AP: Anheuser-Busch transfers ownership of its 2 Ky. distributorships to comply with new law

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We’re starting to see some immediate effects of the law (applause!) passed by Kentucky earlier this year bolstering the three-tier system by banning brewers from owner distributorships.

This is a win-win, and one that even the craft brewers were supporting (lookin’ at you, Texas), so it’s good to see the dominoes continuing to fall.

From this story by AP (complete with correction):

LOUISVILLE, Ky. (AP) — The world’s largest brewer has shed its two distributorships in Kentucky after the state legislature passed a law banning it from owning one.Anheuser-Busch says it purchased American Eagle Distributing in Loveland, Colorado, and has transferred its distributorships in Louisville and Owensboro to the Texas-based Standard Sales Company. In return, Standard Sales transferred three distributorships to Anheuser-Busch.”

 

Brewers and brewpubs employ 125k Texans, report says

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My favorite Texas beer writer, Ronnie Crocker, brings us a nice, neat little wrap-up of the most recent industry study by the National Beer Wholesalers of America, outlining the great economic progress that brewers have both enjoyed and contributed to in recent years.

I’ll follow up later this month with a post breaking down the study, which is packed with great info, and what it means to Texas, but for now, check out Ronnie’s report in the Houston Chronicle.

Read the whole report here.

Excerpt from story:

“A study conducted for the National Beer Wholesalers Association and the Beer Institute pointed out that the number of physical breweries has increased substantially over the past two years, with most of the facilities being ‘very small brewers or brewpubs.’”

Whole Foods to start selling its beer in Texas

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Starting in August, Whole Foods will begin selling its own craft beers in its 10 Houston-area stores, expanding to the rest of the state in mid-September, according to a press release by the company and a story on the chain’s website.

From Whole Foods Magazine: 

“The first beer product on sale on August 8 is the Post Oak Pale Ale … the first of 38 beers set to be produced by the Whole Foods Market Brewing Company. Since its opening in November, the brewery has produced more than 5,220 gallons of beer.”

“This move by Whole Foods Market comes only a couple years after Mintel announced that craft beer sales has doubled from 2007 to 2012 in the United States. Craft beer accounted for $5.7 billion in 2007 and rose to $12 billion in 2012. The trend is expected to continue and rise to roughly $18 billion by 2017.”

WFAA-TV: Talent drought leads to craft brewing degrees

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Sign me up! 

“GRAPEVINE, TX. – A short walk down the beer aisle at a supermarket shows how popular craft brews have become. But the demand has grown faster than the skilled workforce.

“We’re kind of in a talent drought, because the industry has grown so fast it has sucked up everyone who was available,” said Gary Humble, owner of Grapevine Craft Brewery in Grapevine, Texas.

“Peter Boettcher, a German native and master brewer who worked for years at MillerCoors’ Fort Worth brewery, teaches a small group of students the science of brewing beer.

Students spend three days in the classroom and two days in a local brewery each week for six weeks to earn a Journeyman Brewery Certificate.”

Raise a glass to the indie bars

One of the great conversations of life, happening the Red-Eyed-Fly on Red River. 2010. (By Charlie L. Harper III/Credentials Media)

Today, we offer a toast to the independent bars and pubs of Texas and our nation. From the sloppy, wet watering holes with low ceilings and high bartenders to the swanky little corners of downtown with expensive views, they are the beating heart of our social structure – and they deserve our praise during these, the final days of the 62nd Annual Tavern Month.

Some of the best times of my life have been had in bars, or after bars, or on the way to bars, or even recovering from a night in the bars (those morning-after brunches, though!) I challenge you to deny that at least one life-changing event for you happened over beers or cocktails in a bar somewhere.

And if we’re going to congratulate the bars (and the beers that populate them), we need to acknowledge the independent distributors, loyal wingmen to the taverns who play an essential role in supporting the bars’ ability to give us the best quality beers at affordable prices – even here in Austin.

