• 👑 Recoup Wins New Beverage Showdown 
• ❌ Albertsons Ends Merger, Sues Kroger
• 🚚 UNFI's ‘Lean Management’ Fuels Q1 Gains
• 🇨🇦 Boston Beer Goes ‘Cali Sober’ In Canada
• 🤝 Golden Grail Buys Copacker

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It’s a wrap on BevNET Live Winter 2024. Here’s just a handful of highlights from the second day of on-stage presentations from Marina del Rey, Calif.

In a discussion focused on how brands can establish new categories, Recess founder and CEO Ben Witte said that although CBD was a pivotal first step for establishing his relaxation beverage business as a brand the forefront of an emerging sector, he “saw the writing on the wall” early that the regulatory environment would not turn in the ingredient’s favor, forcing the business to innovate and evolve without losing sight of its core proposition around the relaxation need state.

• Today, CBD-infused Recess products are still on the market, representing less than 10% of the business’ sales, while its mocktails are over 90%.
• “Consumers buy solutions, not ingredients,” Witte said. “I really believe it’s important to focus on the key value propositions and the specific occasions and need states you’re most relevant for.”

After that talk, LifeAID founders Orion Melehan and Aaron Hinde ran down the necessary – and often painful – moves and decisions they made to achieve profitability and become EBITDA positive.

• Those steps included hiring a proper accounting team to identify inefficiencies, optimizing inventory and learning how to prioritize their key accounts, slashing marketing and reducing payback periods, and – hardest of all – making layoffs. 
• In the end, the business accrued 24% in savings and is still turning a profit today.

In the wake of the 2024 presidential election there’s a lot of uncertainty in the air over what next year will mean for the marketplace. While no one has a crystal ball, Janica Lane, co-head of consumer investment banking at Piper Sandler, offered some insights into what investors are anticipating for the beverage industry in the coming months.

• Lane said that while many in the industry are worried about potential tariffs promised by president-elect Donald Trump, she believes that the beverage industry is not likely to be as heavily hit as other sectors.
• “I am hugely bullish on beverage,” she said. “I think that if you look in the retail sales data, it's some of the biggest categories in terms of sales. I think it's some of the highest potential for growth and for new companies to emerge.”

BevNET Insiders can read the full recap for all of the insights.

Prebiotic sparkling beverage producer Recoup emerged victorious from the New Beverage Showdown at BevNET Live Winter 2024 yesterday, presented by Coca-Cola North America New Revenue Streams. 

👏 The panel of judges for the final round commended the brand for hitting on taste and current beverage trends in addition to having eye-catching packaging that appeals to its target female audience. 

🏆 Recoup beat out five other brands in the round including Dappy non-alcoholic functional beverage, Passion Joy sparkling passion fruit beverage, Melo sparkling kava drink, Guinep non-alcoholic cocktail, and Grind with Gratitude performance water and THC-infused seltzer.

🥳 As the victor, Recoup will receive a $10,000 awareness-building advertising package and join the ranks of past champions, including Calexo, Parch, SANS, Plink!, and Hiyo. 

Check out the full New Beverage Showdown recap on BevNET.

This likely won’t be the last time we analyze Kroger/Albertsons’ proposed $24.6 billion mega-merger, but this update does mark the end of the deal being a possibility - for now at least. 

• Today, Albertsons announced it has exercised its right to terminate the merger agreement and in a second, separate press release, shared that it has filed a breach of contract and breach of the covenant of good faith and fair dealing lawsuit in Delaware Chancery Court against Kroger.  
• The news comes less than a day after a federal judge temporarily blocked the deal alongside rulings to implement permanent injunctions by an Oregon district court and a Washington state superior court. 
• Albertsons is now looking to make itself whole again and is seeking “billions of dollars in damages from Kroger” 

Check out our coverage of yesterday’s ruling and stay tuned for additional details on this latest news.

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United Natural Foods Inc. (UNFI) has seen progress on its three-year, “lean management” framework intended to steer the company to better financial results, per its first-quarter 2025 earnings report yesterday.

• UNFI posted net sales of $7.9 billion with adjusted EBITDA increasing 14.5% to $134 million. 
• Wholesale volume was up 1.8% in the quarter, compared to down 3.6% in Q1 2024.
• Despite these “positive” results, the distributor still had a net loss of $21 million.
• Leadership emphasized the work being done to create a more efficient business by decentralizing its procurement and the consolidation of distribution centers nationwide.

💬 CEO Sandy Douglas also updated analysts on UNFI’s Simplified Supplier Approach (SSA) program which has been “broadly adopted” and offers better sales data tracking.

Read the full report on Nosh.

The Boston Beer Company is extending further into cannabis beverages with a new THC canned cocktail brand Emerald Hour, launching in licensed retailers in Ontario, Canada. The rollout expands Boston Beer’s cannabev portfolio which already includes cannabis-infused iced tea brand Teapot.

🍹 Emerald Hour is available in two flavors, Cranberry-Citrus and Ginger-Lime, in 12 oz. cans containing 10 mg of THC. More varieties are planned to launch later in 2025.

🤔 Leaning into THC drinks positioning towards alcohol-reduction, the brand is a “solution” to premium alternatives that “are not for the uninitiated,” said Boston Beer director and head of cannabis Paul Weaver.

🪴 The new THC drink is being produced by cannabis producer Peak Processing Solutions in Windsor, Ontario.

Publicly traded Golden Grail Beverages – whose brands include Spider Energy, Sway and KOZ Water – entered an acquisition agreement today to buy Florida-based co-packer United Product Development Corporation. 

💸 As part of the deal, the company is issuing 20 million shares of common stock to the former owners of the copacker.

🔊 Golden Grail CEO Scott Lomu said in a statement that the deal is part of the company’s “recently announced new business focus.” Last month, the company entered an agreement with Rockwell Capital to restructure its debt and paid off a $100,000 note from 2022, with the capital form forgiving an additional $100,000 note also from that year.

Monica Berg, the co-founder of world-renowned bar Tayēr & Elementary and modern liqueur brand MUYU, talks about how her background in bartending and hospitality shaped the creation and vision for both companies. She also shares her perspective on flavor trends and the drivers of new concepts and how she assesses innovation as it relates to new spirits and cocktail ingredients.

Listen to the episode now.