Behind the Headlines – September 2, 2016

Behind the Headlines – September 2, 2016


(female announcer)
Production funding
for Behind the Headlines is made possible in part by.. (male announcer)
The Bartlett Area
Chamber of Commerce and its member A2H – engineers,
architects and planners creating an enhanced quality of life
for our clients and community. To learn more about
A2H’s services and markets, visit A2H.com. – The growth in the local
beer community tonight on Behind the Headlines. [theme music] I’m Eric Barnes, publisher of
The Memphis Daily News. Thanks for joining us. I’m joined tonight
by Brice Timmons, co-founder of High
Cotton Brewing Company. Thanks for being here. – Thank you. (Eric)
Drew Barton is co-founder
of Memphis Made Brewing Company. Thanks for being here. – Absolutely. (Eric)
Kevin Eble is managing
partner of Hammer & Ale. Thanks for being here. And Madeline Faber, reporter
with The Memphis Daily News. Thanks for being here. So, it was funny. We were talking before the show. You all were founded in 2013. And it seems like the beer
community just anecdotally in terms of the number of
brewers and just the.. If you go to restaurants in town
or if you go to stores in town, there is more
local beer everywhere. Obviously Wiseacre has made a
lot of news with the possibility of putting a
brewery in the Coliseum. But why beer for each of you? Because it’s more
than a small thing. I mean, it’s a huge commitment
both business wise and so on. And I’ll start with you, Drew. Why beer? – For me, it all
started in college. I started home brewing when I
was in college and I made my first batch of beer. It was horrible. But I absolutely fell in
love with the process. I knew that time, that’s what
I want to do for the rest of my life. I was in engineering school at
the time and did not want to be an engineer. I didn’t want to be
stuck behind a desk. I wanted to make something
and get it out to the public. – Brice, you? Why beer? – I fell in love with good beer
when I was in the army and I was stationed in Europe. And when I came home to
Memphis after a long hiatus, I was really kind of
disappointed in the things weren’t offered. And I got into home brewing
for fun and I met my partners. And one day somebody
came along and said, hey, how would you
like to do this for real? – And Kevin, you’re different. You’re not a brewer but
you have a restaurant. Local beers of all
types and kinds. Why that? You can open lots of
different restaurants. But why one that was so
focused on beer and ale? – My partner and I both have a
huge passion for craft beer. We just like the quality of it. We started out as, you
know, quantity over quality. And once we decided the
quality is much better, we decided that we wanted to
open a business and Memphis needed something like
that when we opened. – And why? Am I right that it’s growing? It’s really a lot
more attention. Why? What happened in
terms of a shift from.. And I should say, you know, we
invited folks from Ghost River on and Wiseacre. Just timing wise, we
couldn’t get them all on. And we appreciate
you all being here. Why from your point of view
has it seemed to take off? – I think people really want
to focus on a local product. A lot of times, these guys come
in and talk about their beer at our place. And people just want
to meet the brewers. They want to know where
their stuff is coming from. And there has been a shift
nationally from macro brewery to microbrewery. And people really appreciate the
hard work and effort that goes into making good beer. – The reception you get? I mean, when you try to go to a
restaurant or you go to a store and say, “Hey, I’ve
got this niche beer.” I mean, when you
guys first started, did they look at you like you
were an alien or were they happy and really wanted you in
their store or restaurant? – I would say that the
reception was phenomenal. The community has
been super supportive. We joked for a long
time that, you know, being a microbrewer was
the new being in a band, except all of the fans,
at least in the beginning, were kind of chubby
guys with beards. It was like being in Rush. [laughter] So, but it was a lot of fun. And we found everybody
to be really supportive. I think that the industry
has seen this massive growth because, you know,
America is really kind of, you know, looking in itself and
developing culture for the first time in its history. You know, we’ve been the
industrial capitol of the world. We’ve been the tech
capitol of the world. Our economy has boomed. And we’ve figured out how
to make things that are, you know, bigger, more, faster. But recently we’ve
