Reed's, Inc. (Reed's) owns a portfolio of handcrafted, natural beverages.
Reed's two core brands are Reed's, which includes Reed’s Craft Ginger Beer, Reed’s Real Ginger Ale, Reed’s Classic Mules, and Reed’s Hard Ginger Ale, and Virgil’s Handcrafted sodas. Reed’s Craft Ginger Beers are unique due to the proprietary process of using fresh ginger root combined with a Jamaican inspired recipe of natural spices, honey and fruit juices. Reed’s uses this same handcrafted approach in its Reed’s Real Gi...
Reed's, Inc. (Reed's) owns a portfolio of handcrafted, natural beverages.
Reed's two core brands are Reed's, which includes Reed’s Craft Ginger Beer, Reed’s Real Ginger Ale, Reed’s Classic Mules, and Reed’s Hard Ginger Ale, and Virgil’s Handcrafted sodas. Reed’s Craft Ginger Beers are unique due to the proprietary process of using fresh ginger root combined with a Jamaican inspired recipe of natural spices, honey and fruit juices. Reed’s uses this same handcrafted approach in its Reed’s Real Ginger Ale and Virgil’s line of great tasting, bold flavored craft sodas, including its award-winning Virgil’s Root Beer.
Reed’s is the first ginger beer in the US; Virgil’s is an independent natural full line craft soda and is a leader in the craft soda category.
Products
The company makes its hand-crafted beverages with only premium, natural ingredients. The company’ products are free of genetically modified organisms (GMOs) and artificial preservatives. Over the years, Reed’s has developed several product offerings. In 2019, the company streamlined its focus to its core categories of Reed’s Ginger Beverages and Virgil’s Craft Sodas. In April 2020, the company launched its new line of Reed’s Real Ginger Ales, in both Full Sugar and Zero Sugar varieties, made with fresh organic ginger. In 2021, the company entered the alcohol space with the launch of its RTD Classic Mule that is 7% alcohol by volume (ABV) with Zero Sugar and Hard Ginger Ale which is 5% ABV and Zero Sugar.
Reed’s Craft Ginger Beer
Reed’s Craft Ginger Beer is set apart from other ginger beers by its proprietary process of pressing fresh ginger root, its exclusive use of natural ingredients, and its authentic Jamaican-inspired recipe. The company offers different levels of fresh ginger content, ranging from its lightest-spiced Original, to its medium-spiced Extra, and finally to its spiciest Strongest. The company also offers three sweetener options: one with cane sugar, honey and fruit juices; one with honey and pineapple juice; and another without sugar (Zero Sugar) made from an innovative blend of natural sweeteners. In 2021, the company expanded its Extra Ginger Beer portfolio into cans offerings.
As of the end of 2023, the Reed’s Craft Ginger Beer line included five major varieties with a mix of bottles and cans:
Reed’s Original Ginger Beer – The company’s first to market product uses a Jamaican-inspired recipe that calls for fresh ginger root, lemon, lime, pineapple juice, honey, raw cane sugar, herbs and spices.
Reed’s Premium Ginger Beer – The company’s Original Ginger Beer sweetened with honey and pineapple juice. (No cane sugar added.)
Reed’s Extra Ginger Beer – Contains 50% more fresh ginger than Reed’s Original recipe for extra spice.
Reed’s Strongest Ginger Beer – Contains 125% more fresh ginger than Reed’s Original for the strongest spice.
Reed’s Zero Sugar Extra Ginger Beer – launched in 2019, it uses a proprietary natural sweetening system for a zero-calorie version of the company’s Reed’s Extra Ginger Beer.
Reed’s Real Ginger Ale
Reed’s Real Ginger Ale is unique for the category because it combines real fresh ginger with the classic, refreshing taste that consumers love. It contains nothing artificial and is non-GMO project verified. The company offers two sweetener options: one with cane sugar and the other with its zero-calorie proprietary natural sweetening system.
Reed’s Real Ginger Ale – launched in April 2020 in standard and sleek 12-ounce cans. It is the only mass market ginger ale made with organic fresh ginger.
Reed’s Zero Sugar Real Ginger Ale – also launched in April 2020 in standard and slim cans. It uses a proprietary sweetening system to match the great taste of the cane sugar version in a zero-calorie drink.
Reed’s Real Cranberry Ginger Ale – Seasonal product, launch in the fall of 2021 is the company’s Real Ginger Ale with cranberry added. It is a consumer favorite during the holiday season and is available October through December.
Reed’s Harvest Spiced Apple Cider – This seasonal product launched in the fall of 2022 and is a delicious holiday offering available September through December.
Reed’s Ready to Drink
Reed’s Zero Sugar Classic Mule – Launched in 2020 and sold in 23 states, Reed’s first-ever alcoholic offering is packed with REAL, fresh ginger root and made through a unique handcrafted brewing and fermentation process. It contains 7% ABV, and a light-spice flavor profile with no artificial colors, gluten, GMOs or caffeine. It is the ultimate mule, made with fresh ginger root, to be enjoyed anytime, anywhere.
