It’s been a tough few years for BrewDog’s CEO James Watt, what with the accusations of nurturing a toxic workplace culture, a far from friendly BBC documentary, and now the disaster of the Lost Forest scheme. That the Lost Forest is in tatters only came to light after the campaigner Nick Kempe had asked for details in a Freedom of Information request. This forced Mr Watt to admit that half of the trees he had planted under a regeneration initiative spanning 10 000 acres had perished.
In 2020, Mr Watt had boasted that he wanted to help save the planet by buying the Kinrara Estate, near Aviemore, and planting at least a million trees to soak up carbon. However, one in two of the 500,000 saplings planted did not survive their first 12 months due to extreme weather conditions. It did not go down well that BrewDog had received some GBP 690 000 (USD 850 000) in grants from Forestry Scotland to cover the planting and to put up new fences. The Scottish Government agency said the firm may have to replant trees to keep up its end of the deal. A contrite Mr Watt said: “One thing that is for sure is that sustainability is hard.”
Number of US Craft breweries continues to climb in 2023. According to the Brewers Association (BA), the number of operating craft breweries continued to climb in 2023, reaching an all-time high of 9,683, including 2,071 microbreweries, 3,467 brewpubs, 3,900 taproom breweries, and 245 regional craft breweries.
As in previous years, the top five craft brewing companies were Yuengling, followed by Boston Beer, Sierra Nevada, Duvel Moortgat and Gambrinus. But the nation’s biggest brewers are Anheuser-Busch, followed by Molson Coors, Constellation, Heineken USA, and Pabst.
In its report, released on 17 April, the BA put the total number of operating breweries at 9,812, up from 9,730 in 2022. There were 495 new brewery openings and 418 closings. Openings decreased for a second consecutive year, with the trend reflecting a more mature market. The closing rate increased in 2023 but continued to remain relatively low, at about 4 percent.
The ripple effect of the strike at Molson Coors Texas brewery. Seattle is out of draught Rainier beer, while at Molson Coors brewery in Fort Worth, Texas, workers have entered their third month on strike for better wages, benefits and working conditions. At the time of writing (5 May), the strike was still ongoing.
The strike is costing the Teamsters. They are obliged to provide the 400 or so Fort Worth members on the picket line with benefits of USD 1,200 per week and free insurance. The union let it be known that it can prolong the strike, which began on 17 February, for as long as it takes, because it has a strike and defence budget of over USD 300 million.
Although Molson Coors said its contingency plans are working well, kegs of Rainier beer have been unavailable in Seattle since late March, the newssite The Oregonian reported recently. The local beer brand, which is owned by Pabst, was produced by Molson Coors in Texas.
Just as I was pouring over the first learned article on the Bud Light affair – it’s been a year since it began – news reached me that Carlos Alvarez, the man behind Corona’s meteoric rise in the US, has passed away.
Few will remember that in the 1980s, Corona had to face up to a malicious rumour that it contained urine. Sales dropped. The allegation was baseless. But it was a PR nightmare for Corona’s two importers, Mr Alvarez’ Gambrinus Company and Barton (now Constellation). How did they handle this existential crisis? They hit the news circuit heavily, issuing press releases and securing spots on numerous talk shows for executives to clear the air, the website vinepair.com reminds us.
Bud Light boycott: one year on. You would have thought that one year after Bud Light’s ill-fated collaboration with a transgender activist the whole affair would be water under the bridge. Well, it is not.
AB-InBev’s marketers believed they were doing the right thing when they took a social stance to better resonate with younger, more socially-conscious audiences. On 1 April last year, Bud Light collaborated with the transgender influencer Dylan Mulvaney on a social media promotional post. It sparked a backlash from many conservative figures and groups, who called for a boycott (or “buycott”) of Bud Light. A prominent figure in the boycott was Kid Rock, a musician, whose video of him shooting at a pile of Bud Light beers, whipped the commentariat into a frenzy.
Funny that, on 4 April this year, the musician joined Fox News’ Laura Ingraham’s show, with a drink in hand and a Budweiser hat on his head. When asked why he sported the Budweiser hat after his notorious 2023 boycott of Bud Light (both brands are owned by the same company after all), Mr Rock appeared dazed and confused, eventually admitting to Ms Ingraham, “Man, we got … we got … I didn’t know what hat I was wearing.”
Mr Rock may believe that it is ok to drink Bud Light again, as he and Anheuser-Busch’s CEO Brendan Whitworth have since become great friends and have even partied together.
But the Bud Light malaise is far from over, according to a more sober analysis by the Harvard Business Review (HBR), published on 20 March. Not only has the boycott cost AB-InBev in excess of USD 1 billion in revenue in 2023. Bud Light sales continue to be down by 28 percent (by value) this year over the same period last year.
Boston Beer’s overuse of noncompetes becomes an issue. At a time when the use of noncompetes has become increasingly restricted, Boston Beer, the firm behind Samuel Adams beer and Truly hard seltzer, has been in the spotlight for their strict enforcement. The practice, although legal, has sparked debates about the balance between protecting business interests and ensuring individual freedom to work.
