Oklahoma loves Sonic (SAM)
Sonic Hard Seltzer has expanded its distribution beyond its home state of Oklahoma. The new hard seltzer is now available in Texas, Arkansas, Kansas, Missouri, Nebraska, and Arizona in two different variety packs. In addition, the hard seltzer will be sold in various packs of slim cans, which were not available for the Oklahoma launch. The hard seltzer has also been reformulated. The beverages come in flavors familiar to customers of Sonic Drive-in. In the Oklahoma launch, four weeks of the product was sold in four days. It has since settled into an 11% share of the hard seltzer market in the state. Sonic has a powerful regional concentration which will make the initial markets significantly outperform the later markets.
Black Book today (SAM)
We are hosting a Black Book presentation today at 2 PM ET on the hard seltzer category. The focus is on Boston Beer, the company with the most exposure to the category. We will address the impact for the other companies competing in the category, Anheuser Busch InBev, Molson Coors, and Constellation Brands.
Beer distributors’ outlook worsens (STZ)
As seen below, the National Beer Wholesalers Association (NBWA) released its Beer Purchasers’ Index (BPI) for October, with more beer segments contracting than expanding. The BPI is a diffusion index with above 50 indicating expansion and below 50 indicating contraction. The index for imports was 69, up from 65 in September, indicating growing demand. The premium light beer index was 52, but above 50, similar to most of 2021. The regular domestic beer segment had a reading of 42, while the below premium reading was 30, indicating significant declines. The FMB/seltzer segment was 44 in October, up to four points from September, indicating a contracting outlook. The craft segment index was 43, one point lower than September. Cider’s reading was 29, worsening from 34 in September. The at-risk inventory reading for October was 59 for FMB/seltzer for the second straight month and 51 for craft, indicating growing at-risk inventory.
