Much is boiling to the surface when it comes to the craft beer versus crap beer debate. One of the re-emerging discussions is whether or not to continue to support a brand after it is acquired by AB InBev. Well, folks I have three good reasons why you shouldn’t.
AB InBev (ABI) – the Associate Press and brand appropriate spelling of the world’s largest threat to independent craft brewers, Anheuser-Busch InBev (according to Wikipedia) “is a multinational Belgian-Brazilian beverage and brewing company headquartered in Leuven, Belgium. It is the world’s largest brewer and has a reported operating income of $15 billion. AB InBev was formed through successive mergers of three international brewing groups: Interbrew from Belgium, AmBev from Brazil, and Anheuser-Busch from the United States. It has 16 brands that individually generate more than US$ 1 billion annually in revenue, out of a portfolio of more than 200 brands.”
What Wiki doesn’t tell you is that the macro brewer had a reported a decline of nearly $1 billion in sales in 2015; which is perhaps the impetus of its recent quest to acquire as many craft brands as they deem necessary to recoup losses.
One of AB InBev’s recent purchases was Breckenridge Brewery. In December, Breckenridge joined a slew of other recently purchased craft brands who were purchased by Anheuser-Bush’s division, called The High End. Other brands who belong to The High End (based in Chicago) include Goose Island Brewery, Blue Point Beer Co., 10 Barrel Brewing, Elysian Brewing Co., Golden Road Brewing, Four Peaks Brewing Company and Devil’s Backbone Brewing Company.
This is where it gets interesting. How do you keep loyal customers going back to brands they trust even after they are purchased by Big Beer? Don’t tell them. Do a Google search for “The High End” and you will find no such website or information detailing exactly who The High End is or what brands it comprises. This is where the trickery begins for ABI. Furthermore, when you click view the Anheuser-Busch portfolio, you won’t find Goose Island or Elysian anywhere. ABI owns these brand websites, but guess what? They aren’t telling you that the site belongs to them. In fact, if you scroll to the bottom of a page on the Goose Island website, what you see will lead you to believe the site still belongs to Goose Island Brewing Company. But who owns Goose Island Brewing Company? Not John Hall, who is the original founder, whose bio still sits on the GI website. So, unless you heard the news or happen to be an informed consumer, you won’t know that Goose Island is 100% owned by AB InBev.
Speaking of Goose Island, you may have heard about the recent recall of Bourbon County Brand Coffee Stout and Barleywine, which was found to be tainted with bacteria causing off flavors and excessive foaming to the iconic stouts. The Chicago Tribune reported that this was the largest recall in the company’s history, adding that the source of the bacteria has yet to be identified. On the one hand, you might say “accidents happen,” but as a craft brewer, your goal is that your accidents don’t end up in the mouths of your paying customers. But, if you research craft beer recalls, most if not all cases will explain how the contamination occurred, or see that the recall was due to a tongue-in-cheek prank. But, when Big Beer’s involved, I guess we’ll never know what caused the contamination, or what steps are taken to ensure that their mistakes don’t end up in the hands of thousands of beer drinkers worldwide.
With all the talk of globalization and access to capital, AB InBev has always taken the position that their buyouts are intended to help out independent breweries by providing them with some of the logistical perks born by one of the world’s largest beer distributors. However, in practice, we know that ABI’s ultimate goal is to raise revenue and to make up for astronomical losses in its profitability. So, when it comes to decision making, we can see how quality control is not at the forefront. It’s not a stretch to assume that, when push comes to shove, ABI is going to cut costs wherever necessary, even at the expense of Goose Island’s mega popular, once-high-quality BCBS. Because, why pay for high quality when you can just fake it?
We are subscribing to a myth to think there is anything holding the Budweiser makers to the original recipes from the craft breweries they purchase. Who’s to say they aren’t going to one day make only lagers spiked with a plethora of chemically concocted extracts that will masquerade themselves as Goose Island’s Bourbon County or Elysian’ Space Dust IPA?
Another reason why you should ditch the “crap” in favor of craft relates to a couple of the concepts most near to the heart of the craft beer movement, which are unity and community. Recently in Colorado, the Colorado Brewers Guild (*note that the adjective “craft” is missing from this organization’s title) suffered a significant blow to its membership when a large number of key players left the guild to form their own guild, Craft Beer Colorado, after contention related to the acquisition of Breckenridge Brewery by AB InBev (among other disputes). The Denver Post reported that the rift among guild members spiked in December when Breckenridge owner Todd Usry was allowed to finish his term as a guild board member, even after the brewery was purchased by The High End. Recently, the Guild agreed to take away the voting rights for former craft breweries now affiliated with corporate beer companies.
The fights in Colorado may end up being a catalyst, prompting more separation among guilds and trade associations worldwide, as more independent breweries sell out to multinational corporations. The purpose of guilds and associations is to provide legal advice, marketing assistance and other tools necessary to craft breweries so that they can compete with the likes of ABI. You can’t expect transparency and camaraderie when corporate beer execs sit next to independent brewers on boards that decide what regulations are needed to ensure craft beers can compete with their corporate counterparts. Nor can it be found in debates over distribution regulation when one of your board members is a suit from the largest distributor in the world. Big Beer doesn’t need guilds; Big Beer wants monopolies.
The model in Colorado is based on the position of the Brewers Association (based in Boulder, CO), which also allows corporate breweries to be members, but doesn’t allow them to vote. There is some gray area. For example, equity investors, like Fireman Capital Partners, are starting a new trend of purchasing craft breweries. Last year, they invested an undisclosed amount in Oskar Blues (also Perrin Brewing Co. and, recently, Cigar City Brewing), and that opens up a whole other can of questions: Are these breweries still craft breweries? Is the Brewers Association’s definition of what a craft brewery is still sufficient? Is a brewery that grows to a certain size no longer a craft brewery and do we still support them? Are we being hypocritical if we support brands that sell to private equity or non-ABI macros and we still bash everything ABI?
Some say that being only anti-ABI is justified because it is the only outsider showing its hand as an enemy of craft beer. Are they right? It seems that way. Have you seen any reports about Heineken, Miller, their wholesale affiliates or any private equity entity lobbying for legislation or providing million dollar incentives in attempts to stop the craft beer movement?
There is no doubt that the lines are continuing to blur, but don’t let that be a distraction. Aside from unpredictable natural phenomena and erratic consumer behavior, AB InBev is still the real threat to the independent small brewing of complex and beautiful fermented beverages, comprised mostly of just malted barley, water, yeast and hops. It is fundamental, now more than ever, to hold true to the values of the independent craft beer movement, or one day we might wake up to a sea of watered-down lagers made from malt extracts and only one variety (no variety) of hops — imagery circa 1978.
Take this as your warning.
Jeremy Fultz also contributed to this article.