Carl’s Follow-up on 2019’s Predictions
Carl’s Follow-up on 2019’s Predictions
December 26, 2019

2019 was a year that really packed a wallop for international craft beer weirdness. Asahi bought out Budweiser (and ZX) in Australia, Kirin bought New Belgium in America, a boxed wine company bought Ballast Point via a taproom in Chicago that had nineteen Yelp reviews, Carlsberg did a deal with Jing A and than the entire management team of Carlsberg was redirected and reshaped, Lagunitas finally gave 100% of itself over to Heineken and Founders did the same with San Miguel Spain and Widmer Bros finally ended its storied history with a whisper instead of a roar. A lot of things happened that you could see coming and some happened that no one could’ve guessed.

It was no different domestically, and to be honest this has been the strangest year of my career in Chinese craft beer. It has basically been a microcosm of the international macro-craft market on a scale to scale basis. I’m glad it’s almost over. I’m tired. I’ve traveled 139,000 air miles and 100,000 kilometers on the China rail system. I’ve been to the heights of Panzhihua and the plains of Xinjiang, sold more beer than we’ve ever sold, and opened a brewing facility that’s scale and capability as well as team and management system brings a tear to my eye every time I take a second and remember what it took to accomplish. I made some predictions last year, as is tradition. Let’s see how I did? And as always, I’ll make five more predictions that will show you where my mind is with my eyes on the future.

Eins!
I took a big swing in 2018 at the top spot about branding trends and generously gave myself a half-star for effort a year ago in my annual review. But for 2019, the top spot was a bit of a t-ball homerun. What am I gonna say? I treated myself. Chinese craft beer will continue to improve. And guess what? Ding ding ding! It did! Collectively, we won more international awards and attended more international beer fests than ever before, and, most importantly, the quality of China craft beer has increased noticeably. Great Leap alone won several international awards, poured beer in six countries at some of, if not the most, coveted spots at beer festivals in the world. But we were only a small percentage of the representation for China craft in 2019. Every week, someone was somewhere doing something. I personally consumed more domestically produced craft beer made by small independent breweries and happily ordered another round without hesitation in cities as small and large as Urumqi and Chongqing, Shanghai and Xiamen. It’s been a great year for the fanboy in me that still just wants to be surprised and delighted by the quality of people that are just trying to make great beer. One of my favorites was a Pilsner from You Know Brewing in Hunan, Changsha. Changsha! Fucking brilliant. So yeah. Softball prediction, but one I enjoyed making and enjoyed even more seeing come true.

To toot our own horn, I’d like to compare Great Leap to Dream Brewing for a second. Dream Brewing announced an odd thing about a year ago: they purchased Tool Box Brewing in San Diego and the Founder and Brewmaster of Tool Box would now be the Head of Brewing Operations for their China operations. This includes a new brand called, wait for it… Dream Box. That’s about a quadruple entendre. Well, sorry, but that’s horseshit. Tool Box famously imploded and went out of business. Ask anyone from the craft beer scene in San Diego. Hell, ask anyone in Southern California. It wasn’t pretty. The Brewmaster famously tanked the brand and shuttered the business. This has nothing to do with me being a dick. It’s public fucking record. Anyway. Dream Brewing did an entire media campaign around this dude that was basically, “Look at this white dude! Look at him!” In the hopes that no one had ever seen the Wizard of Oz, I guess. Not a great look. And not a great feeling for China craft. But! I said I was going to compare Dream Brewing to Great Leap, so, awaaaaay we go.

The most talented R&D brewer in the world is easily the former head brewer at Warpigs in Copenhagen, Denmark. Foo Lan Xin is a savant of craft beer innovation. I say with full disclosure as she is also one of my closest friends and has been working for Great Leap Brewing since May, running all of our small brewing systems and innovations. She could go and work anywhere in the world. Hill Farmstead, Jester King, Tree House, Fonta Flora. Pick one. She chose Great Leap and she chose China. She chose China because it’s worth choosing. She didn’t fall into a marketing ploy position. She left easily the most sought after gig in Nerd Craftdom and came to Great Leap, because China craft is the future. Believe this.
Fuck it, I deserve a gold star and a half for that shit.

