PR, Profit, and Porter

Yesterday, I posted notes on annual reports of National Breweries Ltd. in Quebec province in the late 1940s. I mentioned that National, a public-traded grouping of the major breweries in Quebec outside of Molson Brewery, purchased Champlain Brewery in Quebec City in 1948.

The 1948 report states this of the purchase:

The company’s 1940s reports are stored in McGill University’s business digital archive. Most are in English but the 1948 report is in French. The reports were issued in both languages but appear in the archive just in one or the other.

The last paragraph states that as a result of the purchase Champlain will have greater marketing opportunities (i.e., via National’s sizeable advertising budget and staff) and “a much larger distribution network that will enable the four corners of Quebec province to purchase Champlain ale and porter”.

Champlain made India Pale Ale and porter. National already made similar ale via its Dawes, Dow, and Boswell units, and porter too via Dawes and Dow (stout) again.

Was National sincere to keep the product lines of Champlain going? It apparently did so until 1952 when E.P. Taylor’s Canadian Breweries Ltd. took over National.

Did National fail to realize efficiencies that Taylor was more pitiless to exact from his new purchase? It’s hard to say. Either way, the bland, reassuring words of the 1948 report echo today’s press releases that accompany big brewery buy-outs of craft breweries.

Business does not, in the essentials, change over time, the brewing business no less. Even porter, proudly advertised in National’s glowing colour plates, is back.

Here, National wanted to convince the Quebec City shareholders and Champlain customers that a local hero was better off in National’s fold – even though National had an existing brewery, Boswell, in the city.

Whether 2018, 1948, or 1878, buying out a competitor is as old as the hills, so is the way to explain it to people.

My sense of it is National would have made the same decisions ultimately as E.P. Taylor: shut surplus production capacity and trim staff. Unless, that is, a major turn-around in profitability and industry prospects occurred soon.

Clearly, National was in trouble by the early 1950s. Why is hard to say without an in-depth study of the structure of the Quebec brewing industry at that time. But even a cursory glance at the annual reports shows the huge spike in taxes the industry had to cope with since 1940. It was to help pay the war cost, and must have wrought a toll that kept management up at nights.

In the event, Ontario-based Taylor appeared at the right time, offering as he did a convenient and less risky alternative to an in-house reorganization.

It came at a price, as such deals always do. The still-surviving (1952), separate identities of Dawes Black Horse, Boswell, and Champlain disappeared before long, the first two with roots in the first half of the 19th century. Dow was selected as the Quebec champion for Taylor, the other brands withered although Champlain Porter continued as a minor item in inventory.

The main Champlain structure in Quebec City still exists today, as offices. Canadian Breweries Ltd. after many peregrinations was absorbed into Molson Breweries in 1989.

Molson is run to this day by canny descendants of Lincolnshire-born John Molson. They kept the brewery out of the 1909 merger that created National Breweries Ltd. A bruited 1944 marriage of Molson and National, see Allen Sneath’s book I cited yesterday, came to nought as well. In retrospect, probably good moves.

So finally Molson got it all. In time it made its own compromises: the deal with Colorado’s Coors about 10 years ago. Still, Molson survives as a substantial Canadian and Canadian-managed business. Pas si pire.

I had the porter the other day (pictured) made at its Batch brewpub in Toronto. Not strongly-flavoured but an authentic, mild porter. And, I’m not making this up: it reminded me of Molson Porter, marketed by the company into the 1980s and always the best of the surviving Canadian porters in that period.

Michael Jackson wrote in the 1986 edition of The Simon and Schuster Pocket Guide to Beer:

Among the Big Three, Molson has the best Porter***, from its brewery in Barrie, Ontario.

The Barrie facility is long-closed, but Molson’s Batch brewpub brews up a porter. Did the brewers have a peek at the old family recipe? I wonder.

If they didn’t, they might have! The 19th-century recipe, preferably, but even 1948’s would be interesting. It would give a clue as well to what the competition was like then, images of which I showed yesterday.