Michael (Hopleaf) Roper’s Take on the Goose Island Deal

Michael Roper is the owner of Chicago’s renown Hopleaf, a beer bar and restaurant par excellence. We’ve been exchanging emails lately and he included in one his Facebook musings on the Goose Island sale to Anheuser-Busch InBev. Subsequently, he granted me permission to reproduce his essay here.

This is a very worthy read, folks. I don’t agree completely with everything Michael says, but I do believe most of it is spot on.

My Thoughts on Goose Island/AB Inbev

by Michael Roper, proprietor, Hopleaf, Chcicago

There is a lot of buzz about the purchase of our hometown Chicago brewery, Goose Island by AB/Inbev.  Some are wishing them well, but more are not.  I believe that is unfair and I would like to tell our customers why I think it is unfair.

It is hard to overestimate the positive effect that Goose Island has had on Chicago’s craft beer scene.  After the failures of Chicago Brewing Company, Golden Prairie, River West, Pavichevich/Baderbrau and others, it seemed that there was a curse on home grown beer in Chicago.  One brewery proved otherwise. A combination of prudent growth, good products, shrewd business practices and smart marketing made Goose Island the first successful craft brewery in Chicago.  For many years they were the only one.

With the crowd pleasing flagship Honkers Ale and in later years 312 paying the bills, Goose Island was able to give us the many great Reserve Series beers that were and are world class brews.  We at Hopleaf have been proud to serve them for years. Goose has been a pioneer in American oak aged beers and aging in whiskey barrels.  Great beer has brought great success and many honors.

AB/Inbev knows what they are getting with Goose Island and what they are getting is a brewery that does what they can’t do.  They can’t make beers like Matilda, Sofie, Juliette, Bourbon County Stout, Père Jacques or Madame Rose.  They can’t even make anything like Goose Island IPA or Oatmeal Stout.  They have given up trying and purchasing a Brewery like Goose is more a symbol of surrender than might be obvious. This is the only way that they can bring good beer into their portfolio. It is a smart move for them.  The last thing that they will want to do is to screw up a good thing.

I am sad that Chicago loses a home grown, family owned, local success story.  It hurts my local pride a bit in the same way that Marshal Field’s becoming Macy’s, First Chicago becoming Chase or the Milwaukee based Bon-Ton’s takeover of Carson Pirie Scott took away something truly of Chicago, built and run by Chicagoans.  Goose Island won’t be all ours any more.  The Hall family will not own them.  That makes me sad but I am not one of those who said I’ll never go into Macy’s again.  All that would do is give us a giant empty store on one of the most prominent corners of the city.  Things change and change is not always bad.  I am not going to suddenly reject Goose Island beers over this. What good would that do?

Goose Island needs a new brewery.  Their Fulton Street Brewery is cobbled together in rented space never designed for brewing.  It is not nearly big enough and is land locked.  It will cost 50 million dollars to build a new brewery in Chicago. In times like these, I know better than most from my own expansion financing woes, that capital is hard to come by. There are investors who would love to provide capital but they bring obligations and expectations that are often no less onerous than a takeover by someone like AB/Inbev. They could be far worse.  Do we know anything about who invests in the expansion of any of the craft breweries that are growing now? I don’t think so.

At John Hall’s age, he may not want to take on 50 million in debt. Why would he?  What will happen now, is that Goose Island, with John Hall on board as CEO, will get their new brewery, IN CHICAGO, paid for by people with very deep pockets.  It will probably be a fantastic brew house. They have lured Brett Porter, former head brewer at Deschutes to take the helm.  He did a fantastic job there.  A brewer of his caliber would not have come here to preside over the decline of Goose Island.  He will probably do great things here.  I welcome him with open arms to Chicago.  We all should.

I know that these takeovers don’t always work out.  Sapporo’s takeover of Unibroue has not been good for their beer.  On the other hand, Duvel/ Mortgaat’s purchase of Ommegang, Chouffe, and Liefman’s has been a good fit; in fact in the case of Liefman’s it probably saved them from extinction.  If I detect that Goose Island is not the beer that it has been, I will drop them like a rock.  I don’t expect that to happen. It could even get better. I am going to give them a chance and I hope that others will too. If they brew great beer with quality ingredients in a new brewery in Chicago that employs our fellow Chicago residents, they stay involved in the community, and continue to innovate while brewing the beers we have already embraced, what is so bad about that?  It is good.  If they make AB/Inbev a better company, how can that be bad?  It means that we have won.

Victory for the good guys would be if McDonald’s uses organic potatoes, non trans fat oil, pasture raised beef and unconfined chickens.  Victory is when Walmart pays attention to the working conditions in the Third World Nation’s factories that supply their merchandize.  Changing the way the big guys do their business is far more effective at making a better world because that is where the volume is. Every little improvement that they make has vast effects. I want the big beer companies to make better beer.  I want more people to drink better beer. I want beer to gain the respect that wine has as an accompaniment to great food. I want people to drink less but better. I want beer to lose its frat party intoxicant image. That will happen a lot faster if big beer companies make beer with integrity.  It can happen.  It might not, but I am going to hope for the best.

