Two Roots Brewing Co., the Sorrento Valley based non-alcoholic beer company, is expanding.
Founded in 2016 and owned by San Diego’s investment management company Lighthouse Strategies, LLC, Two Roots Brewing Co. recently got a “yes” from a buyer at Walmart’s Open-Call. The annual event is a program through which the national retailer identifies and contracts with new suppliers with unique and innovative products.
Now, Two Roots Brewing Co.’s non-alcoholic, non-cannabis-infused beer product is slated to go on a test run in 50 Walmart stores, potentially including in Southern California, by April 2021.
“We found out about Open Call through ECRM (a company that forges relationships between buyers and suppliers) and applied in early July,” said Maikel Van de Mortel, chief marketing and revenue officer at Two Roots Brewing Co. “Right at the end of our Zoom presentation, our buyer let us know they wanted to move forward and provided us with next steps, which was to conduct a 50-store trial within certain regions with our non-alcoholic (non-cannabis) product.”
First task, according to Van de Mortel, was narrowing down the expansion to three regions, which have since been identified as Southern California, Michigan and Massachusetts.
Two Roots acquired Rochester Mills Production Brewery, a Michigan-based company, in 2019, explained Van de Mortel about the decision to expand in the state. The facility has a 60,000-barrel brewing capacity, he said. Massachusetts made sense because the company has several business dealings there and has a keen understanding of the market, he added. Southern California is where Two Roots is headquartered, with a brewery in Kearny Mesa that has a 10,000 barrels annual brewing capacity.
Two Roots will be available at the 50 Walmart stores in three core styles: two IPAs called New West and Straight Drank, and a helles (or a lager) called Enough Said. More than 4,800 small businesses from around the world applied for the chance to pitch a Walmart merchant and 900 meetings were held, according to the company.
Innovation and Ingenuity
Laura Phillips, senior vice president for global sourcing and U.S. manufacturing for Walmart, said the outcome of the first ever virtual Open Call was impressive, including the presentation by Two Roots.
“It is truly inspiring to see the strong entrepreneurial spirit of this year’s participants,” she said. “Despite the challenges small businesses have faced this year, they’ve brought incredible energy, innovation and ingenuity to their product pitch meetings, and we are excited about what this means for our customers, our communities and our commitment to source an additional $250 billion in U.S. manufactured products that support American jobs.”
Added Walmart CEO Doug McMillon: “We want to help small business owners weather the current situation and take care of their employees, so that after this pandemic, they and the communities they serve can thrive.”
Gold and Bronze Medals
Van de Mortel said aside from having a strong product and audition, it worked in their favor that Two Roots secured a gold medal at the Great American Beer Festival in 2019. Earlier this month, the company found out it won the bronze medal at the 2020 event, he said. What’s even more exciting is that, while there was a separate non-alcoholic beer category last year, which received 17 submissions, this year it was consolidated with the session beer grouping, or beers with up to 5% alcohol by volume, for a total 89 entries.
“For us to come in third with a non-alcoholic beer against 89 entries, of which the vast majority was alcoholic, we took that as a massive compliment to the product and the quality we put out in the marketplace,” he said. He adds that the non-alcoholic category is a relatively new segment for Walmart, and Two Roots is honored to be one of the companies to introduce the category to the Walmart customer.
Long-Term Growth Plan
“We are seeing the Walmart opportunity to share our knowledge and experience to buyers to make informed, sound decisions on how to best reach the various Walmart non-alcoholic beer shoppers,” said Van de Mortel. He said there will be heavy focus placed on signage and category building as a result. “From there, we hope to demonstrate the viability of the category as a whole and start expanding to other parts of the country.”
Two Roots non-alcoholic, non-cannabis infused beer launched in fall 2019, just months after its non-alcoholic, cannabis infused beer counterpart was released in the spring. Two Roots products are in a total 350-plus on-premise and off-premise doors, said Van de Mortel. The long-term growth plan for the company includes launching in Northern California in Q4 of this year, followed by the north east region in Q1 and then the south and the Midwest in Q2 and Q3 of 2021, he added.