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On our own behalf – The Beer Monopoly on the Forbes List „Best Booze Books of 2017“

We are speechless. Surprised. Humbled. Incredibly grateful. Our book The Beer Monopoly appears on this year`s Forbes List "Best Booze Books". No, no, it`s not the Forbes Rich List. Fat chance of us ever getting on to that one. The list was compiled by Tara Nurin and can be found here >>


Posted June 2018

United Kingdom – Heineken invests in Beavertown and its own pubs

Ending weeks of speculation, the craft brewer Beavertown, founded by Logan Plant, the son of Led Zeppelin singer Robert Plant, announced on 21 June 2018 that Heineken has acquired a minority stake. It is the latest addition to Heineken’s UK craft beer portfolio after the Dutch brewer bought a minority stake in London’s Brixton brewery last year.

Beavertown said it plans to build a 450,000 hl brewery in London for GBP 40 million (USD 53 million) that will increase its brewing capacity tenfold. Mr Plant wrote on the Beavertown blog that the company had explored other financing options, including crowd-funding and private equity, but dismissed them as unsuitable. Heineken confirmed the investment in Beavertown but made it clear that the GBP 40 million was the cost of the brewery, not the value of its stake. Read on


USA – The perils of having your beers contract brewed: the case of Pabst vs MillerCoors

MillerCoors and Pabst Brewing are facing each other in court over a USD 500 million lawsuit which Pabst lodged against the number two brewer in the US, media reported in June 2018.

For decades Miller and later MillerCoors has been brewing Pabst’s legacy beers, including Pabst Blue Ribbon. The agreement is set to expire in 2020, it was reported. Facing a decline in its own volume, MillerCoors has allegedly already told Pabst that it may not have the capacity to continue that relationship if it is forced to close one of its breweries. Pabst’s volume contracted out amounted to over 5 million hl beer in 2017 according to estimates by Beer Marketers Insights. Read on


United Kingdom – Pub chain Wetherspoon to ditch EU drinks

Is this political activism? The pub chain JD Wetherspoon, known for its affordable drinks selection, is to sell more drinks from the UK and non-EU producers. In particular, it will replace French champagne and German beers in the run-up to Brexit. The switch will affect all 880 Wetherspoon pubs from 9 July 2018. Read on

 

 

United Kingdom – FIFA World Cup expected to boost beer sales

The British Beer and Pub Association (BBPA) has predicted that England fans will drink 14 million extra pints (80,000 hl) at the pub during the World Cup group stages. The extra number of pints drunk during the World Cup group stages could provide as much as a GBP 42 million (USD 56 million) boost to the economy. The taxman will be cheering the loudest as England progresses through the group stages of the competition. Extra revenue could amount to GBP 6.3 million from beer drinkers and pub-goers watching England at the World Cup, the BBPA said. Read on


Netherlands – Bavaria changes name to Swinkels Family Brewers

The Dutch brewing group Bavaria has changed its name to Swinkels Family Brewers to better reflect its product range, the family-owned firm said. “We are more than Bavaria”, Chairman Jan-Renier Swinkels said. Next year Swinkels will celebrate its 300th anniversary. Read on


USA – The rise of Goose Island to global brand: book review

I suspect that the somewhat sneering title of Josh Noel’s book “Barrel Aged Stout and Selling Out” (Chicago Review Press, 2018), which charts the rise of Chicago’s famous brewpub Goose Island to AB-InBev’s global craft beer brand, was chosen to make the book more sellable. Going for a rhyme – stout and out – might help too.

However, the book is anything but racy. It is very level and fair, considering that the final sale of Goose Island to AB-InBev in 2011 for USD 38.8 million (the old Anheuser-Busch had already acquired a 42 percent stake for USD 3.5 million in 2006) shocked the craft beer industry. Not the price – in view of later craft brewer valuations Goose Island, which sold 150,000 barrels beer that year, went for a song – but the sale itself.

Little did craft brewers know at the time that Goose Island was only AB-InBev’s test lab for what to do with its future craft beer acquisitions. It will be remembered that AB-InBev went on to buy nine more US craft brewers between 2014 and 2017, the last one to date being Asheville’s Wicked Weed in May 2017.

Mr Noel cleverly intertwines two narrative strands: Goose Island’s, or more precisely the story of the father-and-son team, John and Greg Hall, who founded the brewpub in 1988 and later a production brewery, and Anheuser-Busch’s. His narrative gathers speed in the 1990s when Goose Island was struggling to make ends meet. At the time, Anheuser-Busch thought that, by launching their own crafty offerings under the Michelob label (later to become Shock Top and others), they could keep the threat posed by craft beer at bay. This tactic proved so futile that Anheuser-Busch resorted to a “if you cannot beat them, buy them” approach, snapping up stakes in the Redhook and Widmer craft breweries.

