How a multinational beer giant is making bank by destroying the world's beer and laying off the world's brewers

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148 Responses to “How a multinational beer giant is making bank by destroying the world's beer and laying off the world's brewers”

  1. BookGuy says:

    So, Bain Capital, Beer Division?  Got it.

    • sgtdoom says:

      Good one! 

      After all, it is called “globalization” — the privatization of everything and the screwing of the masses of humanity.

      My personal beef is with private equity/leveraged buyout debt queen, Peter G. Peterson (and Rockefeller lackey) and his Blackstone Group, which once upon a time purchased the company owning Schweppes Ginger Beer — the finest ginger beer ever made (that’s non-alcoholic,, although it is called a “beer”) — and discontinued that product.

      They are all pure evil . . . . .

    • Cowicide says:

      This is the kind of stuff we can expect universally once Romney completes his acquisition of the entire United States for his corporatist buddies.

  2. MTDutch101 says:

    Of course, this could be one of the reasons that legitimate American “craft” brewing has been reclaiming market share, and why brewing is slowly become more local, somewhat mirroring the smaller local/regional brewers that existed before Prohibition. No real need to boycott ABInBev’s beers because I don’t like corporatization or globalization, I just don’t drink ‘em because they taste like garbage.

    • Finnagain says:

       I’m going to not drink twice as much of that swill now, in solidarity.

    • perchecreek says:

      How can you be sure it’s “craft” beer? For example, there’s the Craft Brew Alliance, Inc., 32.2% owned by InBev. It has begun engulfing and devouring. The Winery Exchange is another body snatcher/idoru kind of entity: “craft” brands are created from thin air, brewed in shared facilities, and marketed.

  3. Henry Pootel says:

    OP clearly doesn’t understand concept of microbreweries and how its DIY/Maker-style roots are dominating beer (at least here in the Pacific North West).   Beer quality and choice has never been better in the US.

    Budweiser quality goes down?  They go out of business?  Sorry was that a little noise I heard?  I was too busy trying to decide which of the 7 microbreweries in my town to visit (one for about every 8000 people).

    • flarktobble says:

       Maybe I’m parsing it wrong, but it looks to me like OP clearly _does_ understand the concept of ubrew — and that ABInBev is buying out those smaller breweries and killing them.  The problem isn’t that AB InBev is losing share on its “big” brands — the problem is that it’s WalMarting those smaller breweries of which we’re all so fond.

    • C W says:

      “OP clearly doesn’t understand concept of microbreweries and how its DIY/Maker-style roots are dominating beer (at least here in the Pacific North West).”

      Clearly you haven’t left the PNW much lately, seeing as the rest of the US is shit for beer. With exceptions, naturally, in the northeast. I love the diversity of offerings here in WA/OR, but I know that most of these amazing breweries can’t or shouldn’t scale to national scale, and that certainly makes me sad.

      • Jim Nelson says:

        And they shouldn’t. Let the transnational horse piss factories inspire beer makers to make their own regional brews. We’ve got two amazing breweries here in Richmond, and there are a lot more to be had in the region.

        Yeah, college kids are looking for cheap and swillable, but once you grow up, good beer is a wonderful thing.

        • C W says:

          “And they shouldn’t.”

          I agree, but I still feel for the places that don’t have much in the way of regional options.

      • Dave Jenkins says:

        I’ve traveled a lot around the US, and I’ve never seen a location/region with a lack of microbrews or independent labels.  Sure, there are probably some very small towns along the Interstate in Kansas or Utah or Mississippi that may only stock AB and Miller, but every proper supermarket I’ve seen always has some proper small local labels.

        If you go into a bar and all they have are AB products, you’re in the wrong place anyway.

        • Navin_Johnson says:

          Indeed,  lots of great (award winning) beers here in the Great Lakes/Midwest:

          Bells
          Three Floyd’s
          Half Acre
          Metropolitan
          Two Brothers
          New Glarus
          Lakefront
          Capital
          Founders
          Arcadia
          Finch’s
          Revolution
          Great Lakes

          Surely I’m leaving some out as well.

          • Messana says:

            Amen to that, good sir – it’s one of the things I miss about the GL region.  Bell’s is more widely distributed these days, which is wonderful.  We’re even seeing ye olde Two Hearted Ale on tap down here in NC.

            Don’t forget Short’s in Bellaire!  Their Huma Lupa Licious is a treat to savor.

          • Navin_Johnson says:

             Looks good.  I’ll keep a look out!

          • IronEdithKidd says:

            Psst…a good deal of Capital’s brewing is done by Stevens Point Brewery.

          • Thorzdad says:

             Living in Indiana, I have easy access to a wide range of amazing craft brews…both on-tap and in my local supermarket! It’s a great time to be a beer lover! (If anyone is ever in Muncie, look me up and I’ll spring for the first round at our great, local craft-brew pub, Heorot. Hope you enjoy early Beowulf decor.)

