Monthly Archives: April 2014

another flatlandBEER rant?…sigh…

Posted on by
2

Sometimes I start a Facebook post, and it ends up as a blog-worthy rant: case-in-point => yesterday’s Post on the Flatland BEER Facebook page.

(Since I now have a blog, I should probably stop myself halfway into the FB rant, and head over here to complete it. I’ll get the hang of this whole InterWeb thing one of these days…)

The rant started off innocently enough – a good news story on increased liquor sales in Saskatchewan. The key point of the story? Sask saw the second fastest growth in Canada across all liquor categories, according to Statistics Canada. This is a good thing… I should be happy about this. But somehow I managed to rant anyway… I guess it was the pejorative comment the Saskatchewan Liquor and Gaming Authority (SLGA) spokesperson inserted when referencing beer:

“Customers in recent years have been purchasing better products, moving into more of the premium brands in all categories,” said David Morris from the SLGA. “And that might be wine and spirits or even beer [my emphasis].”

Mr. Morris’ comment implies a certain attitude towards beer – perhaps he’s reflecting general public sentiment, or perhaps he’s reflecting SLGA’s attitude… either way, I find it irritating.

Regarless, progress is progress – right? The Saskatchewan government has undoubtedly taken major steps to modernizing the antiquated liquor laws in this province (servers can even wear Spandex around alcohol without worrying about a liquor inspector shutting the business down – this was an actual issue the government previously saw fit to regulate… much to the joy of several media outlets).

The next big step? Make accessing Saskatchewan-made beer (liquor and wines) as easy in Sask as it is to access Sask beer in Alberta. And easy, it is: walk into virtually any full-scale liquor store in AB, and you’ll find multiple styles of Saskatoon’s Paddock Wood Brewing Co. (Paddock Wood is also available at The Beer Store & LCBO in Ontario).

This is a public policy issue, that SLGA and Brad Wall need to address — despite significant improvements to the province’s liquor laws in the past couple of years, brewers, distillers & winemakers still report difficulty in getting their products into SLGA stores due to:

  • systematic red tape;
  • local managers who simply aren’t interested;
  • an apparent preference by SLGA for the Molson, Labatt & Sleeman (aka: Molson-Coors, AB InBev & Saporro);
  • poor support to regional #CraftBeers;
  • SLGA stores not rotating stock properly… especially important in quality beer; and
  • not refrigerating local beers, even when the local guys offer to supply the fridge… despite doing so for the macro brewers

Other provinces – such as BC, Ontario & Quebec have implemented “local-first policies.” These don’t mean major producers are turfed, it simply means local producers essentially get first first of refusal to shelf & SKU space… especially important in high-traffic aisles of the store.

Is this policy working? Well when you look at the Brewers Association 2014 World Beer Championship winners, the 7 Canadian winners are from three of the provinces with local-first policies in their public liquor system: BC (2), Ontario (1), and Quebec (4). Correlation doesn’t mean causation… but it’s a theory worth exploring

Baby steps, I know. And we do see some excellent stores & store managers (Normanview in Regina has a great refrigerated section, and South Albert consistently seems responsive), but this shouldn’t be up to individual consumers lobbying individual store managers to bring in interesting, unique, local products… the public liquor system was explicitly created as a public policy vehicle: this is well within the SLGA’s mandate.

[end rant]

Stadiums & Craft Beer

Posted on by
3

The recent announcement that the Toronto Blue Jays’ home – Rogers Centre – would enter the 2014 season with the dubious honour of being the only Major League Baseball stadium not offering any craft beer got me thinking about the crossroad between Canadian sport, and beer.

As a country, I think it’s safe to say we are known for our love of beer. Ask someone what comes to mind when they think of Canada, and beer is likely right up there with Mounties, moose, & snow. Despite this, our pro sports teams seem to have a decidedly cool approach to beer. Sure, you’ll find “beer” at every CFL, NHL, NBA & MLB stadium and arena in Canada, no question. But will you find beer that represents Canada? Or, more appropriately: that represents the team’s region? The area its fans call home? Not likely.

Yes, Molson, Labatts & Sleeman all have long & storied connection to Canada, but none of them are Canadian. They are all owned by foreign conglomerates (Molson-Coors; AB InBev; and Saporro, respectively). This isn’t to say that they have no place in our sports facilities – they do… just as local craft beers should.

