The Portland brewing world is being rocked by the news that 97-year-old Oregon City beer distributor General Distributors has been sold to one of the biggest distributors in the country, Portland-based Columbia Distributing. Columbia Distributing itself was acquired by private equity firm the Meritage Group in 2013.
Beer blog Brewpublic first reported the news of GDI's sale Monday.
General had been a family owned business in Oregon City since 1921, run by three generations of the Fick family. George Fick co-founded the business as Fick Cigar Co., distributing candy cigarettes and cigars during prohibition years.
According to a document filed with the state of Oregon, General will lay off 165 workers as part of that consolidation. No re-hiring of employees by Columbia is guaranteed, but Columbia has indicated they will rehire some employees.
The lay-offs at General will take effect March 31, 2018, at the close of the sale but, according to Brewpublic, the employees will begin interviewing with Columbia on March 1.
"We will be interviewing all employees at GDI and can always use beer and craft knowledgeable people to make us better at our business," says spokeswoman Linsi Taylor of Columbia. "It remains Columbia's goal to have the best team in the beer industry."
According to an interview posted on New School beer blog, Columbia would also consider interviewing GDI employees for other open positions outside of the Portland area, but plan to close down the Oregon City warehouse.
The sale is also a source of uncertainty for the local brewers signed with General. Brewers are uniquely sensitive to any changes in distribution arrangements, often likened to marriages because they are notoriously difficult to dissolve—breweries can live or die based on how well their distributor sells their offerings to bars, stores and restaurants.
Columbia's spokeswoman confirmed with WW that Columbia will take on any GDI brewers who want to be part of their catalog, but will not ask for buyouts if brewers want to opt out.
"They can choose any distributor that meets their needs and Columbia has no intention of holding brewers wishing to move their business," Taylor says.`
At least one brewer, however, is jumping ship entirely.
"For us, when we first got the news it was heartbreaking," says Dave Marliave of Flat Tail in Corvallis, whose IPA was just voted the second best Oregon IPA in a blind taste test at Oregon Hophouse. "General isn't just a partner. A lot of the sales staff, we're to the point were we're friends. We go back six years."
But if Marliave's first reaction was "holy shit," his next was to take stock of whether a distributor was beneficial at all. After GDI shuts down operations on March 31, he says will go back to distributing his own beer.
"The way the industry has changed," he says, "It's shifted so far away from the single-serve package. This is an opportunity to get our distribution rights back without writing a check [to GDI] for a quarter of a million dollars. It's a bittersweet turn of events. Even though it's good for us, I've got guys who helped us build our brand for years who will be out of a job."
Marliave says columbia treated him decently throughout their interactions, and personally guaranteed they wouldn't stand in his way if he wanted to go his own way.
According to Columbia's spokeswoman, the offer that led to their acquisition of GDI had been made long ago—and was part of a general trend toward consolidating in distribution. She points out that 90 percent of GDI's sales volume, including MillerCoors products, were already under contract to Columbia in different Oregon markets.
"Wholesaler consolidation started many years ago in an effort to better serve both customers and suppliers and to survive in an ever changing and more competitive market," Taylor tells WW. "Columbia expressed interest in purchasing GDI many years ago knowing that they would only consider a sale when it was the right timing for them."