InBev Strikes Again

[GPP33]

I love all the conspiracy theories about AB. Could it be that they are just a company that wants to make money for their shareholders? For decades the beer consuming public has demanded light, generally bland and easy drinking beer so companies like Bud provided it. Bud made money so AB bought them to collect the profit. The beer landscape is changing and a growing segment of beer consumers want a different style of beer. AB wants to keep getting money from as many beer drinkers as possible so they can continue to grow, thus they they have two choices; they can create these beers or they can buy companies who already have and already have name recognition amongst this subset of beer drinkers. They are smart enough to realize that these beer drinkers want “craft” and “local” and getting people to try new styles form bud will be a losing battle, though I’m sure their brewers are smart enough to make a pretty awesome Bud Amber, Bud IPA, Bud Stout, Bud Saison, etc. AB doesn’t want to eliminate all flavorful beer and force everyone to drink Bud, they just want everyone to drink beer they brewed, they don’t care what style it is. Unfortunately AB is seems to buying these companies at above what most would consider a reasonable market value, they are doing this based on speculation that they can improve margins and increase distribution. Increasing margin with economies of scale is fine, increasing margins by using inferior ingredients (i.e. rice, cheaper hops, etc) will suck the soul of out that particular brewery.

 

[jerbrew]

Looks like from their facebook post it was the right decision for them to take the offer. Either they were offered enough that they think they can setup a better shop somewhere else or the offer was worth more than what the current business can generate.

Good for them either way.

From Their Facebook page:

"Friends and Members,
As you may have heard, after 22 years of serving the climbing community, Vertical Hold is closing its doors for business on DECEMBER 9th, 2016.
In brief, we are a successful business without a location. We arrived in this position much more rapidly than anyone could have anticipated. We are highly optimistic that we can continue Vertical Hold in a new space, and are working very hard to realize this hope. Without any concrete present plan, it would be irresponsible to make promises or suggest in what form our future business could continue.We are optimistically directing our resources towards this hope.
It has become even more apparent, with the news of our closure, what an incredible and supportive community we are comprised of. Even more than creating a new and awesome climbing facility, continuing this incredible collection of climbers is our real goal.
Thanks so much for the continued enthusiasm and support. We will be updating you throughout this process of closing our beloved space, as well as our plans for the future. For direct news and official updates sign up for our newsletter at www.verticalhold.com.
Vertical Hold is home to us all, and your staff is here to answer any concerns or questions you may have throughout this closure. Please email us at [email protected], or stop by the front desk as we'd love to see you.
With that said, we hope you'll join us in these last days at the gym, and celebrate 22 years of climbing, community, and cause. Please stay tuned for our upcoming events throughout the next few weeks, including our Fall Bouldering League, Veterans Day Climbing, White Monday, and Farewell Party."

nothing about that says it was a good deal for them nor was there an offer. They were either pushed out of their lease or Saint Archer bought the building and kicked em out. Either way its quite sudden for a thriving business to go out of business.

I've talked to the employees and the tag line "we're a successful business without a home" is all they're saying because there is no plan. They've been in San Diego for 22 years and that location specifically for 8. I can't say its not going to work out for them. I just hate that it's for this purpose and happened so suddenly. There are plenty of rock climbing alternatives but that's not the point. Even if it's good for the owner there are tons of people affected by it. Patrons, employees, and kids in their youth league. This kind of things happens to these businesses all the time but it doesn't mean I can't be annoyed and that it was a good deal for them.

 

[jensek]

From Their Facebook page:

"Friends and Members,
As you may have heard, after 22 years of serving the climbing community, Vertical Hold is closing its doors for business on DECEMBER 9th, 2016.
In brief, we are a successful business without a location. We arrived in this position much more rapidly than anyone could have anticipated. We are highly optimistic that we can continue Vertical Hold in a new space, and are working very hard to realize this hope. Without any concrete present plan, it would be irresponsible to make promises or suggest in what form our future business could continue.We are optimistically directing our resources towards this hope.
It has become even more apparent, with the news of our closure, what an incredible and supportive community we are comprised of. Even more than creating a new and awesome climbing facility, continuing this incredible collection of climbers is our real goal.
Thanks so much for the continued enthusiasm and support. We will be updating you throughout this process of closing our beloved space, as well as our plans for the future. For direct news and official updates sign up for our newsletter at www.verticalhold.com.
Vertical Hold is home to us all, and your staff is here to answer any concerns or questions you may have throughout this closure. Please email us at [email protected], or stop by the front desk as we'd love to see you.
With that said, we hope you'll join us in these last days at the gym, and celebrate 22 years of climbing, community, and cause. Please stay tuned for our upcoming events throughout the next few weeks, including our Fall Bouldering League, Veterans Day Climbing, White Monday, and Farewell Party."

nothing about that says it was a good deal for them nor was there an offer. They were either pushed out of their lease or Saint Archer bought the building and kicked em out. Either way its quite sudden for a thriving business to go out of business.

