If hops act like their more psychoactive cousins, SweetWater’s new yr-round Hop Hash Infused Double IPA promises to be particularly potent.  As the name suggests, it doesn’t just use traditional hops for bittering, flavor and aroma: brewers added bricks of concentrated hop resin, or hash, “after scraping the hop pelletizers clean in Yakima, WA.”  Clocking in at 7.8% ABV, the double IPA hits shelves and taps next month in 12 oz 6-packs and draft.

Victory Brewing announced plans to build fourth brewpub in Leesburg, Virginia by 2^nd quarter of 2016, marking co’s 1^st location outside of Pennsy.  Brewpub, dubbed Victory at Courthouse Square, will be in 112,000 sq-ft building when all said and done, featuring “a 300-seat restaurant, upper-level terraces for outdoor dining, and an extensive chef inspired menu,” along with full service brewhouse.  Groundbreaking is expected to happen “later this year,” reported Loudon Times, as Victory’s 3^rd location in Kennett Square, Pa expected to open “later this fall” too.

Goose Island has been a big success story for AB since it bought it in 2011.  Late last yr, ABI noted that it had basically tripled in volume and increased EBITDA by more than 10x.  But recently there are signs of a slowdown in scan and elsewhere.  After starting out 2014 on same hot streak it closed with last yr, Goose Island portfolio has notably slowed in scans for last several mos, as it goes against rollout numbers in parts of country.  All in, Goose Island portfolio volume still up 25.5% YTD thru Aug 10 in IRI Multi-Channel + C-store data.  But that slowed to just +4.3% in latest 13 weeks.  Each of Goose’s top-5 brands slowed significantly, and 3 of the top-5 actually declined in same period.  And that’s even tho avg prices down nearly 1% same period. 

Largest brand 312 Urban Wheat volume down 2% for 13 weeks, and steeper -8% for latest 4 weeks thru Aug 10, bringing yr-to-date trend down to +11.5% in IRI MULC.  Seasonals (-18%) and Honkers Ale (-36%) saw even sharper decline for 13 weeks, falling to +18% and -2.5% respectively YTD.  And tho IPA and Variety Pk each up 35% plus YTD, each slowed 25-30 pts in latest 13 weeks. 

Recall, in 2013 Goose Island brand family was one of fastest growing portfolios in scans, led by lead brand 312 Urban Wheat, which grew vol nearly 50%, alongside Seasonals (+15%) and exceptional growth of Honkers Ale (+94%), IPA (+172%), and Variety Pk (+237%).  But AB pushed too many brands out too far “overdistributing” them, according to one sizable distrib.  And now it can’t cycle the numbers.  One saving grace for Goose has been new 312 Urban Pale Ale, which more than made up for declines of 312 Urban Wheat, Seasonals and Honkers Ale combined in latest 13 weeks.  But perhaps shift of focus to Urban Pale Ale has taken toll on other top Goose brands in addition to lapping roll out numbers.  

Announcement that Utah’s Uinta Brewing received unspecified investment from NYC/OH-based The Riverside Co private equity firm last week remains one of few significant recent transactions in a craft M&A atmosphere that’s remained heavy on chatter, light on action.  Potential strategic buyers (in the beer biz) abound – both AB and MC, plus reportedly Constellation Brands looking for its first craft beer investment – but getting it done remains tough.  (AB did buy Blue Point earlier this yr.)  Uinta’s announcement in addition to thoughts ceo Will Hamill shared with CBN about why he chose this course of action suggest at least some craft brewery leaders are warming up to private equity investments quicker than those from typically larger brewing or beverage companies.  Recall, Uinta has been one of fastest-growing regional players in recent years, up 31% to 59K bbls last yr, almost triple its production in 2008.  Uinta’s on pace for 40-50% volume growth in 2014, Will told us, likely to land production between 80-90K bbls by yr-end.

Uinta’s recently-completed $18 mil expansion of brewing capabilities was key to Will’s decision.  He made a personal guarantee so Uinta could bring in “the best equipment that money can buy.”  Tho happy with his and his management team’s progress, “we can do better,” he insisted, and started “looking for an outside investor.”  But Will “wanted funds and business, operational acumen” and he believes Uinta “got both with Riverside.”  Riverside’s “phenomenal toolbox of operational people who’ve been where I’ve been” will be crucial “to get the business to the next level” while at the same time “100% embracing me and my management team.”  They’re not disclosing exact size of Riverside’s investment and stake, but Will maintained that the folks at firm “just want to bring help to the table.”

