“Really, Ken, a failed company?” Actually Studebaker survived, now part of Worthington Industries. They simply don’t make cars anymore, which hooks right back into my main point here…
I know Studebaker no longer makes cars, a fact I have never been happy with. However, I may never have met my first love on 4 wheels: a 61 Studebaker car I bought for $25 and took me 100,000 miles before rust and burning oil issues took Harvey away, if they had stayed in the car business. A 7 year old car for $25? Eventually Harvey went to automotive heaven where oil changes happen every day and no rust dare enter those chrome hubcap gates.
I didn’t name the car. My ex-girlfriend’s friend did.
Studebaker as a car and truck builder survived, often barely, though tough times, like craft brewing will be going through now. Yes, there are Studebaker-related lessons for tough times, like during Corona, for the small professional brewer to heed. I will bring it back around to just beer.
How ironic the moniker for beer tough times is the name “Corona?”
Anywhosie, during the Depression Studebaker almost went under. Many car companies and breweries did go under. Studebaker convinced the court their vendors would do better with them restructuring and still in business so they could pay off their vendors. Then the war hit and the government put Studebaker to work building trucks for war. The word for truck in Russia was Studebaker for a long time. Then, post war, they were the first with a new car. Despite dark times they forged ahead, thinking and rethinking where they would go next, what the public might need for the moment and in the future.
Lessons: find something new to do that hopefully will increase profits later, and something that will help you survive for now. Studebaker continued to build trucks for the military until Kennedy appointee, and former big car company exec, McNamara took away that business. That hurt Studebaker as much as if the government, during Corona, handed most beer business over to InBev.
Luckily Studebaker execs were looking ahead and had developed the newest new model which took off, literally and figuratively. They were looking to Japanese car companies to be included in their showrooms. It almost happened, but that lawyer made the mistake of informing both they were in discussions with other company. (Irony: that lawyer was Richard Nixon.) Because forward thinking several times in its history the executives at Studebaker saved, or almost saved, Stude as a car and truck manufacturer.
Lesson: look for products people may crave during and post Corona. Whatever it may be. And alternative ways to get them to customers.
Previous to that prohibition certainly didn’t help Studebaker, especially delivery truck sales. Breweries hurt far, far worse, for obvious reasons. The ones that survived found alternative, sometimes beer-related, products. Some sold malt extract with specific instructions on how NOT to brew beer with it. Of course NO ONE DID.
Studebaker was always a company on the edge, in part because they treated employees fairly: they didn’t have a strike until the 50s. They often paid them better than union wage. The unions generally liked them because they were very considerate, providing extra paid time to clean up, providing a bible to the family whose union employees died. They let sons work in their father’s stead when the fathers had been drafted for war.
While I’m sure there are a few craft brewers who don’t treat employees well, generally I think their strength is they are kinder and more considerate than the big guys. Craft beer is a family environment, and the ability to work one on one with the boss is a big plus, rather than being a cog in a corporate wheel.
Prohibition killed off so many breweries. Smart brewers, like FX Matt in Utica, found new products to sell like root beer. Options like delivery, crowlers and growlers to go, food if part of the profile of your business; or working together with food trucks offering delivery of whatever can legally be delivered in your state, should be considered. Selling malt, grist… how about formulating a yeast culture one could flush into a septic tank that would eat away the waste? Rid-X is basically a biological product that does the same. I know: I almost never use Rid-X. All three of the septic tanks I have in our three houses see a lot of yeast. Seems to work; never had to pump any of them.
Don’t just take my advice. Find pros in the field. I admit: I am no biologist.
So the core of any of this advice is to be creative! Think out of the brew box, or have a brew box that could be delivered with food too, if the latter is feasible. Here’s a lesson from FX Matt out of Utica, NY, that you can do whatever with: FX had a ‘friend’ in Congress and an hour after Prohibition was repealed they had the first beer served in a pub in the country.
As we well know, since alcoholic beverages were illegal previous to that, they quickly brewed up a 30 minute batch. Nothing legally problematic went on there!
Could be as simple as having a huge block party right after restrictions are listed that’s very community friendly. New customers, much?
You will be rewarded if you saturate the market with your new ideas via advertising, new brews, new ideas: something you think the public will latch onto, immediately. I know none of us are fortunetellers, but trying to sense a change in the wind, or in this case maybe in the sniffles and the sneezes, would be advisable.
I know: you probably have loans and many ways you have already over extended yourselves. But when the market returns to normal it will be no time to be conservative. In this case the difference between roaring back to life and hurting yourself beyond repair may be just that: a sense of what lays ahead and finding ways to take advantage of it, not being so anal to what you were doing. Heed what Studebaker did, what breweries did, hell, what songwriters do when they take a job washing dishes, being a security guard or giving Music Row tours. Whatever it takes.
Malt for bread, beer-based dishes of any kind or pastry, root beer, sodas, new product and especially new venues like drive through windows, delivery for whatever you legally can deliver.
And, who knows, after this you may have just upgraded your business model in an enriching way. And I don’t mean just money.
Ken Carman and Cartenual Productions
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