Being a journalist with the Chicago Tribune, Mr Noel obviously benefitted from lengthy interviews with the Halls and their employees, in which they shared hitherto unknown insights. I am not sure that the Halls will find their portraits flattering. John Hall is described as a jovial but shrewd businessman, who always sought to grow his company to achieve a profitable exit. His son, on the other hand, comes across as a gregarious and tireless beer promoter, whose ingenuity at devising new beers styles (like barrel-aged beers in 1995) is beyond doubt, but who still likes his beer a bit too much and shows no business sense. His own cider venture, Virtue, flounders.

What makes the book imminently readable is that Mr Noel combines an interest in gripping personal stories with astute business analysis. Moreover, he provides his readers with perceptive descriptions of craft beer’s culture: the dope smoking, the leisurely and congenial ways, the flip-flops and short trousers. Goose Island was no exception. Hence the changes in practices at the brewery instigated by AB-InBev after the takeover – drugs tests, safety regulations etc – serve as powerful examples of the far bigger changes Goose Island underwent after it became corporate.

In Mr Noel’s analysis, AB-InBev messed up the national roll out of Goose Island big time. They took the brand national far too quickly. The taste of the beers, many of which were now produced at AB-InBev’s plants, suffered. They began to taste ordinary. In Mr Noel’s words: “They tasted exactly like what they were: Big Beer imitations of craft beer.” Goose Island’s spirit, revolving around innovation, intimacy, storytelling, nuance, relationships, relevance, authenticity, was gone. As were the Halls and plenty of Goose Island’s long-time employees.

Nevertheless, the takeover of Goose Island put AB-InBev on a steep learning curve. They saw that they could not stop change. Craft beer continued to barrel ahead. Therefore, they would embrace it. Mr Noel devotes the final sections of his book to AB-InBev’s subsequent takeovers of US craft brewers and explains how they have honed their practices in order not to repeat the mistakes they made with Goose Island. Although he mentions that in 2017 Goose Island’s US sales declined for the first time he does not delve into the possible reasons for this: was Goose Island becoming the victim of the backlash against national brands as craft beer consumers increasingly went for a truly local beer? Or did consumers finally turn against its bland beers?

Still, Goose Island has led AB-InBev’s global craft strategy. They are opening brewpubs and bars dedicated to Goose Island all around the globe. The book ends by saying that John Hall does not regret the sale. After all, AB-InBev has taken his dream global.

If you plan to take a book with you on your summer vacations, make it this one. You will be gripped.

On a finale note: I have to declare a personal interest in Goose Island because for over 20 years on my annual visits to Chicago friends would take me to the brewpub for drinks and dinners. When I last visited in April this year I wanted to see what it looked like after the major refurbishment which lasted for almost all of last year. John Hall had sold the brewpub to AB-InBev in 2016. Gone was its snug appeal which in John Hall’s vision compared with “a comfy pair of jeans you’ve had for 30 years”. The new Goose Island brewpub had been given a sleek and modern makeover and the old wooden horseshoe bar, a Chicago staple, had been ripped out. I was also saddened to see that the restaurant was nearly empty. It was Friday evening and our waiter appeared a bit depressed. His take-home in tips would be slim indeed. Seeing that the brewpub is not doing a brisk business, I wonder when AB-InBev will pull the plug?

 

Germany – Radeberger accepts fine for collusion before heading to court

On 12 June 2018, one day before the start of the German beer cartel trial in Düsseldorf, the German Radeberger Group withdrew its objections to the fine imposed on the brewer by the Federal Cartel Office. Though it will be paying up, this does not mean an admission that Radeberger was involved in price fixing, the firm said. Radeberger will continue to contradict the allegations of the Cartel Office. Read on


Australia – Incubator brewery to be built in Brisbane for AUD 15 million

Several countries already have them and soon Australia will have one as well: an incubator brewery, that is, built specifically for start-ups, contract and gypsy brewers, including publicans seeking to create their own branded beers without wanting to invest in a brewery of their own.

Of course, plenty of Australian brewers, craft and otherwise, produce beers for others. But Brisbane Brew Partners, as the firm is called, claims to be the first to turn brewing for others into a business concept. Read on


Belgium – Craft brewers hit out against fake brewers

Beer promoters without their own brewery have been called various names: from beer firms, gypsies and virtuals to cuckoos, imposters, pseudos and fakes. The connotations attached to each name, ranging from the neutral to the pejorative, are far from accidental.

