• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer
  • Advertise
  • About Craft Brewing Business

Craft Brewing Business

Professional Insight, Unfiltered

Craft Brewing Business Craft Brewing Business
  • News
  • Business & Marketing
  • Packaging & Distribution
  • Equipment & Systems
  • Ingredients & Supplies
  • Webinars & White Papers
  • News
  • Business & Marketing
  • Ingredients & Supplies
  • Packaging & Distribution
  • Equipment
  • Webinars & White Papers
  • COVID-19

AB-InBev incentive program potentially a huge blow to craft beer

December 9, 2015Chris Crowell

AB Inbev incentive distribution program

Sorry for the alarmist headline, but it feels warranted. While everyone was watching the Beer Voltron form overseas, Anheuser-Busch InBev had a domestic plan ready to boost its declining sales that could have a much bigger impact on shelf space across the country, this from the Wall Street Journal. This plan is a distribution incentive program that would reward distributors for selling a majority of AB InBev products.

From the Wall Street Journal:

The world’s largest brewer last month introduced a new incentive program that could offer some independent distributors in the U.S. annual reimbursements of as much as $1.5 million if 98% of the beers they sell are AB InBev brands, according to two distributors who requested confidentiality because they were asked not to discuss the plan. Distributors whose sales volumes are 95% made up of AB InBev brands would be eligible to have the brewer cover as much as half of their contractual marketing support for those brands, which includes retail promotion and display costs.

AB InBev, which introduced the plan at a meeting of distributors in St. Louis, estimates participating distributors would receive an average annual benefit of $200,000 each.

The same story goes on to mention one craft beer casualty that’s already happened as a result:

At least one distributor has dropped a craft brewer as a result of the incentive program. Deschutes Brewery President Michael Lalonde said Grey Eagle Distributing of St. Louis last week decided it will drop the Oregon brewery behind Mirror Pond Pale Ale because it “had to make a choice to go with the incentive program or stay with craft.”

So, what do you think? Worth the alarm? For this reason or not, the government is at least peering over the fence to see what’s going on. It was just October that word spread that the Justice Department was investigating claims that AB InBev was/is trying to curb craft beer distribution. Much of that is focused on the effect of distributor acquisitions, which do seem dubious and against the point of the three-tier system to begin with, but take a gander at this nugget from the aforementioned story:

Antitrust regulators are also reviewing craft brewers’ claims that AB InBev pushes some independent distributors to only carry the company’s products and end their ties with the craft industry, two of the sources said, noting that the investigation was in its early stages. AB InBev’s purchase of several craft beer makers in recent years means that it is in a position to offer a greater variety of products itself.

If antitrust regulators actually do care that “AB InBev pushes some independent distributors to only carry the company’s products and end their ties with the craft industry,” well, um, they just made it an actual policy by starting this rewards program. So, investigation over? What else needs to be seen?

The craft beer industry is certainly up for making its case. Yesterday, a U.S. Senate hearing convened to examine the Beer Voltron merger. Cheers to J. Wilson of Prescott, coordinator for the Iowa Brewers Guild, who delivered this message as best he could.

“While market access is an on-going battle that small craft brewers have infiltrated by offering a wide range of locally-produced, flavor-forward products, the ability to produce or package them could soon be hindered if the merger is allowed,” Wilson said. “This mega-brewery would have an even greater impact on brewing inputs such as malted barley and hops and packaging materials like bottles and cans. The hops supply is already tenuous and while malt production can easily be increased, expansion of hops acreage is costly and hop plants take three years to reach maturity.”

direct to customer delivery and shipping
Direct-to-consumer beer shipping up 5 percent in 2023, would be much more if regulations allowed
Cropped shot of male hand holding beer bottle & national flag of USA against setting sun. River background. Happy independence day
TTB proposes some welcome changes to Brewer’s Notices
TTB application process
TTB might eliminate standards of fill for wine, distilled spirts
craft beer regulations
TTB eases some alcohol labeling regulations

Reader Interactions

Comments

  1. KCHopTalk says

    December 23, 2015 at 12:11 pm

    AB-InBev incentive program potentially a huge blow to craft beer https://t.co/AWIdMjzT5v

    Log in to Reply
  2. beerbrewinghome says

    December 11, 2015 at 7:11 pm

    AB-InBev incentive program potentially a huge blow to craft beer https://t.co/QozOvfekJv

    Log in to Reply
  3. FatherFletch says

    December 11, 2015 at 2:02 am

    AB-InBev incentive program potentially a huge blow to craft beer https://t.co/GEZBA9SbP1

    Log in to Reply
  4. Chris Starke says

    December 11, 2015 at 12:44 am

    One of my local bars had a tap takeover featuring Goose Island and Blue Point. Not *too* transparent to those in the know…

    Log in to Reply
  5. Scatterbrain Brewing says

    December 10, 2015 at 5:52 pm

    Scatterbrain Brewing liked this on Facebook.

