Becoming One: The Benefits Champion & Reason See in Merger

One brand had a newer and larger facility while the other had a larger distribution footprint. Both have name recognition in Virginia so Reason Beer and Champion Brewing will continue as separate brand names even though the two are now one company.

It made sense, said CEO Hunter Smith, to keep both brand names alive with separate portfolios and increase buying power for the two companies that will now work as one.

“There are advantages to buying in bulk and placing larger orders might gain us discounts for which we previously didn’t qualify as separate entities,” he told Brewer, saying there was an advantage to producing a combined 6,000 barrels of expected output. Smith added that Champion’s volume of around 5,000 barrels will also allow for better margins on Reason products.

Both brands have a strong following, Smith noted.

“While Reason Beer is a younger brand, it quickly gained brand recognition in Virginia, and we believe that the beer portfolio is strong enough to stand alongside Champion under a common operational umbrella,” he said. “We also think that the breweries are known for different styles and will allow us both to focus on our strengths.”

READ MORE: Three Reasons Integrating Your Operations Will Future Proof Your Business

That is an important key as both brands had distinct portfolios in the market and there isn’t much in the way of stepping on one another’s toes when it comes to combining the sales forces.

The closest two brands are Shower Beer and A-OK Pilsner, but Smith pointed out that one is Czech-style Pils and the other German, “offering different inspirations and flavors,” he said.

The ultimate aim is to bring the Reason brand into Champion’s distribution footprint, allowing for greater chain access and out-of-state sales. Reason Beer will be served alongside Champion brews in Champion taprooms and Champion Hospitality Group properties.

Reason Beer, founded in 2017 by Jeff Raileanu, Mark Fulton, and J. Patrick Adair, gained a loyal following of brands like Reason Pale and Pattern Recognition IPA. Champion named Raileanu its CFO.

From the moment they announced the merger, Smith said team members were excited about the news. The brewery said no jobs will be lost and instead roles that are doubled up on will be worked on together.

“[They are excited in] having a peer partner to discuss the work with, to learn from, and to enjoy being around as an automatic friend at work,” Smith said. “We’re cut from similar cloth and [I] don’t think it would have been possible with other in-town beer brands.”

The biggest adjustment may be Champion moving operations from its Woolen Mills Missile Factory to Reason’s headquarters in Charlottesville, Virginia.

Smith said that Reason’s facility is larger and newer.

“It also has amenities like a break room for staff to enjoy, air conditioning, and ample parking,” he noted. “The location is a plus, as well, directly off a main road not far from the interstate, it’s convenient for distribution as well.

“There are also opportunities for growth inside the building, offering a ‘forever home’ for the joined business.”

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