Room to Grow: Peter Zien Keeps AleSmith in Building Mode

​It’s really been an entire second professional career​ for Peter Zien. At 59 years old though, and heading toward his third decade of ownership at AleSmith, Zien understands for the brand to continue to grow, it can’t just be him leading the charge.

Zien, who got his law degree but went into home finance repair, has led the San Diego brewery since purchasing it from Skip Virgilio in 2002 and has built an executive team that is poised to continue to see the 26-year-old company move forward in a competitive Southern California market.

“I’m not as good as a lot of my team anymore. And that’s just a fact,” he told Brewer in an interview in November 2021. “A President, sales directors, CFO … people, highly skilled and highly trained to do their jobs well. It’s given me the ability to think about what do I want for this brand next year? What do I want in five years? What’s an exit look like? Do I want to create an equity group, do I want to include some of these hard workers in it? I’ve been able to do all this other stuff now. So it’s been really, really important.

“I think you limit your growth if you’re going to … well, the term micromanaging will come up eventually. If you’re an owner, and you’re leaning over people’s shoulders too much, that can disengage an otherwise engaged employee.”

The addition of Brandon Richards — who rose to the role of CEO at Coronado Brewing before joining AleSmith as President — is a part of the third generation of the company that opened in 1995.

“About two years ago, we sought out someone who understood the values and my goals for myself and my wife Vicky and for AleSmith,” Zien said. “We did find that in Brandon, who’s an unbelievably talented young man who gets this game and is just a fantastic leader. He is now my one report. We communicate daily, but that’s it. I don’t go around him.

“Brandon’s gonna run this company, and it’s given me the ability to take that step back and to be that visionary that got me started in this to begin with.”

Zien said he’s ‘enjoying this game again,’ since the addition of Richards and the executive team, which started forming around 2012 when the brewery moved to its 109,000 square-foot facility.

“I can tell you a few of those years, you get a little tired, you get a little burnt, you wonder how much longer you can go,” Zien admitted. “But man, having a President has been the greatest thing for me. I can go into my tasting room as a customer. I can go to other breweries and have fun. I don’t have to worry. I know what has to be taken care of, it’s going to be taken care of.”

But Zien is far from hands-off. He still participates in sensory panels and recipe formulation meetings.

“I’m allowed to go around Brandon to the brewers for that,” he said with a smile. “My Thursday meeting for sensory, but otherwise everything’s gonna funnel through Brandon.”

Zien admits it has taken a level of maturity to trust others to do things.

“I don’t think I had that until I got into my 50s,” he said. “I hate to say that. I just wanted things done a certain way. You train people ‘the right way.’ And the reality of it is, it’s hard to get people to care as much about your business as you do.

“They can care 99%, but you’re the 100% one. You’re the one that wakes up at three in the morning thinking about it. You can’t escape it. Everything is this company.”

Zien was always searching for the right people, but he gives his wife much of the credit.

“She has a sixth sense when interviewing, she finds unbelievable great people,” he said. “I’m the envy of many other brewery owners when they see my team. But you find the right people and it makes life so much better. And her expression … she says, ‘you gotta put the right people in the seats on the bus.’ Sometimes you have to shuffle it around a little. But it’s been a wonderful transition for the company. I feel set for the future and to move forward with the team we have in place right now.”

Building that team now has the company poised to continue growing. Zien says they even aspire to be a little larger.

“Our facility is 109,000 square feet and we’re basically a 32,000 barrel brewery,” he said. “I think that only puts us in about like, ninth position just within San Diego County. So we definitely would like to experience life at the 40,000-50,000 barrel level.

“We have tank space to be a 250,000 barrel brewery, if that were to happen, we have the space for it.”

In fact, the brewery said in a year-end report that it had record-high sales in 2021 with a 38% increase in Sales to Retailers and finishing at a production of 34,000 barrels.

Barrel shipments increased by 40% compared to 2020 (up 29% from 2019) with lots of growth being credited to .394 Pale Ale after a rebrand in 2020 and local execution by landing in the Top 5 brands in IRI.

Zien helped foster that growth early on almost by himself. He took the keys from Virgilio after volunteering to put caps on bottles and help around the brewery on July 16, 2002, with one other employee, a holdover, and friend, Tod Fitzsimmons — who has been and continues to be Brewmaster for the company.

Zien — who humbly considers himself a renaissance person, making his own cheese, having a successful homebrewing career along with roasting coffee, making mustards and chocolate along with playing guitar, painting, and writing — would turn off his phone to follow other aspects of what he loved.

“And I didn’t check my emails,” he added. “And what was happening was, yes, I was fulfilled as a person. But I was doing nothing for AleSmith. The brewery basically did a circle that day. And we weren’t going to grow. And that was true for many years.

“I’m neglecting other things that are going to enable growth. So that call I missed from a potential distributor, an email I didn’t return to appear in interviews like this … that started to wear and the company was growing modestly but I realized, now at 59 years old now, I don’t want to be doing all that physical work.

