Another craft brewery bites the dust...

[tagz]

Kombat understands economics, the findings of which are often counterintuitive. It is frustrating for people like him to talk to regular folks. He's like a doctor trying to explain that the flu isn't caused by witchcraft. Economics-literate people often loose their cool when they hear popular ideas that are false. Like the idea that China is hurting us by "flooding the market with low cost goods made with cheap labor" are all over the place and totally bogus. Some get it, some don't.

Well China does manipulate their currency to make their goods cheaper...

 

[brick_haus]

^^^OH SNAP!^^^

Everytime I read the title of this thread I cant help from thinking that the craft brewery did NOT "bite the dust". Rather, they "drank the fruit of their labor".

 

[LandoLincoln]

Wow, I'm amazed at the amount of short-sighted people here. Use your money to support something you love. If you think AB shares that love, you're fooling yourself.

Won't be drinking Elysian EVER again.

Won't be drinking 10 Barrel ever again

Goose Island IPA tastes like lemon piss

"I won't ever drink another Elysian beer EVER AGAIN!
I won't ever drink another 10 Barrel beer EVER AGAIN!
I won't drink another Goose Island beer...well...except for the Bourbon County Brand Stouts. And their Matilda. And their Sofie. But their IPA is RIGHT OUT!"

Scruples run abundant in this thread.

 

[seigex]

I've always been fascinated by the hypocrisy of people who decry corporate tactics (i.e., capitalism), yet demand a consistent return on their retirement accounts and pension funds. Where do you think those 9-12% gains per year come from? Big, evil corporations, who focus on profit above all else. You can't have it both ways.



Hmm. What kind of car do you drive? What kind of phone do you use? What kind of TV is in your living room? Where does the tag on your shirt say it was made?

Pot, I've got someone I think you'd like to meet: Mr. Kettle.



Nonsense, there's absolutely nothing preventing you from buying shares of AB-InBev yourself. I personally own several thousand dollars' worth, and it's been a great investment. Am I part of the world's elite 10%? Hardly. I'm a lowly government worker.



Budweiser is made in China by slave labour??? Holy crap, all this time I thought it was brewed in St. Louis, Missouri, (by Americans, by the way). You need to blow the lid off this story!



Huh?? Didn't the last two states finally legalize home brewing in the last couple of years? What evidence do you have that this is suddenly going to reverse? You are really crafting some wild strawmen arguments here, Silent. If you have to resort to totally baseless fearmongering to make your case, you've already lost.

Damn, didn't get a chance to respond, but no need to now. This ^^. After reading Silentdrinker's response, I thought I somehow got transferred to some occupy wall street blog.

 

[Falcon3]

Scruples run abundant in this thread.

This better for you?

Things I haven't spent 1 penny on since understanding who it was owned by and the philosophy of the parent company/a real "craft" brew was bought out by InBev/similar:

Redhook
Goose Island
Leinenkugels
10 Barrel
Elysian
Magic Hat
Pyramid
Widmer


I'm sure there are more I'm forgetting/haven't been educated about, but seriously people, let's support what we believe in, and leave the rest to the uneducated masses.

 

[k1ngl1ves]

If a fox bites a bear's ass enough times, eventually the bear is going to turn around and eat the fox.

 

[bob1852]

This better for you?

Things I haven't spent 1 penny on since understanding who it was owned by and the philosophy of the parent company/a real "craft" brew was bought out by InBev/similar:

Redhook
Goose Island
Leinenkugels
10 Barrel
Elysian
Magic Hat
Pyramid
Widmer


I'm sure there are more I'm forgetting/haven't been educated about, but seriously people, let's support what we believe in, and leave the rest to the uneducated masses.

So, if you haven't been educated about some of them, doesn't that make you part of the "uneducated masses"?

 

[k1ngl1ves]

I'm sure there are more I'm forgetting/haven't been educated about, but seriously people, let's support what we believe in, and leave the rest to the uneducated masses.

I believe in home brewing.

Once a home brewer opens his/her own brewery though, I lump it into the same pile as all the rest... including Bud, Miller, and Coors. Beer for profit. The bottom line is important for all businesses, and none of these breweries are any different.

If you don't think they're the same, give me one example of a licensed brewery that gives away all their beer for free. If you find one, I'll categorize it into a third pile.

 

[LandoLincoln]

a real "craft" brew

That term is so nebulous it may as well not exist.

"Well, it has to be brewed with traditional methods and traditional ingredients. Well, mostly traditional ingredients. Most of the time. And it has to be brewed by a small, independent brewery. Mostly independent, anyway. And breweries that don't produce more than 6 million barrels a year are still 'small,' right?"