According to reports, Boston Beer requires employees to sign noncompete agreements which bars them from joining a rival company for a year, and pursues those who do. This makes the firm one of few employers in the craft brewing industry to keep a tight grip on its workforce. It does not help that Big Brewers like Molson Coors and AB-InBev reportedly do not require noncompetes for lower-level brewery employees (although they would demand them from those higher up the food-chain, surely), whereas Boston Beer appears to insist on them for nearly everybody, the website vinepair.com pointed out.
The Boston Globe newspaper recently cited several former lower-level Boston Beer employees, who had to leave the industry because of noncompete agreements their former employer had compelled them to sign at their time of hire.
A spokesman for Boston Beer said that its people are its greatest asset and that “we invest a great deal of time, money, and effort on training and developing our people.” Salaried new hires are required to sign the one-year agreements in states where they can be enforced, he said, but thousands of jobs in the beer industry are not subject to them and former senior leaders have gone on to have successful careers at other breweries.
However, the ethics of noncompete agreements have been increasingly questioned in recent years, with many US states placing restrictions on which workers are subject to them and for how long.
Constellation wins Corona trademark dispute against AB-InBev. A US court of appeals, on 25 March, upheld a 2023 decision that Constellation Brands can sell Modelo-branded hard seltzer drinks, dealing a blow to Grupo Modelo owner AB-InBev. The dispute, which dates back to 2021, hinged on whether hard seltzer could be classified as “beer”. AB-InBev’s Mexican subsidiary, Grupo Modelo, had filed the lawsuit, accusing Constellation of violating a brand licensing agreement when it launched Corona Hard Seltzer in 2020. The lawsuit said the agreement only allowed Constellation to use the Corona brand name in the US for beer. Constellation countered that the licensing deal allowed it to sell other alcoholic drinks as well.
In 2023, a Manhattan jury determined that Constellation’s license to brew and distribute Corona and Modelo branded beverages permitted it to sell products such as Corona Hard Seltzer and Modelo Ranch Water. The US Court of Appeals for the Second Circuit reaffirmed that decision on 25 March.
Anchor Brewing Company auction, the latest. The winning bid for San Francisco’s Anchor Brewing Company was supposed to be announced at the end of January, but things appear to be delayed. Last summer’s bankruptcy and closure of the 127-year-old Anchor Brewing Company came as a shock to San Francisco, especially to local fans of Anchor’s beer. But there were reasons for optimism because the bankruptcy proceedings determined that Anchor’s remaining assets would be auctioned off.
Anchor’s most recent output was just 20,000 barrels beer a year, reports say, down from a peak of 150,000 barrels before Japan’s Sapporo bought the firm for USD 85 million in 2017. It is understood that Anchor will be sold in three lots: the real estate property, the brewery equipment, and the trademarks.
Amongst those interested in buying the brewery or parts of it were a group of former Anchor employees, who formed the Anchor SF Cooperative. They attempted to buy the brewery’s intellectual property. But in a 31 January post, the cooperative announced it was exiting from the bidding process. The group admitted it did not have the money to submit a potentially successful bid, although it had raised more than USD 90,000 through crowdfunding.
You cannot say that things don’t move swiftly in Russia’s brewing industry. It only came to light recently that in mid-March, several members of AB-InBev-Efes’ top management defected to rival brewer OPH, the former Russian unit of Heineken. Take it for granted that they were made an offer by OPH’ parent, the aerosol-to-beer group Arnest, which they could not refuse. Perhaps they also thought that switching allegiance from a Turkish-owned to a Russian-owned business, which has ties to the highest echelons of power, might be their safest option, all things considered. The question is: Did the former AB-InBev-Efes executives sign any non-competes which would have prevented them from immediately joining a competitor, or start a competing business of their own? What’s more, even if they did sign one, will AB-InBev-Efes dare drag OPH to court over this? In any case, with the departure of these executives, the realignment of Russia’s brewing industry has entered the next stage.
Baltika sues Carlsberg subsidiaries for over USD 900 million in damages, it was reported on 1 April (despite the date, this is no joke). Moscow took control of Carlsberg’s Baltika in July 2023 and placed it under “temporary management”, prompting Carlsberg Group CEO, Jacob Aarup-Andersen, to say its business had been stolen. The court filings did not specify what the damages were. Previous court sessions, involving Baltika and Carlsberg, have been closed to the public due to the presence of documents containing trade secrets.
Carlsberg pledged to take all possible action to protect its employees, assets and operations in Russia, following the July 2023 seizure. A preliminary arbitration hearing is scheduled for 15 May, Reuters said.
Australia’s Chuck Hahn opens another brewery. If you have ever been to Australia and sampled a Hahn, James Squire, Kosciuszko, Malt Shovel or Lord Howe Island-branded beer, you have drunk a beer designed by Dr Charles “Chuck” Hahn, an American brewer from Golden, Colorado, who arrived in Australia in 1981. After five decades in the brewing industry, the 77-year-old has come out of retirement for a family business with his son, Scott. Chuck & Son’s Brewing Company, a brewery and taproom, will open in May in the inner west suburb of St Peters in Sydney.
Scott Hahn is a former business consultant, a Woolworths risk manager and product manager at Australia’s number two brewer Lion. He will run the business with input from his father. The new venture is a family affair, the Australian Financial Review (AFR) said on 17 April. Scott’s wife, Amy, will look after marketing.