Tuesday, November 25, 2008

Craft beer vs. the brewery monster

The St. Louis Dispatch has created a comprehensive report on the creation of Anheuser-Busch InBev (ABIB), collating many of its stories and analyses onto one webpage:

Out with the old, in with the new.
Beer deal: the end of the king's reign

I asked a colleague in the beer business what he thought of the sale of Anheuser-Busch to InBev.

You've mistaken me for someone who cares, was the reply. A bravura shrug should not be the response. Wariness should be.


The craft beer industry, due to its precarious and small nature, is at great risk to be affected by circumstances from this sale, predictable and unforeseen, that are out of its control.

Neo-prohibition is on the rise. The economy is in historically bad shape (and excise taxes may be increased on alcohol to help deal with that). In ABIB, the craft beer industry is facing the largest brewery the world has ever seen.

Possible scenarios? There may be realignment of distributorships, scarcity of ingredients (real and nefarious), scarcity of packaging materials (the same). And what of Trojan Horse products: lower-priced beers masquerading as craft beers?

The US House of Representatives has a Small Brewers Caucus. But don't put too much stake in that. Its home web page still lists an event held in May of 2007 as an upcoming event. And, of the 35 members in the Caucus, there are none from Maryland and only one from Virginia: Representative Virgil Goode, Republican from Virginia's 5th District.

[As an update: member craft breweries of the Brewers Association and the National Beer Wholesalers Association (NBWA) will be hosting a tasting for Congressional staffers at the Rayburn House Office Building on 3 December. ]

It helps to have friends in high places. But that's not enough. The craft beer industry and its friends need to redouble their efforts to create small brewers guilds, cooperate in purchasing and marketing campaigns, and actively engage in political outreach.

ABIB has $52 billion dollars (some reports say $55 billion) of debt to repay. It won't be looking to be small breweries' friend.

1 comment:

  1. I really hope the craft beer takes a big hit from any results of the A-B/ InBev merger. I'm really getting tired of beer snobs going off about how important they are just because they like to drink beer that tastes funny. You people ought to just go back to drinking regular beer, you know - real beer, and start saving money for better things like gasoline or new shoes.


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