Do buyouts really impact the beer?

Discussion in 'Beer Talk' started by BeerBobber, Jan 9, 2016.

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  1. chipawayboy

    chipawayboy Devotee (444) Oct 26, 2007 Massachusetts
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    They were a hot craft Brewer in the 90s and got taken over by a larger company w/influence and goals/vision outside of the prior family business. OP didn't ask to include or not include the various organizational circumstances that big company takeovers of craft brewers can take. Point is -- they are still living in the 90s because of the big business influence and haven't changed or grown to a fault IMO. On the upside they do provide an affordable local alternative -- it's just not a beer I'm gonna seek out.
     
  2. zid

    zid Meyvn (1,263) Feb 15, 2010 New York
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    I hope they let us know when Bass gets tweaked again.
     
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  3. TongoRad

    TongoRad Poo-Bah (2,858) Jun 3, 2004 New Jersey
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    I think @Peter_Wolfe said that there wouldn't be any sort of announcement, that they would just start showing up one day. I hope he tells us here, at least :slight_smile:.
     
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  4. joeyjoey104

    joeyjoey104 Initiate (0) Aug 2, 2014 California

    To answer the OP question - I have had Elysian Brewing Co. beers well before In-Bev purchased them, and just last month I bought a sixer of their Space Dust IPA, still tasting just as good as before.

    That is the only one I can comment on, will still buy Ballast & St. Archer, unless they change the quality. Then I'm out.
     
  5. surfcaster

    surfcaster Zealot (553) Apr 20, 2013 North Carolina
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    I think people often assume it is/will be for the worst--my humble view/take on the topic--an example or two:

    Nelson--truly my longtime favorite. I have had it many, many times straight from the brewery. Now regularly getting it in NC and fresh. Comparing it is hard as taste varies but even if it is only "85%"--I'll take it. The impact for me is availability and it has been a good thing.

    Goose IPA--never been one of my favorites but now available at places where BMC has contractually boxed out everyone but a solid alternative when I want to have one--not a GIIPA aficionado but seems to be pretty darn similar.

    Seems like the "new" owners have tried to keep the quality up and even where not perfect-still trying. In this modern era--very little to be gained by dropping a fortune on it and then not trying to develop the market in contrast to some of the old days practices of buying a brand to kill it.
     
    #45 surfcaster, Jan 10, 2016
    Last edited: Jan 10, 2016
  6. LuskusDelph

    LuskusDelph Initiate (0) May 1, 2008 New Jersey

    This thread is so weird, and illustrates the overall weirdness of the beer world today. Some argue that it is bad when a buyout results in changes to good, established brews...and then comments come along saying that a buyout of an established small brewer has resulted in the beers staying the same and not "moving forward".
    Maybe it's just me, but I think that's just plain silly (and it's mighty contradictory too).:grinning:

    I'll second that. Bass is an example of a great classic beer going downhill long before the brand was acquired by a new company. Bass hasn't really tasted right since the late '70s...long before it came under the AB-InBev umbrella. The version sold in the USA in recent years is radically different than 40+ years ago far from terrible (I sometimes choose it on draft over locally made Pale Ales) but if any hint of the old character and balance of Bass could actually be recaptured, I could definitely see myself buying it more often.
    The really funny thing is that I know for a fact that there are a LOT of actually people actually like the current Bass Ale exactly as it is. And how ironic it will be when those people start complaining that a newly retooled Bass tastes "changed". :stuck_out_tongue:
     
  7. SFNC

    SFNC Zealot (516) Apr 7, 2013 North Carolina

    All hail the great multi-national corporation for they are our our future. Why leave a dime on the counter for somebody else when there are share holders to please.
     
  8. drtth

    drtth Initiate (0) Nov 25, 2007 Pennsylvania

    They may be yours, but they're not mine since those folks are losing ground in the battle for popular tastes and their purchases simply illustrate how desperate they are not to be left standing in the dust.
     
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  9. drtth

    drtth Initiate (0) Nov 25, 2007 Pennsylvania

    Nor did you make any mention of your evidece and/or data for the claim that they change.
     
