AB acquires Four Peaks, looks to New Belgium next

[BrewSavage]

You might want to print the list out and keep it in your wallet. It's a little long to memorize.

:

:
Spaten Münchner Hell
Spaten Oktoberfestbier
Spaten Optimator
Spaten Pils

I'm not going to stop drinking those beers.

 

[slym2none]

I'm not going to stop drinking those beers.

I am. It might hurt a little, but I am.

 

[okiedog]

You know, I'm not against Big Beer per se, even if I don't care for some of their products What I'm against, is bullying tactics, such as buying out distributors, paying bonuses to distributors to only push their products etc. I also don't like that AB-Inbev bad mouths or belittles craft brewers, while buying up craft breweries left and right. IMHO, they use their size and money to create an unfair marketplace. Sounds to me like monopolistic practices.

 

[okiedog]

AB-Inbev also just bought Breckenridge Brewery.
http://www.craftbrewingbusiness.com/business-marketing/anheuser-busch-buys-breckenridge-brewery-reports-indicate-they-may-just-buy-everything/?utm_source=Craft+Brewing+Business+Newsletter&utm_campaign=3b541bc3e8-CBBNews_20151223&utm_medium=email&utm_term=0_1e143189ee-3b541bc3e8-79389033

 

[Spartan1979]

I go to a pub see what they have on tap, then pick something I've already had or what seems the most interesting. I'm paying $5-8, it better be a good pint. Don't give a rat's a*s who brewed it or if some big corporation is in control. If the beer sucks, I usually remember and don't buy it again. BudInBev knows their share of taps are decreasing in certain areas. Old drinkers die off, new drinkers have different tastes. I'm kind of surprised we haven't seen a Budweiser IPA, Stout or Pale Ale yet. InBev doesn't want to lower prices, although the scale that they produce beer would enable them to do so. So they are going to maintain the current prices and diversify their offerings for now. If Bud made an IPA and sold it for 30% less a six pack (and it was good) they could send the craft beer market into the toilet. For now, I don't see that happening.

You don't remember this?

 

[cyanmonkey]

You don't remember this?

I heard on one of Jamil's podcasts a while back about an AB InBev or SAB representative telling students in the brew program at UC Davis that they shouldn't kid themselves. Budweiser could make an IPA just as good as anyone else, they just don't know how to market it.

 

[hunter_le five]

You don't remember this?

I do. It actually wasn't terrible. Though there were/are so many better options out there I don't think I ever bought more than a sixer or two of it.

 

[madscientist451]

Nope, never saw it. Maybe they didn't market it around here. But I still think ABInBev could make a decent IPA if they wanted to and if they priced it aggressively people would try it and they could win back some of their market share. Pricing usually comes into play in a competitive marketplace, but with craft beer, it just hasn't happened yet. Its more likely the Goose Island IPA will be their
"flagship" craft beer offering and they won't cut prices. I do look for a price war to happen eventually, as production meets or exceeds demand and breweries have massive debt to pay off.

 

[bob1852]

Michelob made a Pale Ale awhile ago....

But here's the thing, Budweiser's demographics don't want IPA's, Imperial Stouts, etc....

They've tried that with Bud Ale, Michelob Pale, etc....

They're smart and realized they way to maintain market share and to expand profits really to buy up successful breweries, not to try to internally expand their product line.

Besides why would they, when their line of bud light lime, and various -Rita's still hold (probably) a bigger overall market share than all craft beer combined.

 

[tootal]

I was on one of the taste panels for Budweiser Ale and the first rendition was amazing! The aroma and flavor was better than any hoppy ale I've ever had, and that's quite a few! I told them right then that if they would sell this beer they will out sell all other pale ales on the market, it was that good. Unfortunately, they dumbed it down and I was no longer a fan. It was "ok" but that word they love to use, "drinkability", got in the way once again. Trust me, they can brew anything they want, it's always a fight with marketing.
Back in the 80's they were making Anheuser Marzen and Pilsner. The Pilsner was better than any of the German Pils and all the old Germans that I worked with loved it but when it came time to market one of them they chose the Marzen because of it's trendy name, not because it was a better beer. That was a real shame. The Marzen was good but the Pils was excellent!

