Friday, June 22, 2018
Business

Yuengling tries to survive craft beer craze by staying in the middle

When Richard "Dick" Yuengling bought the former Stroh's brewery in Tampa Bay in 1999, no one was talking about blueberry wheat beers or India pale ales.

The then-fast-growing Pennsylvania brewing company, D.G. Yuengling & Son, was ready to expand its footprint and start selling its signature lager in the Southeast. Fast forward to now, and Yuengling is still growing, but feeling the pinch as consumers' palates have changed and more buy craft beers from independent breweries.

Yuengling is the largest brewer in Tampa Bay and the second largest in the state behind the Anheuser-Busch InBev plant in Jacksonville. It produces up to 1.5 million barrels in Tampa every year, about half of all the beer the company produces in a year from all three of its breweries — the two others being in Pennsylvania. Yuengling is the oldest operating brewery in the country and one of the largest American-owned ones.

But times are changing. Big beer companies that sell the traditional line-up of yellow, fizzy domestic drafts at sports games, in bars and in cans at gas stations pretty much worldwide, have seen sales slide as craft breweries grow larger in number and stronger in overall market share.

MillerCoors announced this month that it will close a brewing plant in North Carolina — the first one to ever brew Miller Genuine Draft — partly because of a steady decline in sales. The company has seen a loss of 10 million barrels of beer in seven years, which executives attribute to "economic challenges, an explosion of choice and fragmentation within the beer business, and a dramatic change in the way consumers engage with brands," according to a news release.

Two of the biggest beer companies in the world, Anheuser-Busch InBev and SABMiller, are considering a merger, a mammoth deal that could put antitrust authorities on alert as it has the potential to drive up the price of a pint of beer.

"Big brewers are being hit by a lot of things in the U.S. right now. Millennials are more varied than previous generations, especially when it comes to alcohol. There's a strong desire to support local and independent businesses," said Bart Watson, chief economist with the Brewers Association.

That does present some challenges for Yuengling, but it doesn't affect this mid-sized brewer as much as it would affect the bigger guys, like Budweiser and Coors, Watson said.

"Yuengling has stayed pretty focused on its two core regions — the Southeast and the Northeast — which has enabled them to keep their market share more easily," he said. "They're still growing, though their numbers over the last few years have been slightly mixed. They are affected by this, just at a different level."

It doesn't help Yuengling that the craft beer scene is exploding in Tampa Bay right now. Names like Cigar City Brewing, 3 Daughters Brewing and 7venth Sun Brewing can be found at restaurants, pubs and some gas stations across the state. There are nearly two dozen craft breweries on both sides of the bay.

Last year, craft breweries made up 11 percent of the volume of the beer market and 19.3 percent of consumer sales in the country. Florida breweries, including Yuengling, produced 1.1 million barrels, ranking the Sunshine State fifth in terms of production in the country in 2014.

"Florida has always been below average nationally, but is starting to catch up," Watson said. "It's become one of the fastest-growing states for openings of craft breweries in the country right now. And there's still a lot of room to grow."

So what does that mean for Yuengling? Last year, the brewing company renovated its Tampa Bay brew house and has plans to expand distribution to more Southern states in 2016, said Jennifer Holtzman, spokeswoman for Yuengling. She declined to elaborate on the details.

"We've stayed true to who we are as a company while being mindful of the flavor profiles consumers now demand. Today, even the entry-level drinker has a more developed palette," Holtzman said. "We've expanded our portfolio with some unique brews that are sessionable for the everyday drinker, as well as the craft beer enthusiast."

In November, Yuengling will debut a new India pale lager, a more bitter, hops-based beer than its traditional line-up. The IPL will be offered seasonally in the winter months, and join the line-up of the brand's other seasonal offerings, a summer wheat and Oktoberfest.

This move will help it appeal to more millennials and craft beer fans, said Brian Connors of Connors Davis Hospitality in South Florida.