started, you know, in all sorts of
industries in food, in farming, in wine,
in spirits and beer. Everybody is sort
of saying, well, what about just doing it
better rather than faster. And sometimes slower
and smaller is better. Beer is one of those things. – Drew, I mean, for people who.. I don’t know how to say
this without being silly. But I don’t mean it
as silly as it sounds. But people who have not had a
beer since maybe they had a beer that was one of the
big national brands. And that is a particular thing. Lots of people like it. But it is very, very different
than what you and people like you do. I mean, this is the difference. So, what would you say to those
people who maybe had a beer, used to drink beer? Maybe they drank
beer in college and, you know, it was all like
he was joking or saying. You know, it as
quantity over quality. What would you say to them about
the difference of what you do? – You know, when people come to
our tap room and maybe it might be a couple or a
bunch of friends, and one of them doesn’t
particularly like beer, and they say, “Well,
I don’t like beer.” Well, you can’t blanket
say, “I don’t like beer.” You just haven’t found
the right beer for you. And, you know, there’s some
people who just aren’t going to like beer. That might be true. But there’s probably
some product out there that they like. There’s such a variety of
flavors in the craft beer industry that there’s probably
going to be something they just didn’t even know fit
that category of beer. And when you see a
lightbulb light up, it’s a great thing. – I’ll go to
Madeline in a second. It’s amazing. In a given year, how many
different beers will you put out, give or take? – In a given year,
we’ll do anywhere from 15 to 20 different styles. – Same for High Cotton? – Yeah, about the same. We keep ten at any given time. – That can be
dramatically different. Again, so for people who are
used to these kind of handful of really big brands,
that’s a totally different thing in many ways. – And that category
is huge in volume, but very small in diversity. And so, we’ve got
a much smaller, you know, volume-wise but
our diversity is much greater. – Madeline? – Kevin, from a
retail perspective, how do you think the
appetite for beer has grown? Or whatever the liquid
form of appetite is. Have you noticed that with
an increase in breweries, have more beer
drinkers come about? – Nationally, it’s such a huge
thing right now with craft beer. So, people really want
to focus on local beer. So, you know, these guys are
putting out a ton of beer. And people just
flock towards it. I mean, everybody wants the
new, fresh thing and that’s interesting with craft beer
because there’s always something new. So, you’re always finding
new tastes and new styles. Honestly, the same styles
are vastly different from brewery to brewery. So, there’s a
huge demand for it. And it’s gotten busier and
busier over the last three years, especially in Memphis
when we’re kind of catching up to a lot of other
places in the country. And it’s really a fun time for
craft beer right now in Memphis. – What are some ways that you
have changed the lay out or offerings at Hammer & Ale to
reflect changes in demand? – It’s usually, again, just
trying to keep it as new and fresh as possible. Unfortunately for these guys,
they have to make the new thing. We just have to sell it. So, it’s just trying to
keep everything up to trend. And, you know, lately it’s been
sour beers have been super huge. And, you know, there’s more of a
shift away from Belgium beers, which were popular a
year ago into sour beers. So, just trying to find what
people like and trying to keep those on tap while not
forgetting about things that people enjoy. – And is there.. Let’s talk about
competition for a second. There are more breweries now
than there were however many years ago. Is that a good thing? And are there more
competitors to you, to Hammer & Ale, out there
and is that a good thing? – Absolutely. I mean, competition
is always better. It makes us better. It makes every brewery better. I mean, there’s so many more
breweries now than there was ten years ago. – From your point
of view, I mean, is it like, you
know, some people say, well, you get all these
restaurants and now they’re competing against each other. Other people would say, hey, if
you’re at Cooper-Young or you’re in Overton Square and there are
a bunch of restaurants there, that draws more people. They get more into local food. Is it the same dynamic from
a business point of view with beer? – Yes, only it’s a
