One of the hottest trends in the craft beer industry are cans – a package that many brewers are turning to as a way to open new markets, decrease freight costs and remain environmentally conscious.
But brewers without the space or the funding needed to install a canning line are left packaging their product in the more common glass bottles.
And while most brewers will agree that functionally, glass is still a perfectly good method of delivery, Kansas City based Boulevard Brewing noticed it was losing sales in places glass bottles couldn’t go.
“We needed to put in a package that would meet consumer demand in certain types of accounts that wouldn’t accept glass,” said Bob Sullivan, VP of Sales and Marketing for the company. “Someone that drank our beer everyday but played golf couldn’t enjoy our beer on the course.”
Enter the 16 ounce aluminum bottle, a package that Boulevard introduced for their Wheat offering in late 2009. Currently, they are the only U.S. craft brewery to use the package. Compared that to the 135 breweries that are currently embracing the can*, and you can guess what Boulevard’s next step might be.
“That package got us a bunch of new distribution in places we needed to have access,” Sullivan said. “National parks, golf courses, marinas — all of these places prohibit glass and because we didn’t have access to a canning unit, we were losing sales. We needed something that would work with our existing bottling line.”
But even Sullivan will tell you that the aluminum bottle is a temporary fix to a permanent problem.
“It is an expensive package,” he said. “It costs four or five times more than our normal glass bottles and we have to take less margins on the aluminum bottle in order to open new distribution channels.”
Boulevard is now considering making the investment in a canning line, which would allow the company to stay in the new markets they opened with the aluminum bottle while decreasing their cost of goods.
“I see so many other breweries going that route and I have to believe that the craft segment has gotten to a point where there is enough demand for cans,” said Sullivan. “From an economic standpoint, we would be much more competitive in cans than we could be in the aluminum bottle.”
Although a move into cans is still at least a year away, Sullivan said a decision could be made as soon as November.
“I think the sentiment around here is that, eventually, we need to do it,” he said. “If cans are going to get placement in Missouri, we want it to be our cans and not another brewery. If we can do it financially and find the space, we could be in cans by next summer.”
Boulevard recently converted their aluminum bottles into 6×4-pack units, which were previously distributed as 24 single-serve bottles. A 4-pack of Unfiltered Wheat in aluminum bottles retails for $7.99, the same as their 6-pack of glass bottles. As a company, Boulevard is up 7 percent YTD with retail sales forecasted to be up over 8 percent by the end of 2011.
*According to the most recent count from craftcans.com