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Discussion in 'Beer News & Releases' started by Todd, Aug 7, 2019.
Update to the story:
Thanks for noting the update, @QuakeAttack.
Used to work for Reyes, and when I heard about this acquisition I wasn't surprised at all, they're like the aliens from Independence Day. Barely anyone knows who they are and they like to keep it that way
In some places they also distribute Russian River, Dogfish Head, Anderson Valley, etc. Could have a pretty big impact on craft beer pricing in northern California
Can it get even higher?
Mergers and buyouts are usually not good news for employees. Been there, done that.
To be fair, synergy is the upside of most modern/ med-large company buyouts. If person x1 is doing |payroll| at x and y1 is doing payroll at y (or making signs/ delivering product/ even sales team) if x and y are now the same company, there's going to be jobs where they can save money by merging x1 and y1 into z1 and saving a bunch of money.
This kind of thing, sadly, they can cover it on BA of course, but it's not a craft beer issue. When you hear about someone who does a lot of Salesforce.. that's what this is- getting rid of redundancy and figuring out ways to to shed unnecessary expenditures, which unfortunately means jobs = dunzo. Nothing personal, but it makes sense from an accounting standpoint.
I'll go farther: Most buyouts make sense financially and economically specifically because the company being bought out has so much fat to be trimmed, often especially in the form of superfluous workers and excessive payroll. These often are companies that have grown bloated and spendthrift through years of lazy management, as was the case with the famously extravagant Anheuser-Busch, with a long history of an old boys club and lack of meritocracy (including embarrassingly allowing itself to be led by August Busch IV), prior to its purchase by the efficiently run InBev. This is often true even when the buyer is an unrelated business (such as a private equity firm) and there are no "redundancies."
ll add to that. Not all the cost cutting is to reduce duplication of personnel. For many years AB made it a point of PR and pride to only use whole grain rice in brewing Bud. This practice began early on in their history and was continued up to the time of purchase by InBEV.
The CEO of InBEV at the time of purchase of AB was Carlos Brito. Brito did some fat cutting. included in that there was some internal changes. For example Brito explained to folks that he himself always flew in commercial rather than private jets and it was plain he expected the same from others. (When ABInBEV took over SAB Miller elimination of the private jet perq was also one of the early changes.)
Another change was that rice with some broken grains was fine to be used in brewing Bud. Widely cited by some this was interpreted by many to be a cheapening of quality. Problem is AB had long used whole grain as a PR thing but it turns out that, for example, the home brewing crew on this site agreed that the choice between all whole grain vs allowing some broken grains did not make any differene to the outcome of the beer. In other words the cost saving on the price of rice was truely eliminating unnecessary fat rather than cheapening the product.