The choice in terminology is ideologically motivated because at stake is “authenticity”, the craft beer industry’s battle cry usually lodged against the Big Brewers. But, as the Belgian example shows, it can also be directed at promoters deemed heretical or fraudulent for one reason or another. Read on


United Kingdom – The siege on VJ Mallya is getting tighter

When is Netflix turning VJ Mallya’s colourful life into a TV series? The script could run to several seasons. The most recent development in the convoluted plot saw Mr Mallya step down as director of his Force India Formula 1 team at the end of May 2018. The controversial businessman, who is fighting an extradition request from the Indian Government on charges of fraud and money laundering, is to remain as team principal of the Formula 1 outfit. Read on


Belgium – LaM.U is foodies’ new haven in Charleroi

If you were to cross Eataly with Denver’s Wynkoop brewery you will get – at least conceptually – LaM.U, La Manufacture Urbaine, a café-restaurant with a brewery, bakery and coffee roaster, which opened its doors in the Belgian city of Charleroi, south of Brussels, last year.

From Eataly, a global chain of high-end Italian supermarkets cum food courts, LaM.U took the conviction that people increasingly seek locally sourced, sustainable foods and from Wynkoop, Colorado’s first brewpub, the business concept that renovating an old building in a neglected part of downtown and turning it into a gastronomic hub can invigorate the whole neighbourhood.

Most will have heard of Charleroi only because it has an airport which low cost carriers call Brussels, although the Belgian capital is in fact 50 km away. The city of half a million people had been struggling for most of the second half of the 20th century, following the decline in heavy industries. It got a new lease on life in recent years although unemployment still runs high. Read on


Japan – Coca-Cola launches its first alcopop

At the end of May 2018, Coca-Cola launched its first alcoholic drink, Lemon-Do, which is, as the name suggests, a lemon flavoured alcopop. Coke calls the fizzy drink “unique” in the company’s 125-year history because it contains alcohol. The three Lemon-Do alcopops range in alcohol content from 3 to 7 percent. Packaged in cans, they aim at a growing market of younger drinkers, especially women. Obviously, the alcopops are modelled on the country’s popular Chu-Hi drinks, usually a mix of local spirit and a range of fruit flavours with a high alcohol content of around 10 percent. Read on


USA – PepsiCo acquires snack maker Bare Foods

While Coke goes “naughty” with its Japanese alcopop, rival PepsiCo goes “healthy” with the acquisition of Bare Foods, a food company that makes snacks like salt-and-vinegar beet chips and Granny Smith apple chips. PepsiCo did not disclose any financial details of the acquisition, announced at the end of May 2018. Read on


Australia – Craft brewer Gage Roads buys Matso’s flavoured beer brands

The price seems right. The Western Australian craft brewer Gage Roads from Fremantle has taken over Matso’s for AUD 13.25 million (USD 10 million) with a deferred consideration of up to AUD 2.8 million more, subject to meeting sales volume targets, over a three-year period, it was reported on 7 June 2018.

Matso’s is an iconic beer brand owned by the Peirson-Jones family in Broome, Western Australia, some 2,000 km north of Fremantle. The brand is best known for its wildly flavoured beers (notably mango) and nationally distributed alcoholic ginger beer. The two companies are already connected through a contract deal. Since 2007 Gage Roads has been brewing Matso’s products.

Reportedly, Matso’s sells about 20,000 hl per year and the brands generate annual earnings (EBITDA) of more than AUD 2.5 million. Read on


USA – MillerCoors survey confirms shift in bar traffic to taprooms

No doubt, the Three Tier System is being hollowed out. As more and more states grant craft brewers the right to open taprooms and even sell their beers to-go they are turning into serious competitors for distributors and retailers. MillerCoors recently published a blog piece, which highlights the shift in consumption patterns.

In 2017, craft-beer volumes grew just 5 percent, which represents the slowest growth in a decade. Most growth came from brewpubs and taprooms, whose volume sales rose 24.2 percent to 2.7 million barrels (3.2 million hl), according to the Brewers Association.

Already 9 percent of bar traffic (that’s people) across the US now moves through brewery taprooms and brewpubs, according to data from MillerCoors. In cities like Denver and San Diego, which sport some 50+ and 200 craft breweries respectively, the figure is 35 percent. In Indianapolis, Minneapolis, Seattle and Portland, more than 20 percent of bar traffic now flows through taprooms. Read on

 

 

USA – Molson Coors buys non-alcoholic beverage brand Clearly Kombucha

Molson Coors has expanded its portfolio of soft drink brands with the acquisition Clearly Kombucha for an undisclosed sum. The fermented tea product clearly taps into the healthy choice hype in soft drinks, while being fair-trade, non-GMO, gluten free, dairy free, vegan and kosher. According to the data site Crunchbase, it is distributed in California, Colorado, Texas, Washington, Oregon and Montana.