If their beer tastes good to me, then I'll drink it.
If it doesn't, then I won't.
I'll cut the little brewers some slack since they have a harder time keeping their ducks in a row, but not much.

 

[bob1852]

How many times has BA changed the definition of "craft" solely so Sam Adams still fits?

 

[BlkWater_brewer]

This thread is over.. Kombat is smarter than every one of you... even me.. and that is difficult to do...


He's right about everything.. anything we think is idiotic....



Even though everything he has brought up is easy to rebuttal, there is no reason to as he won't take any time to really think about it..

So thanks for being the smartest person in any room you walk into.... we are lucky to have you here.

Great sarcasm, obviously a legend in his own mind. Best to just give them a wide berth.

 

[BlkWater_brewer]

Being bought out by AB In Bev is not the end. We will be seeing a serious shakeout in small breweries in the years to come - just because of saturation. Sad but true, True Craft Brewers won't sellout. There are some that do this not for love of the holy dollar, but because they love what they do and take pride in it. That is what is lost when breweries are bought out by conglomerates. Sadly there are certain "if it makes me rich it is good" types that just don't get it. If you value profits above all else, including your employees you have become what is wrong with this country.

 

[Bensiff]

I find it fascinating that folks would choose their beer based on an anti corporate ideology with a prejudiced assumption that a corporate entity necessitates employees are miserable and apparently put out bad products; instead of who has a good product and/or a nice establishment that you enjoy. Me, I'll sit here on my iPhone, regardless of Apples "obscene" profits, and enjoy whatever beer sounds like it would taste good for the mood I'm in while saying you folks have a silly dogma.

 

[brewguyver]

<ramble>Damn. If only someone would invent some kind of special tool ... we'll call it ... A Search Engine ... and a place where people can interact like ... an Internet (calling Al Gore) so we can find out what breweries match our ethical principals. And maybe by then we'll be able to do that search in a flying car ... and fly to the tiny local microbreweries who don't believe in making a profit, and can magically make a living giving away free beer ...

Sometimes it amazes me how some people on this board can figure out how to coax enzymes and single cell fungi to produce delicious beverages and yet have so little business sense. That or they're angry that some other homebrewer hit the big time instead of themselves (eff you ... it should have been me!!!).

I do understand the concerns about the workers, but if they didn't put up their life savings to start the brewery, and didn't take big personal risks to make it successful, then they don't deserve the windfall. If there were some people who worked their ass off and didn't get recognized ... the owners will learn karma's a bitch.

So crack a homebrew, or a lemon piss goose island IPA, or whatever you want to drink, and chill.

In closing "Sell out, with me oh yea. Sell out, with me all right. The [brewing] company is gonna pay me lots of money and everything's going to be, all, right."
</ramble>

 

[ciderWI]

Since deregulation, beer seems to be one of the most perfect free markets in existence. Quality is becoming more important than marketing (the majors haven't seemed to figure that out yet). Startup costs are low enough that it's not impossible to bootstrap another microbrewery, and there's a lot of passionate and talented brewers who would like to do exactly that. My point here is that if small non-corporate breweries make the best beer, there will always be great beer available from breweries that aren't multinational corporations.

Having been a principal in three startups, I'm a believer in helping the little guy get going. It's convenient that the best beers available in my local stores and favorite restaurants are great local and regional brews. Goose Island still makes some good beer, but since I have a choice I'd rather order a New Glarus or Lakefront or Central Waters or ...

 

[Bensiff]

Since deregulation, beer seems to be one of the most perfect free markets in existence. Quality is becoming more important than marketing (the majors haven't seemed to figure that out yet). Startup costs are low enough that it's not impossible to bootstrap another microbrewery, and there's a lot of passionate and talented brewers who would like to do exactly that. My point here is that if small non-corporate breweries make the best beer, there will always be great beer available from breweries that aren't multinational corporations.

Having been a principal in three startups, I'm a believer in helping the little guy get going. It's convenient that the best beers available in my local stores and favorite restaurants are great local and regional brews. Goose Island still makes some good beer, but since I have a choice I'd rather order a New Glarus or Lakefront or Central Waters or ...

Now we are talking a little sense. I'm not a big fan of corporations as I believe in capitalism not corporatism. But, by and large most corporations in the US operate cleanly and provide good products at a reasonable price. That being said, living in the PNW we have no shortage of good breweries large and small. Often times the ones that are a little larger make better beer because they have the financial resources to up the quality and there is something to be said about that. However, often I find myself going to ones that operate on 3-5 bbl as much as those running 15+ bbl systems. They don't always make a better product or a different product...there is however a bit of satisfaction in being a small part of helping get someones dream going. Even more, I enjoy talking to the guys and gals working their little breweries. Often they are full of enthusiasm and truly love beer and enjoy talking about it and love the fact that people are showing up and happily paying for their product.