national dynamic. Instead of thinking about the
neighborhood drawing more people because there are
most restaurants there, you need to think about a
city drawing more tourism, more frankly people
moving to cities. You know, one
brewery in Memphis.. And, you know, we were a one
brewery town from 2009 to 2013. No one really talked
about Memphis beer back then. The guys at Ghost River,
all good friends of mine, you know, struggle along
and sort of forced everybody to pay attention. And then in 2013, we opened. Drew opened. Wiseacre opened. And all of a sudden, the
newspapers are paying attention. The tv media is
paying attention. And we’re suddenly
finding ourselves with national publications coming and doing
stories about Memphis being in the top 20 beer cities
in the United States and things like that. – How much do you
sell outside of Memphis? – We don’t sell
anything outside of Memphis. Well, outside of Shelby County. – Yeah, outside the area. You, too? – Not a single drop outside. – And what does it take? This is a strange
question but bear with me. I know on a national level, to
get into big grocery stores.. So, for the big soft
drink companies and so on, it’s really
difficult and kind of.. It’s a much more complicated
business than people realize in terms of big companies buying
shelf space and paying to be at eye level. There’s a reason certain
products that sell a lot are at eye level when you go
in the grocery store. That’s not coincidence. What is it like for you as a
local person trying to get into national kind of chain
stores, chain grocery stores? – Well, for us at Memphis Made
and a similar thing for High Cotton, we both
self-distribute our beers. So, we take the beer
out of our cooler, we put it on our van we
take it out to the retailers. And so, it’s a much more
personable relationship with these companies. A lot of people told us we
couldn’t get into Whole Foods. We’ve got accounts
at Whole Foods now. And it’s a lot of paperwork. You know, it takes a lot of time
to make sure that we keep up with the things they need us
to do to be on the shelves. But these bigger box stores have
shown the flexibility to work with a smaller company. – Your experience? – Yeah, so, we recently
started releasing the cans. You know,
individually packaged beer. And everybody said, oh, this is
going to be impossible for you to deal with big retailers. And some big retailers, national
chains have been difficult. But it’s not because
they’re resistant. It’s because they have an
entrenched bureaucracy that you have to work through. It just takes time. But Whole Foods, you know,
they have that same sort of bureaucracy. There’s a national system you
have to go through to get any product on their shelves. But what we found is that the
people making the decisions there have been, you
know, really friendly, really supportive. I think we actually have more
shelf space at Whole Foods, us and Wiseacre. I think we have more shelf space
at Whole Foods than any other craft brand. – And for you, for people who
don’t know what a growler is, describe this. It’s a strange thing. I mean, I grew up in the Seattle
area and I go back and visit. A friend of mine walks into
a bar with this gigantic. I couldn’t figure out
what he was carrying. And I was a dumb person. I didn’t know what that was. It was a growler. Talk about that. – So, growlers are just
a good way to get fresh, draft beer at home. It’s not packaged
except in kegs. So, it’s, literally,
you know, taken out, like Drew said,
from the cooler to us. And we pour it on
tap into the bottle. You drink it at home
and bring it back. It’s kind of like
the old, you know, the milk thing. You get it
delivered, you drink it, you leave the bottle. You use the same bottle. So, it’s a good way to get
out and try new things without having to spend money on a
six pack and stuff like that. So, it’s a little bit
less than a six pack, 64 ounces. But, again, it’s fresh draft
beer that lasts a few days once you open it. But it’s just a good
way to try new things. And, you know, it’s cool. They’re hip. – Can anyone do that? I mean, can any
bar do a growler? Or do you have a.. – We have a special
license to do it. So, we have the ability to sell
off premise with growlers and sell on premise and have
draft beer at our bar. – Drew, you cut your teeth at
some established breweries. Could you speak about how
Memphis’ local market compares to some of our peer cities? – I thought you were talking
about my chipped tooth at first. [laughter] Yeah, it’s.. I did. I started brewing in
2005 in Asheville, North Carolina at
