The Fall of the House of Stroh Described in Forbes

[Lowell]

Forbes has an interesting read about the collapse of Stroh beer business and fortune. How To Blow $9 Billion: The Fallen Stroh Family

While the onus falls mainly on Peter Stroh [driving force behind our riverfront recovery] it is also a cautionary tale about a family grown decadent by inherited wealth.

Peter Stroh made several bad acquisitions [most notably Schlitz] when the market for beer was contracting and shifting.

I had a bit of a view of this disaster as a close friend's Danish father had been brought in by Peter Stroh to design a premium beer, what would become Stroh's Signature. He was ahead of his time on that front but the light beer craze had arrived in the meantime. Peter Stroh resisted developing a light beer then had an almost snobbish response when the premium beer project had to be sidelined to try to catch up with the light beer race telling his brewmaster, "to pour more water in the beer" and get it on the shelves.

Peter Stroh’s grand vision of a thriving U.S.-wide brewer failed to materialize. It largely missed the boat on the biggest industry trend in a generation: light beer. And Stroh’s core product–cheap, watery, full-calorie beer–was a commodity. But saddled with debt, Stroh couldn’t afford to match the ad spending of its bigger rivals, Anheuser-Busch and Miller. Unable to spur demand through marketing, Stroh turned to price, introducing a 15-pack for the price of 12 cans and a 30-pack for the price of a case of 24. While the latter had legs, it wasn’t enough to outrun the shrinking margins.

I still miss the steam-clouded neon Stroh's sign at the entrance to the I-375.

Below: Peter Stroh [holding papers] at announcement of Flynn Pavilion restoration in 2002.

[DetroiterOnTheWestCoast]

A depressing read. It would have been nice if they hadn't blown the business and there could still be hundreds of jobs in Detroit.

[Lowell]

What surprises me is that their brands are still out there. You can get Stroh's beer at the Park Bar and I frequently see Stroh's ice cream.

[nain rouge]

While the onus falls mainly on Peter Stroh, it is also a cautionary tale about a family grown decadent by inherited wealth.

I think Peter Stroh did alright. OK, so they didn't come out with a light beer fast enough. Still, Stroh took huge risks to stay alive as a business. Peter definitely tried. Stroh was an "every man's" middle class/working class beer company, and he correctly saw that only two or three big companies would really make it in that bracket. Kinda like Coke and Pepsi, or Philip Morris, R.J. Reynolds, and Lorillard.

And maybe you can dig up a few bad stories about family member's behavior, but name me one family without a skeleton or two in its closet!

[TheUsualSuspect]

It's funny how tastes change. I remember well the emergence of the light beer, but had no idea that the groundswell was powerful enough to tank an entire company that ignored it.

Maybe I'm in the minority, but I rarely drink light beer myself, and most of those I hang with despise the stuff. If I'm going to cut calories, a good brew is the last place I'm going to look.

And as for the beer market, the popularity and proliferation of craft beers would seem to have changed the dynamics of the market too. I still know people who drink Bud and Bud-lite, but I see a whole lot more Bell's, Fat Bastards, etc on the shelves and at parties.

[old guy]

What surprises me is that their brands are still out there. You can get Stroh's beer at the Park Bar and I frequently see Stroh's ice cream.

Stroh's is brewed by Pabst now and from what I read their ice cream is made in Belvidere Il. but pretty much only sold in the Detroit metro area.

[professorscott]

Stroh's made a lot of risky business decisions that didn't pan out, but that's very common in a business where the business environment is rapidly changing, as beer was in America during the times with which the article is concerned.

If Stroh's had chosen to remain a regional brewer, which would have included keeping the brewery on Gratiot [[the closing of which lost them much local goodwill), they might have survived, as it turns out some regional brewers have still done well [[Genesee, Yuengling); but again, who knew that was how it would turn out?

George "Dick the Bruiser" Baier's sendoff of the Henley tune "Boys of Summer" on WRIF at the time the brewery was closed was poignant and gave a good indication of how local consumers' thoughts would shift. Now if you want commodity beer, the closest brewery is Labatt's in London, and if you don't mind paying more, Larry Bell makes several fine brews a couple hours away in the other direction. And of course within Detroit and the burbs there are several good local microbrewers, but Detroit will probably never again have beer on an industrial scale, employing significant numbers of people. Which is a shame, because in retrospect it didn't have to happen this way. But of course we have the advantage of retrospection.

[Not In MI]

http://randyayersmodeling.com/modeli...ic.php?t=76520

[canuck]

Canadian tastes have also changed toward microbrew products. I used to drink O'Keefe and Molsons up until the mid nineties when a plethora of micros happened on the scene. Some bigname Euro brews are equal in price to local beer here, I tend to favor those and some local micros. What surprises me more aboit Strohs and Molson Coors is their slow turnabout to address more sophisticated tastes in beer and compete on that front. My only explanation is that their professes are fast and cheap and they insisté on keeping it like that.

