O’Connor Invades Raleigh/Durham Market

(MOVE-IN DAY: O’Connor’s Raleigh Car)

By Jeff Maisey

We at Veer Magazine have enjoyed covering O’Connor Brewing Company’s many stages of growth since its humble beginnings in 2010 producing Green Can, Norfolk Canyon and Red Nun from a small warehouse to its position today as one of the most successful craft breweries in Virginia.

And now, in November, O’Connor Brewing has positioned itself to take a bite out of the crowded craft beer market in neighboring North Carolina with a new distribution deal R.A. Jeffreys Distributing Company and Harris Beverages.

R.A. Jeffreys is the oldest family-owned beer distributor in North Carolina and continues to grow by adding new product lines. It distributes products by Anheuser-Busch/InBev, Corona Brands and other suppliers across 36 counties in North Carolina.

O’Connor will enter the key North Carolina market with its core flagship beers led by El Guapo Agave IPA and Great Dismal Black IPA. El Guapo won a silver medal in the 2017 Tastings World Beer Championship, and a bronze medal in the 2016 Commonwealth Craft Beer Cup. Great Dismal Black IPA earned a gold medal in the 2017 Tastings World Beer Championship and a bronze in the 2014 Dublin Craft Beer Cup.

To get an update on the brewery’s new business move I spoke with founding owner Kevin O’Connor. Here’s our conversation.

 

Let’s start with your expansion into the Raleigh/Durham Research Triangle region of North Carolina. How long have you looked at that market and why did you decide to move on it now?

 

We’ve always had our sights set on Raleigh/Durham. We’re already on the Outer Banks. We’ve been down there a few years. The next logical step was to move west towards another metropolitan area.

We’ve been talking with them (distributors) for six months trying to work some logistics out – what’s we’re going to do, how we’re going to do it, and goals. It’s come to fruition, obviously, now. One of the key components was getting authorized in the grocery stores. That made the decision a lot easier for us.

We’re hoping for the best. You’ve seen some of the infrastructure work we’ve done here (at the brewery) with more tanks. I think we have a hot hand right now. El Guapo is doing very, very well for us. It was one of those things where we thought let’s keep striking while the iron is hot.

Raleigh was the best obvious step for us.

 

As you know the North Carolina craft beer market is rather crowded. Did you feel El Guapo and Great Dismal would have the greatest impact? Any other O’Connor flagships?

 

Yeah, we’re taking those and the Weekend Lager as well. Since we are new down there we’re very cognoscente of the headwinds we’re going to get with “local,” so we’ve been realistic with our goals. It’s more so about what we can go in and offer to the market that we think the craft beer drinkers will drink, and I think El Guapo and Great Dismal are it.

Then we’re noticing some of the bigger brands down there are kolschs and lagers. That’s why we looked at lager.

To offer something different is also a seasonal program – getting things like Heavy Footer down there. I think it is going to keep us new and relevant for the first year.  Then we can speckle the market with some new beers we’re doing R&D on right now.

 

What sort of resources in terms of promotional/sales reps are you dedicating to that market?

 

We’ve hired a rep down there. He comes from the beer-buying side and has some really good connections in the distribution networks down there. I think he’s going to add a lot of value to us. In this day and age, especially in opening up farther away markets, you definitely need feet on the street. He’s done a great job so far lining up events and getting some taps started.

So having monthly and quarterly goals for him I think will direct where he’s going to go. And then the communication with our wholesale partners down there will help us track where we’re headed.

We put some digital marketing out. We’ve networked with other periodicals like All About Beer.

So, making new relationships and trying to stay in vogue down there is key.

 

Do you see O’Connor expanding its brand to other states in the Mid-Atlantic region and beyond?

 

We’ve been in talks with Maryland for the past four months. That might be our next step. We’re already in Washington, DC. We’re developing good relationships with wholesale partners.

The one question I always ask myself and our marketing/sales team is “How do we come into a market where we’re never going to be local and take some of that proverbial buzz away from big nationals or position ourselves as solid craft?”