I've talked to the employees and the tag line "we're a successful business without a home" is all they're saying because there is no plan. They've been in San Diego for 22 years and that location specifically for 8. I can't say its not going to work out for them. I just hate that it's for this purpose and happened so suddenly. There are plenty of rock climbing alternatives but that's not the point. Even if it's good for the owner there are tons of people affected by it. Patrons, employees, and kids in their youth league. This kind of things happens to these businesses all the time but it doesn't mean I can't be annoyed and that it was a good deal for them.

According to the county tax auditor Vertical Hold owned the property outright. So they weren't kicked out. Just saying.

 

[WaltStarr]

I cannot blame any small business owner from selling out to any large business, heck, that's a pure dream for any startup! If I started a business and some Chinese firm offered me a boatload of money to sell out to them, the only issue would be finding a pen immediately to sign on the dotted line! Who cares, it's why you started a business in the first place!

It doesn't mean I would do business with the final result, but that's a personal decision and everybody has to make their own decisions about where they will spend their money.

 

[Iceman6409]

I totally understand a small business selling out to a larger business. Absolutely. However personally I feel that in the industry we are in, craft brewing and home brewing, that companies like InBev, Budweiser what have you, are in fact the enemy.to us. It is well documented to InBev does and will continue to use their enormous size, wealth and power to buy out and crush any and all competition. That is what I see happening. Just my opinion. So when I see Northern Brewer and any others selling to InBev it seriously concerns me. Again I want to emphasize that InBev has the right to do what they are doing and so does anyone else involved with them.

But I personally love the idea of having complete flexibility to make whatever I want and having many choices to get what I need at my disposal who truly understand our needs and also live within our community. I don't want to see the "corporates" coming in and taking over our industry. In the end it only puts more money, control and power to the companies we so desperately try to avoid. If in fact InBev is buying everyone out to help our industry then so be it. I personally do not believe they have that interest in mind. Maybe they do. Only time will tell.

In the mean time one of the things we can do is to communicate our thoughts to the good companies we all choose to work with for our supplies and let them know what we are thinking and what we want to see happen moving forward. In the end I know that business is business and money rules everything. All I ask is for those companies remaining that get approached by corporate beer companies like InBev to make sure they think it through and keep our industry in mind if and when those decisions need to be made. Thoughts are free. Let your vendors know what you are thinking, Just my personal stupid humble opinion.

 

[jerbrew]

According to the county tax auditor Vertical Hold owned the property outright. So they weren't kicked out. Just saying.

Yea I guess they do. I also guess it's ok to just s*** on your staff when given a bit of money. Thanks I'll pass my aggression and annoyance a bit onto them.

 

[grrickar]

Does their beer taste different when they get a new owner?

Only if InBev insists on beechwood aging

 

[dallasdb]

Yea I guess they do. I also guess it's ok to just s*** on your staff when given a bit of money. Thanks I'll pass my aggression and annoyance a bit onto them.

I love it. The business owner holds all the risk.

When times are tough and he has to eat the loss, struggle to pay the bills and let a few people go, he is the a**hole.

When times are good and he has an opportunity to sell the building and probably make a substantial profit. He's the a**hole.

And how do you know he is going to s*** on his staff. He's given them and the customers almost two months notice. Do you know if he is giving them any severance?

You don't even know if they might find a new space and simply re-open in a new location. You just immediately jump to the conclusion that the owner is being an a**hole.

 

[jerbrew]

I love it. The business owner holds all the risk.

When times are tough and he has to eat the loss, struggle to pay the bills and let a few people go, he is the a**hole.

When times are good and he has an opportunity to sell the building and probably make a substantial profit. He's the a**hole.

And how do you know he is going to s*** on his staff. He's given them and the customers almost two months notice. Do you know if he is giving them any severance?

You don't even know if they might find a new space and simply re-open in a new location. You just immediately jump to the conclusion that the owner is being an a**hole.

Right. That was wrong of me to say. I don't know the guy or the situation. But talking to the employees that have been there a long time making it a successful business don't seem too thrilled about having to look for another job. Maybe even feeling a bit abandoned. I'm not trying to convince you all. You obviously have a different view on the roles and responsibilities of a small business owner and the corporatization of the U.S.