[nain rouge]

There's still a diehard group of people that will only drink old school beer. I think that's why they won't mess with the formula. For those that want fancier brews, Molson Coors [[for example) also owns Blue Moon and Killian's. Which is really the way to do it nowadays with cheap consumer products. Don't have one product try to be everything to everybody. Own a bunch of "competing" brands instead.

[Hermod]

Stroh's
Goebel's [[private stock 22)
E&B [[brew 103)

Stroh wasn't the only Detroit beer to lose.

[Smirnoff]

Stroh's made a lot of risky business decisions that didn't pan out, but that's very common in a business where the business environment is rapidly changing, as beer was in America during the times with which the article is concerned.

If Stroh's had chosen to remain a regional brewer, which would have included keeping the brewery on Gratiot [[the closing of which lost them much local goodwill), they might have survived, as it turns out some regional brewers have still done well [[Genesee, Yuengling); but again, who knew that was how it would turn out?

George "Dick the Bruiser" Baier's sendoff of the Henley tune "Boys of Summer" on WRIF at the time the brewery was closed was poignant and gave a good indication of how local consumers' thoughts would shift. Now if you want commodity beer, the closest brewery is Labatt's in London, and if you don't mind paying more, Larry Bell makes several fine brews a couple hours away in the other direction. And of course within Detroit and the burbs there are several good local microbrewers, but Detroit will probably never again have beer on an industrial scale, employing significant numbers of people. Which is a shame, because in retrospect it didn't have to happen this way. But of course we have the advantage of retrospection.

During the beer acquisition years, all public beer companies were target by the Giants, either grow or go! Private beer companies like Yuengling didn't have to worry of being swallowed-up.....

[p69rrh51]

There are a couple executives not mentioned in the article who were brought in to lead the larger company and facilitated some of the bad decisions.

The Julius Stroh House 8050 E. Jefferson Detroit, MI.

Architect: unknown to me
Built date: unknown to me

[p69rrh51]

Designed by Glaver, Dinkleburg & Ellison. Stroh Tower 28-36 West Adams built in 1920 Grand Circus Park Historic District Detroit, MI.

The building cost approximately $2,000,000 to build.

[p69rrh51]

Designed by Weston & Ellington for Gari M. Stroh. 842 Edgemont Park built in 1924 Grosse Pointe Park, MI.

[p69rrh51]

Designed by Roland C. Gies for George Stroh. 548 East Grand Boulevard built in 1903 East Grand Boulevard Historic District Detroit, MI.

[eastland]

I think the article was a bit unfair and quite shallow. The Schaefer and Schilitz acquisitions added much needed brewing capacity and distribution channels. Stroh did come out with a light beer about the same time Bud did. And the company did create a couple of very nice Class A office complexes in the city at a time when investment was leaving town.

[eno]

Thanks for the link to the Stroh's family story. It reads like The Magnificent Ambersons. Rumor had it that you could drink beer while at work at Stroh's but it wasn't allowed to leave the brewery grounds. With the hydroplane races coming up this weekend, Strohs sponsored the annual races some of those years

[IrishSpartan]

Thanks for the link to the Stroh's family story. It reads like The Magnificent Ambersons. Rumor had it that you could drink beer while at work at Stroh's but it wasn't allowed to leave the brewery grounds. With the hydroplane races coming up this weekend, Strohs sponsored the annual races some of those years

That was not a rumor about Stroh's, but rather the truth. It was permitted at lunch and specified beer times, but not relief periods.

[JBMcB]

There's still a Stroh's ice cream shop in Bloomfield Hills:

http://strohsicecreamparlour.com/

[Honky Tonk]

Anyone here remember, or ever go to the Stroh House on Gratiot & 75? Used to be a great place for hosting work parties. Back in the day, it was $6 a head to get in. That included all varieties of Stroh beer you could drink, cold cuts, open face sandwiches, salads, and Stroh's ice cream for desert. Stroh was also instrumental in funding the Stroh River Place project.

[TheUsualSuspect]

Stroh's is brewed by Pabst now ....

I wonder if Pabst uses the "fire brewed" tradition so a part of the Strohs ad campaign?

[motz]

I wonder if Pabst uses the "fire brewed" tradition so a part of the Strohs ad campaign?

Strongly doubt it. Stroh's taste-wise seems to be on par with Pabst/High Life/etc. It's a bit different, but it doesn't really have what I would describe as a "unique" taste. Still really good to get lit up off of for cheap though.

[douglasm]

As I understand it, Pabst does not "brew" Strohs, or any other brand it owns. It's brewing is done under contract by Miller/Coors in their facilitie.

The story of Strohs could probably be told many times over by regional brands that got steamrollered by brands like Miller and Bud. When I moved to the Pacific Northwest 35 years ago, Rainier, Olympia and Heidelberg were THE beers of choice. All are gone, as locally brewed beers, being swallowed up when Heileman expanded [[only to be swallowed by Strohs, and spit out to Pabst when Strohs imploded). They all [[except Heidelberg, which is gone) are brewe by Miller in their Irwindale, CA brewery for Pabst.

[Hermod]

Was Pfieffer's [[Hey, Johnny Pfieffer) a local Detroit beer?