have sold to just anybody. A stalwart figure within the craft-beer world for more than a decade, Blair knows the industry and the individuals within it, and says it was his long-standing respect for and friendship with CBC owners Ron and Rick Chapman that distinguished this as the right move for him and his business. Another key factor is control. Blair has a vision for Monkey Paw and its beers, and will remain intimately involved with the brand, focusing solely on beer—conceptualization and growth of the entire portfolio.
This deal is reminiscent of Green Flash’s 2014 acquisition of Alpine Beer Company. That move allowed for increased production of Alpine beers at Green Flash’s much-larger brewing facilities. Likewise, Monkey Paw, which produced less than 700 barrels last year, will now have the majority of its beers produced at CBC’s Bay Park headquarters, while still making beer on the 15-barrel system at its East Village pub. CBC began brewing its beers at that site—affectionately referred to as “Knoxville” for the street it occupies—in 2013, a year after taking over the 14,000-square-foot property. Since then, it has taken over several other buildings bordering the brewery, creating a rather impressive cul-de-sac campus. CBC is also in the process of installing a kitchen at Knoxville to increase the draw of its tasting room. This is particularly important with the impending arrival of a satellite tasting room from Benchmark Brewing Company and a new brewery, Deft Brewing Company, slated for arrival in Bay Park this year.
CBC is also changing up its game in the southerly municipality of Imperial Beach. The company opened a bar and restaurant there in 2014, and recently signed on to construct a 7,500-square-foot brewpub at the upcoming Bikeway Village on Florence Street. This will increase brewing capacity in a more high-profile location not far from CBC’s original brewpub on its namesake island. Meanwhile, CBC has ceased distribution to certain states, strategically tightening things up to better compete in the marketplace and maximize profits and expenditures.
And two months ago, the company announced the Chapmans’ investment in SouthNorte Brewing Company, a new venture headed by CBC head brewer Ryan Brooks. That operation, basically a CBC offshoot or sub-brand, will meld the brewing cultures of Baja California and Southern California, but there’s more to that fermentation fusion than mere ingenuity. An MO like that figures to appeal to demographics CBC does not currently reach in as great a quantity as they would like. Ditto Monkey Paw’s liquid wares, which skew to a younger demographic more interested in locavorianism, that likely wishes to support an edgier brand versus a company that recently celebrated its 21st anniversary. While this acquisition (which is set to be completed by September) may seem odd to those not paying attention, a look at CBC’s recent body of work where business-model adjustment is concerned shows the logic behind it and how it fits into a large and intricate puzzle.
Summer’s in full swing and so is San Diego’s beer-drinking public. Rather than beat the heat, get right out in it and combat it with local ales and lagers at any of the featured events below. Still thirsty? No problem. Check out even more beery happenings on our events page.
July 11 | Beer Dinner No. 2: North Park Beer’s first beer dinner was impressive, enough that one attendee, O’Brien’s Pub’s Tyson Blake, signed up him and his boss, Nickel Beer Co. brewmaster Tom Nickel, to participate in this month’s feast, which will feature house, guest and collab beers plus fare from on-site Mastiff Sausage that goes beyond its everyday meaty fare. | North Park Beer Company, 3038 University Avenue, North Park, 7 p.m.
July 19 | Hop-Con 5.0: Stone Brewing will celebrate a half-decade of boozy, (partially) barrel-aged beer that salutes and speaks to nerds of all walks of life when it taps five consecutive vintages of Drew Curtis / Wil Wheaton / Greg Koch Stone Farking Wheaton w00tstout and an immense list of specialty brews, serves up gourmet food and plugs in its vintage #HopCade. | Stone Brewing World Bistro & Gardens – Liberty Station, 2816 Historic Decatur Road, Point Loma, 7 p.m.
July 21-23 | Craft Beer Block Party: The tenants of the North Park Brewery Igniter campus—Eppig Brewing, Pariah Brewing and San Diego Brewing—are teaming up for the first time to present a fun weekend that will feature a Friday-night progressing beer-pairing dinner featuring three courses from Biersal Food Truck, and a two-day “local maker’s market”. | CRAFT by Brewery Igniter, 3052 El Cajon Boulevard; North Park, Times Vary by Day
July 29 | Arts & Amps: Ales and art in multiple forms will be celebrated at Karl Strauss Brewing’s PB tasting room and beer garden. There’ll be live mural art by Cohort Collective, a gallery show from Creative Souls on the West, live music by The Schizophonics and Creature Canyon, and food from Tasting Room Del Mar. An event like this could be pricey, but admission is free! | Karl Strauss Brewing Company, 5985 Santa Fe Street, Pacific Beach, 4:30 p.m.
July 29 | HESSFEST 7: Mike Hess Brewing has been getting by with a little help from their friends for a whopping seven years. Breweries from here to Arizona come out to bolster this festival, which benefits Next Step Service Dogs and the YMCA, and will feature nine collaboration beers with the likes of Council Brewing, Eppig Brewing, and Second Chance Beer Company. | Mike Hess Brewing, 3812 Grim Avenue, North Park, 12 p.m.
Winners of the San Diego International Beer Festival’s professional brewing competition were released today. A component of the San Diego County Fair’s annual festivities, the competition included entries from across the globe judged by professional beer judges and Southern California brewing professionals in late-April. A total of 68 medals were awarded to San Diego-based breweries. Of that number, 23 were gold, 21 were silver and 24 were bronze.
San Diego breweries won all three medals in eight categories: American-style Red/Amber Ale, Bitter, Bold Stout, Brett and Other Sour Beer, German-style Ale, German-style Weiss, Imperial Stout and Pilsener. Miramar-based AleSmith Brewing Company once again took home Champion Brewery honors behind three medals—a gold and silver in the same category (one of which was awarded to a Scotch ale) and a gold in the Barley Wine category.
The most local medals went to Pizza Port. That brewpub’s Carlsbad brewpub also won a gold and two silvers. Its Ocean Beach arm won two (one gold, one bronze) and Bressi Ranch production brewery earned a silver. The most medals awarded to a single brewery went to San Marcos’ Rip Current Brewing Company and less-than-a-year-old North Park interest Eppig Brewing. Both of those companies earned a gold, silver and two bronzes. San Marcos’ The Lost Abbey and South Park Brewing Company earned three medals apiece, as well. Also impressive was Rip Current winning two of three medals in the German-style Bock category.
The following is a complete list of the winners from this years SDIBF…
The three-day public beer-fest portion of the SDIBF will take place at the Del Mar Fairgrounds, Friday, June 16 through Sunday, June 18. Tickets and information can be found online.