That’s not to say strategic buyers didn’t court Uinta too, likely “at a higher valuation than a private equity” firm, Will acknowledged.  While working with a strategic buyer “could be positive,” it felt “much more unknown to me.”  Working with a larger company, Uinta could “run the risk of being swallowed up,” Will explained, wondering “how would they embrace our culture and our DNA and all the things that I’ve spent so much time, sweat, blood and tears, and love and smiles and laughter and all of that….  I wouldn’t want to jeopardize that,” Will said.  Distribution footprints factor in here too, which Will said “would be the first question” when talking to strategic buyers.  While certainly possible, moving brands can take time or be “too expensive” to be feasible.  “We don’t want to stop our momentum,” Will added.  

And the brand’s got some momentum.  Recall, it entered large Texas and Florida markets early in 2014, but they won’t be huge contributors to co’s growth.  Instead “a majority of our growth this year, more than two-thirds, will be from existing markets,” Will said.  That includes home Utah market, up around 20% in its 22nd year.  Utah “by far our largest market,” though no longer half its biz.  Home state still gets a great deal of focus from Uinta.  Currently in 27 states, Uinta’s growing in all of them, Will told us.  Like other brewers, it’s riding the IPA wave, seeing strong growth from Hop Nosh, Dubhe and Detour Double IPA, which recently moved over from more-limited Crooked Line into more widely-available 12-oz bottles.  Its Trader Session IPA, while seeing broader distribution this yr in new cans, is “not a new beer for us,” as session beers are “what I’ve been doing for 21 years” in Utah.

Though Will and team have “identified” likely candidates for new markets, such expansion is “not in the immediate future,” he said.  Instead, the co plans to spend energy and newly-acquired knowledge from Riverside to improve internal operations, expand its workforce and dig deeper, “working on the chain level and on the ‘B’ and ‘C’ accounts” in existing markets.  Uinta will continue expanding brewing infrastructure in Salt Lake City.  Recall, thanks can be added to current site to scale up over 300K bbls eventually, Will told us last yr; latest round of construction brought up annual capacity to about 145K bbls.  More capital expenditures could begin as soon as next year, as Will “would like to get in front of the curve in capacity” so the co can “have wider fluctuations of volume of beer on a monthly basis.”  Meanwhile, Uinta will invest more in IT, creating greater efficiencies internally, and ideally adding another 20 employees to its workforce.  The co’s already hired about a dozen folks in 2014 and “if I have great candidates,” per Will, its current 50-some-odd employee-count could get a 40% boost.  Even if that goal isn’t accomplished by yr-end, over the next 6 months the pace of new hires will certainly continue upwards.  Riverside’s operational expertise is sure to come in handy as Uinta pushes forward on each of these initiatives and Will reports largely-supportive reactions of industry members, particularly distribution partners.  How many other similarly-situated brewers will follow suit? 

Northside Festival is intended to be north Brooklyn's answer to Austin's South by Southwest: film, music and innovation extravaganza situated in creative heart of city. No surprise, then, that marketers at PepsiCo viewed it as fertile ground to sample co's take on artisanal sodas, Caleb's Kola. So how did it go? At time BBI happened upon sampling stand on Bedford Ave - Williamsburg main drag which had been transformed into carless park for afternoon - one passerby was brandishing dollar bills seeking to buy (glass) bottles of the soda she'd just sampled. "We could have sold 200 bottles," brand ambassador confided. (All would-be purchasers had to be turned down and encouraged to seek brand at retail; it's also available nearby at nabe's Umami Burger outpost). Of the scores of people who'd stopped by stand, only a few were aware that Caleb's is a Pepsi item, and for most that was matter of indifference, she said. Sampling stand signage, of course, offered no clue to Pepsi ownership of brand that's performed delicate straddling act between indie-style cred and corporate identity, as in online videos in which purported creators of brand are shown in videos shot in settings redolent of NY tenements but do ID themselves along way as Pepsi folks.

