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Coop steps up production
In the last year, Coop Ale Works has spent millions buying larger brewery equipment, including a faster, larger canning line.
That equipment will come into use as the company keeps up with demand from Republic National Distributing Company’s customers. Republic has already joined forces with Oklahoma-based Central Liquor.
Coop’s marketing director, Sean Mossman, said the company has been trying to find a new distributing partner for the last year. With the new liquor laws comes a change in the distributor system. The state will switch from four tiers to a franchised-distributor system. Under this system, one distributor is chosen to carry a single brand, then sell to retailers.
As the system exists now, multiple Class-B wholesalers can buy Coop, then sell to a distributor, who sells it to the retailer. At every level, the buyer increases the price to get a return on the purchase.
The new system should create lower prices for the consumer, Mossman said.
“Three-tier is the industry standard around the country,” he said.
He said while Coop had relationships with several beer wholesalers in the state, RNDC offered some benefits, such as being a national company.
“In the end, we got in sync with the local leadership in Oklahoma,” he said. “We really thought they had the best interest in our brand. You want someone to partner with you to grow your brand.”
RNDC Oklahoma’s Executive Vice President Daniel Zeigler said the company thinks local craft beer is the biggest growth engine in the malt beverage industry. The national craft beer players have slowed down on their growth for the last few years, he said.
“Coop has a lot of growth potential, and we feel like is a good business decision,” Zeigler said. “We’ve crossed paths with Coop at the beer festivals through the year. We have a mutual respect with the way they’ve handled themselves and the way they’re growing their business.”
There could be other local craft companies that get picked up by RNDC as well, Zeigler said.
“We’re certainly interested in continuing our partnership with the craft brewers in the state,” he said. “We want to form some long-term partnerships and may have future announcements.”
Part of Coop’s growth, like other craft brewers in the state, will be moving onto shelves at grocery and convenience stores. Coop already had some shelf space with its low-point beers such as Negative Split, Briefcase Brown Ale, and Spare Rib Pale Ale. Mossman said finding the distributor who could get Coop to the more than 4,000 retailers that will get to carry high-point beer was an important factor in the decision.
While RNDC has national in its name, Coop doesn’t plan to take advantage of that network, said Mossman. Coop has a presence in six states and sees itself as a regional brand.
“We want to be in markets where beer drinkers are able to travel to Oklahoma City, experience us here, then take our product back with them,” he said.
That experience can include touring the brewery on S. Council Road. It has giant fermentation tanks and an improved canning system. The new system can fill about 230 cans per minute, a huge improvement over the existing line that fills 30 cans per minute.
“We’ve been planning for this law change for two years,” Mossman said. “We’ve used all that lead time to make those capital expenditures to increase our production capacity. We’re confident we’ll be able to keep up with demand.”