    Log in to Reply
  6. redflagdan says

    December 10, 2015 at 11:08 am

    AB-InBev incentive program potentially a huge blow to craft beer https://t.co/yVN4yvQKMv #craftbeer https://t.co/RuK27kwB2w

    Log in to Reply
  7. VicinityBrew says

    December 10, 2015 at 9:45 am

    RT @CraftBrewingBiz: AB-InBev incentive program potentially huge blow to craft beer https://t.co/En1bO4xfR0

    Log in to Reply
  8. Heather Lee Lee says

    December 10, 2015 at 5:51 am

    Heather Lee Lee liked this on Facebook.

    Log in to Reply
  9. Matthew McDonnell says

    December 9, 2015 at 9:37 pm

    Matthew McDonnell liked this on Facebook.

    Log in to Reply
  10. Ken Meng says

    December 9, 2015 at 9:37 pm

    Ken Meng liked this on Facebook.

    Log in to Reply
  11. jaime_lugo says

    December 9, 2015 at 7:45 pm

    AB-InBev incentive program potentially a huge blow to craft beer https://t.co/fMdYn8gnwj

    Log in to Reply
  12. Cooper Sepulveda says

    December 9, 2015 at 6:32 pm

    Kinda defeats the purpose of the three tier system

    Log in to Reply
  13. Jesse Miller says

    December 9, 2015 at 5:56 pm

    Defend your beer

    Log in to Reply
  14. Ryan Mader says

    December 9, 2015 at 5:36 pm

    Ryan Mader liked this on Facebook.

    Log in to Reply
  15. Matthew Brooks says

    December 9, 2015 at 5:36 pm

    Matthew Brooks liked this on Facebook.

    Log in to Reply
  16. James Velzy says

    December 9, 2015 at 3:21 pm

    James Velzy liked this on Facebook.

    Log in to Reply
  17. crsimp01 says

    December 9, 2015 at 1:33 pm

    AB-InBev incentive program potentially a huge blow to craft beer https://t.co/uh7EvdSrOh via @craftbrewingbiz

    Log in to Reply
  18. Mike Haack says

    December 9, 2015 at 1:29 pm

    The word is “PAYOLA”

    Log in to Reply
  19. Evan Puckett says

    December 9, 2015 at 1:21 pm

    Evan Puckett liked this on Facebook.

    Log in to Reply
  20. Joseph Wertz says

    December 9, 2015 at 1:21 pm

    Joseph Wertz liked this on Facebook.

    Log in to Reply
  21. LVRGLLC says

    December 9, 2015 at 1:16 pm

    #CraftBeer #CraftBrewing #Beer #BeerBiz AB-InBev incentive program potentially a huge blow to craft beer https://t.co/VP3gyXn1u2

    Log in to Reply
  22. John Wanner says

    December 9, 2015 at 12:51 pm

    John Wanner liked this on Facebook.

    Log in to Reply
  23. thekettleslayer says

    December 9, 2015 at 12:43 pm

    RT @CraftBrewingBiz: AB-InBev incentive program potentially huge blow to craft beer https://t.co/En1bO4xfR0

    Log in to Reply

Leave a Reply Cancel reply

You must be logged in to post a comment.

Primary Sidebar

Latest News

  • The who, what, where, when and how (to register) for Homebrew Con 2023
  • Twenty Tennessee breweries prep 2023 Craft Brewers Conference collab and more beers to know this week
  • Karben4 Brewing to relaunch Ale Asylum brand
  • Caius Farm Brewery opens in Branford, Conn.

Sign up for our newsletter

unsubscribe from list

Most Popular Today

Recent Features

  • Koga-brothers-karben4Karben4 Brewing to relaunch Ale Asylum brand
    March 20, 2023
  • 4 steps to understanding the filtration process in craft beer
    March 20, 2023
  • newbelgium_2023_wildnectar-shopping-basket_family_IMG_2Beyond beer: Examples of craft breweries exploring canned cocktails
    March 16, 2023
  • brooklyn 35 featureBrooklyn Lager turns 35 and more beers to know this week
    March 14, 2023
  • Backwoods Brewing to open a 19-acre resort called Party Acres in the Columbia River gorge this May
    March 13, 2023
  • Distribution update: NYC’s Alewife Brewing now sells in eastern Pennsylvania + news from Maui, Urban South and more
    March 13, 2023

Footer

  • Email Newsletter Sign Up
  • About Craft Brewing Business
  • Contact Us
  • Advertise on Craft Brewing Business
  • Media Kit Download
  • Privacy and Terms

© 2023 · CBB Media LLC