Since its founding in 1991, the New Belgium Brewing Company has grown steadily to become the fourth largest craft brewery in the United States, producing almost a million barrels of beer per year with a carefully-selected distribution network that reaches more than 35 states . In my view, New Belgium’s success has largely been driven by its artful alignment between its business model and operating model, which has allowed it to leverage high employee and community engagement to create innovative products that consumers take personal pride in purchasing.
New Belgium Brewery (http://www.wisconsindistributors.com/partners/new-belgium-brewery/)
Great taste, innovative styles
New Belgium’s craft brews range from standard IPAs and ambers such as the iconic “Fat Tire,” to more niche products such as the “Lips of Faith Blackberry Barley Wine Ale” . Across all of their products there is a commitment to quality and great taste, which differentiate their beer and provide significant consumer value. For instance, New Belgium was ranked in USA Today’s top 10 craft breweries of 2013 , and it’s more off-beat beers frequently top “Beer Advocate” ratings.
Blackberry Barely Wine Ale (https://www.newbelgium.com/beer/blackberry-barley-wine)
The value of identity
Though quality is important, I believe that more critical to their business model is their ability to create value by connecting with their consumers’ sense of identity. Located in Fort Collins Colorado, New Belgium promotes social responsibility and environmentalism as key tenets of its business, and makes consumers feel like they are taking part in the idyllic Rocky Mountain lifestyle when they chose a New Belgium product. When consumers drink New Belgium, they are able to associate themselves with a brand that is consistent with their core values, and show their friends they are a socially-conscious beer lover.
Crucial to New Belgium’s success is its operating model, through which it invests heavily in its employees. Since 2000, New Belgium has participated in an Employee Stock Ownership Program and in 2013 it became 100% employee-owned . This directly links employee incentives to the company’s success and results in a highly-involved culture in which individuals are quick to recommend the newest brew or next innovation. For instance, New Belgium 12-pack holders have evolved to be cheaper and more environmentally-friendly based on a creative design that two employees put together outside of their day-to-day roles. In addition, the company books are open to all employees, who are strongly encouraged to ask questions about what they see . Finally, to sweeten the deal, employees are even given free beer and bicycles based on their tenure .
New Belgium Employees (http://www.consciouscompanymagazine.com/blogs/press/16248541-the-power-of-employee-ownership-new-belgium)
Investments in sustainability
New Belgium places a premium on corporate responsibility, particularly through its commitment to sustainability. For instance, the company has invested in its own on-site energy generation, including a clean biogas treatment plant which produces byproducts that fuel 15% of energy needs, and solar panels that fuel an additional ~5%. New Belgium even charges themselves a per-kilowatt-hour internal energy tax that is then reinvested into onsite renewable energy projects .
To reinforce the idea that New Belgium means more than beer, the brewery invests in a number of community partnerships. For instance, they host the “Clips Beer and Film Tour,” a short-film viewing party to benefit local non-profits . In this and many other New Belgium events, employees work closely with local beneficiary volunteers and vendors to support the community while promoting the New Belgium name.
Through it’s strong engagement with employees and the community, New Belgium has become highly effective at driving alignment between its business and operating models and has achieved a clear competitive advantage in the craft brewery space. By providing employees full ownership of the company, the tools to ask critical questions, and fantastic perks, New Belgium has created a high-involvement culture that drives them toward the most innovative products. Having achieved an employee retention rate of 94.7%, they have also succeeded in capturing their talent long-term and reducing recruiting and training costs, which can be reinvested into their business of creating high-quality beer .
Their top-notch treatment of employees ties closely to their corporate values, which also include a commitment to sustainability and local communities. By operating in way that shows they are a leader in the renewable energy space and a partner to the community, New Belgium creates value for the consumer that is about more than just the beer. When consumers purchase a New Belgium drink, they’re asserting their own sense of personal identity and aligning with values they admire.