            That said, a little perspective is called for. The largest craft brewer in the US today is Boston Brewing. Their flagship brand, Sam Adams, can be found practically anywhere across the country. They produce almost 2 million barrels of the stuff each year. Even with that success, though, Sam Adams accounts for a mere 1% of the total US beer market.

          • TripleE78 says:

             You have access to 3 Floyds, and therefore win any argument on beer.  Ever.  ‘Nuff said.

      • Christopher says:

        Good beer is not strictly limited to the Pacific North West or northeast. Come on down to Nashville, Tennessee and sample some of the offerings at Yazoo, Jackelope, Fat Bottom, Bosco’s, or Blackstone and I doubt you’ll continue saying “the rest of the US is shit for beer”. Travel east to Asheville or south to Atlanta and you’ll find a similar concentration of microbreweries.

        The problem, at least in Tennessee, isn’t a lack of good beer. The problem is lousy distribution coupled with (and in part the result of) arcane liquor laws.

      • big ryan says:

        down here in san diego we are swollen with micro and craft breweries, its a beautiful thing, there are a dozen or so within 10 miles of my house, 

        the times ive been to the PNW the selection seemed alot more limited than what we have down here but still there’s some great stuff up there

      • IronEdithKidd says:

        …seeing as the rest of the US is shit for beer

        Your “fly-over” bias is somewhat astonishing.  Living in Michigan can suck a good deal of the time, but at least we have fabulous beer and a strong Guild.  Add Wolverine State, Atwater, Keweenaw and Right Brain to the list of Great Lakes beers of note in addition to Navin’s list. 

      • snowmentality says:

        North Carolina is definitely not shit for beer. Big Boss, Duck Rabbit, Roth, Fullsteam, Lonerider, just to make a start.

        No, many amazing local breweries probably can’t go to national-scale production without sacrificing quality. But I’m okay with that. I’m spoiled for choice for really good local beer. And I’d say this thread shows pretty clearly that smaller local craft breweries are booming all over the U.S. This is definitely not just a PNW trend.

        • Finnagain says:

           Exactly. PNW here, and I could not care less what happens to the shit brewers. Their “quality” might go down? Gee, that’s hard to even imagine, but so what? I don’t even consider it beer.

    • wysinwyg says:

      They fucked with Boddington’s.  To me, that is a serious issue.

      • Christopher says:

        I’m not generally a fan of lagers, but I really like Boddington’s. Or at least I did. But almost as much as the beer itself I enjoyed their “Cream of Manchester” ads with pint glasses shaped like Swiss cheese or a slice of pie.

        • wysinwyg says:

           It’s actually a pale ale, not a lager, but those ads are great!  Hadn’t seen them before.

          • Ito Kagehisa says:

             I think the Boddingtons recipe was created before the pale ale and lager definitions were nailed down.  It is what I’d call a cream ale, but I am a beer taxonomy heretic, I generally use the names from 600 years ago rather than the postmodernist Michael Jackson lingo.

    • Henry Pootel says:

      OK to clarify…

      OP’s original article headline (“The Plot to Destroy America’s Beer”) clearly doesn’t reflect the concept of…

      • Navin_Johnson says:

        I did a double take the first time I read it too.  They don’t literally mean all of America’s breweries, it’s in reference to Budweiser being considered (or considering itself) to be the particular brand most (sadly) associated with the U.S.

        • Marc Mielke says:

          Exactly how is the evil multinational going to destroy the taste of Budweiser? Just having the brewers can their own piss would be an improvement! The only domestic brand I’d be worried about is Samuel Adams.

          • Navin_Johnson says:

            If you’d read the comments you’d have seen that I mentioned that it would be impossible to make Budweiser taste any worse than it does….

          • benher says:

            Ah, they are trying to destroy the world’s BEER. So naturally, Budweiser/Miller/PBR are exempted.

    • Brian Sprague says:

      I’m lucky enough to be in Maine, where the craft beer scene is thriving.  Yes, the quality and choice is amazing and the craft beer industry is exploding.  But don’t fool yourself.  Even in the PNW craft beer has only about 1/3 of the market.  Still getting outsold by the AB-Inbevs and SABMillerCoors of the world by about 2-1, and nationally it’s more like 9-1.  It’s a long climb, but quality is going to win out.  I sure hope, anyway.

  4. royaltrux says:

    I thought Becks tasted weaker. Now I know why. Local from now on, no exceptions.

  5. Rider says:

    Why is this always the fault of the giant multinational?  What about the independent century old breweries that are selling out for a quick payday to the multinational, that seems to be the real monster here.

    • Navin_Johnson says:

       Why is this always the fault of the giant multinational?