Reed’s Zero Sugar Stormy Mule – Launched in 2022, the Stormy is the perfect companion to the company’s Classic Mule, the Stormy Mule is the ultimate rum flavored alcohol and ginger beer. It contains 7% ABV, and a light-spice flavor profile with no artificial colors, gluten, GMOs or caffeine. It is the ultimate stormy, made with fresh ginger root, to be enjoyed anytime, anywhere.
Reed’s Zero Sugar Hard Ginger Ale – Launched in late 2002, the company’s line of light refreshing hard ginger ales are available in four flavors: Mango, Cherry Lime, Strawberry Watermelon and Pineapple Coconut. They contain 5% ABV, 100 calories and zero carbohydrates and have no added sugar, artificial colors, gluten, GMOs or caffeine. They are made with fresh ginger root, to be enjoyed anytime, anywhere.
Virgil’s Handcrafted Sodas
Virgil’s is a premium handcrafted soda that uses only natural ingredients to create bold renditions of classic flavors.
The Virgil’s line includes the following products:
Handcrafted Line: Virgil’s difference is using natural ingredients to craft bold, classic soda flavors. Virgil’s Handcrafted line includes Root Beer, Vanilla Cream, Black Cherry, and Orange Cream. Beginning in 2023 Virgil’s Handcrafted soda will be offered in both glass and can formats.
Zero Sugar Line: Virgil’s launched a new line of Zero Sugar, Zero Calorie craft sodas in 2019. Each Zero Sugar soda is sweetened with a proprietary blend of natural sweeteners with no added sugars and is certified Keto. This natural line of Zero Sugar flavors includes Root Beer, Cola, Black Cherry, Vanilla Cream, Orange Cream, and Dr. Better.
Primary Markets
The company targets a smaller segment of the estimated $41 billion mainstream carbonated and non-carbonated soft drink markets in the United States. The company’s brands are generally considered premium and natural, with upscale packaging.
The company has an experienced and geographically diverse sales force promoting its products, with senior sales representatives strategically placed in multiple regions across the country, supported by local Reed’s sales staff. Additionally, the company has sales managers handling national accounts for natural, specialty, grocery, mass, club, drug, liquor, and convenience channels. The company’s sales managers are responsible for all activities related to the sales, distribution, and marketing of its brands to its entire retail partner and distributor network in North America.
The company sells to well-known popular natural food and gourmet retailers, large grocery store chains, mass merchants, club stores, convenience and drug stores, liquor stores, industrial cafeterias (corporate feeders), and to on-premises bars and restaurants nationwide and in some international markets. The company also sells its products and promotional merchandise directly to consumers via the Internet through its Amazon storefront which can be accessed through its company web site www.drinkreeds.com. In November 2023, the company relaunched this ecommerce platform, which includes a reoccurring subscription model.
Some of the company’s representative key customers include:
Natural stores: Whole Foods Market, Sprouts, Natural Grocers by Vitamin Cottage, Fresh Thyme, NDG, INFRA, Earthfare.
Gourmet & specialty stores: Trader Joe’s, Erewhon, Gelson’s, Harmon’s, Bristol Farms, The Fresh Market, Woodman’s Cost Plus World Market, Cracker Barrel.
Grocery and mass chains: Kroger (and all Kroger banners), Albertson’s/Safeway, Publix, Food Lion, Stop & Shop, H.E.B., Wegmans, Walmart, Raley’s, Savemart, Ingles, Harris Teeter, Hannaford, SEG/Winn Dixie, Giant, Spartan Nash, Food Land, Lowes, Smart and Final, Winco, Bashes, Haggen, AFS, Market Basket, Meijer, Cub HvVee.
Club stores: Costco
Liquor stores: BevMo!, Total Wine & More.
Convenience & drug stores: Rite Aid, All Town Fresh Markets.
Distribution Network
The company’s products are brought to market through an extremely flexible and fluid hybrid distribution model, which is a mix of direct-store-delivery, customer warehouse, and distributor networks. The distribution system used depends on customer needs, product characteristics, and local trade practices.
The company’s product reaches the market in the following ways:
Direct to Natural & Specialty Wholesale Distributors
The company’s natural and specialty distributor partners operate a distribution network delivering thousands of SKUs of natural and gourmet products to thousands of small, independent, natural retail outlets around the U.S., along with national chain customers, both conventional and natural. This system of distribution allows its brands far reaching access to some of the most remote parts of North America.
Direct to Store Distribution (DSD) Through Non-Alcoholic and Alcoholic Beverage Distributor Network
The company’s independent distributor partners operate DSD systems which deliver primarily beverages, foods, and snacks directly to retail stores where the products are merchandised by their route sales and field sales employees. DSD enables the company to merchandise with maximum visibility and appeal. DSD is especially well-suited to products frequently restocked and responds to in-store promotion and merchandising. The company primarily focuses on expanding its DSD network on a national basis.