Luckily, Virginia is right down the street from Maryland. Networking with the right people is key, like the beer bloggers and the local beer writers, which we’ve already reached out to. Get them drinking the beer and hopefully liking it.

At the end of the day, Maryland is a different beast. The grocery stores up there don’t sell beer. It’s a big independent bottle shop, liquor store market up there. It’s also a big draft market. So, we would look to see where we’re going to divide our time on-premise verses off-premise.

 

You mentioned the new fermenting tanks and grain storage vessels on the outside of the brewery. How do you plan to keep up with demand with your current production and dry storage as you add more markets outside of Virginia?

 

The one thing I never thought I’d run out of in this building – at least not yet – is space. Putting the grain silo in was an efficiency improvement. It’s also a cost savings for us to get the grain delivered bulk. It also gave some warehouse space back to us. With the big orange silo, it looks like a brewery now instead of just a warehouse.

When we put the new (fermenting) tanks in we ahead and built the infrastructure out to be able to bring more tanks in when we need them. I think we’re outfitted pretty well now for the next two to three years.

One of the things we’re looking at is possibly leasing another building in the area to alleviate that warehouse space crunch. We looking at every little aspect. We don’t like to over-spend if we don’t have to.

The one other new thing we’ve got is our 7-barrel pilot system. We’ve obviously become more of a factory as it pertains to beer, but this is really going to help cultivate innovation and creativity. I think it’s going to be fun for us. I think it’s going to be great for the guys to come up with some new, innovative ideas. It’s going to give us time to really look at something. The way the craft market is going right now…a lot of my friends who are smaller really have that flexibility to make new and innovative beers. Making 90 barrels or more of a beer gives you no room for error. This will allow us to tweak new ideas and give us enough time to bring it to market with marketing and label design.

This whole business is built on creativity and innovation, and having the tools to do it is something I believe in and the brewing staff is happy about that.

 

In this current Renaissance of beer, you are now one of the elders. Have you had to time reflect upon where you’ve come from and where you’re headed in just a few years, especially given the about of change that has occurred in the industry and with so much competition?

 

Well, really, I’m at an inflection point. Like, where do we go from here? How do we keep evolving? I’m excited about the craft beer industry like I was eight years ago when I first started.

Did I have a crystal ball and say this going to be so different in eight years? Or, hell, even the last two or three years?  This industry has changed so much. I’m proud to be a part of it and proud to be the frontrunner or first one in the market, but it hasn’t been without its challenges.

The onslaught on new breweries and craft beer bars, and new styles are things that are nerve-racking and awesome at the same time.

With big tanks, we’re not as flexible. Seeing how the consumer is always looking for something new is something we have to pay attention to. We’ve seen a restaurant having stable taps online moving to rotation nation.

I think the tricky part in the next few years is how brands – especially new brands – are going to build their brands in a rotation nation type play where you’re “on” one minute and you’re “off” the next.

When I started the brewery, it was just let’s make beer and have fun with it. Now it’s turned into a lot more data point and thinking about where we’re headed.

The one thing I’m proud of is we’ve been able to offer so many jobs. We have 45 employees now. As we grow and times change, as the president of the company I’ve got to be constantly looking at the horizon of where I see changes happening and be able to act quick. And that’s challenging for anybody. I’m much more busy now that I was eight years ago when I was working 18-hour days getting this beer off the ground. Now it’s more busy work and inflection points.

 

Do you see O’Connor rejoining the Virginia Craft Brewers Guild for 2018?

 

Yeah. We’re going to rejoin.

I think with the challenges ahead for craft beer as a whole, Guilds, like the Virginia Craft Brewers Guild and Brewers Association, need to be strong. The sum is always greater than its parts. For me being out of it for one year it made me look back at what’s important and what I think is important to Virginia as an industry on the craft beer side.

It’s my hope that we can start to look at other things that we can start tackling. And then solidify that with one voice of who we are and what we’re doing.

Locally, my friends in the industry and I sat down and created a smaller association (Coastal Virginia Brewery Alliance) where we sit down once a month and talk about things. At the end of the day, it’s great to hear some of the similar issues and for me to try to help out some of my brewery friends.

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