The deal Aramark, Rogers Centre & the Blue Jays struck with AB InBev is hopefully a one-off. An odd anomaly in a sea of professional sports teams across the United States going out of their way to offer true craft beer in their facilities:

  • in craft beer-crazy Seattle, MLB’s Mariners play in a stadium where 70% of the draft taps are craft beer;
  • the NBA’s Charlotte Bobcats created a craft beer garden at the Time Warner Arena featuring nine North Carolina craft breweries); and
  • several NFL Stadiums have fully embraced craft beer (Reliant Stadium in Houston; Ford Field in Detroit; and CenturyLink Field in Seattle are stand-out examples of stadiums with exceptional craft beer selection)

SteamWhistle_logo_smThe frustrating fact is that the Blue Jays didn’t even give their partnership with Steam Whistle a chance – they opted
not to renew it after only one season (granted, they grudgingly signed the deal after it was noted in 2013 that they were the only MLB stadium without craft beer). The decision is especially odd, given Steam Whistle’s proximity to Rogers Centre – literally within the stadium’s shadow.

So what’s the deal in Canada? Granted, our craft beer scene isn’t nearly as mature as that in the US, but to find a true craft beer (not a macro beer marketed as a craft beer) at a Canadian stadium or arena is rarer than it should be.

Thankfully, we appear to have an excellent beachhead in the CFL’s Ottawa REDBLACKS. Their home stadium – TD Place – signed a deal with AB InBev (Labatt) which explicitly allows local craft beer to be served at the stadium.

The real point of this post…

The Saskatchewan Roughriders & City of Regina would be wise to consider the situation at TD Place as they design Regina’s new $278 million stadium, and negotiate deals with service providers.

ThSaskatchewan_Roughriders_1985_Logoe Riders are a community-owned team. They encourage their players to become active members of the community. The team gives back to the community in a variety of ways. Giving back to local and regional entrepreneurs fits with the Roughriders’ community-focused mandate.

In addition to well established craft brewers such as Regina’s Bushwakker, and Saskatoon’s Paddock Wood, Saskatchewan has seen an explosion of Craft Brewers in the past year – at least 3 new breweries opening in 2013 (District Brewing, Prairie Sun, & Bin Brewing), with at least 2 more to come in 2014 (Black Bridge Brewery & Rebellion Brewing). These breweries are owned locally. They are a part of the RiderNation.

The Roughriders are in a unique negotiating position: as one of the top sports brands in Canada, they are in the power position when negotiating with Canada’s big foreign-owned breweries. The Riders can set the terms. These breweries are salavating to get a piece of the marketing machine that is the Saskatchewan Roughriders (only the Toronto Maple Leafs & the Montreal Canadiens sell more merchandise than the Riders… in fact, the Riders account for 70% of the CFL’s merchandise sales). We can use this fact to stand up for our regional beers & breweries.

Does this mean shutting out a macro-brewery like Molson or Labatt? Absolutely not. As demonstrated by the Ottawa REDBLACKS, craft beer & mass-produced beer can co-exist.

As a matter of fact, experience in the US is showing that craft beer is driving sales volume up, as well as a disproportionate spike in revenue.

Of course, all the theory in the world may not matter if the fans don’t support local craft beer options – it comes down to basic dollars and cents. We’ll never know if we don’t try: given the solid financial position the Riders are in, the growing community of craft brewers in Saskatchewan, and the opportunity a new stadium presents, there hasn’t been a better time in Rider history to take a strategic risk & support their community’s entrepreneurs at the same time.

If the US experience plays out in Canada, it would be good for RiderNation. It would be good for the Roughriders’ bottom line. And it would be great for our regional craft brewers.

Crowdfunding a Brewery?

Posted on by
Reply

Saskatchewan becoming the first province in Canada to permit equity crowdfunding got a fair bit of play in the media shortly after its announcement late last year. To date, the excitement hasn’t translated into many (if any) tangible results – but adapting to anything new takes time.

I believe equity crowdfunding provides an amazing opportunity to grow the already booming craft brewing, distilling, and winemaking industry in Saskatchewan.