Direct to Store Warehouse Distribution
Some of the company’s products are delivered from its co-packers and warehouses directly to customer warehouses. Some retailers mandate the company’s deliver directly to them, as it is more cost effective and allows them to pass savings along to their customers.
Wholesale Distribution
The company utilizes a network of four independent distribution and consolidation centers across the United States to store and distribute its products. The company’s Wholesale Distributor network handles the wholesale shipments of its products. These distributors have a warehouse and distribution center, and ship Reed’s and Virgil’s products directly to the retailer (or to customers who opt for drop shipping).
International Distribution
The company presently exports Reed’s and Virgil’s brands throughout international markets via US based exporters. International markets where its brands are present are France, the U.K., South Africa, portions of the Caribbean, Canada, Spain, the Philippines, Mexico, Vietnam, and Australia.
The company has production facilities in the U.K. and will be expanding into the European Union during 2024.
Distribution Agreements
Manufacturing Products
During 2023, the company entered into co-packing agreements with a new facility in the Southeast United States and a co-packer in North Carolina, Battle Co-Packaging. The company’s agreement with Battle Co-Packaging serves to expand its production for both bottles and cans and will allows it to better serve its Southeast and south-central customers and grow its sales in the region. The company follows a fill as needed model to the best of its ability.
Competition
The company’s products compete with a wide range of drinks produced by a relatively large number of manufacturers. Many of these brands have enjoyed broad, well-established national recognition for years, through well-funded advertising and other branding campaigns. Competitors in the ginger beer category include Goslings, Barrett’s, Fever Tree, Bundaberg, Cock ‘n Bull and Q; in the craft soda category the company competes with brands, such as Stewart’s, IBC, Zevia, Henry Weinhard’s, Boylan, Sprechers, and Jones Soda; In the Ginger Ale category the company competes with Canada Dry, Schweppes, Seagram’s, Vernor’s, and Zevia.
Licensing
During 2020, the company entered into a licensing agreement with Full Sail Brewery headquartered in Hood River, Oregon to manufacture and sell its new line of Reed’s Alcoholic Classic Mule in 4 and 12 pack 12-ounce cans, and 12 pack 16-ounce cans. Full Sail manages all aspects of production and distribution. The company subsequently amended that agreement to assume the distribution rights from Full Sail and instead utilize Full Sail as a co-packer of its RTD Classic Mule line.
Seasonality
Sales of the company’s nonalcoholic beverages are somewhat seasonal with higher-than-average volume in the warmer months. The volume of sales in the beverage business is affected by weather conditions from time to time.
Regulation
U.S. laws and regulations that apply to the company’s business and the production, distribution and sale of its products include, but are not limited to: the Federal Food, Drug and Cosmetic Act and various state laws governing food safety and food labeling; the Food Safety Modernization Act; the Occupational Safety and Health Act and various state laws and regulations governing workplace health and safety; various federal, state and local environmental protection laws, as discussed below; the Federal Motor Carrier Safety Act; the Federal Trade Commission Act; the Lanham Act and various state law statutory and common law duties regarding false advertising; various federal and state laws and regulations governing the company’s employment practices, including those related to equal employment opportunity, such as the Equal Employment Opportunity Act and the National Labor Relations Act and those related to overtime compensation, such as the Fair Labor Standards Act; various state and federal laws pertaining to sale and distribution of alcohol beverages; data privacy and personal data protection laws and regulations, including the California Consumer Privacy Act of 2018 (as modified by the California Privacy Rights Act); customs and foreign trade laws and regulations, including laws regarding the import or export of its products or ingredients used in its products and tariffs; laws regulating the sale of certain of its products in schools; and laws regulating the ingredients or substances contained in, or attributes of, its products. The company is subject to various state and local statutes and regulations, including state consumer protection laws, such as Proposition 65 in California, which requires that a specific warning appear on any product that contains a substance listed by the State of California as having been found to cause cancer or birth defects, unless the amount of such substance in the product is below a safe harbor level.
The company is also subject to various federal, state and international laws and regulations related to privacy and data protection, including the California Consumer Privacy Act of 2018 (CCPA), which became effective on January 1, 2020, and its extension, the California Privacy Rights Act (CPRA), which will take effect on January 1, 2023. The interpretation and application of data privacy, cross-border data transfers and data protection laws and regulations are often uncertain and are evolving in the United States and internationally.
In California, the company is required to collect redemption values from its Ale which is 5% ABV and Zero Sugar customers and to remit such redemption values to the State of California Department of Resources Recycling and Recovery based upon the number of cans and bottles of certain carbonated and non-carbonated products sold.
History
The company was founded in 1987. In 1991, it incorporated its business operations in the state of Florida under the name of Original Beverage Corporation and changed its name to Reed's, Inc. in 2001.
The Analyst Price Target shows the analysts’ low, high, and average target at a glance.