"Yuengling stands out in a line-up of other domestic beers. It's a trade up from the Miller Lites of the world, but often cheaper in price than a local craft beer, which can get pretty pricey," Connors said. "They're sort of an outlier as a medium-sized producer. They have an intensely loyal following and still can keep pace in this great beer race."

Contact Justine Griffin at [email protected] or (727) 893-8467. Follow @SunBizGriffin.

 
Comments
Tampa Bay workforce development initiative looks to Houston for lessons

Tampa Bay workforce development initiative looks to Houston for lessons

The biggest hospitals in Houston had a problem.To earn a prized institutional certification, they needed more nurses with bachelor of science degrees in nursing.But local colleges were more focused on turning out nurses with two-year degrees who, to ...
Published: 06/22/18
Health care IT company CareSync shuts down, laying off 292

Health care IT company CareSync shuts down, laying off 292

TAMPA — The days ahead were supposed to be bright.For weeks, the future of health care tech company CareSync had been thrown into question as founder and CEO and founder Travis Bond unexpectedly departed, kicking off multiple rounds of layoffs. But t...
Published: 06/22/18
Coal and gas hold onto their share of electricity production, despite massive push for renewables

Coal and gas hold onto their share of electricity production, despite massive push for renewables

Here’s an intriguing set of facts: Coal produces the same percentage of the world’s electricity as 20 years ago. Oil and gas remain about level, too.Same for nonfossil fuel sources. In other words, the massive push towards renewables over the past co...
Published: 06/22/18
Brink: Why have Florida’s working-age men left the labor market in droves

Brink: Why have Florida’s working-age men left the labor market in droves

A cancer lurks within Florida’s otherwise rosy job numbers, one that’s been called a quiet catastrophe and an intractable time bomb.Too many men between the ages of 25 and 54 have stopped working.Economists call those the prime-age years. Incomes gen...
Published: 06/22/18
Pride divided no more: St. Pete Pride comes back together

Pride divided no more: St. Pete Pride comes back together

ST. PETERSBURG — The 16th annual St. Pete Pride Parade is getting ready to march along the downtown waterfront the second straight year. But many hope to move past the division caused last year when the parade was uprooted from its original hom...
Published: 06/22/18
For sale: A Tampa Bay area elementary school where you can eat tacos and buy wine

For sale: A Tampa Bay area elementary school where you can eat tacos and buy wine

ST. PETERSBURG — For sale: a 104-year-old elementary school with restaurant and wine shop. It even has a title company where you can close the deal.Less than a year after completing a major renovation of the historic North Ward school, developer Jona...
Published: 06/22/18
Domain Homes: Buyers love them, some others don’t

Domain Homes: Buyers love them, some others don’t

TAMPA — When the 2008 financial crash brought down the nation’s housing market, hundreds of home builders went out of business. Among them was Sharon McSwain Homes in Atlanta, forced to liquidate in 2009.But just as developers like to develop, builde...
Published: 06/21/18
Updated: 06/22/18
Armature Works developers sue Ulele and city of Tampa over use of nearby building

Armature Works developers sue Ulele and city of Tampa over use of nearby building

TAMPA — Two of the city’s hottest developers — the companies behind Ulele and the Armature Works — are heading to court over control of an old city building that sits between the hit eateries. Both want to redevelop the city&...
Published: 06/21/18
Orlando airport first to scan faces of U.S. citizens on international flights

Orlando airport first to scan faces of U.S. citizens on international flights

Associated PressFlorida’s busiest airport is becoming the first in the nation to require a face scan of passengers on all arriving and departing international flights, including U.S. citizens, according to officials there. The expected announcement T...
Published: 06/21/18
Saboteur or whistleblower? Battle between Elon Musk and former Tesla employee turns ugly, exposing internal rancor

Saboteur or whistleblower? Battle between Elon Musk and former Tesla employee turns ugly, exposing internal rancor

Hours after Tesla had sued its former employee on charges he had stolen company secrets, and days after chief Elon Musk had called him a saboteur, the Silicon Valley automaker made a startling claim. The company had received a call from a friend of t...
Published: 06/21/18