Before I get into why I believe this, let’s step back & run through exactly what “equity crowdfunding” is. A generally accepted definition of crowdfunding is:

“the practice of funding a project or venture by raising many small amounts of money from a large number of people, typically via the Internet.”

OK, so what makes Saskatchewan’s new legislation unique? Kickstarter, Indiegogo, and other platforms have been used to crowdfund start-ups, charitable campaigns, humanitarian efforts, etc for years. Sask’s legislation allows for equity in a company (i.e.: ownership/ shares) to be offered in return for an a crowdfunding investment. Typically, offerings of this nature would go through extensive (and expensive) regulatory review and approval – these obstacles could be show-stoppers for a small craft beer start-up.

cropped-cropped-Logo-No-Line21Saskatchewan isn’t the first jurisdiction to permit equity crowdfunding – Ontario has dabble it’s feet; and several US states have legislation in place to permit and regulate equity crowdfunding. In fact, CrowdBrewed is a US website devoted to equity crowdfunding breweries. All About Beer magazine wrote a great article about the crowdfunding model and it’s application to the craft brew scene.

Equity crowd funding provides a unique opportunity to raise capital – in return for equity – with significantly less red tape.

Note I said “less” red tape – not none… SK’s financial regulator still reviews the structure of crowdfunding websites, and of offerings that are going live. The interesting thing about the regulatory review is that the government uses the phrase “no news is good news” when discussing regulatory approval. So long as a crowdfunding website submits the required logopaperwork 30 days before going live (10 days, in the case of a business wishing to equity crowdfund), they are good to go if they hear nothing from the government by the stated go-live date. For those who have dealt with red tape before, this element alone is huge! Unless the government explicitly says no within the 30 (or 10) days, Approval is implied.

So, what at the rules the home brewer with a dream of one day running a craft brewery (or the bathtub distiller hoping to produce craft spirits) has to play within? To my mind, the three items of key interest to Saskatchewan entrepreneurs are:

  • Both the business and the investor must be located in Saskatchewan
  • Businesses can make two, six-month offerings of $150,000 each over the course of a year.
  • No person may invest more than $1,500 in an offering.

Despite facing some regulatory hurdles, equity crowdfunding provides quite the opportunity to float an idea to the masses, garner support from like-minded craft beer drinkers, and (hopefully) join the Saskatchewan craft beer boom (3 new breweries in 2013 and at least 2 new ones confirmed for 2014).

The idea of many people providing (relatively) small amounts of money is something most Saskatchewan folks can relate to – Kinsmen TeleMiracle is an excellent example of crowdfunding. For nearly 40 years, TeleMiracle has taken to the airwaves one a year for 20 hours straight. Over the course of these 20 hours, the telethon raises immense amounts of money through multiple small donations. $5.3 million was raised in 2014, amounting to about $5 for every resident in the province. 

Just to the east of the Saskatchewan border rests an example of a start-up brewery hoping to leverage crowdfunding to kickstart their business. Prodigal Sons Brewery (Twitter | Facebook) announced their intention to start a brewery near Winkler, Manitoba last week. They are currently running an Indiegogo campaign to raise funds in support of the brewery. At the moment, they haven’t raised any funds – so if you think it’s an interesting idea, consider supporting the campaign (deadline is June 3, 2014).

Of course, an even more stereotypically Saskatchewan way of starting a brewery is the Co-operative model. And the co-op is exactly what a group of folks in Saskatoon are hoping to use to get their brewery off the ground. If you haven’t had heard of Temperance Brewing Co-operative, have a look at their Facebook page & give them a Follow on Twitter (hopefully we’ll be hearing more about them soon).

So what’s this post about? It’s about my desire to see new craft brewers, distillers & winemakers enter the Saskatchewan market. The liquor landscape in Saskatchewan has changed a fair bit over the past 20 years, and some of the most dramatic changes have occurred in the past 2 years. I suspect some of the opportunities have been lost in the shuffle. There are amazing home brewers making the leap into the world of Saskatchewan craft brewing… but there could be more lurking in the woodwork, unaware of the options available to them, and the support that exists in the community.

We’ve shown time & again that we support causes we believe in – from the Roughriders (through thick & very, very thin); to TeleMiracle; to a university professor starting a small, unlikely brewery in an old Regina building…