French Broad Brewery. And when I started out there,
there were four breweries at the time. Bosco’s was the only thing
in town in Memphis at the time. Ghost River
hadn’t opened up yet. And so, I got to see that
industry grow quite a bit. You know, by the
time I left the river, a dozen breweries.. I think it’s over two dozen
breweries in Asheville now. And so, I mean, I was in on
the sort of the front line in Asheville and certainly the
front line here in Memphis. And so, I could see
where the potential can go. And we’ve certainly got
the customer base for it. I think this industry move could
have happened a long time ago. It just took a while for
all of us to figure it out. But yeah, there’s definitely
a lot of growth potential. – Where do you see beer culture,
brewing culture here in town evolving and how far are we
away from reaching peak beer? – Like saturated market
and too many breweries? It’s a tough one. I don’t think.. The saturation point is very
difficult to say when that’s going to happen. The more breweries that
are going to be here, the more breweries that are
going to have to look at selling their beer outside of here. There is only a
finite number of people, you know, that can do
selling here in town. But, I mean, as long as your
business model is solid and you make a good product, there’s no
reason that dozens of breweries couldn’t open in this city. – Same question for you. I love this phrase “peak beer”. – This is something that’s being
around the national brewing community for a long time. And I think the answer is no. Craft beer across the
nation is on a continued uptick. We’re on track collectively as
an industry to have 20% market share by the year 2020
on a national level. Twenty-percent market
share is considered something. You know, five years ago people
thought that was impossible. They thought, oh, craft
beer is this niche market. It will never have more than
five percent of the industry. Then it was never
more than ten percent. We’re on track for 20 steadily. And frankly, it’s,
you know, the growth has been almost exponential. Memphis, however, is
uniquely poised to be I think a national brewing center. The simple fact is we do have
the best water in the United States, hands down. It is cheap. It is abundant. We are sitting on a
major distribution hub. I mean, we are the
nation’s distribution hub. We have inexpensive real estate
and a labor market that is readily trainable and
not terribly expensive. Meanwhile, the craft
brewing meccas of Denver, California, Oregon are all
unbelievably expensive real estate. They have very
expensive labor markets. They do not have good
distribution networks compared to Memphis. And with the
exception of Oregon, they’re all
running out of water. And the treatment of the
water that they do have is a tremendously expensive process. Whereas we can bring
water out of the tap, remove the chlorine,
and brew beer here. They’ve got to do,
you know, this expensive reverse osmosis filtration. When you think
about doing that for, you know, hundreds of
thousands of gallons of water, that is pricey. – And the water
thing is interesting. I mean, you know,
there’s a whole push. The Chamber of Commerce are
pushing this water is a resource as an economic
development resource. But you were nodding your head. I mean, the water.. You’ve worked in other places. The water here is great? – It’s a great base for
doing those variety beers I was talking about
before where, you know, we don’t have a lot of minerals
that we have to then take out to make a particular beer
taste a particular way. It’s very basic to start with. And then we can add different
minerals to enhance the flavor profile of the beer. – You talked about license with
the growlers and I’m going to start with you. How are you all, if at all,
impacted by the wine in grocery stores bill? We’re not talking about wine but
there was more to that bill in terms of distribution
and high gravity or high alcohol content beer. How did it impact you? -It hasn’t affected us yet. January of 2017 is
when it affects us where, from my understanding, beer will
just be beer up to a certain percentage, which is going to
be higher than what it is now at 6.2% alcohol. So, in order to sell higher, you
have to have a liquor license. And we don’t have
a liquor license. We just sell beer up to 6.2%. So, once that law changes, I
believe it piggybacked on the wine and liquor
in grocery stores, we’ll be able to sell
higher alcohol beer. So, as of now, it really
hasn’t affected us that much. But it will shortly. – Yeah, as a brewer,