 

[brick_haus]

I, for one, am an employee of a small company that was consumed by the evil large corporation (unfortunately not in the beer manufacturing business). It's been horrible over the last three years since the buy out. Here's my personal experience, please send your pity.

1. I recieved a severance from the small company. One week of salary for every year of service. 20 years for me.
2. A 20% pay increase right from the start.
3. Increase from $1000 company matched 401K to 7% matching.
4. Slightly better health benefits as the buying power of the large corperation is greater.
5. Increase from $2500 annual bonus to a 15% target annual bonus.
6. There is no longer a ceiling, I can now be promoted into a higher position. Before there was no room to "grow".
7. 2 promotions in three years has doubled my salary. Thats more increase in pay than the previous 20 years with the small company.

Here's the down side. The poor unfortunate underperforming employees were all laid off. And they were only given the same week/years service severance from the small consumed company AND a paycheck every week for one year and continuation of their medical benefits as a severance compensation from the horrible, ugle large coproration...
We kept the performers onboard.

 

[tagz]

I, for one, am an employee of a small company that was consumed by the evil large corporation (unfortunately not in the beer manufacturing business). It's been horrible over the last three years since the buy out. Here's my personal experience, please send your pity.



1. I recieved a severance from the small company. One week of salary for every year of service. 20 years for me.

2. A 20% pay increase right from the start.

3. Increase from $1000 company matched 401K to 7% matching.

4. Slightly better health benefits as the buying power of the large corperation is greater.

5. Increase from $2500 annual bonus to a 15% target annual bonus.

6. There is no longer a ceiling, I can now be promoted into a higher position. Before there was no room to "grow".

7. 2 promotions in three years has doubled my salary. Thats more increase in pay than the previous 20 years with the small company.



Here's the down side. The poor unfortunate underperforming employees were all laid off. And they were only given the same week/years service severance from the small consumed company AND a paycheck every week for one year and continuation of their medical benefits as a severance compensation from the horrible, ugle large coproration...

We kept the performers onboard.

Well I'm convinced. Let's go full on neoliberal free market. It worked out really well in Latin America.

 

[brick_haus]

Well I'm convinced. Let's go full on neoliberal free market. It worked out really well in Latin America.

I guess you're right. We certainly do not want the private sector to be the driving force behind our economy. We all know what a failure Reagans policies were.

 

[LandoLincoln]

I, for one, am an employee of a small company that was consumed by the evil large corporation (unfortunately not in the beer manufacturing business). It's been horrible over the last three years since the buy out. Here's my personal experience, please send your pity.

1. I recieved a severance from the small company. One week of salary for every year of service. 20 years for me.
2. A 20% pay increase right from the start.
3. Increase from $1000 company matched 401K to 7% matching.
4. Slightly better health benefits as the buying power of the large corperation is greater.
5. Increase from $2500 annual bonus to a 15% target annual bonus.
6. There is no longer a ceiling, I can now be promoted into a higher position. Before there was no room to "grow".
7. 2 promotions in three years has doubled my salary. Thats more increase in pay than the previous 20 years with the small company.

Here's the down side. The poor unfortunate underperforming employees were all laid off. And they were only given the same week/years service severance from the small consumed company AND a paycheck every week for one year and continuation of their medical benefits as a severance compensation from the horrible, ugle large coproration...
We kept the performers onboard.

My company was purchased by a private equity firm. This is what THEY did to my company:
1. Fired about 1/2 of the workforce at my company's HQ to skeleton crew levels. Need something done and somebody's on vacation or sick? Too damn bad. You're going to have to wait for them to get back.
2. Sold all of the real estate that my company owned
3. Leased all of the same real estate that they just sold.
4. Pocketed all of the money that they made from the sale of the real estate.
5. Stopped all manner of bonuses.
6. Started to complain about how much money we're wasting on overhead, like...oh, I dunno...RENT that we never had to pay before.

The Elysium guys could have sold the business to a private equity firm. It's a good thing for the employees that they left behind that they didn't.

 

[k1ngl1ves]

I worked for a small engineering company. Less than 200 people. We were bought out at the beginning of the year by a national company. Here's what changed:


Nothing. No layoffs. No change in benefits... which are great btw.


Why? Because of collective bargaining. I wouldn't work without it...

