The craft beer industry officially hit a rough patch in 2018, with many big name craft brewers having to pump the brakes, but Karl Strauss Brewing Co. was not one of them. Karl Strauss actually grew off-premise dollar sales by 12.3 percent in southern California through the first three quarters of 2018.
“Our growth is being driven predominantly by increased sales velocity at retail, meaning our beers sold faster last year than they did in previous years,” said Mark Weslar is the VP of sales and marketing over at Karl Strauss, noting the dollar sales rate of velocity was up 14.4 percent in 2018. “Fortunately, we’ve been growing our overall sales and our retail velocity for several years in a row now, which is no small feat given the number of breweries in our market and the fact that we’re a 30-year-old brewery.”
Flavor experience centers
Karl Strauss has a neat distributed approach to its brewing operations. There are a number Karl Strauss brewpubs located throughout southern California, which are seen more as a connected network of “flavor experience centers.” These satellite breweries enable the brand to release small batches and R&D new beer recipes at an impressive clip.
“In 2018, we will have released more than 170 different beers, many of which get scaled up into commercial release batches out of our main brewery once we’ve proven market demand in our brewpubs,” Weslar said. “We think of our brewpubs as Temples Of Beer where our beer is celebrated, sampled and evangelized by our staff through education, sampling, food pairings, etc.”
We followed up with Weslar once we noticed that this upward demand trendline led to Karl Strauss signing a long-term lease for 20,000 sq ft of additional warehouse space next to its main brewery on Santa Fe Street in Pacific Beach, San Diego. This space includes a 6,200-sq-ft cold box and significant dry goods storage. It is yet another example of maximizing the space it has for brewing and capacity.
“The primary use for the warehouse space will be for increased cold storage,” Weslar said. “Currently our cold storage resides in the main brewery building. The new warehouse space enables us to move cold storage from the brewery to the adjacent warehouse, and it also helps us more than quadruple the size of our cold storage space to account for growing demand.”
The move also frees up precious square footage in the main brewery for a new canning line.
Lastly, Weslar said to expect a shit-ton (our words) of more new beers from Karl Strauss in 2019:
“We have some exciting stuff happening with our Beer Portfolio in 2019, including ramping up our barrel-aged beer and sour releases to include selling them in 500-ml bottles, launching a year round Hazy IPA called Boat Shoes, launching a rotating Hazy IPA program and numerous medium sized batch releases throughout the year.”