Ales abroad: San Diego beer’s global footprint

Thirsty in Tokyo for AleSmith Brewing Co.’s Nut Brown Ale? Visit Craftheads in the bustling Shibuya district.

Hankering for Modern Times’ Funky Universal Friend while wandering Wellington? Check the shelves in that New Zealand city’s Cult Beer Store.

Seeking Stone in Stockholm? Drop into The Bishops Arms near the Swedish capital’s central train station.

“There is a demand specifically for San Diego craft beer in those countries,” said Lynda Hess, chief operating officer of Mike Hess Brewing, which sells beer in the United Kingdom, Sweden and China. “They know that San Diego is making some of the best craft beer in the world. That’s why they sometimes contact us.”

American craft beer has never been more worldly. Between 2013 and 2016, the last year for which statistics are available, U.S. craft beer sales abroad rose 61 percent. More than 114 million pints of American craft beer were sold in foreign markets in 2016, bringing in revenue of $121 million.

Keeping beer fresh on the 30-day voyage to Antwerp or two-week trip to Yokohama is a challenge, requiring constant refrigeration. And developing relationships across time zones and cultures takes patience.

But numerous San Diego brewers see the world as their oyster stout. Foreign distributors eager for beer from U.S. breweries, Hess said, often pay shipping and import fees, plus handle the local marketing chores.

As a result, it can be cheaper to send beer around the world than across the country. “I’d rather sell beer internationally than on the East Coast at this point,” said Brandon Richards, CEO of Coronado Brewing.

The trick, advised Bob Pease, is to find a good partner.

“If you can identify the right distributor in an international market, you can do well,” said Pease, president of the Brewers Association, a U.S. trade group based in Boulder, Colo. “You have to do your homework on the front end.”

That homework involves digging past stereotypes and truly understanding foreign consumers. While Chinese brewers specialize in light lagers, Stone’s launch parties in Beijing and Shanghai last November revealed a thirst for bigger, hoppier ales.

“It was all about the IPAs there,” said Stone co-founder Steve Wagner. “There’s obviously Stone fans there.”

Catering to those fans is one reason to export. Another, Wagner said, is self-protection. Stone, Modern Times and other breweries with cult followings often find their beers unofficially exported by third parties, whose haphazard operations can damage the beer.

“Part of our decision-making process in selling beer in Australia and China was ensuring that our beer would be presented the way we want it,” Wagner said. “At least we would have a fighting chance.”

Still, this is a side line for local breweries. Stone may be the most aggressively international of the county’s 150-plus breweries, exporting to more than 40 countries. Yet overseas business only amounts to 6 percent of Stone’s sales — with two-thirds of that coming from the Escondido company’s Berlin brewery, which serves the European market.

Mike Hess’ exports are around 1 percent of its sales, while Coronado peddles 7 percent of its beer abroad.

In the six years since Coronado entered the international marketplace, Richards has noticed the rise of American-style craft breweries in other countries. That may reduce demand for U.S. beers, but Richards said his brewery offers something that cannot be cloned elsewhere: an image.

“People recognize us as a California brand,” he said. “They may not know exactly where Coronado is, but they know it’s on the beach and it’s in California. And there’s this California aspiration all over the world.”

Foreign flavors

What San Diego beers are popular abroad?

Canada: For Coronado, Guava Islander is hot in British Columbia. “We don’t have a large amount of fruit IPAs in our portfolio, but the ones we do sell well,” said Sara Gill, Coronado’s distributor in Vancouver.

Chile: “IPAs and Belgian strong ales are what sell the most as a category,” said Perry Hirsch, who distributes Coronado beers in Santiago, Chile. “And even though IPAs aren’t to everyone’s liking, it’s what really stands out and makes American craft beer unique to the foreign consumer who does get into good beer.”

China: Stone’s biggest hit in Beijing and Shanghai? “Stone IPA, possibly because we lead with that,” said Steve Wagner, Stone’s president and co-founder. “There is definitely an appreciation of the more tropical IPAs, though, as Vengeful Spirit also did well.”

Germany: For Stone, its IPA is the top seller, followed by Arrogant Bastard and Stone Go To IPA. “However,” Wagner said, “both Stone Berliner Weisse and Stone Ripper were introduced fairly recently and early indications are that they will be both be top three by the end of this year.”