 

[tagz]

I guess you're right. We certainly do not want the private sector to be the driving force behind our economy. We all know what a failure Reagans policies were.

Obviously there is a middle ground. We'd both probably agree that a regulated private sector can produce a significant level of wealth for a broad sector of society. That said, the belief that unfettered corporate power is a net positive for society is naive.

 

[seefish]

Why the hell do we even care about this? Make your own damn beer.

 

[madscientist451]

I read all the comments and respect other's views. But I really haven't seen any coherent explanation of any downside that comes with small breweries being bought by large corporate brewers. There's enough margin in beer that it will continue to attract more investment. That means more choices and better quality and more and more breweries. The big beer producers control the market and keep their prices high and the consumers keep paying. There's no interest in a price war, consumers seem to equate price with quality. That gives even more small brewers a chance to get started.
Germany has about 80 million people and 1,300 breweries. We need to add about 2,000 more breweries just to get to their brewery/population ratio. As beer drinkers, we have a lot to look forward to.

 

[soccerdad]

We all know what a failure Reagans policies were.

Brick - I'm not sure if this was tongue in check or not. If you have consumed sufficient RR cool aid you may think his 8 years were an economic success despite the fact that the first 6 were more than miserable. He pretty much emptied the treasury to try to jump start an economy that was in a down cycle - that never works! - but it set the tone for most succeeding presidents leaving us (as RR did) with the largest deficit in history.

Murray Rothbard was admittedly a disillusioned libertarian because Reagan promised so much in a small government, free market vein and delivered pretty much none of it ,,, but if you can see through some of his bias and disappointment, this is a fascinating essay - with significant truth

http://www.lewrockwell.com/1970/01/murray-n-rothbard/conservative-con-man/ for the economics part, scroll down to the heading "The Reagan Years: Libertarian Rhetoric, Statist Policies"

off my soap box - I got yeast to pitch

 

[brick_haus]

Appreciate the feedback soccerdad, but I find Murray Rothbard hard to take seriously.
I fell off of my soapbox earlier today. Hope all is well with the employees of the subject brewery.

 

[Talgrath]

I read all the comments and respect other's views. But I really haven't seen any coherent explanation of any downside that comes with small breweries being bought by large corporate brewers. There's enough margin in beer that it will continue to attract more investment. That means more choices and better quality and more and more breweries. The big beer producers control the market and keep their prices high and the consumers keep paying. There's no interest in a price war, consumers seem to equate price with quality. That gives even more small brewers a chance to get started.
Germany has about 80 million people and 1,300 breweries. We need to add about 2,000 more breweries just to get to their brewery/population ratio. As beer drinkers, we have a lot to look forward to.

For consumers, a buyout is bad all around. More breweries means more competition which means lower prices or higher quality expectations. Sure, it's just one brewery out of the many thousands in the United States, but it's still one less brewery. What's more, InBev buying out craft brewers may mean Coors and Miller go on the prowl to buy out breweries on their own. Every brewery we lose is less reason for BMC and craft breweries to improve their products and prices.

Additionally, it's worth noting that the craft beer market crash of the early 90's started much like this, with some of the bigger regional craft breweries being snapped up by BMC; the speculators rushed in, either artificially inflating local craft breweries or making new "craft" breweries of poor quality. In theory, the industry is smarter and more resilient now than the early 90's, but it's hard to not see some startling parallels. The last crash set back craft beer at least five years, if not more, another one could be similarly disastrous.

 

[eric19312]

I think corporate buyouts must make it easier to finance new breweries. Bankers want understandable exit strategy. InBev provides that, money flows. We beer drinkers benefit from the innovative start ups being able to attract investors to fund those 1000 barrels and multi year aging programs. I didn't much care for Ely beer anyway..the labels were glued onto the bottles too well.

 

[the_ale_scale]

They should past a legislation making it a requirement that breweries name the companies that own or are in possession of controlling shares in micro breweries for branding. Ie. Anheuser on a Bluemoon

 

[kombat]

They should past a legislation making it a requirement that breweries name the companies that own or are in possession of controlling shares in micro breweries for branding. Ie. Anheuser on a Bluemoon

Uh.. I believe that is the rule, for publicly-traded companies. They clearly publish all their holdings in their corporate literature, annual reports, or whatever other appropriate media. The shareholders are entitled to know exactly what it is they own.

In fact, many (most? all?) publicly-traded companies require majority shareholder approval before executing large buyouts. As an AB-InBev shareholder, I've personally voted on many corporate actions with the company, including consideration of buying smaller breweries. I don't recall any voting literature regarding the Elysian buyout, but that may just be because it's in the early stages, and will require shareholder approval before being finalized.