Kombucha is a buoyant category. Estimates place kombucha’s total category sales at over USD 600 million per annum.
Read on

 

 

Belgium – Jupiler is coming home

Jupiler may be Belgium’s major pils brand, but its new packaging, which it is hoped will boost sales during the FIFA World Cup, still raised a few eyebrows. Now, “Belgium” figures larger on the packaging than the brand’s name; actually, the name Jupiler does not appear on the front label. Obviously, AB-InBev, which owns the Jupiler brand, is giving its Belgian beer the same makeover it bestowed on Budweiser in 2016, when it renamed Budweiser as America. Read on

 

 

USA – AB-InBev pulls support from study on effects of moderate alcohol consumption

AB-InBev has cancelled its financial support for a study overseen by the National Institutes of Health (NIH), an agency of the US Department of Health & Human Services, that aims to assess the health benefits of moderate alcohol consumption, according to various US media. The ten-year, USD 100 million study has attracted criticism because it was to be largely funded by alcohol producers, including AB-InBev, which put the study’s neutrality into doubt. Read on

 

 

Belgium – The battle for shelf space heats up

It appears counterintuitive that Big Brewers, all the while trying to cut costs, are increasing their stock keeping units (SKUs). According to perceived wisdom, rising numbers of SKUs add complexity and thus costs. Therefore, traditional FMCG companies have often tried to eliminate SKUs in order to focus on bestsellers.

So why has AB-InBev, in recent years, not only launched plenty of brand extensions to its Leffe brand, an abbey beer, but also extended Leffe’s pack portfolio - so much so that you begin to wonder if they are still making any money? Read on

 

 

United Kingdom – Beaverton Brewery to move in with Tottenham Hotspur

Beer and sports are such a great combo that more and more craft brewers are setting up shop inside sports stadiums. In May 2018, London’s Beavertown Brewery confirmed plans to open a brewery and taproom inside the newly developed stadium of Premier League soccer team Tottenham Hotspur.

The new 61,500-seat stadium – which cost a reported GBP 850 million (USD 1.1 billion) – is expected to open at the start of the new English soccer season this August. The brewery, a 40 hl plant by Germany’s Braukon and paid for by the soccer club, will produce specialty beers.

It is almost next door to Beavertown’s Tottenham location. Beavertown relocated to its current site from its original home in Hackney, north London, in 2015 as it sought to expand annual capacity to 15,000 hl beer. Read on

 


Netherlands – Heineken’s beer couriers deliver cold beer

Is this the next big thing in beer sales? Heineken has taken the idea from pizza delivery services and launched a courier service for beer and snacks in Amsterdam’s cool neighbourhood De Pijp. The service will be expanded to cover most of Amsterdam by July, Dutch media report.

Guess what, Heineken’s new courier service, which also delivers cold beer in the streets and in parks, seems to have fallen foul with health commissars, the municipality and the hospitality industry, albeit for different reasons. Read on

 


South Africa – AB-InBev and Heineken push value packaging

What are we to make of AB-InBev’s launch of Carling Black Label beer in a one litre bottle for only ZAR 19 (USD 1.51)? Is it AB-InBev’s attempt to hike its volume sales through disguised discounting? Promotions have become a distinct feature of South Africa’s mature beer market recently as market leader AB-InBev (at an estimated 80 percent market share) and Heineken (13 percent market share) have gone for large bottles and multipacks. Read on

 


Germany – Glyphosate scare and beer: here we go again

The weedkiller glyphosate is in the news again. After the European Union in November 2017 controversially extended its use by five years, the issue was put on a back burner by media – only to come to the fore again in May 2018 when the German consumer association Stiftung Warentest published its review of 20 alcohol-free beers in Germany, available in the June issue of its magazine.

Unsurprisingly, testers found residues of glyphosate in all of them with the exception of two organic beers. Glyphosate has been used in agriculture for over 40 years. Read on

 


Vietnam – Habeco forecasts drop in profits in 2018

Sabeco and Habeco are facing strong headwinds this year, so much so that in May 2018 Habeco announced that it expects its pre-tax profit in 2018 at only VND 746 billion (USD 32.6 million), down 11 percent compared with 2017, local media report.

The decline in profit comes despite a projected 13 percent hike in revenue to VND 8.9 trillion (USD 389.3 million) because Habeco worries that fierce competition, a hike in input costs and a potential increase in excise will negatively impact its bottom line. Read on

 

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