 

[Zekk]

I heard on one of Jamil's podcasts a while back about an AB InBev or SAB representative telling students in the brew program at UC Davis that they shouldn't kid themselves. Budweiser could make an IPA just as good as anyone else, they just don't know how to market it.

I believe it. Their head brewers are still brewers, if we can do it so can they. Plus if they can't they have the cash to go out and hire the best brewers to make one. But why bother when they can just buy craft breweries with established fan bases.

 

[Turkeyshot]

What they are really after is shelf/tap space, after all without that you can't sell beer.

You mean like this article. http://m.motherjones.com/tom-philpott/2015/12/big-beer-wants-take-away-your-craft-beer

 

[Magnus314]

The weirdest thing about this thread is the whole, "Those guys are artist/craftsmen who do the best of everything to make beer! Nothing should ever change!"

Those "Artist/Craftsmen" change things every year as Malt, crops, and hops change.

But once those breweries go big, if they change a dang thing, they're a bunch of sell-out jerks.

Reminds me of Metallica, or Sublime, Nirvana, Ozzy, and a million other bands. "They're awesome and independent. They better never change a thing or any lyrics or style or tempo of any song ever, or ever be successful and get popular/major distribution or they suck and are loser sell-outs and I've always hated them!"

 

[geoffey]

The weirdest thing about this thread is the whole, "Those guys are artist/craftsmen who do the best of everything to make beer! Nothing should ever change!"

Those "Artist/Craftsmen" change things every year as Malt, crops, and hops change.

But once those breweries go big, if they change a dang thing, they're a bunch of sell-out jerks.

Reminds me of Metallica, or Sublime, Nirvana, Ozzy, and a million other bands. "They're awesome and independent. They better never change a thing or any lyrics or style or tempo of any song ever, or ever be successful and get popular/major distribution or they suck and are loser sell-outs and I've always hated them!"

I think the point is more: what is the motivator of the change? I wouldn't assume that people here are unaware of yearly/seasonal changes that happen to recipes at small breweries. But when the brewer makes a change in a recipe in order to keep the quality the same or better than last year, well that's a much much different thing than a brewer changing a recipe because they are motivated more by profits than the quality of the beer. And in a way that's one of the main differentiators between craft and micro. So it's not really surprising at all to hear people on HBT be critical of it.

 

[Magnus314]

And in a way that's one of the main differentiators between craft and micro. So it's not really surprising at all to hear people on HBT be critical of it.

It's certainly not a surprise, just out of touch.

The difference between craft and micro is how much you sell. If it's too much, more than 15,000 barrels/year IIRC, it's not micro.

If you make the exact same beer, and it's great and everyone loves it and you sell truckloads of it you are suddenly not micro anymore, you can actually make your livings as a brewery full of employees, the hipsters turn on you on the internet, and you're big enough to attract the attention of investors.

Blue Moon is just as "craft" as the 1,000 tiny breweries brewing the same style. And even the beloved Dogfish will sell Malt Liquor in a brown paper bag, and thousands of "micro" "craft" breweries are brewing cream ales and adjunct lagers.

I think AB/Inbev is just now doing what they should have done 40 years ago- getting into the business of converting non-beer drinkers into beer drinkers.

And they're not going to do that with 50-100+ year old brands and products everyone already knows.

 

[geoffey]

It's certainly not a surprise, just out of touch.



The difference between craft and micro is how much you sell. If it's too much, more than 15,000 barrels/year IIRC, it's not micro.



If you make the exact same beer, and it's great and everyone loves it and you sell truckloads of it you are suddenly not micro anymore, you can actually make your livings as a brewery full of employees, the hipsters turn on you on the internet, and you're big enough to attract the attention of investors.



Blue Moon is just as "craft" as the 1,000 tiny breweries brewing the same style. And even the beloved Dogfish will sell Malt Liquor in a brown paper bag, and thousands of "micro" "craft" breweries are brewing cream ales and adjunct lagers.



I think AB/Inbev is just now doing what they should have done 40 years ago- getting into the business of converting non-beer drinkers into beer drinkers.



And they're not going to do that with 50-100+ year old brands and products everyone already knows.

It's not at all out of touch, but that's just my opinion.

Some people think there's more than just volume to differentiate craft beer from macro. You clearly don't so there's not much more to discuss. But I get it, you dislike hipsters turning on successful breweries when they get to big.