      I know man.  It’s so unfair.

    • C W says:

      “Why is this always the fault of the giant multinational?”

      Because they survive and continue to exist.

    • wysinwyg says:

       Did you not read the article?  InBev acquired AB via hostile takeover.  Hardly “selling out for a quick payday” when the company gets bought out from under you.

      • UXO says:

        The company can’t “get bought out from underneath you” unless you’ve already sold a controlling interest. a.k.a. SELLING OUT

      • ChicagoD says:

        Whatever Wikipedia says, the Busch family was never compelled to lose control of the company. The family ultimately cashed out.

        • wysinwyg says:

           Actually, there’s several ways the Busch family could be compelled to lose control of the company unless they held more than 50% of the shares in AB.  Maybe they did cash out as a matter of fact (source?) but that’s not the only way the takeover could have happened.

          • ChicagoD says:

            Source? About a year’s breathless coverage in the St Louis Post-Dispatch, Riverfront Times, and St. Louis Business Journal.

            This Busch was ready to be done with getting his hands dirty.

        • Navin_Johnson says:

          From what I recall, the family was never on the same page with each other, or with their board. Like monarchies, there can be downside to handing off control to your kids..

          Also, iirc this happened when foreign companies were able to snap up a bunch of U.S. assets because of the extremely weak dollar.

          • ChicagoD says:

            Yes. The family also had its bad seeds, malcontents etc. Those public corporations that are still heavily influenced by the founders great great great grandchildren are a funny lot.

          • Navin_Johnson says:

            Busch IV seems kind of like the George IV of beer royalty…

          • Christopher says:

            One of my favorite stories is that Groucho Marx was invited to speak at an anniversary celebration of the founding of the Busch Brewery. One of Augustus Busch’s descendants was also there, and before they got up to speak invited Groucho to go to a nearby bar for a quick drink.

            In the bar Groucho ordered a Miller and the younger Busch said, “I’ll have the same.” Groucho got a kick out of a descendant of Augustus drinking the competition.

            I’m fuzzy on the details, but the story is from Life With Groucho.

    • UXO says:

      I agree absolutely. The multinational couldn’t do *shit* unless and until the smaller brewery sold out.

      On the other hand, who gives a rat’s ass about whether Anheuser-Busch horse piss tastes different? It’s still horse piss. True µbreweries are locally-owned and -operated, and are pretty safe from rapacious multinationals. And if they get bought up and diluted, another will spring up to replace the sellout. People (some people) appreciate good beer, which means there’ll always be a market.

        • zartan says:

          A hostile takeover is only possible if a controlling interest in the company is already available on the public markets.  There is no way for inBev to carry out a hostile takeover on a local privately-held (or any privately held) brewery because the equity is not available for purchase unless the owners agree to selling, and if they agree to selling, it is no longer a hostile takeover.

          • UXO says:

            THANK you.

          • Navin_Johnson says:

             The thing is that the OP bemoaned that: “It’s always the multinational’s faults” which I thought was kind of funny.  Poor multinationals…..

          • wysinwyg says:

            I was talking about Anheuser Busch in particular; the only privately held brewery mentioned in the article is Goose Island.

            I’m not a fan of the idea of atomizing ownership of corporations for the sake of making a quick buck in an IPO; if you want to argue that going public is “selling out” then I guess you’re entitled.  But that’s hardly a commonly held opinion.

          • zartan says:

            By definition, going public is selling out.  When you go public, the founders (or current private owners) of a company sell part or all of their ownership stake to outside investors who are by definition going to be primarily concerned with the financial performance of the public firm.  Once you’ve done that, you are fair game for takeovers, hostile or otherwise.  

            I’m not saying this is right or wrong – just that literally and factually this is how public companies work.  

            If private companies are “selling out” to InBev, that can only be because the private brewers’ owners decide that they’d rather have whatever cash InBev is offering.  

          • wysinwyg says:

             Again, I’m not talking about privately held companies at all.  As far as whether going public constitutes “selling out” — that’s going to depend on what you mean by “selling out.”  If by “selling out” you mean literally “selling ownership stake” then yeah sure, but “selling out” usually has a more involved connotation than just selling something.  Bands usually aren’t accused of “selling out” unless their transitions to big-time labels are accompanied by a loss of quality in their output.

          • UXO says:

            Fact is, I think the comparison is apt. When you go public, you’re beholden to shareholders, who care about one thing and one thing only: profit. If you can make a profit while keeping the quality up, great. If you can make a bigger profit by letting quality slip, even better! And THERE lies the rub. If you truly, passionately care about beermaking, you won’t sell control. I’m not saying you’re wrong to do so, mind you, just that those would not be the actions of someone whose priority is brewing. Personally, if it meant I could provide a better future for my family, I’d sell my µbrewery in a heartbeat. But I wouldn’t then bemoan the loss of quality – I’d accept it as the inescapable outcome of my actions, and cry all the way to the bank.

