A Spirits Distributor Exits California. Plus, AG1 Hits Costco

0:04Welcome to the CPG Week podcast by BevNet and Nosh. I'm Monica Watrous, here with my co-host, Lucas Southard. Now, here is the latest in food and beverage industry news. Fourth-generation cheesemaker Sartori announced its acquisition of organic cheese and butter producer Rumiano on Monday, bringing together two legacy family-owned businesses. Sartori will now operate and market the California-based cheese brand alongside its own namesake products and has purchased Rumiano's Crescent City, California-based cheesemaking facility. Alongside the deal, Rumiano divested its converting and distribution facilities in California to Wisconsin-based cheese packaging and distribution business Masters Gallery Foods, which produces for private label, retail, food service, and industrial use.

0:55Sartori will also retain all Rumiano employees at its creamery facility and continue normal operations, according to the company. Rumiano, which sources milk from small family farms located within a 100-mile radius of its Crescent City facility, is well aligned with Sartori's sourcing principles. As well, Sartori also sources from family farms within 70 miles of its Wisconsin facility. Both companies emphasize the importance of these supply chain models to reduce carbon emissions from diesel fuel as well as to support local economies around their respective headquarters. One beverage alcohol distributor is facing a somewhat existential crisis currently.

1:34Republic National Distributing Company, or RNDC, announced this week it was pulling out of California after losing several major suppliers. The move, effective September 1st, is a significant blow to RNDC, which has been facing significant challenges throughout its business for the past year. The distributor's former CEO was ousted in February when suppliers began pulling out of RNDC's California business. The news comes less than a week after Brown Foreman, one of the biggest whiskey and spirits makers in the U.S., announced it was withdrawing its brands from RNDC's portfolio. RNDC's pullback will likely be a boon to other alcohol distributors like Southern Glazer Wine and Spirits.

2:16For example, when Anheuser-Busch's Cutwater moved on from RNDC earlier this year, it tapped Southern Glazer as a distributor in many markets. But that's not to say that Southern Glazer has not had its own struggles. During President Joe Biden's administration, the FTC filed a lawsuit against Southern Glazer over illegal price discrimination, and that case remains open. Supplement brand AG1, formerly Athletic Greens, is readying its first ever brick and mortar retail launch nearly 15 years after the brand debuted selling direct to consumer. The digitally native business will roll out single serve stick packs of its trademark green drink powder in an exclusive 40 count box format to all Costco locations nationwide.

3:01The shift into physical retail was made in an effort to increase the product's accessibility to consumers. The company has focused on one single product offering, a green powder combining vitamins, minerals, antioxidants, five clinically studied probiotic strains, as well as prebiotics and more during its lifespan. It also has become a case study for nutrition brands growing in a digital era. Since its early days, AG1 has tapped into wellness-focused influencers, athletes, and celebrities, including Dr. Andrew Huberman, Lewis Hamilton, and Allison Felix. The brand's investors include names such as Hugh Jackman, Cindy Crawford, and Steve Aoki.

3:39This is an interesting move by AG1, who has been digitally native for a long time, and going into club seems to pair well with their distribution move earlier this year when they launched branded vending machines in international airports, which seemed like a great pitch for people who travel often and are looking to up their vitamins and up their nutrients when they're on the go and able to grab it from a vending machine. And it's interesting to see a lot more brands that are digitally native making their moves into physical retail. Nuts.com just mounted its retail debut with a new brand, Pop and Soul, which is launching in Target, ShopRite, and other retailers.

4:24It's smart of AG1 to be making this move. It's also surprising to me that this is the first time that they're launching into physical brick and mortar in 15 years. In other news, beverage, alcohol, private equity firm and brand incubator, InvestBev announced itself as one of the investors in Challenger Energy brand, Lucky Energy. The brand formerly known as Lucky Fuck Energy had reported a Series 1A round in March that brought in$14.2 million. That Series A1 brought the company's total investment to over$40 million. The news comes after InvestBev has begun a process of diversifying its portfolio out of beverage alcohol with investments in adult non-alcoholic purveyor Sashay, kombucha maker Junshine, who also makes a hard kombucha, and THC Beverage Can.

5:15In talking to Lucky Energy founder and CEO Richard Laver, he said the brand is not waiting to raise more money. This summer, it plans to launch a Series B round that has a goal of hitting 30 to $40 million for that round alone, which would double what the brand has already raised. It's also pushing to hit a goal of 17 ,000 retail doors by the end of this year and between 30 ,000 and 40 ,000 retail doors by the end of next year. So the brand is really trying to move quick. I will be keeping an eye on this one because there were some inferences during my conversation with Laver, as well as with InvestBev managing partner, Brian Rawson, that Lucky Energy might diversify its portfolio even deeper into the BevAlc category with a potential mixer or possibly an RTD cocktail.

6:04For the record, both founders said that there was no immediate plans to move into those categories, but that the conversation was not off the table. In looking at the energy category as a whole, shelf-stable energy drink dollar sales were up 5.6 % in the last 52-week period, as tracked by Serkana. On a lighter note, have we reached peak Mike's Hot Honey yet? The Sweet Heat brand has teamed up with Burt's Bees to release a limited edition lip balm, which sort of makes sense because you think honey, you think bees. Yeah, I feel like that's just going to hurt your lips. You might as well just eat some like Flamin' Hot Cheetos and then you get the same effect.

6:45Speaking of other things that have gone a little too far, Hefty is celebrating its 60th anniversary this year with a birthday cake scented trash bag, which are, according to the press release, infused with notes of vanilla frosting and rainbow sprinkles, which I will counter rainbow sprinkles do not smell like anything. Or taste like anything except straight sugar. But that doesn't stop my kids from wanting it on every ice cream we get. This is not trashy. Burlap and Barrel co-founder Ori Zohar was watching the latest season of HBO's Hacks when he spotted his brand Spices during a scene in an L.A.

7:25grocery store. He shared on LinkedIn that he startled his wife by yelling, Those are our spices. Do we dare to guess which L.A. grocery store that it was spotted in? I will say it might rhyme with Barawan. It actually was not Arawan. It was L.A. Grocery and Cafe. But, you know, it's a pretty good guess. Has Air One been in TV shows yet? Have they made that jump? The aisles are too narrow to fit camera and production crews. That's why. That's true. That's true. They would just be knocking all of these high-priced products off of the shelves. Here are some other notable bits of news from the week.

8:11Asian frozen food brand Laoban is ready to launch its third line. known as Crunchy Bites, just four years after it first expanded beyond restaurants into retail. With President Trump's sweeping tariffs in limbo again, a fresh wave of uncertainty has hit the market and the spirits industry. A ruling by U.S. Court of International Trade blocked the majority of Trump's sweeping Liberation Day tariffs, and a day later, a U.S. appeals court temporarily reinstated the tariffs while legal proceedings play out. And finally, after founding and operating high-protein puffs and crisps brand Iowan Organics for nearly nine years, Mark Samuel is preparing for his next Better For You snack venture, Mark's Snacks.

8:53For these stories and more, become an insider at BevNet and Nosh. And if you're enjoying the show, please subscribe on your listening platform of choice. That wraps up this edition of CPG Week by BevNet and Nosh. Thank you to our audio engineer, Joshua Pratt. Our director is Mike Schneider, and our designer is Erin Ouellette. If you enjoyed the podcast, please subscribe on your listening platform of choice and we will see you next time.