REGINA — A new partnership in the Saskatchewan craft brewing industry is an indicator of changing times.
On Tuesday, Saskatoon-based Paddock Wood Brewing Co. announced a new partnership with Regina’s District Brewing Co.
Paddock closed its operations in Saskatoon on Jan. 27, with general manager Doug Yaremko saying this move was a result of the last few years in the brewing industry.
“We saw a recession immediately following COVID and high interest rates. And that was the start. That was the start of a decline in consumption of craft beer.”
Yaremko mentioned craft beer, a premium selection of alcohol, is more expensive than domestic beer.
In the last three years alone, Yaremko estimated craft beer prices have risen by between 10 and 15 per cent.
“We've been on a downward trend in craft beer consumption over the past three years in particular. Due to economic factors, as well as changing consumption factors, which have certainly impacted our industry.”
As a result of closing its operations in Saskatoon, Yaremko confirmed most of its employees weren’t retained.
Despite the downsizing, Yaremko said the partnership presents a good opportunity for the company.
New arrangement splits branding and production roles
Paddock Wood Brewing Co. will handle the brand, sales and marketing for the company, while District Brewing Co. is responsible for the production and distribution side.
Yaremko said District Brewing Co. working on its distribution is a big gain.
“This provides us with access to technology and resources that we haven't been able to access. So better filtration.”
He added, “I would say [it's] world-class when it comes to pure production as well as other opportunities.”
On the flip side, Hayden McPherson, marketing co-ordinator with District Brewing Co., said in-house distribution helps cut waste by reusing products.
“Reuse of ingredients, things like yeast and different byproducts that can stay alive and get more use, limits their overall costs.”
Another benefit of the partnership is helping keep craft beer products from the companies at a steady price.
“My costs go down, and District's costs go down because they're producing more product. So with that, there should be the ability to maintain prices at least for a short period,” noted Yaremko.
Partnerships like this will likely continue, said Yaremko, as industry patterns and craft beer consumption are changing.
As for what will make this partnership successful, Yaremko said it’s about helping Paddock Wood Brewing Co. expand its venture beyond beer.
“If we can find the right products for the right markets and consumers, we want to build those out.”
As for District Brewing Co., McPherson said it’s about ensuring everything becomes smoother, “as we get everything ironed down on the production side, on their new setup with their sales and their marketing, how that ties in with us as well, and how we work together and grow.”
McPherson also said District Brewing Co. is open to new partnerships.
“We have a lot of different opportunities to make more things. And so I think as the industry keeps changing, we'll still have our doors open for everyone who needs it.”
