Minutes from September 15, 2015 Ben Cook, Hanger 24 Craft Brewery

Tuesday, September 15, 2015

Open Board of Directors Meeting

San Bernardino Community College District
114 S. Del Rosa Drive
San Bernardino, CA 92408



Present: Don Averill, Deborah Barmack, Peter Barmack, Carole Beswick, Russ Bogh, Ken Coate, Scott Davis, Kevin Dyerly, Jill Eaton, Dick Hart, Mark Kaenel, Lowell King, Pam Langford, Ed Lasak, John Mirau, Dan Murphy, John Prentice, Brian Reider, Kristine Scott, Paul Shimoff, Wendy Strack, Steve von Rajcs, Phil Waller and Hassan Webb

Guests: Angela Gardner

Announcements: 1) A letter of congratulations was sent to California State University, San Bernardino which is celebrating its 50th Anniversary. 2) Inland Action is sending a letter to the Governor urging that he sign AB 914 (Brown) giving SANBAG toll road authority.

M/S/P: Minutes from July 21, 2015 and July 28, 2015

Dan Murphy introduced Ben Cook, Owner/Master Brewer, Hanger 24 Craft Brewery.

Beginning in 2008 Ben Cook took his home brewing hobby and built a successful and growing Company that sells product in three western states and currently employs 145 people. He discussed the Company’s history, milestones and challenges.

Founder and Master Brewer Ben Cook and friends used to meet in hangar 24 at Redlands Municipal Airport after an afternoon of flying to trade stories, talk aviation, play music and share a few cold ones that Ben just finished brewing at home. Family and friends encouraged him to pursue his brewing, and he spent valuable time working in Quality Assurance at the Anheuser-Busch Brewery in Van Nuys, CA. While learning on the job and majoring in Biology at California State University San Bernardino, Ben knew he would follow his passion to create beer. He attended and graduated from the prestigious Master Brewers Program at the University of California, Davis. Ben was brewing at night and selling his beer during the day. He took as many Small Business Association (SBA) classes as were available, created his business plan and received his first SBA loan. He sought out and found the brewing equipment he needed, a great location adjacent to the Redlands Airport and aptly named his brewery Hangar 24. His big break came in 2009 when shelf space at Stater Brothers Market was made available. It was not long after that the other grocers followed.

The big beer companies have experienced a decline in their growth in market share while craft beer market share is growing substantially.   Americans’ enthusiasm for microbrews reached new heights last year as craft brewers accounted for 11 percent of the US beer market, according to the Brewers Association. Hangar 24 went from sales of 1,100 barrels in 2008 to more than 10,000 barrels in 2011. Because of this success they added delivery trucks and installed three new brewing tanks in addition to moving a part of their operation to a 22,000 sq. ft. distribution center in Redlands.

Regulations on distribution are in place so that big beer companies like Anheuser-Busch, Miller-Coors and InBev do not monopolize the market. These top three control 80-90% of the market share. The Alcohol and Beverage Commission (ABC) controls and regulates the industry and restricts discounting or deal making in the marketplace. However there are many loop holes and the system is flawed. The distributors control the market and shelf space is limited. The craft brewing industry is pushing for changes in the federal laws and legislation is pending.

Last year Hanger 24 brewed some 38 different beers using products from the U.S. to the extent possible. Their beer is now available throughout California, Arizona and Nevada, and they plan to increase their presence in these states.

A Q & A period followed.

Meeting adjourned at 8:30 a.m.