Goldrush time for craft brews
So Moa Brewing in Blenheim is going public. It has announced plans to sell a little over a third of the business in a public stock offering in order to raise money for a massive, rapid expansion.
On one hand, it barely qualifies as news. Since Geoff Ross bought a majority share of the company in 2010 it has been following the 42 Below plan to the letter. Now it has reached page 142, where the company goes public.
On the other hand, it does bear a moment's contemplation. Moa hopes to use this expansion to more than triple production in less than a year. That is gutsy in any business, and again typical of the Ross model. But the interesting bit is that this isn't happening in isolation. We are seeing production expanding all over the New Zealand beer market.
Also last week, Tuatara Brewing, near Wellington, opened the doors on its supersized new brewery. It has overbuilt production capacity in anticipation of continuing triple-digit sales growth.
This allowed Tuatara to take advantage of the financial stumble at West Coast Brewing to capture the Dale's Brewing contract. Dale's first new batch of American Amber rolled off the bottling line last week, just in time to add a few pallets to a shipment of New Zealand first craft beer directly into South Australia.
It was the first overseas shipment for the relatively new Nelson brewer and he was thrilled to be in the company of Brew Moon, Renaissance, Liberty and Garage Project with this new distribution channel.
In addition to Dale's, Nelson was experiencing widespread expansion. We have already mentioned that Sprig & Fern were adding locations locally, and they have had recent plant expansions to prepare for that growth.
Townsend Brewing has upgraded its bottling line to accommodate its expanding range, and Golden Bear recently bought its first bottling line to start satisfying demand for a packaged range.
Then there is the Mussel Inn. It was no longer happy to quietly sell its Golden Bay-made beer in kegs and riggers, and let Invercargill produce the packaged product. It has also put a bottling line into its plant. Owner Andrew Dixon points out that this allows him to bottle and distribute a wider range of his beers.
In August, at Beervana, we kept hearing the question, "Is this a bubble about to burst?". Once you get Moa offering Joe Public a chance to "own a brewery", the risk is there. But having seen such a bubble burst in the United States in the 1990s, we aren't too worried for New Zealand yet. We can joke about being five to 10 years behind in our trends here but, in this case, that's a very good thing.
We are selling into an international market very savvy about craft beer, with mad passion for anything new, and anything New Zealand.
In the right distributor's hands, as long as the quality remains high, our breweries won't face saturation for a good while yet.