how does that impact you? – So, we have a similar.. It’s going to
affect us similarly. But what I guess I’d say and
I’ll put on my lawyer hat for a second. This law was passed along with
the wine in grocery stores law. It goes into effect
January of next year. And the definition of beer in
the state of Tennessee is going to change. It used to be that beer
was alcoholic beverages, malt beverages that were
five percent alcohol by weight, which is a really weird way
to measure that, or less. That number is being
increased to eight percent, which is basically
ten percent by volume. So, when you think of,
you know, a Budweiser, that is a five percent beer. A lot of the stuff that we
make runs between four and six percent. And now we’re going to be able
to move into these so-called high gravity beers
that are higher alcohol. And you can do a lot of
cool things with that. There’s a lot more
flavor you can pack in. – So, it is flavor, not just
alcohol content and I get drunk faster or some kind of,
sort of, I don’t know, you know, college kind of thing. It’s more.. There’s more to it. – These beers are
definitely not, you know, college
beer bust kind of beers. They are much more
expensive to make, which means they’re much
more expensive to buy. They tend to have higher alcohol
content but they also tend to have a lot more body,
a lot more character. People drink them slower. They will usually.. You might really think of it
more like somebody buying a bottle of wine. You know, you don’t say just
because wine has more alcohol than beer that people are
buying wine to get drunk. That’s silly. – Yeah. Your take on the new law and the
impact on your business beyond what they described? – We’re looking forward to being
able to provide some of that, especially at the tap room. When the law changes in January,
we will offer tap room only higher alcohol beers. And that’s only because
we’re going to only make it in small volumes. Like Brice said,
it’s a different.. It’s not a different process it
just takes longer than it does higher alcohol beers. It takes longer
to condition out. We don’t have time for
beer to sit around like that. So, we can make it in a smaller
volume and have it available just at the tap room. – And a tap room, and
then I’ll go to Madeline. For those who don’t
know what a tap room is, it is.. – A tap room is when you can
actually come up to the brewery and drink. We actually built a bar around
the brewery so you can come in our place and, you
know, sit at the bar, see the brewery
right there beside ya, and drink a beer. You know, often times
I’m up there having a beer with everybody. It’s right there. – You all have one, same thing. – Yeah, we have a tap room. We have a large event space. We’ve literally had
weddings in the brewery, which, you know,
cheap — free PR. I’ll plug it in. But yeah, you can rent an
event space that’s got, you know, huge windows
that look in the brewery. – And you don’t get pushback. You’re kind of competing
with him when you do that. And he’s selling your beer. But is it, again, back to this
thing of it’s a virtuous circle because it’s more
people drinking beer and getting educated. I mean, because Ghost River
is about to build a tap room. Wiseacre has a tap room. They’re talking
about this Coliseum, really big tap room. But those don’t compete or
those don’t hurt your business? – Not really, no. We actually kind of like it
because we can sell everybody’s beer at once. They can only sell their
own beer at Memphis Made. They can only sell their
own beer at High Cotton. So, we have an opportunity
to sell everybody’s beer. So, you know, no
offense to you guys but, you know, sometimes people just
don’t want to drink one Memphis Made and then
another Memphis Made. And so, people
want to try variety. So, we don’t really
see it as competition. – Madeline, about
five minutes left. – Yeah. So, the big news obviously is
Wiseacre is looking to expand a lot and has expressed interest
in renting the Coliseum for a 30-year lease. What I think is interesting
about Wiseacre’s big move is that what’s developed alongside
craft brewing is this buy local, support local kind of movement. And with Wiseacre trying
to bring on more volume, more capacity and sell
outside of Shelby County, you know, unlike you all, does
the shift from a craft brewery to a mass craft brewery, does
that support Memphis’ local breweries or will this
Wiseacre stand on its own? – Absolutely. It’s going to be good
for the brewing community. And first of all, I
mean, the shift from.. I wouldn’t go so far as to say