A bit further down Bedford on Sat, separate stand was sampling another new Pepsi item, Lipton Sparkling Iced Tea. Available to try were line's 3 initial flavors - Peach, Lemonade and Raspberry - and their "tiny bubbles" were touted via gimmicks like giveaways of pens that also can be used to blow bubbles. A few blocks away, at main stage of fest at 50 Kent, concertgoers listening to performers like Neko Case, Built to Spill and Best Coast could take a dive into TinyBubbles ball pit. Other fest sponsors on bev side included kefir marketer Lifeway Foods, operating expansive media lounge.  

Are doors for boutique sodas opening wider at national fast-food players? Count Boylan Soda's national tie-in with 3,300-store Arby's chain - possibly biggest foodservice win in history of brand - as further evidence that winds of change are blowing thru quick-serve restaurant (QSR) scene. Starting last month, brand has gotten 3 flavors placed within chain operated by Atlanta-based Arby's Restaurant Group, with extensive ads and promos supporting. Effort has likely offered significant sales and visibility boost to brand owned by Emigrant Capital, and may even have eased path to signing additional DSD distributors, impressed by extent of activation. "Really like what they're doing," marveled one distrib.

These days, indie bev brands see great chance to crack fast-food chains that are looking over their shoulder at fast-growing fast-casual eateries and starting to adopt some of their cues as competitive responses. Bevs positioned as "craft" or "artisanal" are one way of doing that, so doors may open wider now. Boylan, for instance, already can boast being served in BurgerFi's scores of locations, and foodservice likely comprises majority of its sales, tho NY-based co doesn't say. As for Arby's, under its executive chef Neville Craw, it's worked hard to position itself as "Fast Crafted," deli-inspired vision nestled between fast food and fast casual. "We offer superior service and quality vs a typical QSR while borrowing on the aesthetics of a fast casual restaurant," per Arby's Jason Rollins. "We define Fast Crafted as quality, affordable food that is quickly, yet skillfully prepared. Craft soda seemed naturally aligned with our Fast Crafted positioning." Craw, who also has title of sr dir for product development and innovation, has made it point to reach out to consumers via ArbysIdea.com Web site for ideas, including recent poppable desserts challenge.

Tho Boylan, under ceo Michael Milstein, prefers not to discuss its activities with media, Arby's Rollins was happy to flesh out what BBI was hearing in channel. Effort began with deliberate concept and focus group research around craft soda to determine fit and guest appeal, with Arby's apparently working to suss out importance of such queues as cane sugar sweetener and glass bottle. That led to 2013 request for proposals, which BBI hears drew such other boutique-soda rivals as Jones Soda. Boylan made the cut - selected "because of the quality of their product and spirit of partnership," Rollins said - and by last summer, chain was ready to conduct market test, in Atlanta and Philadelphia. Tho Pepsi is Arby's fountain partner, that created no headaches, Rollins said: "We are working on other beverage initiatives with Pepsi on an ongoing basis."

Alliance moved chainwide for May-Sep period with Black Cherry, Ginger Ale and Creme Soda flavors. Boylan branding has been included in restaurant merchandising and product featured in print, TV and digital/email promos. Coupon valid Jun 3-9 offered free Boylan soda with purchase of any Market Fresh sandwich. National ads have run for Black Cherry flavor. Photo on Yelp, for instance, shows open-top ice cooler situated on countertop, pitching $2.29 sodas as "Natural Flavors … Naturally Refreshing." It sports big Boylan logo on front panel. "Guest feedback has been very positive so far," Rollins reports - view borne out by frequent accolades that can be spotted on social media. "We heard from guests in our market test that craft soda at Arby's was viewed as premium and unique for QSR. Additionally, we saw an increase in guests opting to make their Market Fresh order a combo meal to include the Boylan soda (in test) and hope that it will continue to offer an appealing beverage alternative." Just today, Arby's posted Facebook comment, "Some people do lunch better than others" with still life of deli-style sandwich, paper bag of chips and Boylan Ginger Ale.  

When Xyience Xenergy energy brand was sold to Big Red Ltd late last year, it shed its association with Ultimate Fighting Championship, owned by the same folks who had owned Xyience. But what would replace it? One answer is becoming clearer: college football.

