AB-InBev Bought Its Way Into a Craft-Brewing Corner. Now It’s Trying to Cut Its Way Out

Discussion in 'Beer News' started by ESHBG, Mar 10, 2023.

  1. ESHBG

    ESHBG Pooh-Bah (2,099) Jul 30, 2011 Pennsylvania
    Pooh-Bah Society

    https://vinepair.com/articles/ab-inbev-craft-layoffs/
     
  2. Alefflicted

    Alefflicted Crusader (445) Dec 2, 2017 Minnesota

    No surprises here.
     
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  3. TheMindIsItsOwnPlace

    TheMindIsItsOwnPlace Initiate (20) Dec 19, 2022 Indiana

    ISO: FUCK AB-INBEV shirt
     
  4. AlcahueteJ

    AlcahueteJ Grand Pooh-Bah (3,088) Dec 4, 2004 Massachusetts
    Pooh-Bah Society

    Major corporation buys smaller ventures, bleeds them dry, sells them off when profits dwindle, and then moves on.

    Do we still get Bourbon County?
     
  5. pulse

    pulse Zealot (679) Mar 22, 2016 Ohio

    I saw this earlier today on the trash site that sometimes has good posts. Responded by laughing at AB-Inbev.

    My perspective is that it isn't suprising at all, if you saw anything about the way they treated their properties. It doesn't seem surprising... they are practicing the usual model of American capitalism - buy your way in and win by market share. It's the same thing going on in the gaming industry, for instance. Unfortunately for Inbev, they couldn't beat craft beer by purchasing a few brands and churning out garbage. There are too many options without a bust hitting... they still get to trash the original brands like EA/Activision swallowing up developers and walk away with sullenly kicking rocks, but whatever. Screw them.

    We got a good look up here with the Platform debacle. Too bad there are still other corpos creeping around. They aren't all as dumb as AB.
     
  6. gyorgymarlowe

    gyorgymarlowe Zealot (618) Aug 24, 2019 Colorado
    Trader

    Does ABI still own Ratebeer?
     
  7. ChicagoJ

    ChicagoJ Grand Pooh-Bah (4,023) Feb 2, 2015 Illinois
    Pooh-Bah Society Trader

    The primary issue facing large craft brewers is Miller/Coors and Budweiser's lock on the big box shelf sets and tap handles in chains / entertainment arenas which move the primary volume of distributed beer.

    This squeeze from above with the top dozen conglomerates, and the hundreds of local breweries squeezing from below, is the primary issue which many of the largest and best independents have fallen the past decade. AB buying two dozen breweries was mostly inconsequential in the scheme of things.

    Largest National Independents (Non Stock Market / Private Equity / Big Weed) Sold Starting with Goose Island:
    • Anchor
    • Ballast Point
    • Bell's
    • Cigar City
    • Dogfish Head
    • Firestone Walker
    • Founder's
    • Goose Island
    • Lagunitas
    • Modern Times
    • New Belgium
    • Oskar Blues
    • Sweetwater
    Remaining Large Independents (Non Stock Market / Private Equity / Big Weed) with significant lost shelf space to Miller/Coors and Budweiser Distributors Wholly Owned or Priority Accounts including Seltzer (Miller Coors / White Claw):
    • Abita
    • Deschutes
    • Great Lakes
    • North Coast
    • Odell
    • Sierra Nevada
    The days of brewery start ups becoming large and then national are done without significant private equity or stock market investments (100s M or 1B +). Best we can hope for is the remaining solid national brewers and the few dozen top regional brewers are able to survive in this environment.
     
  8. jesskidden

    jesskidden Grand Pooh-Bah (3,071) Aug 10, 2005 New Jersey
    Pooh-Bah Society Trader

    What ever happened to PE-backed "Enjoy Beer" ownership of Abita?
    (2015)Enjoy Beer Acquires Abita Brewing Company
     
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  9. milkshakebeersucks

    milkshakebeersucks Pooh-Bah (1,998) Feb 10, 2020 Maryland
    Pooh-Bah Society Trader

    One effective tool to counter the mass produced bought out breweries has been the Independent Craft Brewer Seal, I'm always looking for it when searching the shelves.
     
  10. ramseye4

    ramseye4 Savant (1,246) May 14, 2010 Virginia

    I honestly didn’t know about several of these, such as Founders and Bells.

    If a brewery I like such as those two gets bought out I’ll continue to buy their product and support them. Taste is paramount for me, plus even though they were bought out they’re still supplying jobs to their local areas.

    That being said, seeing that list makes me pull for Sierra Nevada even harder for some reason
     
  11. PapaGoose03

    PapaGoose03 Grand Pooh-Bah (5,291) May 30, 2005 Michigan
    Pooh-Bah Society

    I see some potential irony here in that, if ABI is closing breweries or cutting back in others, then the supposedly flooded marketplace will be alleviated to some extent thus helping all of the independents that are struggling through the mess.
     
