September 11-15, 2017

Fruitful Relationships

(l to r) Windy City’s Wesley Phillips, Artisanal Imports’ Lanny Hoff and Louis Glunz Beer’s Eric Korbus give cider makers distribution advice.

It’s something that every savvy, experienced brand owner, regardless of category understands: You could have the best product in the world, with the finest ingredients and a folksy, engaging story behind it, but it’s nothing without the right distribution.

As cider producers enjoy their category’s explosive growth—market research company Technomic had the category up 45.8 percent in 2013—and more and more players get into the apple game, they, like craft brewers before them, are trying to navigate the complexities of the distribution landscape. And at last month’s CiderCon 2014—the industry conference staged in Chicago by the fledgling United States Association of Cider Makers—a few distributors with a significant presence in the category offered their perspective on the state of cider distribution to the audience of producers and marketers.

One of the greatest obstacles to further expanding the segment has been consumer perception. “People didn’t really understand [cider] at all,” noted panelist Lanny Hoff, VP of marketing and brand development at Austin, Texas-based Artisanal Imports. “But now they understand that it is made from apples, which is progress.”

Shrinking that perception gap, Hoff added, takes strong branding and equally strong sales in the marketplaces. Brand building is a two-way street between the cider brand’s owner and the distributor. Both parties must understand the other’s role in that partnership. “Don’t have false expectations on us and we shouldn’t have false expectations on you,” offered Eric Korbus, craft brand manager for Lincolnwood, Ill.-based Louis Glunz Beer.

A big part of managing each other’s expectations involves being on the same page about a brand’s identity. “We want to understand what your identity is and help you execute that,” noted Wesley Phillips, director of business development at Windy City Distributing in Chicago. “What is it you want to accomplish? Everything needs to fit in with what you want to do.

Are you a boutique, artisanal cider and what’s the right packaging for you?” However, he added, the brand owner needs to figure that out before seeking out a wholesaler. “Looking for distribution before that happens is probably putting the cart before the horse,” Phillips said.

But it’s never too early to devise a distribution plan, advised Hoff. “I encourage the small producers to think about distribution before they think they need to,” Hoff said. “Pick markets based on not only where you think the business is going; pick markets where you like to go—mix business with pleasure. The time to start working on distribution is now.”

Occasionally the partnership doesn’t work and one party wants out. Unfortunately, it’s not always so simple to dissolve the relationship, especially in states with strong franchise laws. Hoff warned that the cidery needs to be aware of the individual states’ laws before signing on with prospective distributors in those territories—especially since franchise laws typically favor the wholesaler. “The responsibility of understanding states’ franchise laws is on you,” Hoff told the cider makers. “That’s part of your due diligence.”

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