Blue Moon has never been a craft beer btw. One clever guy even sued them for pretending to be. I'm sure he was a hipster though.

 

[cyanmonkey]

Blue Moon has never been a craft beer btw. One clever guy even sued them for pretending to be. I'm sure he was a hipster though.

Yeah they're part of the MillerCoors thing.

He wasn't a hipster, but a ****** nonetheless.

 

[Magnus314]

Sandlot was making award winning Belgian styles, Bitters, Ambers, and a ton of other decidedly non-macro beers 20 years ago, in a 10 barrel brewery in a basement, but they don't count as "craft"?

Must be because they were so successful they actually got well known, and major distribution.

So I guess "craft" = "not very popular"? That's the weird bias of this whole thing.

 

[ViciousFishes]

So, who wants to start a successful microbrew with me here in central NC, so we can sell it off for way more than it's worth?

I'm in!!

 

[pdxal]

Sandlot was making award winning Belgian styles, Bitters, Ambers, and a ton of other decidedly non-macro beers 20 years ago, in a 10 barrel brewery in a basement, but they don't count as "craft"?

Must be because they were so successful they actually got well known, and major distribution.

So I guess "craft" = "not very popular"? That's the weird bias of this whole thing.

Do you have information about Sandlot starting in a basement? All the information I've seen says that they started at the stadium and were always just an offshoot of Coors. Coors tries to obscure this fact, though, to make Blue Moon seem more like "craft":

http://www.westword.com/restaurants...ut-the-sandlot-brewery-at-coors-field-5733550

http://www.bluemoonbrewingcompany.com/OurStory

 

[bob1852]

Sandlot was making award winning Belgian styles, Bitters, Ambers, and a ton of other decidedly non-macro beers 20 years ago, in a 10 barrel brewery in a basement, but they don't count as "craft"?

Must be because they were so successful they actually got well known, and major distribution.

So I guess "craft" = "not very popular"? That's the weird bias of this whole thing.

"Craft" is however the Brewer's Association decides to define it that year.

 

[geoffey]

Sandlot was making award winning Belgian styles, Bitters, Ambers, and a ton of other decidedly non-macro beers 20 years ago, in a 10 barrel brewery in a basement, but they don't count as "craft"?

Must be because they were so successful they actually got well known, and major distribution.

So I guess "craft" = "not very popular"? That's the weird bias of this whole thing.

Not really sure where you're seeing that bias. I'm not familiar with Sandlot so I can't speak to them. But if they are anything like Surly then that viewpoint is ridiculous and no one would seriously think Surly isn't craft beer. They've grown a huge amount the last few years and no one is complaining. As I said previously, most people don't define "craft" by adhering to strict numbers.

 

[cyanmonkey]

So how do WE define craft beer?

 

[MaddBaggins]

My personal definition is an independently or employee owned brewery. Not publicly traded, not owned my a mega Corp.
Most importantly to me, not a part of ABI. Anyone else, but not ABI.

 

[Murphys_Law]

Whats really scary about all this, is how much political power they will have in cities and such. Now, more than ever, another massive corporation will be able to lobby harder to get what they want, and will continue to put the little guys out of business.

The other side of that coin....

The "little guy" started a brewery and sold for a $B. Isn't that the American Dream?

 

[Calder]

I don't think anyone blames the little guy who sells out for a fortune - good for them.

What I have issue with is that AB is buying up all these small craft breweries, and then providing very lucrative incentives to the distributors to sell 98% of their product. That only leaves 2% shelf space for the small guys if they are successful.

Say 'craft' beer has 17% of the market (I don't know what it actually is), if only 2% is available for the independents, then AB will be providing the other 15% of the craft beer, (or ~95% of the craft beer market).

Once they have established brands, and a lock on the market, what would a big shareholder owned conglomerate do to increase profits? If I were them I would look at every possible means of reducing costs and increasing profits. This will mean ingredients will change, processes will change, and most probably the resulting beer will change. I'm sure they will keep small batch 'Flagship' beers unchanged, but you will also pay for them, the rest will be 'diluted'.

AB's primary business is to make money, and as much as it can from it's resources. Always looking to increase ROI. If it doesn't, then it's share value will fall. It just happens that the way it makes it's money is thru making and selling beer.

