Tuesday, 22 July 2008

Small Brews Not Weak Beer

Small craft brewers are increasingly asserting their influece with distributors, a reflection of their growing importance in the beer marketplace, according to The Wall Street Journal.
Larry Bell yanked the beers made by his small Michigan brewery out of Chicago, where they enjoyed a loyal following, rather than see the rights to market them there sold to another distributor. He worried that his specialty beers would get lost among the distributor's mass-market brands...

The maneuver is perhaps the most audacious in a string of recent efforts by small-batch "craft" brewers in the U.S. to try to assert more control over how their beer is sold as they gain in popularity -- and clout. The craft brewers are using this new influence to stir up changes with beer distributors. Other brawls have erupted in New York and Texas.
As usual, government and regulation lie at the root of the problem:
Under laws that date to the repeal of Prohibition in 1933, beer generally must be sold through distributors. Producers like Bell's Brewery sell the brew to a distributor, which marks up the price and trucks it to a bar, restaurant or store, which then sells it to a consumer.
Good for Mr Bell and the other craft brewers struggling to expand their businesses while dealing with a dense thicket of regulation and distribution networks dominated by brewing giants. Thanks to Howard for the tip.

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