Author Topic: Brü's Views | On Craft Brewery Buyouts  (Read 1600 times)

Offline brulosopher

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Brü's Views | On Craft Brewery Buyouts
« on: November 26, 2015, 12:59:05 PM »
For Thanksgiving this year, we thought we'd introduce something new, something fresh, something totally different than you might expect. You know what they say about opinions... well, we've got 'em too! Today we bring you a new series we're calling Brü's Views where each contributor shares their thoughts on a hot and usually controversial topic in the beer and/or brewing world.

In this inaugural article, we take on an issue that's been bringing beer drinkers to the brink: buyouts of craft breweries by major conglomerates. What do you think?

http://brulosophy.com/2015/11/26/brus-views-on-craft-brewery-buyouts/

Offline klickitat jim

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #1 on: November 26, 2015, 01:49:31 PM »
I saw a handfull of Oregon craft brewers meeting with Senator Wyden on the news a couple weeks back. Trying to find a way to slow down or stop these deals. I thought that if I were an investor, it would be wise to note which breweries were at the table and which ones weren't.

As a consumer... I'd like to try your beer. You have to find a way to get it to me though. If you want me to buy more than once, it better be damn good.

Offline brulosopher

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #2 on: November 26, 2015, 02:06:34 PM »
I thought that if I were an investor, it would be wise to note which breweries were at the table and which ones weren't.

Totally.

Offline erockrph

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #3 on: November 26, 2015, 04:49:16 PM »
From my own personal perspective, I'm OK with it. If a brewery owner has poured their blood, sweat and tears into their business, they should be allowed to recoup on that. As many bigger players start snapping up smaller breweries, that will only serve to increase access to those craft brands. Goose Island IPA is all over the place since the AB buyout. If the beer is good, then I'll drink it. If it sucks, I won't.

But I can certainly see the cause for concern by the little guys. Not every craft beer drinker is as discerning as me. A good friend of mine likes good beer, but his fridge is always stocked with Sam Adams and Sierra Nevada. I fell like most beer drinkers are the same way - who has the biggest display, best packaging, most familiar name, etc.
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Offline kramerog

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #4 on: November 26, 2015, 06:02:47 PM »
My issue with these buyouts is that the value of the buyouts to the buyer is that the buyer can take an up and coming brand and then distribute it over their much wider network putting other craft brewers at a significant disadvantage.  Since the distribution networks are highly regulated, I wonder if there is a way the state governments can do anything to not put the remaining craft brewers at such a disadvantage such as raising the volumes allowed under self-distribution.

Offline klickitat jim

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #5 on: November 26, 2015, 11:45:28 PM »
I wonder if being bought by a big guy necessarily means that the bought brand will be seen in more areas. Or if it just means that the big guy gets some mention for it in the business news and that nudges their stock value up. My understanding is that overall beer consumption is fairly level and has been for several years. If so, the big guy isn't growing by selling more beer, just by increasing stock values. The stores I shop in seem to have more selection than 5 years ago but the added selection is not from medium guys who were bought by big guys, its mostly canned six packs from new guys. If im right, probably im not, but if im right this buy out craze will reach its end fairly quickly. If its not resulting in more overall sales, it will collapse on itself.

Online tommymorris

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Brü's Views | On Craft Brewery Buyouts
« Reply #6 on: November 27, 2015, 12:21:13 AM »
I wonder if being bought by a big guy necessarily means that the bought brand will be seen in more areas. Or if it just means that the big guy gets some mention for it in the business news and that nudges their stock value up. My understanding is that overall beer consumption is fairly level and has been for several years. If so, the big guy isn't growing by selling more beer, just by increasing stock values. The stores I shop in seem to have more selection than 5 years ago but the added selection is not from medium guys who were bought by big guys, its mostly canned six packs from new guys. If im right, probably im not, but if im right this buy out craze will reach its end fairly quickly. If its not resulting in more overall sales, it will collapse on itself.
I think the big brewers want complete portfolios to sell to the big restaurant chains and big box stores. This helps the big restaurants and big box stores because they can buy a complete lineup for all their customers tastes from one source.

The broader portfolios will also help them push little guys out of the limited shelf space. Right now big box stores have to sell the small brands to have a comprehensive line up. Over time with consolidation that may not be the case.

All that said, I think there will always be pressure to sell some local beer.