To that end, I present you this excellent read – a missive from Craig Purser, CEO and president of the National Beer Wholesalers Association, who does what he does for the same reason I do: He believes in the contribution that wholesalers make to the industry, to the economy and to our community. So do I.

But because he’s the expert, he’s able to say it a little better than I can:

“Thanks to a successful system of independent distributors and retailers, American consumers enjoy more choice and variety in beer than any other consumer product – and more selection than any other country in the world. So when you head out to your local watering hole, be sure to raise a glass and offer a toast to a system that works so well for brewers, distributors, retailers – and most importantly – the consumer. Cheers!”

Read his note here and raise a glass in your favorite watering hole tonight! Cheers indeed!

 

Popularity of home-brewing serves up The Dream for Denton hobbyist

Credit: Charlie L. Harper III

We love how the U.S.’s growing appreciation of craft and indie beer is having such a profound effect on people’s lives. I especially love how this guy, Dennis Wood of Denton, has chosen to capitalize on it. Check out this piece in the Denton Record Chronicle.

“Most people get a beer on their birthday. Dennis Wood is getting beer and a business. Upon turning 50, Wood is in the process of opening up his own home-brew supply shop, Baron’s Brewwerks. The store, named after Wood’s German shepherd, will supply thirsty residents all they need to create their own ale and wine in the comfort of their backyard, kitchen or garage. He plans to open early next month.”

A great sign of the continuing victory of great beer, and the people who love it.

Kentucky craft brewers score lege victory with passage of bill protecting three-tier system

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Kentucky is bracing for a big fight from Big Beer after lawmakers closed a loophole in the three-tier system that helps avoid monopolies.

We advocated for this bill and cheered the craft brewers and media for supporting it – unlike in Texas, where some of the craft brewers think the three-tier system hurts them, the situation is Kentucky is that they need the system to protect them from being overtaken by Big Beer (like AB/InBev). We applaud the state for passing the bill and stand behind it as it prepares for a costly onslaught.

Here’s a look at the situation by the Louisville Courier Journal.

“House Bill 168, signed into law by Gov. Steve Beshear after it comfortably passed both chambers of the legislature this year, was sought by the ABC as a way to close a loophole in the three-tier system that tries to keep producers, distributors and retailers separate. That system is aimed at avoiding monopolies.

The bill stemmed from a court case where a Franklin Circuit judge said there was nothing in existing law at the time to prevent Anheuser-Busch, the world’s largest brewer, from buying a distributorship in Owensboro, having owned one in Louisville since 1978.

The beer battle was one of the most contentious issues of the legislative session, pitting craft brewers and independent distributors against Anheuser-Busch with both sides claiming a win for the other would reduce jobs.”

DMN: Bill would allow public companies like Wal-Mart to sell liquor in Texas

By Charlie L. Harper III

Bills moving through the Lege would allow grocery stores to sell wine and spirits, and Wal-Mart to open a package store next to its big box stores.

Decent take-out here from the Dallas Morning News: 

“Sen. Kelly Hancock, R-North Richland Hills, presented his bill to a business and commerce committee saying Texas’ current restrictions are unfair and limit competition. He noted that Texas is the only state in country that allows private companies to own package liquor stores but prohibits public companies from doing the same.

“Texas shouldn’t be the only one in the business of picking winners and losers,” he said. “The current law restricts consumers and choices that they deserve.”

Kentucky House passes distributor bill – Senate urged to do same

Credit: Charlie L. Harper III

Another editorial in the Lexington Herald Leader earlier in the week celebrates the overwhelming House passage of HB 168 and urges the state Senate to do the same.

It also points out ABInBev’s staunch opposition to the bill, while noting the support of most craft brewers in the state. 

This system benefits craft brewers and stymies Big Beer by holding them at bay to allow the smaller brewers some shelf space (and more) – we already know this in Texas. We encourage other states to embrace it as well.

Thanks to the H-L once again for its leadership!

