There are nine kinds of beer on tap at the Canyon Creek Chophouse in downtown Toronto. None of them are products of Brick Brewing Co. Ltd. BRB-T
But never mind that. George Croft, chief executive officer of the Waterloo, Ont.-based brewer, is sticking with Diet Coke. By the time our two-hour lunch is over, he will have downed three.
Make no mistake: Mr. Croft is passionate about his craft, but he seldom partakes during the day. “I think there is that sort of notion that, you know, folks in the booze business are busy drinking at lunchtime and they go back to work half-gunned,” he says. “Those days are so far gone.”
Heading into the crucial summer season, beer executives like Mr. Croft need to remain clear-headed. Several factors have sparked concerns that price hikes may be in the offing this year, something unlikely to go unnoticed by a nation of beer lovers. Stubbornly high energy prices are hitting brewers’ distribution and freight costs. Households are feeling pain at the pump, so indulgences like beer are falling in priority. And cold and wet weather from February to the end of April caused the industry’s overall beer sales volume to sink by 7.6 per cent during that period, compared with the same period last year. When the weather is bad, people are less likely to drink beer.
So far, Brick has done more than stay afloat. Sales of its beer brands rose by 12.4 per cent during its fiscal first quarter, which ended on May 1. The company is benefiting from a budding renaissance of craft beers – those that are made with an emphasis on local roots and distinctive taste rather than mass appeal – and its Waterloo Dark, Red Baron and Laker brands are selling well.
Still, Mr. Croft remains mindful of those larger industry trends.
“We aggressively manage our costs. Certainly the last resort for us is to ever take a price increase,” he says.
Mr. Croft joined Ontario’s first craft brewery in May of 2008, in the midst of a dark chapter in Brick’s history. The company was in violation of loan conditions set by its lenders, inefficiencies were rampant throughout its operations and its core business was in decline. “You kind of had that triple threat, where all the indicators were pointing in the wrong direction,” Mr. Croft says of those early days.
But now, after directing a shakeup of its senior management team, steering the settlement of a number of high-profile lawsuits – including one involving founder Jim Brickman, whom the company alleged had misused expense accounts – and hammering out the company’s new strategic plan, Mr. Croft has no intention of looking back.
Instead of trying to save on costs by closing facilities, Brick is focusing on boosting revenue by filling up its excess capacity, which totals an extra 2½ million cases. The company has begun selling select beer brands in new markets including British Columbia, Atlantic Canada and Ohio. And as always, the scrappy company is waging a constant “David and Goliath” war with Molson Coors and Labatt.
Mr. Croft also knows what it’s like to be on the Goliath side. During his university years, he worked for Labatt as a summer rep, organizing special events including slow-pitch baseball tournaments and rodeos. During the school year, he served as a campus rep for the company, boosting Labatt’s profile among faculties and fraternities. Before he even finished his degree, he was steeped in the corporate world of brewing. After graduation, he joined Labatt full time and worked in a variety of roles from 1984 until he left the company in 2005.
But now with Brick, he faces different challenges in boosting the brand. Perhaps the most ambitious element of Brick’s new growth strategy revolves around coolers. Specifically, getting men to drink them.
Brick’s most transformative move was acquiring the Canadian rights to the Seagram Coolers brand from Corby Distilleries Ltd. in a transaction worth $7.3-million earlier this year. Now that it owns those rights, making coolers “cool” for males will require a product makeover. Among the changes, the company is considering introducing two new can formats for coolers, including six-packs and single-serve cans. Those would complement the existing four-pack bottles that are more popular with women.
