Molson Coors announced today that it is phasing out its interests in both ready-to-drink coffee and CBD beverages, with emerging growth leader Pete Marino acknowledging that “not every project or innovation will meet our ambitions.”
In an email to distributors today, as reported in Molson Coors’ Beer & Beyond newsletter, Marino announced that the beer giant had reached a mutual agreement to end its partnership with coffee roaster La Colombe effective March 31, 2023, just over two years since the two companies kicked off an exclusive 10-year pact for distribution of its canned Draft Latte line in 2021.
Philadelphia-based La Colombe will now seek to merge operations of its RTD business with its other bagged coffee and cold brew multi-serve segments, according to the report. Addressing distributors, Marino acknowledged that La Colombe’s move to consolidate distribution of various products “creates significant logistical challenges for our distributor partners while still requiring similar levels of investment on their part.”
“Over the past few years, we have opened new lines of revenue for all our businesses as we leverage the competitive strengths of Molson Coors and expand beyond the beer aisle,” said Marino. “We’ve had some hits and some misses, but we’ve learned a ton and we have positioned ourselves for a bright future. One of the lessons we’ve learned is to quickly identify when something just isn’t going to work for us, or for you.”
The report noted that La Colombe “would welcome the chance to stay involved with Molson Coors for certain classes of trade,” but the coffee company recognizes “why that doesn’t make sense for them or many of their wholesalers.”
At the same time, Marino also announced that Truss, the joint venture between Molson Coors and Quebec-based cannabis producer Hexo Corp. to develop CBD drinks, is being dissolving at the end of this year, citing challenges to scaling in the current regulatory environment in which CBD remains illegal as a food or beverage ingredient under federal law.
In 2020, Molson and Hexo launched Truss to produce non-alcoholic, CBD-infused beverages at a production base in Fort Collins, Colorado. Its first release, a three-SKU line of sparkling waters featuring 20mg CBD per 12 oz can, was released that same year in Colorado, and then expanded to 16 additional states in 2021.
The beverage conglomerate is hoping that less baggage will allow it to redirect resources to its non-beer options, including energy drink ZOA and the forthcoming Topo Chico Spirited, via a licensing partnership with The Coca-Cola Company.
“Not every project or innovation will meet our ambitions. What’s important is that we learn from each and build capabilities that will serve us well into the future,” Marino said. “The key for us is to go big behind what’s working and smartly pivot out of what isn’t working from a scale standpoint, like CBD beverages.”