2013-03-28

Co.Exist

Should Corporate Beer Fear The Micro-Brewer? Or Just Acquire It?

As small breweries gain market share from the Buds and Coors, a new strategy is emerging: If you can’t brew with them, buy them.

Is a beer war brewing?

From a consumer perspective, it’s felt like micro-breweries were slowly chipping away at their share of the domestic beer industry, dominated by just two behemoths Anheuser-Busch InBev and MillerCoors. Since the 1990s, smaller batch brews and breweries have seemed to pop up everywhere, from high-end restaurants to bodegas, in small towns and big cities.

Turns out, craft beer now claims 6% of the $200 billion industry’s market share (Anheuser and MillerCoors have about 90%, combined). And while that number sounds small, in three years, the little guys will control 10%. The diversity in the beer market is greater than ever, and beer trade group The Beer Institute recently announced that the number of permitted brewers had grown to 2,751. The current era has seen the most rapid opening of new breweries since prohibition.

And while that may be cause to celebrate for micro-brew lovers, it’s also a reason to--just maybe--get concerned. There are signs that mega-corporations are growing nervous about the little guys and are trying harder than ever to stave off competition through consolidation--for example, the recently blocked effort by Anheuser-Busch InBev to acquire the half of Mexican conglomerate Grupo Modelo that it didn’t already own.

But their eyes aren’t set just on big companies. According to US News:

Anheuser recently signed distribution agreements with two craft brewers, the Seattle-based Red Hook Ale Brewery and Hawaiian Kona Brewing Company. It has also taken steps to possess its own craft breweries, with the most high profile acquisition happening in May 2011, when it bought Chicago-based craft brewery Goose Island for $40 million.

The owner of California brewery Lagunitas signaled on Twitter that he had been propositioned to sell his beloved brewery by one of the big guys. And big companies continue putting out brands of beer that are marketed as craft beer but are owned by big corporations (think Blue Moon) or have names that sound exactly like craft beers.

Of course, whether not your favorite beer is owned by a huge corporation is mostly a matter of principle--unless of course they change the recipe. It’s likely some breweries will sell when offered millions and millions, and who can blame them?

But there’s always been something anti-corporate about local brewing, that drinking those beers has been about supporting community and local jobs (as well as getting drunk). As Tony Magee of Lagunitas tweeted: "Selling ones brewery is selling all of ones best friend’s careers, their hearts, the portion of their lives they spent working for you."

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1 Comments

  • Liggymoffatt

    Uh, acquiring craft breweries is a new strategy? Do your homework before you start typing, kid.