          • foobar says:

            It’s pretty hard to start up a brewery entirely on your own financing.

          • zartan says:

            Not sure what you mean here.  No one starts a brewery through an IPO.  The (few) public brewing companies all went public long after their founding.

          • jandrese says:

            Breweries actually have fairly modest upfront costs.  The equipment is not terribly expensive and you can start [i]small[/i].  It’s certainly possible to start your own microbrew in your garage.  The only big hurdle is whatever crazy blue laws your state/county/municipality has. 

          • foobar says:

            @boingboing-d169aba4714e8e2b31778bd1f1fa9cd3:disqus Yep, it’s in large part going to be licensing and compliance that forces you to seek funding, and those funders are likely to want to sell off their part at some point.

            As far as I’m aware, regulations pretty much everywhere (at least in North America) prohibit running a commercial brewery in your garage. The smallest you can get is a brewpub.

          • hymenopterid says:

            Jandrese, a small brewery may have a modest price to start, but volume is also an issue.  It takes the guy on a 7bbl system just as much time to brew a batch as it does the guy on the 700bbl system.  A tiny brewery means a lot of work for a small amount of beer.  They’re not very efficient with heat either.

            Sam Calagione, who started on a 15 gallon(0.5bbl) system, recommends at least 15bbls for a pilot brewery.  Anything smaller and the brewer has to brew too frequently to keep up with production, leaving him no time for the other work associated with running a business.

        • GlyphGryph says:

          Huh?

          You can’t have a hostile takeover of a privately owned company. The article clearly explains methods that apply only to a company that has literally sold out.

          So I’m not exactly sure what was factually incorrect about that statement?

          • wysinwyg says:

            Good thing I wasn’t talking about a privately owned company then.

          • UXO says:

            I was. I was referring to shops like Boddington’s and Hoegaarden. I couldn’t care less what happened to AB, except as has already been pointed out, they may tend to drive down the cost and increase the availability of hops. But if the punters who drink Bud get even shittier beer, who gives a flying fuck?

          • wysinwyg says:

            Boddington’s has been owned by a publicly traded company since 1989 (by the same company that once owned Costa Coffee no less).  I didn’t bother to look up Hoegaarden.

          • UXO says:

            And that’s my point. InBev could never have taken over Boddington’s unless and until they sold out. They did so in 1989. You sell >50% of your stock, you aren’t “family-owned” any more. Simple. I don’t say this often, but I think Cory is wrong – his summary says InBev is buying up “family owned” breweries, and they simply aren’t.

          • wysinwyg says:

            Again, not too many people regard going public as “selling out”.  I can see why you would argue that but a lot of people are going to disagree.  And this fact moots your original argument since we aren’t actually talking about any privately owned companies.

          • UXO says:

            Cory said “family owned”. Seems to me to be the definition of private.

          • wysinwyg says:

             Cory may have but I didn’t.  If you disagree with Cory argue with him.

          • dbergen says:

            But everyone else was, are you not getting that?

            If you take your company public you are trading things, like security, for capital, and you need to assume that risk.

            If you don’t want to risk take over then don’t go public, very simple.

            It’s about greed you see.

          • UXO says:

            dbergen: I agree 100%. All I’m saying is, you don’t get to bewail the fate of *family owned* breweries when they, well… aren’t. You can’t call yourself “family owned” if you’ve gone public. At least, *I* don’t think you can, but perhaps the folks writing ad copy might beg to differ.

    • sgtdoom says:

      Oh wow, great point, dood!  I mean, it’s like those companies, during hostile takeovers, have all the options and time in the world, dood!

      And when we’re forever being laid off and our jobs offshored, why, it’s gotta be our faults, dood, those sweetums multinationals are such grande fellows, dontcha know, they can’t ever be at fault, dood……

    • Brian Sprague says:

      It’s a valid point.  Goose Island comes to mind.  They made a conscious choice to sell the company to AB.  They didn’t have to.  They just did.  Unless you’re talking about publicly traded companies, a takeover is completely voluntary on the part of the ownership.  It takes a buyer and a seller.  (Again, unless there is publicly traded stock, and almost no craft breweries are big enough to even think about going public.)

  6. daniel harmon says:

    This is questionable reporting at best.

    Hop prices are kept in check by huge beer companies buying tons of different breeds from tons of different hops farmers from small to large all over the world. The only reason we have the craft beer boom that we are having in the U.S. is because InBev/Bud and Miller/Coors are subsidizing the cost of these ingredients for smaller breweries. Talking to one or two hops farmers in Europe that lost business doesn’t tell the whole story.

