Rivalry Brews, a startup craft-beer delivery service based in Medina, has expanded its shipping to 41 states less than a year after launching its first sales.
The expansion comes as Rivalry looks to carve out a place in the surging and competitive space for e-commerce alcohol sales — all while focusing predominantly on Northeast Ohio craft beers.
"We have added more breweries and will have 30 total here soon," said Rivalry co-founder and CEO Adam Esker. "We are partnering with a local company to ship beer to businesses and corporations, and launching our virtual beer tasting offerings. We have two certified craft beer cicerones who are going to do beer tastings for groups, events, meetings, etc."
As noted in this feature, Rivalry formed its LLC a few years ago. But the business had always been more of a passion/side project for Esker and his partners, who work other day jobs. They were planning to launch their first deliveries last summer.
Then the COVID-19 outbreak hit, and Esker was laid off from his job as an account manager with INSIGHT2PROFIT, a tech-enabled consulting firm in Beachwood.
In terms of the plans for Rivalry, the timing was serendipitous. Not only did Esker have more time to get Rivalry off the ground, the timing for it to break into the market couldn't have been much better. With taprooms closed to the public, imbibers increasingly picked up their booze from grocery shelves or through delivery services. Consumer use of food and drink delivery services surged accordingly.
Breweries that could pivoted to direct-to-consumer delivery to capitalize on the demand. Drizly, a nationwide shipper of beer, wine and liquor, reportedly saw its gross merchandise value grow 3.5-times during the pandemic. The company told Forbes in December it was "light-years beyond" where the company expected to be at that stage of its development.
According to market research firm IWSR, the value of e-commerce alcohol sales in the U.S. grew 80% in 2020. It projects the U.S. will overtake China to be the largest alcohol e-commerce market in the world by the end of 2021.
Of course, this growth comes from a low base. IWSR notes e-commerce represented just 1% of off-premise alcohol retail sales by volume in 2019. By 2024, however, IWSR projects that will grow to 7% in the U.S., compared with 6% in China.
Just a few months ago, Rivalry was distributing to four markets: Ohio, Pennsylvania, Virginia and Washington, D.C.
Now the only states it's not shipping to are: Utah, Massachusetts, Oklahoma, Hawaii, Alaska, Alabama, Delaware, Kentucky and Rhode Island.
A challenge for the startup business is navigating separate liquor laws in each state. But details of how Rivalry managed its expansion is something Esker prefers to keep close to the vest lest he tip off aspiring competitors that want to replicate what Rivalry has achieved so far.
Nonetheless, the runway ahead of Rivalry is a promising one. The small business recorded about $70,000 in sales in 2020 without a full year of business while shipping to just four markets.
The company also supports local brewers by expanding their brand reach and helping them sell some additional product, including packaged beers that might've otherwise expired.
"We are working on growing our marketing and building a brand in 2021," Esker added. "We are partnering to ship beer to these businesses, offering virtual beer tastings and continuing to expand our brewery partnerships."
Thirsty for more craft beer news? Check out our look at the state of the Ohio craft brewing industry that includes feedback from Great Lakes Brewing Co., Fat Head's Brewery and North High Brewing of Columbus, which is expanding into the Cleveland market with two new taprooms opening in Ohio City and Beachwood later this year.
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March 19, 2021 at 01:27AM
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Craft beer delivery startup Rivalry Brews expands shipping to 41 states - Crain's Cleveland Business
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