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  10. ravenwork

    ravenwork Initiate (0) Mar 16, 2015 Pennsylvania

    One of the fundamental things about craft beer that I enjoy is getting truly unique and wonderful taste experiences. Things where some brewer was inspired to take a chance, try something different, or just make a bold tweek to an existing style. The other thing I enjoy is that experience of freshness, where you walk into a brewpub, or crack a bottle from a nearby brewer, and you get to have their beer at the very peak of quality. This experience can be ethereal, and for some styles the window can be tight. The harsh reality is that Big Beer ownership of craft beer will work against both of these experiences, without a doubt.
     
  11. eppCOS

    eppCOS Poo-Bah (1,617) Jun 27, 2015 Colorado
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    Even if the quality stays high, to me that's missing the point. I just don't want good beer to become like the retail clothing market. So, I will pay an extra $1-2 to keep a small-scale brewer in the game rather than just sending it to megabeerz,inc., as I don't want all our options being reduced to a single market of "Made in _____[you know where]" - it's hard to find clothing that is made by people who aren't in awful factory conditions (if not outright out-sourced slave conditions, not kidding here). I don't want beer to become like that... with no options. Or options where that sweater would be $500 if you want it produced fairly.

    Yes, folks can go nuts on me (that's fine) and say "but you can't taste suffering or mega-recipes" - fair enough. But once you know about the market conditions, that's where YOU get to decide what you want to see in this world.
    Sorry - sober at this moment - off the soapbox.
     
  12. utopiajane

    utopiajane Initiate (0) Jun 11, 2013 New York


    Well said!
     
  13. drtth

    drtth Initiate (0) Nov 25, 2007 Pennsylvania

    I think I'd only like to change one word here and propose substituting the word "can" for the word "will." My reason for this suggestion is that on multiple visits to the UK I've found that the experiences you describe are alive and well even in the presence of big beer and lots of pubs being "tied houses" (i.e., owned by a big brewery). This is where we, the audience/consumers/lovers of such experiences as you describe need to be both aware and proactive. If we settle for less that is exactly what we'll get.
     
  14. chipawayboy

    chipawayboy Devotee (444) Oct 26, 2007 Massachusetts
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    This thread and the beer industry are only as weird as people's perspectives. Let's face it -- buyouts and eventual consolidation will have many effects on people's drinking experience -- some good (better overall beer quality, affordability and availability) and some bad (classic/popular brews getting tweaked -- recipe/dist -- for reasons not necessarily in the best interest of the consumer, brewey stagnation/lack of innovation etc.)....and shockingly these are contradictory. :grinning: My perspective -- I am fortunate to only drink brewery fresh beers -- and I love it. Anything else is degraded experience (taste/freshness wise). What's your perspective ? Where are you coming from on this topic?
     
  15. dennis3951

    dennis3951 Initiate (0) Mar 6, 2008 New Jersey

    Since Blue Point was taken over their beers are the same. What has changed is that Toasted Lager is showing up on tap in a lot a places it never was before.
     
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  16. SFNC

    SFNC Zealot (516) Apr 7, 2013 North Carolina

    Trust me I don't want them to be, but they will do what is needed to to either co-opt or crush the competition. I hope I'm wrong, but.....
     
  17. Geuzedad

    Geuzedad Initiate (0) Nov 14, 2010 Arizona

    Don't blame you brother, in fact I do too. Its just that I have actually stopped there on the way to San Diego and had it on draft as well as purchased bottles of their beer brewed and bottled there and I can tell a difference. Now hopefully it will be addressed with the centrifuge but my point was that anytime you increase production or go into another system there are likely to be changes. Not necessarily bad mind you, but changes none the less.
     
  18. Ri0

    Ri0 Initiate (0) Jul 1, 2012 Wisconsin

    Were you able to buy 4pks of BCBS this year? Why not?
     
  19. PapaGoose03

    PapaGoose03 Poo-Bah (2,906) May 30, 2005 Michigan
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    I think the buy-outs have the potential to affect the brewery's beers (or their operations) in three ways:
    1. Improving the beer quality by providing expertise or capital funds for a QC lab, ability to absorb the cost of dumping experimental beers that don't work out, etc. But I suspect that the breweries that have been taken over so far have all been in the top 5-10 percent of the BA ratings, thus the beers are already very good quality and not so much in need of help for improvement.
    2. Capital funds to expand operations, distribution, etc. I don't know how much this has happened yet.
    3. Improve the profit margin for the brewery by providing access to large-scale purchasing power or other benefits like that. Again, I don't know how much this has happened.
    Over time, these benefits will help these breweries to out compete and force some of the competition out of the game, but that hasn't really happened yet, has it?
     