  12. rgordon

    rgordon Pooh-Bah (2,677) Apr 26, 2012 North Carolina
    Pooh-Bah Society

    This was inevitable. Circa 2009-2019 the ABI folks saw the success of smaller wholesalers literally "taking" business from them in independent but strong retail outlets. As my Grandfather used to say, "It stuck in their craw". ABI under-estimated the strong smaller retailers and their good relations with the smart small wholesalers. ABI never understood the power of these relationships. I still laugh about how the founders of Wicked Weed still get the last laugh.
     
  13. JackHorzempa

    JackHorzempa Grand Pooh-Bah (3,181) Dec 15, 2005 Pennsylvania
    Pooh-Bah Society

    The other business condition which impacts all of the brewing industry, but perhaps the larger, distributing craft breweries the most, is overall potential supply vs. demand. I had a conversation with the owner of a mid-size regional craft brewery owner over 5 years ago where he told me that there is more capacity of the overall brewing industry than there is customer demands. He mentioned values at that time (which I do not recall today) but there was x million barrels/year of brewing capacity in the US and only y million barrels/year of beer being purchased with x much greater than y. And when you consider the amount of imported beer being purchased this makes this differential even more poignant. That owner a year or two later sold his business to a craft brewing consortium.

    There is an ongoing thread about Pittsburgh Brewing Company (which is a regional brewery) and how they invested in a new brewery:

    https://www.beeradvocate.com/community/threads/iron-city-beers-new-home.671829/

    It seem to me that this is a very bold move for the owners of Pittsburgh Brewing Company given the present competitive nature of today's beer market.

    Cheers!
     
  14. moodenba

    moodenba Pooh-Bah (1,833) Feb 2, 2015 New York
    Pooh-Bah Society

    I'd think affected brands would be brewed by other AB-owned facilities as long as there is a market for the orphan brands. AB probably has plenty of capacity available so, at least in the short term, will have additional profit. I don't see a clear long term path forward for independent craft brewers depending on a regional or national distribution.
     
  15. moodenba

    moodenba Pooh-Bah (1,833) Feb 2, 2015 New York
    Pooh-Bah Society

    ABInbev bought and aggressively distributed their collection of craft brands at the same time some of the larger craft brewers were striving to expand. The ABInbev distribution power placed their brands prominently in the retail market and stunted competitor growth. Now that the likelihood that any of the other craft brewers will "break through" to good national sales and distribution has diminished, ABInbev can reduce their commitment to craft, as the threat has passed.

    I took a look at the article and will comment on the fate of Blue Point, and the recent layoffs. The independent Blue Point was a small brewing operation with few employees. The company contract-brewed almost all of its bottled and canned products (bombers excepted). They eventually had their products distributed locally by the ABInbev distributor. After acquisition, ABInbev built a sizeable brewery, packaging facility, and taproom/restaurant, and actually planned an outlet in Brooklyn. Maybe things didn't work out as well as hoped. But at least in this case, ABInbev didn't do too much wrong, and made a real commitment.
     
  16. jesskidden

    jesskidden Grand Pooh-Bah (3,071) Aug 10, 2005 New Jersey
    Pooh-Bah Society Trader

    That's apparently what they're doing for the Platform beers that they announced they will continue to market.
    [​IMG]
     
  17. AZgman

    AZgman Pundit (954) Dec 22, 2011 Arizona
    Society

    Breweries need all the help they can get. I always have local beers in my fridge and I try to visit breweries every month. I don't like $7 pints any more than anyone else, but the alternative is less good, fresh, local beer.
     
  18. JackHorzempa

    JackHorzempa Grand Pooh-Bah (3,181) Dec 15, 2005 Pennsylvania
    Pooh-Bah Society

    Cheers to you!

    On a somewhat related note I met two buddies for beers at a local craft brewery yesterday for some chit-chat and beers. We 'crossed over' from Happy Hour to non-Happy Hour. When my buddy Brian saw the bill and noted that some of the beers were $5 vs. $7 he was very, very happy to see that. Upon departing I said something like "we should do this again sometime" and my buddy Brian quickly responded: "$5 beers, hell yeah!".
     
  19. AlfromPA

    AlfromPA Crusader (439) Dec 9, 2021 Colorado

    Let's face it: craft beer so-called is a specialized taste. Some drinkers, mainly men, like the aggressive flavor of IPAs and stouts. They like the higher booze levels, the heavier mouth feel, and the zing of hops, especially in summer. It seems like they're perhaps 10%, at most 15% of the malt beverage market. Most drinkers who don't go for wine or spirits prefer much lighter (insipid to many of us) flavored concoctions: light beers, flavored seltzers, cocktail-seltzer combinations, etc. Many of the IPA-stout consumers like to drink in brewpubs. So the small local brewpubs seem to be in pretty good shape, but the medium size craft brewers that are selling on a large regional scale, or national, and appeal to that 10-15% of the market have seen their sales level out or decline. Even when purchased by larger conglomerates like ABI their sales are often flat or declining. There's a finite number of consumers, and they may even be resisting buying now, or buying less, given the recent spiking of prices.
     
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  20. BeerQuestor

    BeerQuestor Initiate (109) Aug 5, 2015 New Jersey
    Trader

    Not here in NewJersey, New breweries are springing up like wildfires.