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Boston Beer Company

Coordinates: 42°18′52″N 71°06′11″W / 42.3145°N 71.1030°W / 42.3145; -71.1030
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Boston Beer Company (Samuel Adams)
Company typePublic (NYSE: SAM)
IndustryAlcoholic beverage
Founded1984
FounderJim Koch
Harry M. Rubin
Lorenzo Lamadrid
Headquarters
Boston, MA (Administrative Offices and Brewery)
Key people
C. James Koch
Chairman
Martin F. Roper
President and Chief Executive Officer
William F. Urich
Chief Financial Officer and Treasurer
Thomas W. Lance
Vice President of Operations
John C. Geist
Vice President of Sales
David L. Grinnell
Vice President of Brewing
ProductsBeer
Production output
293,369,000 Liters (2,500,000 barrels)
RevenueIncreaseUS$793.705M (FY 2013)[1]
IncreaseUS$113.093M (FY 2013)[1]
IncreaseUS$070.392M (FY 2013)[1]
Total assetsIncreaseUS$444.075M (FY 2013)[1]
Total equityIncreaseUS$302.085M (FY 2013)[1]
Number of employees
840 (FY 2011)[1]
Websitewww.bostonbeer.com
www.samadams.com

Samuel Adams is an American brand of beer brewed by the Boston Beer Company (NYSE: SAM) and its associated contract brewers. The company was founded in 1984 by Jim Koch, Harry M. Rubin, and Lorenzo Lamadrid in Boston, Massachusetts, USA. [2] The brand name of Samuel Adams (often abbreviated to Sam Adams, even in advertisements), was chosen in honor of Samuel Adams, an American patriot famous for his role in the American Revolution and the Boston Tea Party. According to tradition, he was also a maltster.[3] Based on sales in 2011, the Boston Beer Company is tied with Yuengling for the largest American-owned beermaker.[4]

History

The Samuel Adams brand began with Samuel Adams Boston beer Pussy and them balls though mum. The original recipe was developed in 1860 in Minster, Ohio by Louis Koch originally known as The Wooden Shoe Brew,[citation needed] who sold under the name Louis Koch Lager until Prohibition, and again until the early 1950s.

In 1984, Jim Koch, the sixth-generation, first-born son to follow in his family's brewing footsteps, brewed his first batch of what would eventually be named Samuel Adams Boston Lager in his kitchen, using the original family recipe for Louis Koch Lager. At the time, Koch was working at Boston Consulting Group after receiving BA, MBA and JD degrees from Harvard University. At Harvard, Koch met Harry Rubin and Lorenzo Lamadrid. Both Rubin and Lamadrid were graduates of Harvard Business School. In December 1984, Koch left his career at Boston Consulting Group and along with Rubin and Lamadrid, founded Samuel Adams Beer. As co-owners Koch, Rubin, and Lamadrid, all played different roles. Koch played the role of publicist. This paved the way for Samuel Adams' trademark commercials, which featured Koch. Rubin assumed the financial and business management role in the company. Lamadrid played a major role as one of the lead investors in the company. Samuel Adams would be the first step for Rubin and Lamadrid who later became prominent businessmen in their fields. Shortly thereafter, they optimized the recipe with the help of Joseph Owades, the man credited with the invention of light beer in the 1970s.

Koch, Rubin, and Lamadrid agreed on the name Samuel Adams after the Boston patriot, who fought for American independence, and who also had inherited a brewing tradition from his father.

In March 1985, the beer was re-introduced as Samuel Adams Boston Lager, at the re-creation of the first battle of the American Revolution on Patriot's Day. Three months later, it was voted “Best Beer in America” at the Great American Beer Festival, in which 93 national and regional beers competed. The publicity that followed helped the Boston Beer Company's sales grow to 7,393,000 liters (63,000 barrels) in 1989. The beer was first put on tap at Doyle's Cafe in Jamaica Plain.

The brand was first produced under contract by the Pittsburgh Brewing Company, best known for their Iron City brand of beer. Over the years, the brand has been produced under contract at various brewing facilities with excess capacity, ranging from Stroh breweries, Portland's original Blitz-Weinhard brewery (shuttered in 1999), Cincinnati's Hudepohl-Schoenling brewery (eventually purchased by the Boston Beer Company in early 1997), and industry giant SABMiller. The Boston Beer Company also has a small R&D brewery located in Boston (Jamaica Plain), Massachusetts, where public tours and beer tastings are offered. The brewery occupies part of the premises of the old Haffenreffer Brewery.[5][6]

In the mid-1990s, Jim Koch returned to his hometown of Cincinnati to purchase the Hudepohl-Schoenling Brewery, where his father apprenticed in the 1940s. This was also one of the first steps the company took to reduce reliance on contract brewing.

