New Holland Brewing Company announced on December 15 that they are entering into a “long-term partnership agreement” with Pabst Brewing Company that will “focus on the national distribution and sales of New Holland’s full portfolio of beer.” Effective first quarter 2017, Pabst will manage New Holland’s wholesale network to help New Holland “accelerate growth and drive success at the shelf.” This rather unprecedented relationship, of course, prompted interest and questions.
Brett VanderKamp, founder and president of New Holland, is transparent about the decision, explaining why he believes New Holland and Pabst are good for each other. After a proven track record of 20 years, New Holland is a “well groomed and well healed” brewery of modest size that has the white space to grow at a pace appropriate for an opportunity for Pabst to acclimate into the American craft beer segment. “From a portfolio perspective, this partnership adds a well-rounded value for them,” VanderKamp stated.
Currently, New Holland is distributed in 34 states. Although achieving presence in all 50 is certainly not beyond possibility, it’s not part of the 2017 strategy with Pabst. VanderKamp’s immediate goal is to broaden and deepen their exposure in their present markets, as well as consider their potential to expand into additional select states as it makes sense.
What does Pabst bring to the table? An entire sales organization, which includes a robust national sales team to manage the distributor. Pabst has the mobility to operate across their geography with precision all the way down to shelf. VanderKamp values the reach that Pabst has—allowing them to have significant conversations with key people in different regions that New Holland hasn’t had the human resources to tackle.
Before deciding to commit to Pabst, VanderKamp admitted that in some cases, reviewing proposals from other potential partners included ownership percentages exchanging hands. In order to protect themselves, VanderKamp said he and his team created “guardrails around what was really important to us and the New Holland brand.” Pabst will be financially incentivized for their efforts, but New Holland retains sole ownership, and does not relinquish any equity to Pabst.
For VanderKamp, the intangibles of a partnership like this are just as important as the financial bottom line. “We quickly aligned on what matters in both of our organizations. With Pabst, We’re a cultural fit, a trust fit, and a value fit.” To honor the integrity of New Holland’s mission and vision, to continue to grow the company, and take their brands across the country, sharing the New Holland story, VanderKamp felt compelled to go with his gut.
“At the end of the day,” VanderKamp revealed, “I had to simply decide if I liked the guys [at Pabst].” When asked if he thought he could sit across the table and have a beer with Pabst chairman Eugene Kashper and the rest of the Pabst team, and actually enjoy it, VanderKamp laughed, and replied, “Yeah. I could have many.”
When addressing the public’s perception that a move like this could mean backlash for New Holland, VanderKamp acknowledged the risk, but dismissed any threat that could be associated with Pabst, particularly “when you compare them to the most notable behemoth that’s out there right now.” VanderKamp admires the role Kashper has played in this partnership. “Eugene is an entrepreneur through and through. He was intimate in this deal, very hands on, and is incredibly approachable. From a leadership standpoint, working alongside Pabst is really not that scary at all.” From a social or consumer standpoint, it’s PBR—a domestic that indexes incredibly successfully against craft beer. And, as VanderKamp playfully jabbed, “…probably also in your fridge at home right now, too.”