From the editorial: 

The House passed the so-called beer bill overwhelmingly Tuesday and now the Senate should do the same.

Despite remarkably imaginative arguments to the contrary from AB InBev, the bill is designed to preserve competition and limit monopoly power in the wholesale market for beer and other malt drinks.

That’s a good thing.

House Bill 168 provides that no company that makes beer in Kentucky can sell it at wholesale. This is essentially the law that applies to wine and spirits.

Alcohol regulators, independent distributors, MillerCoors and most craft breweries favor the measure.

AB InBev, the company that resulted when a multinational paid $52 billion for Anheuser-Busch in 2008, is battling to hold on to the wholesale operation Anheuser-Busch has long owned in Louisville and another AB InBev bought last year in Owensboro.

Also, it looks like Tennessee is climbing on board, too. Cheers to you guys – we do a great job with our three-tier system in Texas, and it’s heartening to see crafts in other states recognizing the benefits – as well as who their true enemies (and actual allies) really are.

 

ICYMI: Craft brewers give three cheers to distribution bill in Kentucky. Texas? Are you listening?

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The Lexington Herald-Leader ran an editorial praising a bill that codifies a three-tier system for beer in Kentucky – prohibiting breweries from owning their own distributorships. The bill, House Bill 168, protects beer consumers and producers and keeps multinational beer companies like ABInBev from railroading the smaller crafts, the editorial says.

“It should be passed,” the editorial says. 

We heartily agree. AND SO DO THE CRAFT BREWERS IN KENTUCKY!! Go figure.

“The bill would spell out that those with a Kentucky license to make beer can’t hold a license to distribute it, too. Brewers in Kentucky’s burgeoning craft beer industry say the move is necessary to protect them from being squeezed out of the market,” reads the article (linked right above) that covers the bill’s passage through a House committee in Kentucky earlier this month.

YES. This is our point.

Now, we aren’t in Kentucky. Texas craft beers have been thriving in the Lone Star State for years under our three-tier system. But we extend applause to Kentucky for seeing the benefits of this system, as opposed to falling for the trap set by them by Big Beer and trying to dismantle it – which would only benefit ABInBev, which is never good for the crafts.

I fail to see how some of the craft industry can actually think Big Beer would be on their side. I hope some in that community read this editorial and see how while we are arguing over preserving the basic, and very successful, tenets of our three-tier system here, other states are champing at the bit to put something similar in place. TO PROTECT THE CRAFT BEERS. And their consumers, more importantly, since that’s what this should really be about.

We’d like to thank the Lexington newspaper for its leadership on this. From the editorial: 

It’s probably not possible to know now whether Kentucky law governing production and distribution of beer is so confusing by intent or mistake. Regardless, it’s time to clear it up.

House Bill 168 promises to do that and protect the interests of beer producers and consumers in Kentucky. It should be passed.

The bill seeks to prevent breweries from owning distributorships in Kentucky. It would enforce a three-tier system of beer production, distribution and sales much like that for wine and spirits. Under this system, adopted in many places after the repeal of Prohibition, the producer of an alcoholic beverage, with few a few exceptions, can only sell it to a wholesaler who sells to retailers. 

<snip> ….

The Economist reported last fall that in America AB-InBev, “is suffering growing competition from small makers of ‘craft beer.’” No surprise that AB-InBev has been snapping up craft breweries from Long Island to Oregon, despite the disdain for those beers and their effete drinkers in the Anheuser-Busch Super Bowl ad. It now controls almost half of the U.S. beer market.

In this environment, AB-InBev’s move to expand its distribution footprint raised alarms. A distributor owns the exclusive right to distribute brands of its choosing in a specified area. AB-InBev, of course, wants to distribute the brands it owns. So, the distributor, instead of hustling to serve ever-changing consumer tastes at competitive prices, is pushing its own brands at its own prices.

That inevitably means small brewers will struggle to get their products to retailers, reducing consumer choice.

 

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