When I started Tombstone Brewing Company, I can’t say that I ever thought I’d be thinking about this quote from Edward Abbey’s Journey Home in the context of the endeavor:
“Growth for the sake of growth is the ideology of the cancer cell.”
I find myself thinking a lot about it now.
We had a rough August, and September doesn’t appear on track to treat us any easier. Honestly, the rest of the year is probably going to pretty thoroughly beat us up. Thankfully, our problems all stem from the incredible blessing that there is more demand for our beer than the brewery can meet right now. Hence my preoccupation with growth, especially after a weekend that simultaneously drove home how lucky we are and how terribly insufficient a quantity of beer we’re able to produce.
It’s been less than a year since we sold our first beer. At that point, I was staying up at night worrying about whether I’d gone overboard going with a 15bbl system. It seemed monstrous. The idea that a single batch would be hundreds and hundreds of gallons of beers was nerve-racking.
Making matters worse was the fact my plan was to brew styles that were largely unproven in the Arizona market from the top down, starting with the closest thing we have to a flagship, our hazy New England-style IPA. It seems silly now, but a year ago, Arizona breweries had at most made just a small handful of one-off beers of the style. There I was in a tourist town in the middle of nowhere, a place where the prevailing beer preference is for the lightest, clearest thing available, going all in on what basically amounted to building a brewery around IPAs that taste like fruit juice and look more like Hefeweizens than any IPAs most of our customers would have ever seen.
It all worked out due in large part to the simple fact that juicy, extremely drinkable IPAs with intense citrusy and tropical aroma and flavor but relatively low bitterness are delicious. Weedy knows what he’s doing; that’s an understatement, honestly. We didn’t half-ass the equipment, so we could trust the process. We cut no corners with ingredients, so we could trust the product. It’s hard to say this without coming off as arrogant, but execution wasn’t a huge concern. The only question then was whether the concept would work. Luckily, it did.
That wasn’t just the way it worked with the IPA. Doing a dry-hopped sour early on was risky, as the vast majority of our customers had never had a sour beer. Like with the IPA, however, it’s a set of characteristic that are likely to appeal to most people, hardcore beer enthusiast or not. Most people just aren’t familiar with them in the context of beer. A light tartness beautifully complimented a grainy wheat backbone, and Simcoe hops added a nice extra layer of funky, fruity flavors. The first sour wheat we made tasted more like orange juice than any beer I’d ever had. Who doesn’t like orange juice? It converted a lot of tourists into sour-drinkers.
I could go on about how it was the same with our Norwegian Farmhouse IPA (of course people are going to like a crisp, dry, effervescent showcase of candied-orange hops with limey esters and complex earthy notes), our Strong Scotch Ale Aged in Islay Scotch Casks (for an Islay whisky drinker, nothing is better than a rich, thick, raisiny Wee Heavy with an over-the-top peaty, smoky, sea air barrel character), and any number of the more unique beers we’ve made. I’m just mentioning these to make a point, though.
There’s an unbelievably diverse world of beer styles out there already, and I doubt we’ve even started to see the outer reaches of brewers’ creativity. There are delicious flavor combinations that have been around for centuries but that, despite being damn delicious, still probably sound weird to most beer drinkers. There are cutting edge ingredients and techniques that might end up defining the new classics. We want to embrace the immense variety of exists while doing our own exploration. We want to do it thoughtfully and with an uncompromising attitude toward technique and ingredients. This should be an adventure. It should be fun. It should be a creative endeavor at its heart. The trick, however, has been balancing that clear mission with the reality of the market.
I just now looked over wholesale orders for our last 90 days of releases and tried to calculate just what sort of expansion we would have to undergo if we were to sell every account ever case or keg they requested. Basically, we’d need about 165bbl of additional fermentation capacity that we can turn around every fifteen days or so in order to not short accounts. We’d need 90bbl to devote just to IPAs, 75bbl just for DIPAs, and about 45bbl just for pale ales and session IPAs. We only have a meager 45bbl of total fermentor capacity right now. I’d be lying if I denied the popularity of those particular beers of ours was pretty thrilling, but with expansion would come new problems.
We wouldn’t have room to make anything else. We’d be a one-trick pony, basically. We wouldn’t be able to do all the exciting barrel projects we have planned. We wouldn’t be able to produce the amber and the lagers that dominate our tap room sales or the sours and other styles that aren’t available anywhere else in our neck of the woods. We wouldn’t be introducing people to exciting new things. We’d be brewing stuff with the same basic blueprint dozens of times a month with only minor variation. It’d be hard to get excited about our twelfth IPA batch of the month, even if the hop bill did vary a little. This should be fun, and it almost certainly wouldn’t be at that volume.