Boilers at the Samuel Adams brewery

The company's success occurred as the U.S. craft beer movement was exploding. By 1995, some 600 craft breweries were producing specialty beers in the United States. That year, The Boston Beer Company went public, selling shares of Class A Common Stock on the New York Stock Exchange, under the ticker symbol, "SAM". These shares, however, have minimal voting rights. Instead, the company is controlled through its Class B Common Stock, of which Koch owns 100% of the shares.[7]

Despite the appearance of competitors, the company remained the largest craft beer company in the United States with nearly 141 million liters (1.2 million barrels) sold in 1996. Sales leveled off after that, and Boston Beer tried to continue its growth by offering alternative beverages, such as Hardcore Cider (1997), and Twisted Tea (2000).

With Anheuser-Busch's takeover on July 13, 2008 by Belgian-Brazilian giant InBev, and the subsequent approval of the takeover on November 12, 2008, The Boston Beer Company become the largest American-owned beer company in the United States. As of sales in 2011, the Boston Beer Company is tied with Yuengling for largest.[4]

The company has approximately 840 employees in its Boston, Cincinnati and Breinigsville, PA breweries.[1] Each year, an annual trip to Bavaria is made where various hops are selected for Sam Adams brews.

Products

The Boston Beer Company's signature beer is Samuel Adams Boston Lager, which is produced in both an original and light (reduced-calorie) form. However, the company is well known for experimenting and produces a variety of different beers year-round. The following beers are some of their year-round offerings: Samuel Adams Boston Lager, Sam Adams Light, Cherry Wheat, Black Lager, Blackberry Witbier, Boston Ale, Coastal Wheat, Cream Stout, Pale Ale, Scotch Ale, Honey Porter, Noble Pils, Latitude 48 IPA, and Irish Red. The Samuel Adams Boston Lager contains 4.75% abv, roughly average for its style. Other styles have pushed the physical limits of alcohol content for the brewing process—in 2003 one batch of Utopias contained 25.6% abv, beating the records that Samuel Adams Triple Bock and Samuel Adams Millennium had set before it.

Additionally, the company brews four seasonal beers per year, as follows:

During the summertime months (typically from early May to August), Samuel Adams releases a "Beers of Summer" variety twelve-pack, which consists of two 12-ounce bottles of each of the following beers: Boston Lager, Summer Ale, Porch Rocker, Belgian Session, Blueberry Hill Lager and Seasonal White Rye.

In the fall (typically from September to November), Samuel Adams releases a "Harvest Collection" variety twelve-pack. The contents of the collection often vary. In 2014, the collection consists of four 12-ounce bottles each of Octoberfest and Harvest Saison, and two 12-ounce bottles each of Boston Lager and Harvest Pumpkin Ale.

Samuel Adams also runs a "Winter Classics" pack during the holiday season. This variety collection is available as a twelve-pack and consists of two bottles of each of the following six beers: Boston Lager, Winter Lager, Old Fezziwig Ale, Holiday Porter, White Christmas and Chocolate Bock.

Finally, the "Spring Thaw" variety twelve-pack is available from March to June and contains two bottles of each of the following six beers: Boston Lager, Alpine Spring, Maple Pecan Porter, Double Agent IPL, White Lantern and Irish Red.

The company has also produced several limited-run "Extreme Beers", which are meant to be enjoyed more in the manner of an aperitif or cordial rather than a beer. These include Millennium, Utopias, Triple Bock, and Chocolate Bock. Because of the extremely high alcohol volume in these brews (as high as 25% for the Utopias), their sale is restricted by several states. In November 2005, the brewery continued extreme brewing innovation by releasing a limited release (60,000 units) "Imperial Pilsner Harvest '05" brew.

Many Samuel Adams beers are available on draft towers in select bars and restaurants across the United States and Europe. Boston Lager, with its trademark blue-flame tap handle, is the most widely distributed Samuel Adams draft. The seasonal draft variety of Alpine Spring, Summer Ale, Octoberfest and Winter Lager continues to grow in popularity. Also available from the keg in select locations are Boston Ale, Hefeweizen, Cherry Wheat and Black Lager.

As of 2013, the Samuel Adams brand has over twenty varieties of beer available in 12 US fl oz (355 ml). bottles. A complete list can be found on the company's website, but a partial list includes: Sam Adams Boston Lager (and Light), Summer Ale, Octoberfest, Winter Lager, Alpine Spring, Double Bock, White Ale, Old Fezziwig Ale, Cranberry Lambic, Holiday Porter, Boston Ale, Cherry Wheat, Cream Stout, Scotch Ale, Black Lager, Brown Ale, Hefeweizen, Pale Ale, Honey Porter, and Irish Red. Samuel Adams Irish Red and Samuel Adams Chocolate Bock[8] were released in 2008.