“It’s just the best for the company for the owners to entrust others to run it. It’s just the way to get bigger.”

Nearly 80% of AleSmith’s production doesn’t leave the state, with a majority of that still being served to San Diego County consumers. AleSmith was never afraid to head east, hitting up to 30 states in the US at one point. Right now, they go into 18 states through about 20 distributors. But understanding that personnel is needed in these states is a step in growth for the brand. Before just being on the shelf saw sales. With a rise in local beer in each state, AleSmith sees the need to market the brand better. A new look started that change and the addition of boots-on-the-ground staff are next. Its .394 Pale Ale and its connection to San Diego Padres baseball superstar Tony Gwynn helped sell almost half of the entire production locally, but a benchmark beer like Speedway Stout helped build the brand away from San Diego early on.

“There was a time when I would go pouring beer at GABF, and I would have people ordering beer in one line, and I’d have distributors lined up to talk to me over on the right,” Zien said. “They all wanted my beer, and they didn’t care what they paid. They didn’t care if I had a salesperson in that area or not. They just wanted our beer. So I signed a deal here. I signed a deal there. Now it’s a little different. You need to have support and we’re working on that. We’re trying to get regional representatives to carry our flag.

“It’s not enough to treat your distributor as a delivery system and a pickup system. You could get away with that when you’re small, and highly in demand. But now I’m competing with a lot of breweries and a lot of great local beers and people are tending to drink more localized. We used to go all the way to New York and Boston and so forth. But we’re concentrating on the west and some of the Midwest.”

Zien can tell the San Diego and Tony Gwynn story all day long, but he said the out-of-state story is different.

“You have to read our can and know a little bit about us,” he lamented. “If we’re not going to be doing tastings and we’re not going to do tap takeovers in these various places we are in, what tends to happen is the orders go from taking a mix of the beers until they whittle down to eventually just Speedway or Speedway and IPA. And that’s not what we want. We want to have a nice shelf for us.”

Zien said the addition of David Berryhill as Sales Director is helping in that growth.

“He very much understands the distribution game​,” Zien said. ​“​I’m learning a ton from him. And as a company, we’re experiencing great growth again, and I give David so much credit for that.”​

But the key is finding new people to drink AleSmith’s brand.

“There’s a new group of 21-year-olds every year,” he pointed out. “How do you find them? Do you run an ad in a brewers publication? Or do you try, maybe a mountain climbing magazine?

“If you’re looking for someone who doesn’t know you, then you have to go somewhere where you aren’t.

“We talk about that stuff now. I’m a soft sell kind of guy. I would have been a terrible salesperson. I would rather make a product and you come to me because you like it. AleSmith, to some extent, needs to break a little bit away from that. And that’s why I’ve hired very good people in the sales department who can go and do that where I couldn’t. I think it’s an important part, you need to expand your base.”

Zien said that asking to be a 50,000-barrel brewery is not that big a deal.

“It doesn’t seem like it’s a ton of beer compared to when you think of the million-barrel breweries like the New Belgiums and Sam Adams [of the industry],” he said. “I’m asking for 50,000.

“Maybe I’ll be around when we’re 100,000 or not. But you know what? If the quality drops 1% to grow, then we’re not growing. It has to be on my terms. I’m not gonna water something down to sell more of it. And so far, we’ve been good about that.”

Every person in the AleSmith brew cellar is a beer judge. Many of them judge at the professional contest level, Zien said, and he believes it’s important to attain quality in the product.

“I wanted judges’ feedback,” Zien said in talking about both his homebrew days and in competitions like GABF and the World Beer Cup. “When I became a judge, that’s also really great, because now you have essentially a marketing group in front of you of 12 different Porters that people made.

“When it’s your turn to brew a porter, believe me, you figure out what you want and what you don’t want. So yeah, it has to be at the highest quality.”

During hop-shortage years, AleSmith would introduce a Double IPA, as an example.

“Money be damned, you know, we weren’t making money,” Zien recalled. “It didn’t hurt as much. I just said I believed in the consumer, I believe that there would be a day where they know the difference between ‘okay beer,’ ‘good beer’ and ‘great beer.’ It’s a long, slow journey, but it’s happening.”

AleSmith is there for people that want the high end,” even in a pandemic market or such.

“I still believe, in any economy, there’s a market. There’s always going to be a Tiffany’s, there’s always a Rolls Royce,” he said. “There’s a certain segment of the population that are going to just want the best and I’m that way. But I never wanted to be snooty or pretentious.

“I used to say I wanted AleSmith to be the Rolls Royce of craft beer without the pretentiousness. I wanted to be accessible and I want everyone to be able to try it. And if you don’t think you know much about beer, it doesn’t matter. You know what you like since the day you were born, you’ve been putting things in your mouth that you like to eat and drink. And that’s all I need.”

Be the first to comment

Leave a Reply

Your email address will not be published.