    Second, the Goose Island buyout has been almost universally praised due to InBev’s hands-off approach. I know people who work as brewers there and the end result of the influx of money has been expansion of their basic line (312, IPA) to non-Chicago breweries which was overseen by GI employees (not InBev) and a HUGE expansion in their more experimental and small batch products. Last year, getting a hold of Bourbon County Stout (one of the highest praised beers on the planet and one of the most influential U.S. beers of the past 30 years) was nearly impossible. The buyout allowed them to increase output by nearly 10 times this year, without a drop in quality (although the batches can shift significantly year to year). Other bottled “special releases” have boomed in supply. On top of that, they’ve created a new, Chicago-only line of experimental beers (keg only). More brewers are working on newer, more interesting things. And the only reason they could do this is because of InBev. This doesn’t mean in 10 years it’ll be the same, but this report is biased in it’s current approach.

    • Grego says:

      …And what happened to the head brewer who invented the Goose Island recipes?  Oh right, gone the moment of the buyout.  You’re trying to frame that as desirable?

      • daniel harmon says:

        You mean the ones they’re still brewing and haven’t messed with?

        Greg Hall’s decision to leave was his own. Obviously a talented guy in the field. But it’s not like the brewery has died since. The Fulton and Wood series happened AFTER he left. Though I haven’t loved all of those, every one has been unique and interesting. One man didn’t make that company and one man’s departure sure hasn’t destroyed their reputation as one of the premier breweries in the world.

        • lafave says:

            I think we’re going to have to wait a couple more years to see how beneficial the Goose Island sale was. And if history is any guide, it doesn’t bode well for the brand.

  7. Baanrit says:

    Ok, yes, that’s bad. . . and I like Hoegaarden too. . .   oh well I will have to just go the resturant right near me that sells umpteen kinds of craft brews. People want good beer and rapcious corporation isn’t going to stop that. . . 

    • hymenopterid says:

      Then might I suggest you try Wittekerke instead.  It’s another Belgian wit that I’ve seen at Trader Joe’s. It Comes in a can!

      The thing with wits, is that the flavor fades fairly rapidly over time, so you have to get one that’s fresh enough in order to get the subtle flavors of the yeast.  New Belgium made a beer called Mothership Wit which was pretty true to the style.  Blue Moon and Great White are not really good examples of the style.  They are not shining wits.

      If you like wits then you might also like Bavarian Hefeweizen.  Ayinger is probably the best, but Hacker-Pschorr is really good too and has a name that sounds like the propulsion drive on a starship.

      A good Kolsch, might be a potential alternative as well.

  8. Colin Curry says:

    And yet the consumption of craft and micro-brewed beers is expanding rapidly in the US – 13% by volume last year:

    http://www.brewersassociation.org/pages/business-tools/craft-brewing-statistics/beer-sales

    One of AB InBev’s brands in Canada, Alexander Keiths, has tried to keep up by producing a white beer, stout and several other niche beers. IMO they’re inferior to at least some other brands, but they certainly taste different from each other. If people think Keith’s was some sort of classic IPA that was ruined, well, that ship sailed decades before AB InBev bought them.

    Not saying that AB InBev is innocent, but a large proportion of their brands were fairly anonymous in terms of flavour before being purchased.

    • jetfx says:

      I’m so glad to see someone else who recognizes that Kieth’s is not an IPA. It’s constantly marketed as such and sold at a premium price in every province in Canada except Nova Scotia. I did find that the variety of beers Kieth’s offered still had this sort of “Kieth-sy” taste to all of them.

  9. tw1515tw says:

    This is the Anheuser-Busch that tried to get the original Czech Budweiser banned? I know criticising a nation’s beer is like insulting someone’s sister, but the American Budweiser is a poor relation to the Budweiser Budvar (aka Czechvar).

  10. Navin_Johnson says:

    I can’t even imagine how you make Budweiser taste worse than it already does. That said, a lot of locals were worried about the take over of Goose Island, but so far things seem to be ok..

    • regeya says:

      I haven’t tried it since the InBev takeover, but I can’t imagine it being worse either.  It was already pisswasser. If I get St. Louis beer, it’s Schlafly. Yeah, the Conservapedia people. I know. *sigh*

      Takeovers aren’t always bad. The Miller takeover of Leinenkeugel’s mostly meant a change of ownership, and sales over a larger area.

      • ChicagoD says:

        Different branch of the Schlafly family, from what I understand. We all have cousins we’re not proud of. They just share the name.

      • IronEdithKidd says:

        As a long time consumer of Leiney, I haven’t noticed any real difference in taste.  As long as Sunset Wheat tastes a bit like Fruity Pebbles, I’ll be a happy camper.

  11. MonkeyBoy says:

    AB took over Rolling  Rock beer much to its detriment. The current packaging and advertising for RR still sorta implies that it is made in Latrobe PA even though it is produced in New Jersey.