I suspect how good the beer tastes is NOT a metric within the company. Sure good product helps to retain customers and sales, but it is the sales that count, not how good the product is.

 

[Phunhog]

I don't think anyone blames the little guy who sells out for a fortune - good for them.

What I have issue with is that AB is buying up all these small craft breweries, and then providing very lucrative incentives to the distributors to sell 98% of their product. That only leaves 2% shelf space for the small guys if they are successful.

Say 'craft' beer has 17% of the market (I don't know what it actually is), if only 2% is available for the independents, then AB will be providing the other 15% of the craft beer, (or ~95% of the craft beer market).

Once they have established brands, and a lock on the market, what would a big shareholder owned conglomerate do to increase profits? If I were them I would look at every possible means of reducing costs and increasing profits. This will mean ingredients will change, processes will change, and most probably the resulting beer will change. I'm sure they will keep small batch 'Flagship' beers unchanged, but you will also pay for them, the rest will be 'diluted'.

AB's primary business is to make money, and as much as it can from it's resources. Always looking to increase ROI. If it doesn't, then it's share value will fall. It just happens that the way it makes it's money is thru making and selling beer.

I suspect how good the beer tastes is NOT a metric within the company. Sure good product helps to retain customers and sales, but it is the sales that count, not how good the product is.

I don't know....how or why would they change the beer? I agree that they could potentially change it to save money. But here is where the economy of scale factors in. Your small to medium sized brewery is woefully inefficient (labor) compared to large scale breweries(automation). I am sure AB can brew an IPA much cheaper than almost any other brewery just based on the cost of labor. Now factor in their buying power for ingredients. Changing recipes would only hurt them and would have a negligible affect on their ROI. I see a price war coming where a "big beer" craft beer six packs is several dollars cheaper than a true craft beer six pack. The whole goal being to eliminate as much competition as possible.
I rarely buy commercial beer anymore and I was SHOCKED to see what a six pack goes for. So I went with what I knew was going to be good and was also one of the cheapest craft sixpacks Sierra Nevada HopHunter (7.99). It was almost half the price of BP Sculpin.

 

[bob1852]

I don't think anyone blames the little guy who sells out for a fortune - good for them.

What I have issue with is that AB is buying up all these small craft breweries, and then providing very lucrative incentives to the distributors to sell 98% of their product. That only leaves 2% shelf space for the small guys if they are successful.

Say 'craft' beer has 17% of the market (I don't know what it actually is), if only 2% is available for the independents, then AB will be providing the other 15% of the craft beer, (or ~95% of the craft beer market).

Once they have established brands, and a lock on the market, what would a big shareholder owned conglomerate do to increase profits? If I were them I would look at every possible means of reducing costs and increasing profits. This will mean ingredients will change, processes will change, and most probably the resulting beer will change. I'm sure they will keep small batch 'Flagship' beers unchanged, but you will also pay for them, the rest will be 'diluted'.

AB's primary business is to make money, and as much as it can from it's resources. Always looking to increase ROI. If it doesn't, then it's share value will fall. It just happens that the way it makes it's money is thru making and selling beer.

I suspect how good the beer tastes is NOT a metric within the company. Sure good product helps to retain customers and sales, but it is the sales that count, not how good the product is.

Craft beer has only ~10-15% market share, yet makes up ~50% of the shelf space at my standard grocery store.

More breweries now than ever in the U.S., and ~2000 more in the planning the planning stages.

Sorry, I'm just not buying the conspiracy....

 

[slym2none]

"Craft beer" takes up between 30% and 50% of the shelf space, depending on the store. Now, take out some of those "craft beers" because they are owned by AB/InBev or some other large conglomerate, and you are talking 20-35% of the shelf space dedicated to actual craft beer.

That's what ticks me off.

 

[geoffey]

My concern is that the 50% of shelf space that is now "craft" beer at your local store will be 90-95% beer made/owned by one of two conglomerates in June near future. That makes it very difficult for smaller breweries to survive if their profits are based at all on selling packaged beers. I would imagine that the successful business model in the future will be more based on brewpubs and not packaged beers.

Really it's a very smart tactic by ABInbev and others. But I'm not of the opinion it's a good thing for the craft beer world in general, including consumers.