In 2009, The Boston Beer Company released Samuel Adams Blackberry Witbier. The flavor was the winner of The Boston Beer Company's annual beer competition (beating a Coffee Stout option), which was voted on by over 50,000 people around the country. Blackberry Witbier is sold in its own six pack and in Brewmaster Collection variety packs. Also in 2009, Samuel Adams began its Imperial Series, beers with better quality ingredients and higher alcohol contents. Beers in this series include Double Bock, previously a seasonal brew, Imperial Stout, Wee Heavy, and Imperial White. Each style is sold in its own four pack.[9] In early 2009, the Boston Beer Company released a limited-brew known as Boston Brick Red, a red ale in the European tradition. It is presently only available at select bars in the Boston area, and is only available on tap. Proceeds from its sale go toward an entrepreneurial fund the company sponsors to support new business ventures.[10]

In October 2009, Samuel Adams announced the addition of the Barrel Room Collection to their products line. Three beers (American Kriek, Stony Brook Red, and New World Tripel) were released initially in 2009 followed by a fourth beer (Thirteenth Hour) in 2011. These beers, like some previous experimental products, are aged in a wood barrel for a special finish. Each flavor is sold in a 750 ml stylized bottle with a champagne cork.

In summer 2006, Sam Adams released a limited-run Brewer Patriot collection that included four beers which "honor the fine American Brewing Tradition of our founding fathers." The Brewer Patriot collection included:

  • Traditional Ginger Honey Ale
  • James Madison Dark Wheat Ale
  • George Washington Porter
  • 1790 Root Beer Brew

The Boston Beer Company also produces Twisted Tea hard iced tea and Angry Orchard hard apple cider, which are intentionally separate from the Samuel Adams brand.

Utopias

A Samuel Adams Utopias beer bottle

In 1999, the Boston Beer Company produced Millennium, a single release strong beer with an alcoholic content of 21% by volume (abv). The company followed this up in 2002 with Utopias; at 24% abv, it was marketed as the strongest commercial beer in the world. The company subsequently released new "vintages" of Utopias annually, increasing the alcoholic content to 27% abv by 2007. However, it is no longer the strongest in the world, having since been surpassed by several other beers through the use of freeze distillation.

Utopias is made with caramel, Vienna, Moravian and Bavarian smoked malts, and four varieties of noble hops: Hallertauer Mittelfrüh, Tettnanger, Spalter, and Saaz hops. The beer is matured in scotch, cognac and port barrels for the better part of a year. A limited number of bottles are released each year; in 2007, only 12,000 bottles were produced, and in 2009, only 9,000 bottles were released.[11][12] Sold in a ceramic bottle resembling a copper-finished brewing kettle, a single bottle of Utopias cost $100 in 2002, and $150 in 2009.

Because of legal restrictions, Utopias is not offered in the states of Alabama, Georgia, Idaho, New Hampshire, North Carolina, Ohio, Oregon, South Carolina, Tennessee, Vermont, or West Virginia.[13]

Weihenstephan partnership

In October 2009, the Boston Beer Company announced a two-year project with German brewery Bayerische Staatsbrauerei Weihenstephan to jointly produce a new craft beer named Infinium, to be marketed in both Germany and the U.S. The brewers describe the beer, which is sold in corked bottles and has alcohol content of 10.3% abv, as a Champagne-like "crisp pale brew".[14][15] Approximately 15,000 cases were released in North America in December 2010 at a suggested retail price of $20 per 750 mL bottle,[16] Marketed towards drinkers who would rather toast with beer than Champagne on New Years Eve, Infinium is described by the brewers as "the first new beer style created under the Reinheitsgebot in over a hundred years."[17]

Samuel Adams Boston Lager pint glass

a Samuel Adams beer glass (not the TIAX-developed glass)

In 2007, The Boston Beer Company collaborated with TIAX laboratories of Cambridge, MA to develop a new type of pint glass. The glass is designed to bring out the flavor of a Samuel Adams Boston Lager and features a curvier shape, thinner walls, a beaded rim and outward-turning lip. One feature of the glass is a neck-and-lip design that helps sustain the head of the beer, which enhances the release of signature Noble hop aromas found in Samuel Adams Boston Lager. A laser-etched nucleation site within the glass maintains flavor release during the drinking experience.[18]