    Meanwhile the Latrobe Brewing plant was taken over by City Brewing and is/has been used for contract brewing for Sam Adams, Iron  City, and some more “craft” like brands.

  12. Kevin Pierce says:

    Anheuser-Busch has done a pretty good job of destroying their quality.  A takeover doesn’t change my mind about them – they’ve always sucked / been the product of last resort / for the captive audience.

  13. kobrakai says:

    If you live in the USA and can’t find an equivalent microbrew or local brewery that has something better than InBev’s offerings, you’re not trying.  I have a hard time believing that Three Floyds, Founders, Stone, New Albanian or one of the many other amazing breweries would even talk to someone from InBev.

    • daniel harmon says:

      Except GI did. And it’s worked for them beyond their expectations thus far.

      And the irony of you listing Three Floyds is that their attempt to stay small has begun destroying their local reputation while non-locals (like Stone and Founders) take up shelf space. If FFFs converted entirely to Gumballhead, they still couldn’t meet demand. So now there’s bars like the one I was in this weekend that literally had a “Fuck Three Floyds” rant on their beer menu and suggested other things instead. If you choose to stay small, great. That’s your decision. But don’t sell it as some ideal situation that allows unlimited expansion and product output. Founders and Stone are two good examples of slow-growth breweries that make fantastic beers. But so is Goose Island, and GI hit a point where they could no longer meet demand without cash influx. Don’t be surprised if Founders goes the same way in the next few years.

  14. Clemoh says:

    I’ll never understand why a multinational would buy a brewery that they ‘can’t afford to run’.  I certainly would steer clear of businesses that I couldn’t run.  Guess that’s why I don’t run a big company and make millions of dollars.  In the film industry, we had a tern for this: ‘failing upwards’.  I’m sorry to see this trend extending into legitimate craftsmanship.

    • GawainLavers says:

      They can afford to run it, but they don’t want to.  What they’re doing is liquidating a brand.  A brand has certain loyalty due to past performance.  If the brand tapers off in quality, that loyalty won’t die immediately.  So you calculate that the purchase cost will be offset by cutting production costs to near 0, liquidating “redundant” infrastructure, and then riding out brand loyalty to the ground, which is now all profit.

    • Vickie Kostecki says:

       I would assume they would do it to get rid of competition. Or at least disguise themselves as that competition. IMO that’s worse than getting rid of the brand outright, making themselves seem “craft” & local.

    • Jim Nelson says:

       Well, I can see buying a recipe and brand, but finding out that the physical plant is in utter disrepair / unable to handle expansion. Although that would be motivation to expand / build a new facility, rather than just shutter the thing and hand the production off.

      Now, if there was nothing special about the recipe, that might work out for you. But, if you’re relying on things that never got written down (like if you just laid off the brewmaster, and then made him write down the recipe on his way out the door) then you’re just asking for trouble, and lost sales, and wholesale destruction of the brand’s reputation.

      • daniel harmon says:

        If you run any sort of brewery and you don’t have detailed processes for your beers, you don’t deserve to be in business. This isn’t homebrewing. This is a billion dollar market where even the smallest brewpubs require QC processes to oversee the chemical reactions that are going on. Beer is science. You can’t just willy-nilly stuff and expect consistency.

    • dbergen says:

      Removing competition?

  15. The idea that IntBev is making budwieser lower quality by using broken rice instead of whole grain is LAFFO.   It’s already garbage – bud uses rice because it’s far cheaper than barley to begin with.

    While it’s a shame if they screw up a micro that they take over, it’s not unique to them.  Celis was purchased by Miller and run into the ground. 

    Thankfully, I’ve got more than a half dozen local brewers in Atlanta and most bars and restaurants around town have a dozen or more quality US micros, german and belgian beers on tap.

  16. Joe Skaggs says:

    I agree with a lot of other posters here: AB is buying large brewers, but few microbrewers. Still want to taste great beer? Find your local brewer, head down to the taproom, and see what it’s all about. 

    Admittedly, those of us who are lucky enough to live in beer-rich places like Colorado or the PNW have more local beer options. However, I travel to a lot of small towns across the USA, and I hardly ever find a small town that doesn’t have a local brewer or a package store that carries some local brands. Beer is better when it’s small anyhow.

    So, will InBev kill itself? Probably. Once they swallow up most of the macros and stop making huge profits by selling away things that have taken generations to build, the Wall Street investors who have rocketed InBev’s stock price up will abandon ship, and InBev will either have to make quality important again, or lose market share to brewers who care.

  17. RJH says:

    When InBev bought Anheuser-Busch, I can exclusively reveal that Budweiser continued to taste just as dreadful as it always did.

    The plot to destroy America’s beer? What hysterical hyperbole. If you want a decent beer, don’t buy a mass-produced one. 