As Austin co preps Xyience relaunch for coming fall that will see name change and new can graphics, it's wrapping up details of new affiliation with ESPN that will push entry toward mainstream via sports network's Game Day and other college football programming. Deal may include contracts with on-air talent, who may be used in TV spots for brand, tho nothing's been inked yet, said svp marketing Thomas Oh. It will be a way, he added, "to excite retailers and distributors, to bring them a platform they understand." Tho UFC has boomed among younger male viewers, it had sometimes been viewed as disconnect with Xyience brand that's staked out credible position in healthy-energy space, given all-natural formulation and absence of calories.

Under Big Red ownership, brand is dropping complicated Xyience Xenergy moniker in favor of simply Xyience as brand preps relaunch for fall. "Nobody called the brand Xenergy," Oh noted. "So we'll clean it up and have a very clear brand message." Also dropped have been sublines devised under prior ceo John Lennon in teas, lemonades and sports drinks, which proved a big ask among retailers, in favor of 8 primary flavors, all in silver 16-oz cans.

Six months into effort, Oh said consumer research has confirmed zero-calorie line is viewed as offering great taste while delivering on energy promise. Brand's core users, better-for-you-seeking consumers, are seen as disconnect with brand's prior main affiliation with UFC, "brutal sport" which was dropped as brand's prior owners, Fertitta bros, transferred it to new ownership. (Monster Energy was quick to fill that void.) UFC tie "did a great job getting some awareness for the brand, but was somewhat narrow and pigeonholed us," Thomas figures. More generally, Xyience would get drowned out in extreme-sports space by heavy activation of Red Bull, Monster and Rockstar.

News on marketing front comes as co quietly has made progress strengthening distribution, in some cases by bringing in Bud wholesalers, in markets like Southern Calif and Ill, who were looking to replace now-fled Monster brand. In SoCal it's in mix of 9 Bud, MillerCoors and unaligned houses including Ace, Straub, Triangle, Mission and Lenore, said Big Red prexy Gary Smith. It's also recruited network of indie Pepsi bottlers in Pac NW, where Rockstar has remained in indie beer houses even as it's tied to Pepsi network in most of the rest of country. Tho Big Red has many of its other brands, including Big Red and Hydrive Energy, in Dr Pepper Snapple network, Xyience brand's only DPS operation is in Ohio, where brand had to find successor to defunct Buckeye. On retail side, Xyience has entered GNC nutrition chain, alongside rival Redline, long a mainstay in that channel given brand owner VPX's diverse supplement offerings under Redline and other brand names.  

Long-anticipated transaction in which Coca-Cola became minority shareholder of Monster Beverage closed on Fri, announced moments after close of trading at 4 PM EST. In deal, KO made net cash payment of about $2.15 bil for 16.7% stake in MNST, which will continue to operate as indie co out of its Corona, Calif, hq. Coke also is adding 2 allies to Monster board, with its evp/cfo Kathy Waller and her predecessor in post, Gary Fayard, who retired in Apr 2014. As part of transaction, KO transferred to MNST its full range of energy brands worldwide, roster that was listed as NOS, Full Throttle, Burn, Mother, BU, Gladiator, Samurai, Nalu, BPM, Play and Power Play, Ultra and Relentless, while MNST transferred to KO its range of non-energy brands, including Hansen's Natural Sodas, Peace Tea, Hubert's Lemonade and Hansen's juice items. Recall, that co had been founded as Hansen Natural, before new controlling shareholders Rodney Sacks and Hilton Schlosberg and their brand development colleague Mark Hall set co off on growth jag in energy, starting with unsuccessful Hansen Energy line, then wildly successful Monster Energy brand.

Other key part of alliance was transition of North American distribution to Coke bottling system in the roughly half of US where Monster brands remained distributed by Budweiser wholesalers. (Major exceptions are Kalil in Ariz and Big Geyser in NY.) Coke also becomes Monster's preferred distribution partner around world, reprising plan that was original intent when cos first aligned back in 08 but failed to pan out in practice. Coke noted on Fri that new int'l distribution commitments already are in place with bottlers in Germany and Norway.