When people have to let employees go because of a failing business I understand but to dissolve your business indefinitely for a company that produces an at best decent product and will employ 1/10 of the people your letting go to run that space then I have a problem. But hey i don't make decisions for these people.

Too many people refer to it as "just business" and "it's not personal" but business affects people and makes it personal. I'm a pretty socially minded idealist (probably not a popular view 'round these parts) yet I understand the drive for this whole thing to happen. I've said this several times but it doesn't mean I have to agree.

 

[dallasdb]

jerbrew,
Best thing to hope for is that they can find a new location soon.

Might be hard to do in San Diego.

 

[pepindavid]

AB doesn’t want to eliminate all flavorful beer and force everyone to drink Bud, they just want everyone to drink beer they brewed, they don’t care what style it is.

The missing part is that they want to do it with an "accountant" mentality, cutting costs wherever possible, including slightly reducing quality, detail by detail, if they think they can get away with it. At their scale and volume, every minor reduction in cost can result in

It's not if what the big companies is not also influencing what people want (that's why millions is spent on publicity).

The bottom line, though, is that we live in a capitalist economy, where the "law" is the capital HAS to be accumulated. Big companies, to survive, are condemned to expand their profit, accumulate capital. Sure, small companies (not publicly traded) can "stagnate" in a state where they feel that make an ok living and provide a good service/product. But that's not what defines our "monopolistic capitalist" society (yes, I know, I sound like a marxist).

 

[WaltStarr]

The missing part is that they want to do it with an "accountant" mentality, cutting costs wherever possible, including slightly reducing quality, detail by detail, if they think they can get away with it. At their scale and volume, every minor reduction in cost can result in

It's not if what the big companies is not also influencing what people want (that's why millions is spent on publicity).

The bottom line, though, is that we live in a capitalist economy, where the "law" is the capital HAS to be accumulated. Big companies, to survive, are condemned to expand their profit, accumulate capital. Sure, small companies (not publicly traded) can "stagnate" in a state where they feel that make an ok living and provide a good service/product. But that's not what defines our "monopolistic capitalist" society (yes, I know, I sound like a marxist).

We are more of a laissez faire capitalist society than a monopolistic capitalist society. What's needed is further regulation.

 

[jensek]

The missing part is that they want to do it with an "accountant" mentality, cutting costs wherever possible, including slightly reducing quality, detail by detail, if they think they can get away with it. At their scale and volume, every minor reduction in cost can result in

It's not if what the big companies is not also influencing what people want (that's why millions is spent on publicity).

The bottom line, though, is that we live in a capitalist economy, where the "law" is the capital HAS to be accumulated. Big companies, to survive, are condemned to expand their profit, accumulate capital. Sure, small companies (not publicly traded) can "stagnate" in a state where they feel that make an ok living and provide a good service/product. But that's not what defines our "monopolistic capitalist" society (yes, I know, I sound like a marxist).

Weirdly…despite the “Monopolistic Capitalist” economy…we’ve never had more breweries or better beer.

 

[bob1852]

The missing part is that they want to do it with an "accountant" mentality, cutting costs wherever possible,

So, small breweries aren't conscious of costs, and things they can tinker with to save money, increase margins, and maintain/expand a product that consumers want?

I'd argue that smaller breweries need to be much more conscious of costs as their margins are much smaller...

 

[jensek]

We are more of a laissez faire capitalist society than a monopolistic capitalist society. What's needed is further regulation.

More regulation favors big business. Raises startup and compliance costs for small business and decreases competition.

 

[pepindavid]

Weirdly…despite the “Monopolistic Capitalist” economy…we’ve never had more breweries or better beer.

And they are slowly being bought one by one.

The concept of "monopoly capitalism" (sorry, I think I used the French "capitslisme momopolistique") is that the need for capital accumulation (always more and more, no end to the need to increase profits) tends to create monopolies over time. It doesn't exclude that small guys exist, and can thrive. Just that that there is a tendency towards monopoly as a sector matures. At least that's what I recall from the concept.

But... That's way too serious for a Friday afternoon.

Cheers!

 

[bob1852]

And they are slowly being bought one by one.

The rate of new breweries opening is far greater than that of acquisitions/partnerships by InBev...

The number of microbreweries has more than doubled since 2012 (1149 to 2397).

https://www.brewersassociation.org/statistics/number-of-breweries/

Has InBev acquired ~1250 microbreweries in that time?