Also, nothing in business is certain. I think there is logic behind this consolidation, but, it's impossible to say how the market will react. Maybe because I am a homebrewer, when I buy commercial beer I like to mix it up.  I often stick with breweries I trust, but, I rarely buy the same product twice.
« Last Edit: November 27, 2015, 02:22:19 AM by alestateyall »

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Brü's Views | On Craft Brewery Buyouts
« Reply #7 on: November 27, 2015, 02:00:34 AM »
I think it's worth it to listen to the latest Experimental Brewing podcast for the back and forth from Denny and Drew. I agree with Denny. "Craft" is a useless, often disingenuous term. I wouldn't have drank Ballast Point before the buyout and don't plan on it afterwards. This isn't due to the business aspect of the deal but my lack of interest in their rather boring beers.

Denny said it best, and I paraphrase, "let's dispense with the term and let people decide if the beer is good on their own terms."

I don't need the "Craft" term associated with a beer to make me drink it.

Offline klickitat jim

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #8 on: November 27, 2015, 03:56:18 AM »
I think it's worth it to listen to the latest Experimental Brewing podcast for the back and forth from Denny and Drew. I agree with Denny. "Craft" is a useless, often disingenuous term. I wouldn't have drank Ballast Point before the buyout and don't plan on it afterwards. This isn't due to the business aspect of the deal but my lack of interest in their rather boring beers.

Denny said it best, and I paraphrase, "let's dispense with the term and let people decide if the beer is good on their own terms."

I don't need the "Craft" term associated with a beer to make me drink it.
Yup

Offline troybinso

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #9 on: November 27, 2015, 04:47:38 AM »
I wouldn't have drank Ballast Point before the buyout and don't plan on it afterwards. This isn't due to the business aspect of the deal but my lack of interest in their rather boring beers.


Wait, what? How do you know their beers are boring if you haven't tried them yet?


RPIScotty

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #10 on: November 27, 2015, 11:19:17 AM »

I wouldn't have drank Ballast Point before the buyout and don't plan on it afterwards. This isn't due to the business aspect of the deal but my lack of interest in their rather boring beers.


Wait, what? How do you know their beers are boring if you haven't tried them yet?

I was trying to get across that I didn't enjoy them when I had them so would not have drank them if given a choice before or after the buyout.


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Offline theoman

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #11 on: November 27, 2015, 12:22:27 PM »
Capitalism will do its thing. As long as it doesn't interfere with my brewing at home, I'm not too concerned about it.

Offline pete b

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #12 on: November 27, 2015, 12:52:25 PM »
I guess "craft" beer is the new "natural" food, the term has lost its meaning. The term craft to me implies hand made. Obviously with today's technology even a tiny brewery can have a lot of automation so it really means to me that actual brewers at the actual brewery are calling the shots, not some executives in a city near you. That being said, a lot of "craft" brewers are making so so beers and a lot of big corporations are "making" great beers. Given the choice of a crappy local micro brew and a good beer that has been bought out by a big company I'll take the good beer. All things being close to equal, however, I'll take local and small every time.
There are other factors too. If I know a corporation is a particularly bad actor I will go out of my way to avoid their products, even at the expense of quality.
I sure am glad I know how to make this stuff!
« Last Edit: November 27, 2015, 12:55:27 PM by pete b »
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Offline Biran

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #13 on: November 28, 2015, 04:44:06 PM »
I really can't blame a guy who works his ass off to build a product and a brand and decides to make some money off it.  Ballast Point got bought for one billion dollars.  I would've taken that deal in a heart beat.

Offline dbeechum

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Re: Brü's Views | On Craft Brewery Buyouts
« Reply #14 on: November 28, 2015, 06:43:33 PM »
Well and here's my take on it from that same episode. I don't begrudge anyone their right to get paid for their effort. But as free market evangelicals are fond of saying the only vote that matters is the one you make with your wallet - I won't buy products from these transactions if I don't trust/like the parent companies. It's nothing to do with what's craft or not and absolutely zero to do with the taste but a matter of voting with my dollars.

That's why I keep shaking my head at the BCBS frenzy every year. The stuff could taste like the liquid soul of the buddha, but it will never let me forget that the same people funding it's creation are the same ones who funded those "brewed the hard way" ads, etc, etc.
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