The guy is telling about how is daughter asked him "Where do babies come from..."
The woman asked the guy, "What did you tell her?"
The guy, well explains (without going into graphic explanation here), and holds up his sausage (the food item) and uses that as a graphic for a penis, and then after he's telling them what he said, takes a bite out of it.
The slogan for the beer company, is No Nonsense. Meaning, there's no BS associated with the beer. And there was no BSing with the guy telling his daughter, "Where babies come from either"