  18. zartan says:

    Inbev is an interesting case from the financial perspective because of the amount of goodwill (an accounting term that esentially means the amount paid for acquisitions over and above the market value of their physical assets) they have built up due to their rapacious acquisition strategy – over $50 billion dollars, a truly remarkable amount.  This goodwill makes up nearly half of their assets, a highly unusual circumstance for any company.  This ties their hands to a great extent in terms of what they can do strategically (since they have borrowed a ton of money to pay for these acquisitions) and quite frankly probably forces them to act in ways that create openings for the many small, local craft brews that people have mentioned in this thread.  The counter-example public brewery in the US is the Boston Beer Company, which has done a pretty respectable job of growing rapidly but at a measured and sustainable pace, and maintaining a reasonably high level of quality in so doing.

    Bottom line for me, though, is that in most of the country compared to 20 years ago the variety and quality of beer choices at every level of the market, from gas stations to fancy bars, is exponentially better today than it was back then.  InBev has mostly swept up hundreds of the world’s makers of bland lagers and given the founders and owners of these firms huge paydays.

  19. Christopher says:

    Interestingly I just read an article about a local brewer, Yazoo, that has seen their business grow 30-40% per year. But the owner has a business degree and has seen other breweries overreach, so he’s taking a slow and steady approach to growth. He’s also insisting on keeping the brewing local. He’s even buying some hops grown locally.

    It’ll be interesting to see if that strategy works over the long run.

    One thing that’s worth noting that was not in the article was that following the 2010 flood that hit Nashville the Yazoo brewery released a special brew with all money from sales going to flood relief. I can see a big multinational doing something like that for PR. The Yazoo people did it because they live here.

    Here’s the article:
    http://nashvillecitypaper.com/content/city-news/following-nine-years-slow-steady-success-whats-next-yazoo-brewing

  20. Uncle Geo says:

    Bottom line, big often means crappier because profit gets to dominate all other concerns. Buy local brews and small brews exclusively and there wil be more oif them. And challenge your crap swilling friends to try a real beer -build the movement!

    And I’m not sure I buy the notion that the big guys keep hop prices down enough for small brewers to exist. Hops are a plant, I grow ‘em in my backyard in MN, and if I can I can’t see why local farmers can’t

  21. cmwnyc says:

    They own a ridiculous number of brands now. http://en.wikipedia.org/wiki/InBev_brands

    • Finnagain says:

       Wow, that’s crazy. But there is nothing on that list that I will miss. Too bad about Boddingtons and Whitbread though.

  22. Navin_Johnson says:

    It’s hilarious that InBev raised the price of Bud, it was already both worse, and priced more than a number of cheaper, better tasting macro, lawnmower beers.

    While I’d rather have a decent craft beer, if choices were limited at a bar I’d choose Old Style, Pabst, Schlitz etc. over Bud any day.

    • Christopher says:

      There are homebrewers who have shared with each other a strain of yeast that was, ahem, borrowed from a Budweiser lab and which they use to brew Budweiser at home.

      I avoid Budweiser myself, but for those people who genuinely enjoy it I can’t help thinking that brewing it at home is a better option than buying the mass produced version.

      • Navin_Johnson says:

         I’ve often wondered what Bud tasted like 100 years ago.

        • First Last says:

          Apparently pretty much the same.
          InBev sent a brewmaster over to my country a few months back to do a series of promotional/informational talks (in conjunction with our national-swill producer, so probably a takeover happening there soon) and he said they had decades upon decades of it all in deep freeze so that they can maintain the taste across recipe alterations or seasonal fluctuations with a battery of tasters specially trained for the brew.

          I was honestly really impressed they put so much effort into such a mediocre beer.

    • IronEdithKidd says:

      You forgot Hamm’s, the beer refreshing. (More of a fishing beer than a lawnmowing beer, though.)

    • Nylund says:

      Reading up on those types of brands is utterly confusing.  I believe that the majority of those sorts of brands, Pabst, Shlitz, Blatz, Lone Star, Goldmine, Olympia, etc. not to mention Colt 45, St. Ides, etc. are now mostly all under the same corporate umbrella (Pabst Brewing Company).  Further more, I think (but am not certain) that they, in turn, have contracted out their production to companies like MillerCoors, which is a joint venture between SABMiller and Molson-Coors.

      In other words, I’m not really sure what the difference is between all the brands operated by InBev and the brands you’re mentioning other than they’re made by a different giant beverage conglomerate.

      I could be wrong though.  Reading up on those brands leads to an internet wormhole of confusing company histories, buyouts, joint ventures, and contracted production that’s pretty hard to sort out (at least for me).