Also, doing that sort of volume and with such a limited range of beers is in large part fundamentally inconsistent with our goals. My business plan puts us pretty much exactly where we are; I just thought it would take us a little longer to get here in some ways (demand) and a lot quicker in others (canning line). Over time, we’ll put more beer in barrels, including for fermentation, and a lot more of the product will be packaged in cans from now on, but we plan to avoid exceeding the 3,000-barrel-a-year self-distribution threshold unless we have absolutely no choice. It’s important to me that the tap room features eight very different beers on tap at all times, which wouldn’t be possible without even more fermentors or some sort of pilot system.
Perhaps most importantly, the numbers in my business plan work out. The business will thrive if we just stick with it, while expansion would put us in uncharted territory. Unlike a year ago, when sleepless nights were the norm, I know at this point that the market can sustain the business at its current level. Sure, there are bumps, especially when issues come up as we learn the ropes for things like canning or our barrel program, but statewide demand could plummet and we’d still have plenty of cushion. That’s comforting. The excitement of making Tombstone Brewing into something bigger than I’d envisioned is alluring, but it comes with huge risks. We don’t even have twelve months of data. It seems silly to be thinking about massive growth when we’ve yet to know how our beers sell in a whole September yet.
I visit a lot of other breweries, and in the last six months, I haven’t been to a single one that didn’t make a New England IPA of sorts. We’re one of many at this point, and there’s a strange arms race happening. Our hoppy beers are hazy as as a side effect of the techniques and recipes we’re using to produce the mouthfeel and other characteristics we’re after. Haze is the obvious thing to latch onto, though, so people are running with it. Our IPA almost looks clear by comparison at this point.
At one of the recent blind tastings we did to see how we stack up against our competition, every taster thought the Heady Topper and Sip of Sunshine control beers had been entered in error; they weren’t hazy enough to be the style they basically invented. Everyone thought they were thin and not very intense. The field is filled with beers that are almost exaggerated caricatures of the style, and the market may decide that’s what people prefer. If interest in more elegant, refined examples wanes as only the most rustic, aggressive examples boom, or if the bottom of the hazy IPA market falls out completely, I’m not worried about selling enough of our beer at current production levels. It’s a different story if we go big.
Finally, I’ve noticed an interesting anomaly when it comes to beer drinkers. Craft beer newbies typically come to our tap room and try a flight. They find out they love Gose or barrel-aged beers or hazy IPAs. They almost always get a pint of something. It’s a social thing for them and their friends and for us too, as we get to interact with them. We’re sharing a new world with them, and it’s exciting.
On the other hand, a fair number of the people we’d be brewing most of that hazy hoppy stuff for have already made up their minds. They rarely stay on site for long if they ever come at all. They almost never consider sticking around for a pint of Pils. Before opening the brewery, I never would’ve expected the average Bud/Miller/Coors drinker to be the adventurous palate up for trying new things while the people who seem like hardcore beer geeks often refuse to touch it if it isn’t a hazy IPA, a pastry stout, or a mixed fermentation sour. But that’s the way it seems to be. We love those customers too, but we’d miss out on a lot of our most rewarding interactions if we changed our model to serve what surprisingly seemed to be the pickier crowd.
Along with seemingly irrelevant quotes about growth, those are the things that have been on my mind as I ponder how to deal with our current demand-exceeding-supply problem after finishing up invoices for the two hundred cases of our beer being delivered tomorrow, hundreds of cases less than what our accounts requested. Because the massive (and expensive) growth it would take to satisfy demand isn’t in the cards right now, the question becomes how to deal with accounts given the imperfect current situation, which is going to last for quite some time into the foreseeable future. I keep ending up with the same four general approaches to choose from.
The first approach is a purely chronological one. I’d just go down the list of accounts in the order in which they first got beer from us. I’d make sure our first account got everything they wanted. Then, I’d go to the next one and do the same with each account until every keg is sold. It’s an appealing approach because it rewards loyalty and longevity, and any approach that ignores the contribution to our growth from people who took a chance on an unknown product when we were just starting up doesn’t make me comfortable.
There’d be some interesting issues if that was how I did it, though. Every account wants IPA, but some won’t touch pale ales or double IPAs. Some accounts just want lagers, others just high ABV stuff. We’d end up with accounts featuring only portions of our lineup, and it would be almost entirely random. We’d basically have a couple of places that have all the hoppy stuff you could ever want, others that would be an extension of our tap room with limited hoppy stuff, and a bunch of other places that have random other beers from us. There’d be no accounts where someone could get the sort of variety, and as a result the sort of experience, that I’d hoped to give people when I decided to start a brewery. You’d have to come to Tombstone if you wanted a journey through the full scope of what we can do.