VEB Opens West Coast Office, with Faa, Hicks, Owens in Key Roles Looks like plan earlier reported by BBI (Mar 6) to retain key non-energy execs from MNST as core of West Coast base for Venturing & Emerging Brands incubation unit has panned out, with prexy Tom Hicks making transition as well as such key brand execs as Hubert's Lemonade "chief lemon head" and marketing vp Blair Owens. Tom apparently will run sales, Blair marketing, under svp/gm that Coke assigned in Apr to what it's called VEB's Craft Beverages unit, Jeremy Faa, vet mainly of Coke's Asian and Latin American businesses. Team is seeking office space in Irvine/Tustin area. Both Hicks and Owens boast big-company experience that should make transition easier, Hicks at Naked Juice as it moved under Pepsi ownership umbrella, Owens at Coke itself earlier in career as well as at Gallo Winery and P&G. Non-energy brands at Monster have had peculiar role within MNST: once hoped for as parallel growth engine to Monster Energy and proof to Wall Street skeptics that co can innovate on many fronts, in more recent years they've been viewed as ancillary activity with greater emphasis on operating tightly than on generating outsize growth. That role change was signaled by corporate name change from Hansen Natural to Monster Beverage 3 years back.

Progress on Transition as Pieces Come Together Tho there inevitably have been some bumps in transition, KO/Monster deal has generally been regarded as innovative triumph for both partners, who get to focus on their areas of competitive strength. As reported last week (BBI, Jun 11), plan in US seems to be to deploy 3-tier brand strategy, with flagship Monster vying vs Red Bull, NOS harnessed as fighter alternative to Rockstar and Full Throttle more value-oriented line. Coke may have more demanding task figuring out how to weave in diverse array of brands in multiple categories, including glass-bottle Hubert's line that holds potential but may not be great fit in current form with bottling system.

"We continue to think this transaction is a huge win for both companies as it capitalizes on the respective strengths of each," wrote Wells Fargo's Bonnie Herzog. "As such, we remain very encouraged by MNST's long-term growth prospects, particularly in international markets. However, we remain cautious on the stock near-term since we expect its Q2 results will be negatively impacted by distribution issues as it transitions to the Coca-Cola system." Her quarterly survey of c-store operators - prime channel for energy drinks - had included comments about "out of stocks," "low inventory levels," "frustrated drivers" and "disruptions in service," even as archrival Red Bull continues on a roll winning $$ share thanks to flavor extensions and higher prices. MNST brass has indicated it hopes to follow price increase taken by Red Bull at beginning of 2015 once it gets over hump of transition to Coke. As Bonnie noted, too, her latest survey demonstrated some improvements since prior one in Dec, with deliveries advancing slight from 1.4X per week to 1.5X and Monster out-of-stocks narrowing to 2.8% from 3.6%.  

Working via its new distributor Dora's Naturals, Icelandic Glacial water has cracked NY's Duane Reade and Fairway Markets chains. With Dora's aboard to supplement efforts of core distributor Anheuser-Busch, brand has entered 175 Duane Reade stores and all Fairway stores in NY, NJ and Conn. Meanwhile, out west, Culver City, Calif-based brand and A-B have won presence in all Raley's Bel Air and Nob Hill Foods units in Northern Calif . . . Seattle-based Unique Beverage Co said its placed its line of USDA-certified organic, naturally sweetened sparkling flavored waters in 400+ Target stores in flavors like Mixed Blueberry, Mixed Berry and Citrus Twist . . . LA-based Caliwater Cactus Water is launching 1-liter Tetra Pak version of its wild prickly pear drink in all 16 Gelson's Market stores and all 11 Lassen's Natural Foods stores in Southern Calif. New pack complements existing 11.2-oz box.  

SF-based Project Juice next week will add wellness shots to its array of items available for home delivery or online. Purchasers of at least half dozen Project Juice juice blends will have access to 5 different 2-oz shots at $5 each, vs current system where only 3 are available to purchasers of juice cleanse upgrade. The line includes Liver Flush (Detox), Turmeric Tonic (Inflammation), Tummy Tonic (Digestion), Flu Shot (Immunity) and Mineral Surge (Longevity) items.