Finally, this was a tough decision for the Halls to make.  I don’t envy what Greg  will face when he goes out in public over the coming months. After a spell consulting with the new owners and brewers, Greg Hall is going to move on.  I predict that we will see him in a role somewhere in Chicago doing something to further our craft beer scene. Whatever he does, I wish him the best.  I also want to thank him for his inestimable contributions to craft beer in Chicago.  We would be so much the poorer if there had not been a Goose Island and a Greg Hall here. I am full of hope that Goose Island will continue to prosper in Chicago brewing great beer and making us proud. I hope that everyone will be fair and give them a chance.  If the liquid in the glass changes for the worse, we can all vote with our next purchase of another brand of beer.

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7 Comments

Filed under beer industry, guest post, social commentary

7 responses to “Michael (Hopleaf) Roper’s Take on the Goose Island Deal

  1. Pingback: Micheal Roper’s (Hopleaf) Take on the Goose Island Deal

  2. To Michael and with regards to the Hopleaf,

    I applaud your efforts to see the potential in the ABI purchase of Goose Island. I think we all expect to see further consolidation in craft brewing, with some smaller breweries consolidating, but more likely with the big boys buying more. The question is how they manage their ownership.

    There are major differences between Duvel owning Ommegang, Chouffe, Liefmans, DeKoninck –and ABI buying Goose Island. Duvel is a dedicated brewer of high-quality (mostly) Belgian beers, with total family production less than 1mm bbls/year. Duvel has no industrial/commodity beers. Duvel is driven by the desire to make the best beers possible and to sell them for what they are worth, creating dependably high margins. We don’t fear Duvel telling us to reduce materials quality, get rid of people, reduce QC, or implement other cuts that have occurred since the takeover of AB. There are hair-raising stories aplenty about the cuts forced on Budweiser by their corporate masters. It’s all about money, it’s not about beer.

    I truly enjoy Matilda, and other Goose Island beers, and I sincerely hope they dodge the bullet. I do wonder why, with the enormous resources available in Chicago, there wasn’t anyone there to invest in Goose Island.

    Maybe there was no opportunity, but I still wonder.

    Larry at Ommegang

    • Our reviews suggest that Unibroue was not significantly affected in terms of quality by their acquisition by Sleeman.

      But as I mentioned elsewhere, product quality is only part of the equation. When you have a bully in the marketplace that’s been antagonizing toward craft brewers and their place in the market, and Goose Island chooses to befriend that bully, expectation in the schoolyard is that there will be blood. And that Goose Island will throw and take some blows for the bully.

      Naturally, this is probably going to be disappointing to all those brewers who have taken their lumps over the years.

      • stephenbeaumont

        That’s a fair point, Joe. In fact, two fair points. I didn’t address Michael’s note about Unibroue directly, but like your database, I disagree. There have certainly been supply issues and some particularly laudable brands have been mishandled, but I haven’t noted any significant difference in quality.

        You’re also quite right about the emotional side of it, of course. It’s my job to avoid that trap and focus on matters of taste, but not everyone is going to be able to look at it so cold-bloodedly.

  3. This is an outstanding take by Michael Roper on the acquisition of Goose Island and I’m going to link it to my post today on Beers In Paradise’s website @ http://www.beersinparadise.com/?p=4001.

    It’s also an optimistic post as Larry at Ommegang points out…let’s hope Michael’s optmism as well as my own is justified.

    Jason
    President
    Beers In Paradise/beersinparadise.com

  4. Michael,

    I am curious to know if you still stand by your earlier position given this week’s news about John Hall stepping down as president of Goose Island. Do you still feel the way you did in April about AB’s management outlook?

    • I have mixed feelings about how things are going at Goose Island over a year on from their sale to AB/Inbev. On one hand, they have greatly expanded their barrel aging program, moving it to a large dedicated facility. They have introduced several “Fulton and Wood” series beers and most of them have been very good. These beers are fun because they allow brewery staffers who don’t usually get to be creative to make a beer of their own. There is a fun release party at the barrel house for each one. They have done some collaboration projects with Chef Rick Bayless that have produced some delicious beer. This year there was more Bourbon County Stout available and there were some excellent variations including the much sought after Cherry Rye BCS. To my taste buds, the Reserve series beers have remained excellent. That is the good news.

      On the other hand, some key brewhouse staff have left Goose Island recently to start their own breweries. Many people in Chicago are upset that 312, Honkers and IPA are now brewed at an AB facility in New Hampshire. It does not bother me much because I don’t carry those brands anyway. However, I’d prefer that all of their beers be brewed locally and that if that means expanding their Chicago operations, that is all the better. Many of the new people at Goose including John Hall’s replacement are AB corporate types with few ties to craft beer and no ties to Chicago. That does not make me happy.

      So, as with all things in life, there is good and bad that comes with change. I still remain hopeful that Goose Island will continue to produce some great beers that I will be proud to serve. My customers and the folks at Goose Island know that if they fail to offer great beer, I will discontinue Hopleaf’s long support of their products.

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