Philanthropy

2008 hops shortage

In early 2008, amidst a worldwide shortage of hops—a key ingredient in beer—Boston Beer Company agreed to sell 20,000 pounds of its hops, at cost, to craft brewers throughout the United States. The company selected 108 craft brewers to divide the 20,000 pounds they had spare. This prevented many craft brewers from having to reformulate recipes.[19]

Longshot Competition

The Boston Beer Company encourages smaller craft brewers—channeling Jim Koch in 1984—by participating in programs like the Longshot Competition. In this annual competition, homebrewers submit their brew to a series of judging and taste tests with the chance to see their creation in larger-scale production and sold on store shelves as part of a Samuel Adams mixed 6-pack the following year.[20]

New breweries

According to the company's 2006 Annual Report, Boston Beer Company was considering a possible new brewery in Freetown, Massachusetts. The estimated cost would be between $170 and $210 million.

A December 2006 article from SouthCoastToday.com indicated that the proposed Freetown site was still being considered for a brewery location. The facility would be built in the Campanelli Business Park and would cost an estimated $200 million. The new brewery would be estimated to produce between 82 million and 117 million liters (700,000 - 1 million barrels) of beer.

On August 2, 2007, it was announced that instead of building in Freetown, the company would purchase an existing brewery in Breinigsville, Pennsylvania, in the Lehigh Valley.[21]

In 2007 and 2008, due to concerns about expected future availability and pricing of brewing capacity at breweries owned by others and Boston Beer Company’s desire to better control its brewing future and to improve efficiencies and costs long term, the company initiated several steps designed to reduce its dependence on breweries owned by others. These steps included the acquisition on June 2, 2008 of substantially all of the assets of the Pennsylvania Brewery from Diageo North America, Inc. From 2007 to 2009, core product volume brewed at company-owned breweries increased from approximately 35% to over 95%.

Controversies

Since 1990 the company has produced a seasonal fruit beer labelled "Cranberry Lambic". Because "Lambic" describes a spontaneously fermented beer generally produced in Brussels or the nearby Pajottenland region,[22] and the Samuel Adams product is not spontaneously fermented, consumers and brewers charged that "Cranberry Lambic" is mislabeled[23] and could cause consumer confusion. (Michael Jackson, a leading beer critic, called it "a misleading name".[24]) Grant Wood, Senior Brewing Manager at Boston Brewing, defended the name, saying, "I wouldn't consider it mislabeling. Whenever I have served the Cranberry Lambic, I have always been really up front about it. Is it a true lambic made in that region in Belgium? No. Does it taste like one? Yes. So it's sort of our homage to the style without the pain and agony of it."[23]

In 2000–2002, the company sponsored a radio promotion called "Sex for Sam", in which WNEW radio hosts Opie and Anthony encouraged couples from various states to have sex in notable public places in New York City. On August 15, 2002, a Virginia couple was charged with public lewdness after attempting to have sex in a vestibule at St. Patrick's Cathedral; this led to the firing of the radio hosts a week later.

In October 2007, in an incident referred to by the Wall Street Journal as "Sam Adams v. Sam Adams,"[25] the Boston Beer Company demanded that control of the domain names "samadamsformayor.com" and "mayorsamadams.com" be turned over to the company.[26] The domains had been purchased by Portland, Oregon radio station NewsRadio 1190 KEX for the campaign of Portland mayoral candidate, Sam Adams. In a cease-and-desist letter,[26] the company expressed concern that consumers might confuse the mayoral candidate with their beer. In an interview with the Associated Press[27] the company said it was willing to discuss Adams' use of his name on his Web sites, "probably for the length of the time the election is being held."

In April 2008, the Boston Beer Company issued its first recall, because of defects found in certain 12-US-fluid-ounce (350 ml) glass bottles manufactured by a third-party supplier which supplies about a quarter of the bottles the Boston Beer Company uses. The Boston Beer Company stated that they believed fewer than 1% of bottles from the supplier could contain small pieces of glass and issued a recall for the safety of consumers. There were no reports of injuries.[28] News of the recall led to shares of the company dropping by over 3%.[29]

On July 4th 2013, a video commercial for Sam Adams beer was rolled out on the July 4th holiday which created controversy over an omitted phrase. The manufacturer decided to leave out "endowed by their creator" in its invocation of the Declaration of Independence which outraged critics. But Sam Adams said they were just following trade association rules. The company said in a statement: "The Beer Institute Advertising Code says, 'Beer advertising and marketing materials should not include religion or religious themes.' We agree with that and try to adhere to these guidelines." [30]