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  20. maltmaster420

    maltmaster420 Initiate (0) Aug 17, 2005 Oregon

    One small example: AB has started brewing some of the 10 Barrel stuff in Ft Collins. I don't know if it's recipe changes, the shape of their fermenters, cheapening of ingredients, or what, but something has definitely changed, and not for the better. The beer (specifically Pray for Snow) is now somehow thinner, sweeter, and less hoppy than it used to be.
     
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  21. Oktoberfiesta

    Oktoberfiesta Initiate (0) Nov 16, 2013 New Mexico

    Once they build that 'High End' brand to 12 breweries, they can mass sell a whole USA "regional" lineup to every bar in the USA (with incentives). I don't see how the little guys can compete with that. There are more chain restaurant tap lines than local. Customers really have to let their voices be heard.
    Are they knocking out any "better" beers from said shelf space? I realize taste is subjective. But most can agree GI shouldn't be in every chain restaurant in a town where GABF winners sit on the bench.

    Can a 2 for $3 deal be beat? SN 16 oz cans may come close. But for that newcomer to craft (millions more of those than established drinkers, fyi), they are really onto something here.

    GI is now seemingly in every fringe "craft" type eatery/bar in my area these days. Some places are hesitant to have more than 1 IPA. How they choose that over some local options (elevated ipa, marble ipa, bosques IPAs.. Even regional beers get the shaft) is a bit of an eye opener. I agree variety is nice, and who am I to be the beer god of judging what should or shouldn't be on a tap list. But there is a true blurring of lines here as AB INBEV has pretty much infiltrated the craft genre.

    In many places, GI got added right next to Bud and Bud light. So for those places, GI is better than nothing at all. In that regard, I like that things are getting better. But at what expense? If there is any trickle down effect, it'll be newcomers trying GI, think its okay, and then find a local option at that second or third restaurant they visit down the road.

    Smaller breweries just cannot compete on a price level with these guys either. So losing tap lines to a higher price/oz yield is tough, especially when they can label it "craft", and charge the same. In bars that were always hesitant to add a line for GI all of a sudden is not easy to compete with either.

    Win out because your products are better. Not because you can buy every facet of the operation.
     
    #61 Oktoberfiesta, Jan 11, 2016
    Last edited: Jan 11, 2016
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  22. zid

    zid Meyvn (1,263) Feb 15, 2010 New York
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  23. spaceman24

    spaceman24 Initiate (0) Oct 7, 2008 Texas

    The places whose products truly are better will always find a way to keep making and selling that product. Those who were riding the wave of popularity and aren't making a superior product may close up shop. That's the way of things. You'll still have plenty of good beer options.

    If Sierra Nevada made it in 1981, they'll make it in 2021.

    And being honest, as much as I'd miss a bunch of other breweries, if my options were BMC (+whatever good-tasting stuff they're still churning out) and SN, I'd still have plenty of good beer to drink. Life would continue, as much as some clowns here act like it wouldn't.
     
    #63 spaceman24, Jan 11, 2016
    Last edited: Jan 11, 2016
  24. tylerstubs

    tylerstubs Initiate (0) May 14, 2015 Colorado


    What I often miss in posts like this is...Who's the loser of said dime? The craft brewery owners and operators who make a large sum of money?

    MAYBE, a few small jobs are changed/lost at the street level but seriously, I think the people who are part of the purchase benefit greatly, the purchasers gain market share (that's the sole intent, not to dilute beer or ruin people's lives) and the beer gets to more people. Sure, some bigwigs might gain a TINY amount of money. I can't be certain but I'd venture to guess somewhere in the fractions of a % and the guys who worked their hearts out to get these breweries to where they are make more money than they ever imagined.

    The argument of shelf space I can see, but most of these guys control such a large amount of distribution they already do that. Also, consumer demand simply takes care of that one pretty easily. Bud-We want that endcap, we'll build it, maintain it and fill it etc. Store owner-OKAY you got it.
     