The second approach is a volume one. This one the most profitable one for us by far, and it’s arguably going to satisfy the largest number of people who drink our beer. Basically, I’d look at each order based on size and do the same thing as the first approach, substituting order size for longevity of account. It’s cheaper and easier to deliver a lot of beer to a few accounts than it is to deliver a few beers to a lot of accounts, so the delivery and logistical costs would plummet. Plus, we’d get the beer to each account faster, which means it’ll be fresher and colder. Everyone who benefits from the approach really benefits, but some don’t benefit at all.
The biggest problem with number two is that some of our oldest accounts, ones we really cherish, wouldn’t make the cut. We’d be shorting or eliminating from our accounts list some of the nicest, smartest, most knowledgeable people to ever sell an alcoholic beverage in the state. Also, how do we quantify things like accounts who send barrel society members to us or who encourage people to come down to visit the brewery, which is in many ways more beneficial to us than all the wholesale volume in the world?
Another big problem is that some of the highest volume accounts are picky, so a variety of issues (plus the others discussed immediately above) would again become a major issue. Without a doubt, there’d be some places that will always have whatever we have at the brewery that’s hoppy. Anything that’s seen a barrel will always have a home. But what about the beers we’re brewing because we’re crusaders for the whole world of beer rather than a limited subset?
The third approach would value variety above all else. The number of different beers instead of total volume of beer ordered would govern the methodology. Account preference would be based number of different beers per order. There’d be something cool about a number of places across the state being able to offer a diverse selection of our beers. However, it isn’t clear that we’d actually be able to sell all of our product doing it that way. It would require accounts to let us occupy a lot of their taps to the detriment of other great breweries, and I haven’t felt out how many accounts would be willing to do that. It would be an awkward conversation asking, and I’d feel pretty presumptuous assuming they’d even consider it.
It might also rub a lot of people in the beer community the wrong way. People complain all the time about breweries with core lineups that don’t excite the more hardcore enthusiasts when those same breweries allocate the stuff that does excite them to those accounts that move the most of their core lineup. It seems to stem from a belief that breweries are intentionally not making what customers want. In reality, the market for Parabola is never going to be anywhere close to the market for DBA. The beers people talk about online and at bottle shares aren’t the beers that the vast majority of drinkers care about. They wouldn’t keep the lights on for most breweries.
The problem is that our core stuff is in large part the stuff that appeals to the hardcore folks in the community. Our model revolves around juicy IPAs, barrel-aging, and mixed-fermentation. We just happen to love things like traditional German lagers and other classic styles too. Basically, if we pressured accounts to carry those beers of ours that for most breweries would be their moneymakers, we would actually be doing the exact thing many people in the community get unfairly angry at other breweries for doing. We’d be pushing less desirable products on accounts using more desirable ones as incentive. I’m not sure how I feel about that.
The fourth and final approach is to keep doing what we’ve been doing. It’s a time-consuming, draining process that guarantees everyone is pissed off a little, but it’s probably the most fair to everyone except us. We try to anticipate what people want, asking for orders with the understanding some beers are very limited if possible, and we do our best to guess yield. Then, when we get all the beer packaged, we we think long and hard about every account, balancing numerous factors and setting limits or cutting out people accordingly. We consider longevity, volume, and variety, but also consider fairness-based factors like whether we shorted or left them off them last time in addition to numerous other miscellaneous factors like how they present our beer or how they are to work with. It’s an agonizing process, honestly. I’d love to make everyone happy, but I know that’s impossible. Preparing orders is trying to make the best of a bad situation, working really hard and thoughtfully, all the while knowing lots of pissed off people are a guarantee. Even worse, you know you’ll also be letting down people who are too awesome to ever complain.
We’re lucky. Insanely lucky. And right now, all I know for sure is that growing to grow is most certainly not Tombstone Brewing Company’s ideology no matter how tempting it might be. Responsibly trying our best to satisfy demand without doing anything drastic, and doing everything with an eye on sustainability, is the goal. Deciding how we manage accounts within that framework is the quandary.
There are, of course, countless other approaches worth considering in addition to the ones discussed above, but those are the real contenders. It is still almost entirely up in the air how we decide to proceed, and in a perfect world, this blog post might elicit some helpful input from both accounts and customers. We want to do this right, and we’re all ears if anyone has a great idea about how we do that.