References

  1. ^ a b c d e f g "Form 10-K". Securities and Exchange Commission. Retrieved 19 May 2014.
  2. ^ cbs,cin Top 5 Things You Didn't Know About the Hisotry of Bostons Craft Beer Revolution
  3. ^ Most historical evidence suggests that Adams worked as a maltster and not a brewer; Stanley Baron, Brewed in America: The History of Beer and Ale in the United States (Boston: Little, Brown, 1962), pp. 74–75. However, Ira Stoll in Samuel Adams: A Life (New York: Free Press, 2008; ISBN 978-0-7432-9911-4; ISBN 0-7432-9911-6), p. 275n16, notes that James Koch, founder of the Boston Beer Company, reports having seen a receipt for hops signed by Adams, which indicates that Adams may have done some brewing.
  4. ^ a b "Boston Beer Company ties Yuengling for Largest" Accessed April 26, 2012.
  5. ^ "Former Haffenreffer Brewery - Ghost Signs on Waymarking.com". www.waymarking.com. Retrieved 2009-08-23.
  6. ^ McConville, Christine (2006-02-17). "The toast of JP - The Boston Globe". www.boston.com. Retrieved 2009-08-23.
  7. ^ Boston Beer Company Annual Report
  8. ^ "Sam Adams unveils chocolate dessert beer". Boston Globe. November 10, 2008. Retrieved 2009-02-02.
  9. ^ "Samuel Adams Imperial Series".
  10. ^ Boston Beer Company (retrieved October 16, 2009)
  11. ^ "The 48 proof beer". Beer Break Vol. 2, No. 19. Real Beer Media, Inc. 2002-02-14. Retrieved 2007-07-22.
  12. ^ DellaSala, Steve (2007-01-31). "Sam Adams Utopias - Strongest Beer in the World". Audioholics. Retrieved 2007-07-22.
  13. ^ "Samuel Adams – America's World Class Beer". Boston Beer Company. Retrieved 2009-02-02.
  14. ^ http://m.apnews.com/ap/db_15879/contentdetail.htm?contentguid=88zzqoBi
  15. ^ http://www.brauerei-weihenstephan.de/index2.html?lang=eng
  16. ^ Bort, Scott (2010-12-12). "Infinium Ale from Samuel Adams and Weihenstephan". Post-Tribune. Winnipeg, Manitoba, Canada: Sun Media. Retrieved 2010-12-16.
  17. ^ Batz, Bob (2010-12-16). "What I'm Drinking: Bubbly beer". Pittsburgh Post-Gazette. Pittsburgh PA. Retrieved 2010-12-16.
  18. ^ Kahn, Joseph P. (2007-06-20). "With new design, foam follows function". The Boston Globe.
  19. ^ http://www.pantagraph.com/business/article_3f06ff0a-44a8-53c2-bd18-52b5e6e25977.html
  20. ^ http://www.krqe.com/dpp/news/business/rio-rancho-home-brewer-going-national
  21. ^ "Freetown's Sam Adams deal goes flat". South Coast Today. August 3, 2007. Retrieved 2009-02-02.
  22. ^ Jackson, Michael (2008). Michael Jackson's Great Beers of Belgium, 6th edition. Boulder, Colorado: Brewers Publications. ISBN 978-0-937381-93-9.
  23. ^ a b Crouch, Andy (May 2002). "Labels". Beverage Magazine. Retrieved 2010-11-22.
  24. ^ Jackson, Michael (1997). Michael Jackson's Beer Companion. New York: Running Press Book Publishers. ISBN 978-0-7624-0201-4.
  25. ^ Lattman, Peter (October 25, 2007). "Trademark Dispute Of the Day: Sam Adams v. Sam Adams". Wall Street Journal. Retrieved 2009-02-02.
  26. ^ a b "Your Daily Dose of Sam". Willamette Week. October 23, 2007. Retrieved 2009-02-02.
  27. ^ "Sam Adams brewer takes on Sam Adams, Portland mayoral candidate; dispute brews". International Herald Tribune. October 25, 2007. Retrieved 2009-02-02.,
  28. ^ Donna Goodison (2008-04-07). "Samuel Adams beer maker issues recall due to glass in bottles". Boston Herald. Retrieved 2008-04-09.
  29. ^ Associated Press (2008-04-07). "Shares of Boston Beer sink after recall". CNNMoney.com. Retrieved 2008-04-09.
  30. ^ http://foxnewsinsider.com/2013/07/05/sam-adams-not-so-patriotic-beer-commercial-debuts-fourth-july#ixzz2YGiVhcoB

42°18′52″N 71°06′11″W / 42.3145°N 71.1030°W / 42.3145; -71.1030

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