  25. Oktoberfiesta

    Oktoberfiesta Initiate (0) Nov 16, 2013 New Mexico

    I said this with Ballast Point's deal. We helped a select few become millionaires. Our job is done as consumers IMHO. I doubt the hourly workers there are seeing any big benefit. The end goal is accomplished as a grassroots company. These workers are just like Mcdonalds/WalMart or any other big factory workers now. Sure they keep people employed and the local economy sees some benefit, but by and large, there are companies that are local that keep profits in state that are nipping at these sold out breweries heels. BP doesn't need our help. Every six pack bought goes directly into Constellations pocket.. fyi, they are all BIG WIGs at the quantity level they work at. Corona sales are ridiculous.

    Locally, I have loved seeing my local breweries grow year after year. Every Pint or growler I had filled helped those guys out. I personally know many have investors (or joint partners), so its not all local mom & pop fun and games. Most have bank loans through out of state banks. There is a business side to all of this. But with so many breweries trying to get their name out there, there isn't a time or a place where BP currently fits into my drinking desires. Help your local grow, let them get bought out, and set them free. Rinse and repeat.
    Demand is one thing. But newcomer/fringe crafty type drinkers usually buy what they see at the store, at the gas station, and at the beer stores. If they see it enough, they might think its popular enough to give it a try. Points of sale in the supply side are shrinking for many breweries.

    Many don't even see it as a feasible opportunity to distribute. In NM, some laws changed this past year to where breweries could open up 2-3 of their own tap rooms. From the smallest in the state, to the biggest, they are taking advantage of that. They saw a demand, and brought their own supply. I guess that's one workaround. It's where consumers go to where the product is. Not enough people do that though. A consumer cannot demand something they don't know exists because the shelf space war is being won by billionaires. Over time, consumer demand should win out. But we are seeing quite a few buyouts every few months unfold. I can see stores telling us or new to craft consumers what to drink. And I don't like that.
     
    #65 Oktoberfiesta, Jan 11, 2016
    Last edited: Jan 11, 2016
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  26. JackHorzempa

    JackHorzempa Poo-Bah (4,870) Dec 15, 2005 Pennsylvania
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    That is most certainly the case but you personally may not like the results. Blue Moon is being produced at several million barrels a year which means there is a HUGE consumer demand for this beer. There will likely be increased consumer demand for core Goose Island beers like 312, Honkers, IPA in the very near future.

    You should continue to support the local independent breweries that you prefer but consumer demand does not equate to your personal preferences.

    Cheers!
     
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  27. gopens44

    gopens44 Poo-Bah (2,350) Aug 9, 2010 Virginia
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    Old folks or Cardinals fans. I may be one. Or both.
     
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  28. Domingo

    Domingo Poo-Bah (2,685) Apr 23, 2005 Colorado
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    The easiest answer is - "sometimes yes, sometimes no."
     
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  29. besch64

    besch64 Initiate (62) Mar 16, 2013 New York

    Has InBev's purchase of Goose Island changed the way Bourbon County tastes? Possibly not, I don't know.

    But you know what will start tasting different? When your favorite local small-scale brewery gets shut out of its only distribution deals because InBev is bullying and outright bribing distributors to drop their craft brands, Favorite Local Beer Co will go out of business. So those beers will go from tasting delicious to tasting like nothing, because they won't exist.

    I don't give a hot damn if BCBC tastes the same or not.
     
  30. JackHorzempa

    JackHorzempa Poo-Bah (4,870) Dec 15, 2005 Pennsylvania
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    Are you willing to travel to "Favorite Local Beer Co." to drink on-premise and walk out with several growlers or packaged beers when you leave?

    Cheers!
     
  31. drtth

    drtth Initiate (0) Nov 25, 2007 Pennsylvania

    Every time I see a post like this, I start wondering, given that ABInBev isn't doing anything they've never tried to do before (except buying fewer than 1% of the existing craft breweries) how did we wind up with so many (over 4000 with the number growing daily) local small-scale breweries up and running and producing flavorful beer in the first place?

    I mean how did all those small-scale breweries get distributed in the first place if ABInBev is as all powerful as you are suggesting?
     
