In the world of XY charts, there are companies with steady linear trajectories, the oft-coveted hockey stick growth curves and then there’s whatever geometric shape Revolution Brewing is creating.
Since diving head first into full-scale production in 2012, the Chicago-based beer company has brewed up a revolution in the Windy City – growing sales to just over 50,000 barrels in 2014. 2015 forecasts place sales from its production brewery and its brewpub somewhere north of 70,000 barrels, a figure that Donn Bichsel, Revolution’s director of sales and marketing, estimates will double by 2017.
So this summer, in an effort to keep up with increasing demand and a desire to expand into new markets, the company will embark on a multi-million dollar expansion, install a new 120-barrel brewhouse – twice the size of its current system — and four 800-barrel fermentation tanks. And depending upon how firmly the company wants to press on the gas pedal, capacity could accelerate to 225,000 barrels as quickly as Ziemann, their fermentation tank supplier, can weld together pieces of stainless steel.
But even Revolution isn’t impervious to the threat of an uprising, one that will include about 50 craft breweries in the Chicagoland area before the end of 2015.
So what’s the company’s strategy for accelerating growth at a time when so many craft breweries are competiting for valuable tap and shelf space?
The chains.
“We really embraced the chains early, knowing that we are a chain driven market and knowing that we wanted to make our beer available to as many people as possible,” Bichsel told Brewbound during a recent phone conversation. “We could have done this without getting involved in the chains. We just have to make sure they are taking care of our brands the right way and selling them at the right prices.”
Propelling Revolution’s growth in the chains is its flagship IPA, Anti-Hero, which accounts for nearly 60 percent of company-wide sales.
“It’s our horse,” Bichsel said during a conversation at last month’s Brew Talks meetup, held on April 28 at the Revolution Brewery in Chicago.
“We try to temper it down, but we like to let it run,” he added.
Bichsel believes the brewery’s recently introduced Fist City “Chicago Pale Ale,” brewed with all “C-hops,” could one day be the lead brand.
Despite the optimism, there was a very practical reason for behind Revolution’s introduction of a fifth year-round product in cans, Bichsel said.
“Some chains are deeply committed to craft and deeply committed to giving us a full shelf in the cooler,” he said. “That is one of the reasons why Fist City was created — to be able to have a fifth brand that can fill out a shelf.”
But while that strategy plays well in Chicago, it’s tougher for Bichsel and Revolution to command cooler space as it moves farther away from home.
“In home markets, chain buyers have become quick to adapt and know that their local brands will be their horses,” he said, noting that Revolution is probably “over-indexed” in Chicago.
“As we move farther afield, and start to move further into Ohio, that is where the pushback becomes more evident. It is give me your number one and give me your number two. If number one performs well, we will give you your second placement. If that performs well, we will give you your third,” he added.
In our latest video from Brew Talks Chicago (above), Bichsel provides an update on Revolution’s progress through the midway point of the year, offers his takeaways from the 2015 Craft Brewers Conference, and shares his vision of craft category development over the next 12 – 18 months.
Join us in Kansas City for our next Brew Talks meetup on May 18.