June 25, 2019

Words of Wisdom Forged by Experience – Insights from Industry Icon, Jim Koch

If anybody understands the American beer industry, it’s Boston Beer founder Jim Koch. Since launching Samuel Adams in 1984, Jim has witnessed all the shifts in the industry and has experienced the rise of craft firsthand. Boston Beer is the second largest craft brewer in the country – and just happens to be a client of SLG!

Boston Beer trusts SLG’s Keg Pros and solutions to manage the processes for efficient keg returns (Kegspediter) and unsaleable product disposal (EcoBev). Jim gave a talk at Beer Industry Summit 2019, where he spoke candidly about his outlook on the current state of craft, as well as the highs and lows Boston Beer has gone through over the years. It is worth noting that Boston Beer has used those experiences to grow and mature as a brand.

Although craft has grown exponentially in the last few years, Jim feels that a slowdown was inevitable. “If anybody thought that craft beer was going to grow even five  percent a year forever,  [that thought] was delusional. Because even if it did, eventually it would become 100 percent of the gross national product, which would be a great thing, but not likely to happen,” he said. Jim believes that although craft beer will always be crucial, it has gotten to a point where it will probably grow “a couple percent a year.”

Jim also mentioned that because craft has become so hypercompetitive, this is not the industry to go into if the goal is to get rich quick. Even though the craft industry is still growing, the numbers are proving that it’s difficult to stay in business as a craft brewery. There are a total of 7,346 operating breweries – a number that has grown every year since 2009. On the flip side, there has been a steady increase in the number of breweries that fail every year.

Boston Beer wouldn’t have been able to reach its current level of success without going through some hard times. “We have ups and downs, but when you’re struggling to get growth, people aren’t the problem – people are the solution,” Jim said. He shared that when Boston Beer was going through a rough time, rather than laying anyone off (something they’ve never done in 34 years!), they took $30 million worth of waste out of their breweries.

EcoBev is an ideal solution for ensuring that a brewery is not wasting money or warehouse space on out-of-date, damaged, or recalled beverages by providing fast and discreet product removal and destruction. Kegspediter, which returns kegs to the brewery faster, allows a brewer to do more with less. In other words, by shortening the keg cycle time and increasing the annual keg cycles per year, Kegspediter reduces the number of kegs required to keep up with production. This means the brewer spends less money on buying kegs and can instead invest more money in growth.

If you’re interested in hearing more about how any of these solutions can benefit your brewery, contact our Keg Pros today!