  32. tylerstubs

    tylerstubs Initiate (0) May 14, 2015 Colorado



    Coors distributes a ton of these guys in CO. I cant remeber if they're evil or not? They also emply tons of people and people really want to work for them, from the uneducated to engineers but we'll also ignore that.
     
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  33. highdesertdrinker

    highdesertdrinker Zealot (556) Nov 5, 2012 Arizona
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    Yeah, I think it's not quite as raw, and earthy, and it seems more refined, but I am loving the Pure Hoppiness in 12 oz. bottles!
     
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  34. SFNC

    SFNC Zealot (516) Apr 7, 2013 North Carolina

    Sure lots of people come out smelling like a rose (owners, some employees, if lucky), but ultimately the consumer and many of the now redundant employees who may lose a job they love even with a cash payout to walk away come up short. Innovation, skill and integrity are replaced with automation and eventually a lowest common denominator attitude towards product. Shelf space will be the first deciding battle of the war of attrition. It'll be interesting to see the climate in a couple years. I would bet this will be looked back at as a "Golden Age".
     
  35. CJNAPS

    CJNAPS Initiate (0) Nov 3, 2013 California

    As long as they don't mess with the brew master and let it be business as usual then the taste might stay the same. If they start messing with ingredients to save money and speed up the process to get more beer out there, that's what I always think will eventually happen when "macro" buys these breweries up. Most of us just don't wanna give our money to the big guys...but have no problem drinking some BCBS hahaha Cheers and ONE LOVE
     
  36. CJNAPS

    CJNAPS Initiate (0) Nov 3, 2013 California

    I will never stop drinking Victory at sea and Sculpin
     
  37. cjgiant

    cjgiant Poo-Bah (5,373) Jul 13, 2013 District of Columbia
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    This IS something I know at least a bit about... and I'm sure you are aware that end-cap and specialty display racks are not "additional" space. In fact, it's highly prized space, and space not being occupied (in the referenced picture) by your local craft brewer. I understand this is a separate conversation, and don't want to sidetrack the conversation.

    Closer to that thread, I don't think big beer wants to destroy what it's buying. I do think they will push to make it profitable enough to earn the x% their owners (however structured) expect (cost of equity). Was the brewery operating at peak $$$ efficiency when bought? Was it at or above the company's cost of equity? Or did they see room for improvements to the operational/financial side of the purchased brewery to get it in line with that cost? What are the changes to reach profitability, assuming that is the case?
    • Better purchasing power to lower variable costs? No change
    • You can use x% less of this in your beer to hit profit. Change
    • You can utilize these techniques and new equipment to hone in consistency. Sort of a change, in an odd way
    • We need to increase the price of these beers y%. No change
    • You don't need these 5 employees. No change, presumably (but good?)
    • You don't need to produce these X offerings, as they don't make the right %. Sort of a change (to no taste whatsoever)
    • We need to tweak these X offerings to make them more palatable to the greater market (those that enjoy our other beers). Change
    I don't think these are unreasonable possibilities, but are not guarantees, either. I also noted only changes, not whether they were for the better or worse. I haven't had enough experience to notice any taste perception differences in any specific offerings (didn't get GI, or much Elysian, before their buyouts, for instance). The fear is some of the above (for the worse), and it is still a fairly small sample size of "over time" breweries that can be used. Guess we'll see, over time :slight_smile:.
     
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  38. cjgiant

    cjgiant Poo-Bah (5,373) Jul 13, 2013 District of Columbia
    Society

    And that strategy didn't stem the loss of market share, so live and learn - to use another cliché :wink:.


    Note: just being argumentative for its own sake here, and to point out one case does not a trend make (but when it's all you have, it can't be just ignored). Mainly, I don't have any proof or necessarily a strong belief in the implications of the actual statement to even attempt to defend it (though it is possible, but I've already done the theoretical post, and we'll still wait and see).
     
  39. tylerstubs

    tylerstubs Initiate (0) May 14, 2015 Colorado


    Show me where this is the result. That's purely speculation.
     
  40. SFNC

    SFNC Zealot (516) Apr 7, 2013 North Carolina

    Check out the movie and music business. It may not have taken hold in the beer game, but give it time.
     
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