As a young District Sales Manager for Lone Star Brewing Co. my territory was west Texas. While I had a number of distributors in this area, it really was all about low volume and a lot of windshield time. Lone Star’s volume was concentrated in Austin and then moved southward. Although the territory was west Texas, I did have one distributor in Oklahoma located in the Lawton/Altus market. Typically this would be a very small market as far as any potential; however, since the Vietnam War was at its peak, the distributor’s territory included Ft. Sill. Sill was the army’s artillery base and was full of soldiers, thus making nice incremental volume.
On my first visit to the Oklahoma distributor, who was a multi-brand Miller house, the staff was very open and cordial. Since Lone Star’s management at that time was ex-Schlitz trained, our paperwork was similar to Schlitz’s. We were required to complete a market visit report including a physical p-o-s and beer inventory. I found the operation had only 20 cases of Lone Star on the floor, and when I asked for orders, I was told the operation had none in the system. I immediately asked the sales manager why they had no orders and was told that the company was discontinuing Lone Star altogether. Obviously, this caught me by surprise.
I was informed the operation would sell the existing inventory. I called the brewery and spoke to the sales manager who did not seem to be upset, but suggested I contact any other distributor in the market to find another home. From 1959 to 1973, Lone Star operated what was once the old Progress Brewing Co. in Oklahoma City. During the early 60s, Lone Star had good volume and a decent investment spends for Oklahoma. My visit coincided with the brewery closure.
I immediately contacted the other two wholesalers, Coors and Schlitz who both agreed to meetings. By this time, Coors had over a 70 share of market so their warehouse was new and big. I was shown into the President’s office where I noticed a small trophy with a Lone Start can sitting on his credenza. The President arrived and I updated him on what had happened and asked if he had any interest in distributing Lone Star.
He smiled, turned to the trophy, and commented that it was obvious I did not know his history with the brand. As it turned out, he had been the Lone Star distributor for years, but as Coors continued to grow, Lone Star decided that they were not getting the focus they felt they needed. Lone Star terminated him and moved to Miller. I confirmed I did not know the history, apologized, and thanked him for his time.
I went to the Schlitz house, located in an old railroad terminal with wooden floors, which also had Stag, a good selling regional. Schlitz, a decent seller and about nine years from imploding, and Stag made for a good house, and while the wholesaler was open, he declined. After all the years of investment by Lone Star in Oklahoma and this market, Lone Star was no longer available and all was lost.
A message to today’s craft brewers from Warren Buffett, “price is what you pay, value is what you get.”
From Food City for the 4th:
And Happy Belated 4th!
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