December 14, 2006
What Saint Arnold's wants to do

Some of us bloggers had a little conference call with Brock Wagner of the Saint Arnold brewery last night to talk about just what it is he and his cohorts want to the Lege to do for them. I've summarized the law, but that doesn't always translate into plain English. Which is why we have con calls, so we can ask questions like "So, just what exactly is it that you guys want to do?"

And the answer is pretty simple: The microbrewers want to be able to sell their beer directly to the public. They're not going to do all of their sales this way - it wouldn't make any sense, and it would justifiably tick off the distributors they use now. What they want, similar to what Texas wineries can now do, is for breweries that make up to 75,000 barrels per year be able to sell up to 5000 of those barrels of their beer per year directly to individuals. Such brewers can currently sell directly to retailers (this is known as the Shiner Law, as it was enacted to accomodate the Spoetzl Brewery; the law no longer applies to them because they're too big for it), but not to individuals. For perspective here, Saint Arnold is the biggest microbrewer in Texas; they sell about 14,000 barrels per year. Brock estimates they'd actually move less than 1000 barrels this way. Anheuser-Busch sells about 14 million barrels a year in Texas. If all five existing Texas microbrewers sold the max each year, it'd represent about 0.1% of the total annual sales in the state.

Being able to sell directly to the public can take several forms, including opening an on-premises brewpub, though given each microbrewers' actual locations, none of them are likely to do that. (As it happens, brewpubs can bottle and sell their beer to individuals right now in Texas. They don't need to go through a distributor. None of them do this, but they could.) What it would mean in practical terms for Saint Arnold's is two things: One, letting folks who take their Saturday tours buy a sixpack or two to take home with them. Right now, if you take the tour you can drink the samples, but if you want to bring that taste home with you, you need to stop at a supermarket on the way. And two, kegs. If you want a keg for your tailgate party or whatever, you buy them from a middleman. Unfortunately, most such suppliers don't carry craft beers like Saint Arnold's because there isn't enough volume for them, so unless you want a keg of Bud Lite or the like, you're generally out of luck. With the new law, just call up the brewery and you're on your way.

As noted previously, Texas wineries can already do this. Go visit the Messina Hof winery or one of its colleagues - you can purchase a few bottles of their wares while you're there. Many microbreweries not in Texas can do this as well. The intent of this campaign is to put Texas microbrewers on equal footing with them.

The benefit for brewers is clear: By eliminating the middleman for these sales, they get a much better margin on them. That would help them with their cash flow, and would make it easier for them to stay in business. That's good for the distributors, who should like having solvent, stable clients, and may make also it easier for new brewers to enter the market for them to service. Expanding the market for high-end beers is good for retailers as well, since they make more money on those sales. It's certainly good for beer drinkers. And the limit on what the micros can do is plenty small enough to keep it from affecting the big boys in any meaningful way. It's a pretty good deal all around.

That's the case for this project. I'm an unabashed fan of Saint Arnold's, so I'm a believer. Brock says the feedback he's gotten so far has been positive, and why not? It's beer. People like beer. What else is there to say?

Houstonist gives a little love to the campaign, while Barleyvine sums it up thusly:

Lastly just let me opine a bit more on Brock's quest and how important it is to Texas and beer drinkers in general. A few years back Texas passed a law that would allow Texas Wineries to sell small amounts of their own wine in their tasting rooms. The result was not lawlessness, or drunkenness, but higher profits for the wineries and an increase in tourism to Texas wine country (Hill country). To me this should be a slam dunk issue. Letting breweries sell some cases of their own would not only help small business profits, but as places like Colorado, and California can attest will increase tourism as people come from not only within Texas, but outside to taste some of the great beers that Texas has to offer. Texas should be about the small business, those people that are willing to take a chance, start something from nothing and being a bit of a maverick. Isn't that what Texas is all about?

Let me close, by saying, if your reading this blog and support local Texas beer, try and support the quest of Saint Arnold's in any way you can. Whether that's by doing the simple thing of buying a six pack of Lawnmower or writing a letter to your State Representative, do what you can.

Indeed. I'll have more to say as the project progresses. Stay tuned.

UPDATE: John and PDiddie chime in. Here's what the desired legislation would look like.

Posted by Charles Kuffner on December 14, 2006 to That's our Lege | TrackBack

Jaxon's on Airway in El Paso sells growlers (or at least they used to, when I was still there). Too bad more brewpubs don't do that.

Posted by: agm on December 17, 2006 3:56 AM