Website Closers® presents a family-run operation with a focal point on community relations quickly made its taproom a destination for meetings and events in Charlotte, NC. Demand exploded as local appetites for their hard seltzer became insatiable. Management shrewdly and swiftly increased production and commenced regional distribution. The brand is now a household name in bars and grocery stores in Charlotte, NC, and surrounding areas, with expansion plans throughout the Southeast.
Covid and lockdowns pushed consumers to buy drinks from off-premise establishments. The public had no choice but to spend their time at home or outdoors, and hard seltzer rapidly became the drink of choice and an excellent craft beer alternative for many. As bars and restaurants reopened, those consumers desired a beverage with flavor nuances that were longer lasting than typical alternatives. This brand, then, was perfectly placed and poised for the ensuing crusade. The house-fermented hard and non-alcoholic seltzers, flavored and conditioned with natural purees, are an unrivaled craft beverage—poles apart from what the public is accustomed to.
Hard seltzer has changed the dynamics of social drinking. The modern generation is more health-conscious than those prior and is looking for an alternative to beer. Fortunately, healthy living and having fun can go hand in hand, which is why the brand’s low-calorie, low-carb, and low-sugar craft seltzer is the preferred choice for this market dynamic.
Sales experience significant peaks in the warmer seasons, as seltzer is traditionally a light beverage. This company, however, is not traditional by any means, and the team has created seasonal drinks to negate slower months in the fall and winter.
Seltzer is a diverse beverage, and the typical customer is becoming increasingly and similarly diverse. The target market leans toward health-conscious individuals who love the omission of sugar, gluten, carbs, and calories. However, trends are shifting, and consumers across multiple demographics have come to love this company’s beverages, in no small part because of the variety. The range is designed to satisfy every preference and includes full-bodied, seasonal, and light seltzers with the capability to create non-alcoholic alternatives.
Revenue in the hard seltzer segment is expected to grow to $14.12 billion in 2022. The market is expected to grow annually by 18.14% until 2025. As a result, scale prospects are rampant, particularly for a business first to market.
Some of those prospects include the expansion of wholesale distribution, including doubling barrel capacity, and adding an in-house canning line. The company does little advertising aside from social media, so increasing the marketing budget to bring on a crackerjack team would undoubtedly boost sales. Further opportunities involve developing new distribution channels to service bordering states.
Since its inception, the business has witnessed sensational demand. The concept is brilliant and scalable, but the small family-owned operation needs a capital injection to join the big leagues. We’ve witnessed how early backers of the craft beer and spirit movements reaped unthinkable yields, and evidence suggests that seltzer is next in line. The growth plan laid out in the projection mode is based on the plan outlined below and detailed in the financial model.
In May 2021, we dropped our marketing firm and took marketing in-house to reduce costs. Within 6 months, while our marketing expenses decreased by 86%, our tap room sales also dropped by 59%. Seasonality heavily impacted this number, however, we noticed a gradual decline when we abandoned our heavy marketing strategy. Our current location is in an up-and-coming neighborhood, so there won’t be foot traffic until this year when all of the surrounding buildings gain their tenants. Hiring a full-time, dedicated marketer/event planner will help keep our brand consistent and increase the number of “regulars” in the space. Our biggest nights are our events nights, whether it be music or parties. Included in the $80,000 marketing/events budget is a $45,000 base salary for a marketer/planner and a $35,000 budget for live bands and social media/news outlet paid promotions.
We are rebranding our taproom into more of a Social Club / Bar and Seltzery. We will focus always on our craft seltzer, but we will create a lounge feel with events or live music every night. The revamp will come with the help of our marketing team Wray Ward. We will bring in charcuterie boards and small snacks to create a fun neighborhood place to grab a glass of wine, beer, cocktail, and of course seltzer. All while watching live entertainment.
The progression of the area we are currently located in was impacted by Covid. Thrift Road and Jay Street were supposed to be packed with eat /work/play concepts. The streets are finally turning around as these gorgeous buildings are being occupied by large offices, bars and restaurants, and other things making the West End a destination space. Charlotte is a city of nooks. Consumers often go to “SouthEnd”, “Plaza Midwood”, and “NoDa” for the night. They stay on the same street/area as to not have to drive. With all of the new development, the “West End” is becoming the next mini ecosystem for people to barhop.
As of now, we serve seltzer, beer, wine, seltzer cocktails, and various N/A options. Once we get our liquor license in early 2023 we will be able to operate as a full bar. While we will focus on our craft seltzer and our distribution channels, the tap room will greatly benefit from becoming a full-service bar that will cater to the masses. We want to be a “Social Club and Seltzery” in the tap room and a “Craft Seltzer” in RTD.
This is where the real growth potential comes in. We are currently on at 41 Harris Teeters and have the ability to distribute outside of the Charlotte area. We plan to saturate our market in Charlotte and North / South Carolina before eventually expanding nationally. We took back on-premises sales from our distributor to ensure we have reps exclusively selling our seltzer to bars and restaurants. Having multiple reps with appropriate pay structures is pivotal to the success of the brand. On-premises sales are a relationship game, so having consistent representation in the market is important. We are confident that with our capacity and ability to service off-premises accounts across the state, we will be able to increase sales exponentially. Our current capacity is 90 BBLs- 1 10 BBL tank, 1 20 BBL tank, and 2 30 BBL tanks. This allows us to produce 2,016 BBLs a year. We are currently producing 570 BBLs a year, which is reasonable for a small microbrewery, but this is only utilizing 30% of our capacity. Because we are seltzer (sugar water yeast fruit), we don’t need dry grains or most of the equipment needed before the fermenter while brewing. We only need about 1/3 of the space and ingredients of traditional beer breweries. Our decision to get larger tanks was based on the incremental price increase and size per tank. For example, a 20 BBL Cedarstone fermenter is $12,650 while a 30 BBL is $15,730, and the 30 BBL only takes up a small increased space. We want to utilize this capacity and that would be done through a strong, well-funded sales team.
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