Jester King is aligning itself with an industry wide effort to clarify what it means to be independent in the buyout era, but the renowned farmhouse brewery is doing so with a number of “contrarian” caveats meant to draw attention to an even more distinct definition of “independent” than the self-appointed creators of the seal would like.
On Thursday, the brewery announced plans to adopt the Brewers Association’s seal of independence, a badge the trade group introduced earlier this summer as a means of distinguishing autonomous brewers from those owned by multi-national brewing conglomerates. However, Jester King takes issue with the fact that the seal can be used on label art, in taproom windows, and elsewhere by companies it believes aren’t actually independent, despite their meeting the BA’s indie criteria.
At the heart of the issue, Jester King believes true independence means being 100% independently held. The Brewers Association, meanwhile, which sets the most widely accepted definition of the word as it relates to beer, holds that a brewery can claim independence if less than 25% of the business is owned by “an alcohol industry member that is not itself a craft brewer.” The matter is further complicated by the influx of private equity cash into the industry in both minority and majority ownership structures, as the BA does not discriminate against breweries that are minority, majority, or wholly owned by such firms in its definition.
“We personally find it odd that a brewery could be just under a quarter owned by a multi-national conglomerate and still be considered ‘independent,’” writes Jester King founder Jeffrey Stuffings in a blog post detailing its seal adoption and subsequent reservations. “Secondly, we’d count majority ownership by private equity firms as disqualifying. We have no insider knowledge, and are far from well-versed in the field of venture capital, but it’s our understanding that it’s only a matter of time until VC firms flip their brewery holdings for a profit.”
This has been an increasingly contentious issue in the industry for a number of years now, as craft stalwarts and smaller breweries alike have flipped to the likes of Anheuser-Busch InBev, MillerCoors, Constellation Brands, a litany of other non-craft brewers, and myriad PE firms.
UPDATE:
For its part, the BA says it appreciates and respects Jester King’s position.
Says BA CEO Bob Pease: “Jester King is a leader in our community and their participation is important. We hope others will follow suit. We recognize and respect their concerns about the seal, but at the end of the day we are trying to start a movement around the values of independence and transparency and why we think those matter to the beer drinker. JK’s willingness to put the craft communities needs ahead of their individual concerns is the definition of leadership to me.”
Pease expounded further on how the BA itself landed on the 25% threshold and why the organization feels private equity through a more independent lens than companies like Jester King, and a number of others. On the percentage cliff, Pease says that was established in 2006 “as the point that it is believed a company still exercised full control of that company’s direction,” but he did not say the reason behind it. As for the issue of private equity, the BA has taken its charitable position because the organization believes such firms don’t provide the same streamlined routes to market or access to raw materials that a partnership with a brewing conglomerate affords.
Reached by GBH, Stuffings adds that “despite not being totally satisfied with the criteria,” the company likes “the notion of our trade group (the BA) taking the lead on this topic.” He says the company voiced its dissent not to undermine, but to add to the conversation with its own beliefs while it works in an effort to take the lead on other matters important to the industry.
“We also wanted to use the opportunity of our announcement to raise some of our issues, despite ultimately being in support,” says Stuffings. “Finally, we’ve taken / are in the process of taking more of a leadership role when it comes to sour beer terminology, so we’d prefer to let the BA take the lead on independence.”
Though the bedrock of this conversation is inherently philosophical, there is also a physical component to it all. Put frankly, some people think the seal has aesthetic shortcomings and serves to muddy label art with its rather large size and upside down bottle graphic, which feels like a negative connotation to many [GBH wrote a design efficacy analysis here]. While that’s ultimately a matter of taste for some, it’s a matter of taste that brings about tangible ramifications. For instance, in explaining why the company is adopting the seal, Stuffings writes:
“When I walk into my local grocery store and stare at the shelves in the beer aisle, I’m met with a dazzling display of colors and what appears to be a nearly endless array of unique choices. But nowadays, if you really break down what’s staring back at you, it’s easy to see the ugliness of the illusion of choice. A startling number of the options send your dollars funneling back to the same three or four giant beer conglomerates.”
However, the company won’t be applying the seal to its own label art over “aesthetic concerns” choosing to use more B2B applications and tertiary consumer touchpoints like case cartons, bottle carriers, its website, and in its tasting room. Meaning, at least on the shelf, Jester King’s adoption doesn’t really clarify this confusion. Stuffings even concedes that “our decision not to use the seal on our bottles somewhat diminishes” the actual utility of the seal. The decision to not include it on bottles, he says, was made out of respect to the company’s designer.
“Ultimately, it came down to valuing the strong feelings of our artist Joshua Cockrell, who was highly opposed to its inclusion on his label art,” says Stuffings. “Joshua is a long-time friend, our first employee, and an essential part of our brewery, so I deferred to his wishes, even though I knew it would lessen the practical impact of our support.”
If you’re wondering why Jester King’s decision is newsworthy over any other brewer wringing its hands over the use of the seal (there are many breweries on both sides of that argument, with gusto) look no further than their last weigh-in on an industry concern. When AB Inbev bought Wicked Weed, a brewery Jester King shared a close relationship with, their very public decision to bail on Wicked Weed’s invitational festival and most invitees followed suit immediately. These days, it seems that Jester King sets the bar and the rest follow. Which in this case, could mean a boon for the seal, and a bust for the definition of “independence” as currently defined.
Despite philosophical differences, though, between the BA, Jester King – and indeed, many others – over what true independence looks like, the effort to define it all ultimately comes from a very similar belief. As Stuffings writes:
“If there’s one thing we can’t stand, it’s inauthenticity. And sadly, that’s what big beer is doing by gobbling up small breweries at an alarming rate and displaying them side by side at bars and on retail shelves. It’s this inauthenticity and illusion of locality and independence that bothers us, and we’re onboard with a coordinated effort to push back against what we see as an unethical business practice.”
- Dave Eisenberg