Sleeping Giant Helps Boulder Beer Keep Cans on Shelves

Like many beer drinkers in Colorado, Matthew Osterman got his first taste of "wow" from Boulder Beer. Although the brewery, founded in 1979, had already attained legendary status — both inside and outside of Colorado — by the time Osterman was old enough to drink, it was an important early discovery in the Colorado native's beer journey.

“Boulder Beer is near and dear to my heart,” he says. “It was formative to my craft-beer experience. There is no brand that is more iconic.”

But a brutally competitive market — there are now more than 8,000 craft breweries nationwide — took its toll, and in October, Boulder Beer announced that it would have to lay off a third of its staff and stop canning and bottling beer, focusing solely on running the Boulder Beer brewpub on Wilderness Place.

Osterman, like many Coloradans, was shocked. But as the founder and president of Sleeping Giant Brewing, a huge contract-brewing firm in Denver, he was in a position, maybe, to do something to help both breweries.

Osterman called Boulder Beer co-owner Gina Day and her husband, Frank, founder of the Rock Bottom, Old Chicago and Chop House restaurant and brewery chains, and offered to come up with a way to keep the brewery’s brands alive. Although he hadn't worked with them before, he knew them through his connections in Boulder and in the Colorado craft-brewing industry.

The result of the call was a good one. Although the specific details of the contract are still being worked out, Boulder Beer will allow Sleeping Giant to brew, package and sell most of its core lineup of beers, including Buffalo Gold, Mojo IPA, Hazed Hoppy Session Ale and Shake Chocolate Porter.

Boulder Beer isn’t paying anything up front as part of the arrangement, but both companies will benefit if sales go well, Osterman explains. “In a perfect world, doing something like this would have taken six to twelve months, but we had to put this together lightning quick.” Without that speed, Boulder Beer would have lost its space in hundreds of liquor stores and restaurants.

In addition to keeping Boulder Beer’s products on shelves, the deal will also allow Sleeping Giant to enter a new business area that it hadn’t previously been involved in: the marketing and selling of beer. As a contract brewer, Sleeping Giant doesn’t have any brands of its own. Rather, it makes and packages beer for fifteen to twenty different breweries — about half of which are in Colorado, including Station 26 Brewing and the Post Brewing. The relationship gives smaller breweries much larger capacity and allows them to save money on the cost of ingredients, equipment, transportation and logistics.

But now Sleeping Giant can add sales as part of its offerings. “We can take this platform we are building for Boulder Beer and use it for future clients,” Osterman says. “It’s a huge amount of economy of scale that we will be able to provide.”

And there is very little risk. Boulder Beer made 16,000 barrels of beer last year, so even if Sleeping Giant only produced half of that, it would still make money, Osterman explains. But it’s more likely that the brewery can actually grow sales, he insists, especially since Boulder Beer was doing 30,000 barrels just a few years ago.

“Yes, it is ultra-competitive right now and hard to sell beer. But it’s easier for Boulder Beer than it would be for some ‘Bob’s Brewing Company,’ because Boulder Beer immediately brings to mind a place that people know. It’s a home run.”

On Wednesday, Sleeping Giant packaged its first run of Boulder Beer, canning Buffalo Gold. The facility will fill cans of Shake Chocolate Porter today and Hazed on Friday.

“It’s very fitting to start with those,” Osterman says. “And we keep the Boulder Beer brand alive.”