      • Nylund says:

        Regarding the above (and InBev), it’s sort of funny to think about those issues in the context of people’s arguments over which country makes better beer.  How do you answer that when a bottle of Guinness Stout bought in the US is brewed by LaBatt in Canada, which in turn is owned by the multinational AB-InBev.

  23. yoshua says:

    HA! My cousin is a “global innovation manager” for AB InBev. I’m gonna have to bug him about this.

  24. zeppo says:

    West Virgina, checking in.

    As an Appalachian-American, I can say with authority that if you can find craft beer in a podunk coal town, you can find it anywhere.

    There are few places where I can’t purchase Sierra Nevada or New Belgium, and if I’m lucky (Fayetteville, Davis, or Morgantown) I can get the local brew, which I dearly love.

    I think it’s *great* that multinationals are buying out publicly traded breweries; maybe it will get more folks to support craft brewers.

  25. rocketpjs says:

    I have no beef with owners of microbreweries ‘selling out’ to big corporations – just like it doesn’t bother me when an indie game developer does it.  Good for them – they worked hard, made a quality company and can do what they want with it.  If someone offers me a zillion dollars for my company I’ll sell it to them in a heartbeat.

    But one megacorp buying out another is the beer equivalent of Disney buying Lucasfilm (both of whom have bought many lesser mortals).  So what?

    It’s been years since I’ve bought a megabrew.  Those that do get what they pay for.  It’s all just rich people playing rich people games.  As long as the microbrews continue to thrive I could care less – and one microbrew or another being bought out is not going to change the math much.

    Now, if InBev started lobbying to create regulatory capture and stifle microbrews (which I’m sure they’ll try eventually if they can), then it’s time to man the barricades.

  26. Uncle Geo says:

    And don’t forget, you can brew your own. Thank you Jimmy Carter!

    • rocketpjs says:

       Of course, a smart CEO will begin to campaign to make that illegal again, to increase market share.  Throw a few dozen million at Congress, fold it into an omnibus bill about saving babies or something, and voila – stock price goes up.

    • huskerdont says:

       Hear hear! 55th batch in the secondary as we speak!

  27. zombiebob says:

    I haven’t drunk beer in about 10 years, but thi till makes me very upset. I used to love Hoegarden, and I am saddened that it basically is no more. This whole situatiuon reminds me of a similar one that hits closer to home (due to my now being a non-drinker): how those mofos at unilever DESTROYED Breyers  ice cream. These bastards are just purchasing a brand, a label, an idea, a marketing plan, and of course customers.  Once they have it, they see nothing wrong with changing the true bedrock foundation upon which the brand was built, it’s real substance… it’s quality. THEN they have the balls to use tradition as a selling point. I miss my Breyers Vanilla Bean Ice Cream.

  28. snah says:

    This documentary touched on the issue of the industrial beer makers vs. the micro-brewers.  It’s worth watching.

    http://beerwarsmovie.com
    http://en.wikipedia.org/wiki/Beer_Wars

  29. snagglepuss says:

    All I know is that my friends and I, every New Year’s, have a tradition of ripping open a warm can of Stag at midnight and swilling that fucker.

    It’s our version of kissing a toad  - Drink something that horrible at 12:01 a.m. New Year’s Day, and nothing worse can happen to you all year.

    • Antinous / Moderator says:

      All I know is that my friends and I, every New Year’s, have a tradition of ripping open a warm can of Stag at midnight and swilling that fucker.

      What a coincidence. My friends and I rip open an actually stag at midnight on New Year’s eve and use its organs for haruspicy.

  30. Marko Raos says:

    “Brito is a very candid and transparent guy,”
    Sounds like a very candid and transparent sociopath to me, the kind our current system is designed to foster.

  31. This is a replay of what happened to mom-and-pop soda bottlers at the turn of the last century when the beverage giants started buying up smaller, regional soda companies. Much was lost then as well. The hand-crafted, lovingly produced, small-batch soda pops were the pinnacle of carbonated beverages. As other commentators have noted, there is a wide variety of artisan micro-brews, especially in the Pacific Northwest. But the OP is correct, once uniquely American beer brands have been sucked up by a ginormous multi-national corporation that is totally focused on the bottom line. My advice: Just don’t ear or drink “corporate” foods & beverages – ever again – and we’ll turn this trend around. Maybe.

  32. phead says:

    Of course beer tastes like it does by the process, the mix of ingredients and the water (what they call liquor) used to make it.  In the past you might copy the first two, but local water was local and hard to copy.  Chemistry solved that and modern lines can just copy  the original liquor used, you press a button and get your brew.

  33. The existence of an AB for microbrewers to sell-out to should raise the quantity of craft beer in the same way that the existence of Google and Yahoo! gives tech start-ups an exit.

  34. All I care about is St Arnold’s Christmas Ale is out and I’m in a jolly ho-ho mood.  

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