Zwei!
Contract brewing will prove to be a fucking scam. Bingo Bango, contact brewing is a fucking scam. It’s why we built our own brewery. Brands like Slow Boat and No. 18 Brewery have shown their impatience with the inefficiency of contract brewing and refocused their efforts on their own retail expansions, their own production facilities, and quality control. More and more craft brands are realizing this fact and are using contract services less and less. Haidilao continues to diversify their output partners for contracting their in-house line of beers, and other restaurants who thought they would skip over supporting locally made independent craft brands by having the same contract facilities brew their own line of in-house beers have realized that is more of a novelty than anything else. This was also a bit of a soft ball prediction, but from an industry insider position the writing is on the wall. Consumers need brand recognition and they need a story. Contract brewing provides neither. Gold Star.

Drei!
China Resources will make a major move in international or domestic craft beer via an acquisition. This was a bigger swing. The CRE/Heineken deal earlier this year quietly took commercial beer analysts by surprise, but doesn’t count in my prediction. The Carlsberg/Jing-A partnership was something that Jing-A had spent a year promoting (I mean denying), and so making that as my prediction would’ve been lazy as fuck, although it does count as a move in the same DNA as what I predicted. CRE/Heineken will do something inevitably, so I’ll just have to settle on taking a zero on this one. However, I’m also happy it didn’t happen. It’s too early and it just wouldn’t add anything to craft beer development in China. Neither will the Jing-A/Carlsberg deal, but a CRE move this early would be monumentally premature domestically.
Now, the prediction that they would move on a major international brand is kind of true since Heineken took 100% of Lagunitas this year and Beavertown last fall. Nevertheless, I’m still taking a zero here because it wasn’t a CRE generated deal. But hey, maybe sometime soon they’ll prove me right. I’ll be happy to reward myself ex post facto stars later. I’ll even drink a Brewdog Punk IPA to celebrate.

Vier!
Bad money will implode a major Chinese craft beer brand. Well, let’s just say I had a dream that involved a panda fucking a drunk cat that liked to fight using its fists. I made this prediction knowing I couldn’t actually prove it, but it’s happened from the private equity level all the way to major acquisitions. Once great brands that had the momentum or the hype to expand and lead the market took bad deals and instead have languished. This was always hard to watch and pointless to prove. You know who you are. Half a star for not saying shit out loud.

Fünf!
Accurate analysis! This year we saw our requests for media fluff pieces about the China Craft Beer Revolution take a dive. Everyone did, because it’s just not that interesting of a story anymore. What we saw increase to an alarming and annoying level were our requests to “jump on a call to discuss the Chinese market….I’ll compensate you for your time.” Everyone from oddly espionage- esque research houses with PO Boxes in Texas to institutional analysis firms with Manhattan office space reached out to us. This shows a growing level of maturity to how people are looking at analyzing the market. Instead of just making shit up, research houses are at least spending money and trying to find professional experts to fact check their assumptions. We even had a third party “research institute” in China post an “information wanted” request in a bunch of Chinese language industry WeChat groups that specifically offered 800 RMB (Gee Golly!) to any front of the house manager for Jing A, Panda, NBeer, No. 18 Brewery, or Great Leap Brewing that were willing to disclose consumer data, ingredients usage, and revenue numbers. We were going to pull a Good Will Hunting and send one of our C-level directors to fuck with them and give outlandish stats, but they required a valid 2nd generation ID card or passport to verify identity. Bummer. 800 smackers though. That’s a lot of quiche! The more established houses that approached me directly via the professional network cesspool that is LinkedIn offered a higher price tag, but it made me feel like an escort. Or more of an escort than I already am, I should say. We’re getting close to a better analytic State of the Union, but not close enough for a full star.
3.5 stars. Not my best year, but easily my best actual year.

 

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