 

[WaltStarr]

More regulation favors big business. Raises startup and compliance costs for small business and decreases competition.

That's the myth that gets pushed by big business, but the opposite is actually true.

 

[jensek]

The rate of new breweries opening is far greater than that of acquisitions/partnerships by InBev...

The number of microbreweries has more than doubled since 2012 (1149 to 2397).

https://www.brewersassociation.org/statistics/number-of-breweries/

Has InBev acquired ~1250 microbreweries in that time?

Excellent point. The beer industry was closer to “monopoly” 30 years ago….but even then there were ~80 breweries in the US. The beer industry is already mature. It’s one of the oldest industries in the country. If we lived in a “monopolistic capitalistic” society I would think the beer industry would already be a monopoly. Instead it has gotten more competitive with 4,600 breweries.

 

[Sparge]

I have no problem with stores or breweries selling out to InBev. I applaud the small business person who builds something of value and then cashes out. That is the American way. What I have an issue with is big businesses with predatory business practices (some of which have been very questionable) taking over an industry. I do not want the beer market to look like Walmart.

When I was growing up, we shopped at the local grocery store, local hardware store, the local pharmacy, etc. Owners and workers in these stores lived fairly decent lives on livable wages and in many cases good benefits. That sure beats the hell out of the minimum wage big box salaries. The only tool I have to show my displeasure, is where I spend my money. I have a great relationship with my local LHBS and they will get my money until they are run out of business or bought out by InBev or some other conglomerate.

 

[jensek]

That's the myth that gets pushed by big business, but the opposite is actually true.

It was the ever increasing beer and brewing regulations that have given rise to the 4,600 breweries in the US? No. It's the opposite. Regulations and barriers to entry have decreased.

 

[Toga]

I don't think there is a need to panic with this one. I am not a fan of InBev but Look what InBev has done with Goose Island. They have not ruined the name and products from what I can taste. This can only be a win for the brand with the long arms of InBev introducing it where it has not been introduced yet.

 

[WaltStarr]

It was the ever increasing beer and brewing regulations that have given rise to the 4,600 breweries in the US? No. It's the opposite. Regulations and barriers to entry have decreased.

And you're wrong again. There is more regulatory control over the big breweries today than before the legalization of home brewing, and we all know the legalization of home brewing led directly to the craft beer microbrewery revolution.

I don't think there is a need to panic with this one. I am not a fan of InBev but Look what InBev has done with Goose Island. They have not ruined the name and products from what I can taste. This can only be a win for the brand with the long arms of InBev introducing it where it has not been introduced yet.

As somebody who was a big fan of Goose Island prior to the buyout I can guarantee you, they ruined the products.

 

[slym2none]

Maybe I will finally get to try Hopadillo now, here in NC.

Or, should I just make a batch of Haterade???

 

[jensek]

And you're wrong again. There is more regulatory control over the big breweries today than before the legalization of home brewing, and we all know the legalization of home brewing led directly to the craft beer microbrewery revolution.

You realize you just agreed that deregulation led to the increase in breweries?

 

[WaltStarr]

You realize you just agreed that deregulation led to the increase in breweries?

The deregulation was not deregulation of business. It was deregulation of what was permissible in a person's own home. Two completely different things.

In fact, this deregulation of what a person could do in their own home led directly to new regulations that allowed small microbreweries to flourish and even more regulations on breweries that did not qualify as microbreweries.

 

[MidAtlanticBrew]

Who is Karbach why does anybody care? I find it mildly humorous that InBev becomes the lightning rod for HBer's emotions. It's craft brewers suggesting inBev hurts craft, but they seem so quick to sell out. If you being play, its the craft brewers playing you. InBev is at least upfront with their intentions to dominate.

 

[Murphys_Law]

If Inbev "strikes again" and buys Reynolds, where will people get their hats?

 

[day_trippr]

So, "Hate the game, not the players"?

Cheers!

 

[jensek]

The deregulation was not deregulation of business. It was deregulation of what was permissible in a person's own home. Two completely different things.

In fact, this deregulation of what a person could do in their own home led directly to new regulations that allowed small microbreweries to flourish and even more regulations on breweries that did not qualify as microbreweries.

Again. You just said that deregulation led to the expansion of breweries. Legalizing homebrewing lowered barriers of getting into the business by allowing people to self educate on how to brew and it also allowed for experimentation. In addition to that states changed laws to allow brewpubs, on prem sales, self distribution, raised alcohol limits, lowered license fees etc....