that they’ve reached that mass craft brewing. I think they’re about 22,000
barrels a year right now, which is still.. You know, that’s a
good size brewery. But it’s, you know,
not top 20 or anything. Now their goal, I
think, is to, you know, change to 100,000
barrels of production a year. And that would put them in the
top 15 in the United States. And I hope they do it. You know, what we’ve seen in
other cities where one brewery really takes off in that way. And Wiseacre has had.. You know, they’ve got a
phenomenal investor group. You know, the Bartosch brothers
are experienced in the industry. They know what they’re doing. A lot of us, you know,
started out as hobbyists. Those guys, and well
Drew is a professional. – It’s you. – The rest of us
sort of as hobbyists. But, you know, those guys
have had a plan from day one to be big. And I think that what we’ve seen
in other cities is when one of the breweries gets big, the
smaller breweries end up being able to sort of
be niche markets. And the big
brewery becomes a draw. The little breweries become sort
of the interesting exhibits in the museum. I think that it can be
really good for everybody. – You said they’re doing 20,000. Give or take, what do
you guys do in a year? – We do about a little
more than a tenth of that. – Just for comparison. – We’re around 3,000. – Okay. Your take on the
proposal at the Coliseum. – I’m all for it. You know, they’ll pretty much
be neighbors of ours along with Hammer & Ale. I think it’ll be great. It’s just more craft beer
drinkers coming to our area, to come to our tap room,
to come to Hammer & Ale. They’re not going to
just go to Wiseacre. They’re not going to
just come to our place. They’re going to
bounce back and forth. So, it’s just going to be
more people coming to that area. And not only to that area but
more people coming to Memphis with that national
recognition of their name. – So, what was initially
proposed for the Coliseum was a 30-year lease. And as an industry
that’s been so explosive, do you think that’s a little bit
far sighted and what indicates to you that beer
is here to stay? – I’m not even going
to comment on that. It’s their business plan
and they’ve done well so far. So, you know, I think they
know what they’re doing. – I mean, there are
questions, you know, about whether.. It seems to be no question
they’re going to invest a ton of money in some
facility somewhere. And they’ve been, you know.. Frank Smith, one of the, I
guess the lead investor, has been real clear that,
look, we need to get in there and get feasibility. It may not be possible. And there are people
who have some doubts whether it’s possible. But I don’t think there’s any
doubt that they’re about to invest a huge amount
of money, which says, to your point, whether
it’s in the Coliseum, which would be kind of iconic
or it’s in some warehouse. It’s a huge investment. It speaks to the kind of
thing you’ve been talking about. Meanwhile, I don’t know
how this impacts you. I’ll turn to you. The multi-nationals,
the big Anheuser-Busch, the Europeans, the
billions of dollars worth of, you know, the big brand
name ones are combining. Does that have any
impact on you all? Does it just make it better
for you because you’re that, as Madeline said, you’re that
much more local when they are that much more international? – Well, so, that combination is
happening mostly outside of the United States, first of all. The Justice Department is making
Miller spin-off its major brands here in the United States. So, it really isn’t going to
have that much impact here at home. But at the end of
the day, I mean, and no offense. You know, the guys that
do that kind of work, the brewers that make that
beer are highly talented, very, very skilled people. But Bud Light, Miller
Light and Coors Light, they’re all, you know,
variations on beige. You know, if you, beige is fine. – We’re going to
end on that note. And the other one,
Crosstown Brewing Company. Are there any others I
should give a shout out to who are coming? There are more on the way we
think but we know Crosstown is good. I’m out of time but thank
you all for being here. Thank you for joining us. Join us again next
week, goodnight. [theme music] (male announcer)
Production funding
for Behind the Headlines is made possible in part by.. The Bartlett Area Chamber of
Commerce and its member A2H – engineers, architects and
planners creating an enhanced quality of life for our
clients and community. To learn more about
A2H’s services and markets, visit A2H.com.

Leave a Reply

Your email address will not be published. Required fields are marked *