Today’s infographic is entitled U.S. Beer Imports in 2007 and was created by Matthew Bambach for, I believe, a newspaper article about beer imports. But I like how it neatly shows the flow of the beer from different places into America.
Today’s infographic answers the age-old question, Is Beer Really Cheaper Than Gas? Created and investigated by Keg Works, who came to following conclusion, which is that the claim only works for homebrew. I guess we won’t see any beer-powered cars anytime soon.
Today’s infographic is from Orchestrated Beer, which is business management software for craft breweries. They created the infographic below to visually show what their software can help breweries do, showing the supply chain from farm to consumer.
Here’s an interesting development. In hindsight it’s probably inevitable, especially given the sheer number of breweries in planning. There’s a new crowdfunding website that just launched. It’s called CrowdBrewed, and as its name implies, it’s specifically aimed at helping potential brewers and brewery owners raise the money they need to get started. It appears to work like Kickstarter, just with an emphasis on breweries.
Personally, I love Kickstarter. So far I’ve backed well over 100 projects through the crowdfunding website, and a few more on other similar ones. I find the idea of crowdfunding appealing, though I’ve spoken with plenty of people who feel otherwise, and they’re welcome, of course, not to participate. But if you like helping others or feeling like a small part of something you find worthwhile, take a look. Kickstarter is the king, at least for now, but there’s also Indiegogo, RocketHub, GoFundMe and many more.
As for beer, searching for it on Kickstarter reveals 311 results, so there’s certainly a ready base of potential folks for CrowdBrewed. I’ve sponsored more than a few brewery and beer-related projects, and since I’m drawn to them, it might be nice to have a single place to see what people are trying in the world of beer. Will it work, catch on, and help get some breweries started? Only time will tell.
The inevitable approval of the merger between Anheuser-Busch InBev and Grupo Modelo moved one step closer today, according to Harry Schuhmacher’s Beer Business Daily, who writes that a “consent decree has been filed with a federal judge today seeking court approval of the ABI-Modelo-Constellation deal with the DOJ. News of the settlement agreement comes before the April 23 court deadline to report to U.S. District Court.”
Apparently, “[t]he agreement is close to the one A-B revised in February, selling the big Piedras Negras brewery to Constellation and allowing them to some time to expand that facility to brew all of US Modelo beers (and any others Constellation wants to brew there). But the agreement also includes ‘certain distribution guarantees for Constellation in the United States.’”
Constellation Brands released a statement, Anheuser-Busch InBev and Constellation Brands Announce Revised Agreement for Complete Divestiture of U.S. Business of Grupo Modelo, outlining the deal, and the transaction website, Global Beer Leader, also has a statement.
Here’s part of ABI’s press release:
Anheuser-Busch InBev and Constellation Brands Announce Revised Agreement for Complete Divestiture of U.S. Business of Grupo Modelo
AB InBev to sell Piedras Negras brewery and grant perpetual rights to Constellation for Corona and the Modelo brands in the U.S. for USD 2.9 billion
Constellation to acquire 50% of Crown it does not own for USD 1.85 billion
Terms and merits of combination between AB InBev and Grupo Modelo relating to global deal remain unchanged
AB InBev synergy projection revised to approximately USD 1 billion from USD 600 million
Anheuser-Busch InBev (Euronext: ABI) (NYSE: BUD) and Constellation Brands, Inc. (NYSE: STZ, STZ.B) today announced a revised agreement that establishes Crown Imports as the #3 producer and marketer of beer in the U.S. through a complete divestiture of Grupo Modelo’s (BMV: GMODELOC) U.S. business. The transaction establishes Crown as a fully owned entity of Constellation, and provides Constellation with independent brewing operations, Modelo’s full profit stream from all U.S. sales, and rights in perpetuity to the Grupo Modelo brands distributed by Crown in the U.S.
As part of AB InBev’s acquisition of the 50% of Grupo Modelo it does not already own, AB InBev has agreed to sell Compañía Cervecera de Coahuila, Grupo Modelo’s state-of-the-art brewery in Piedras Negras, Mexico, and grant perpetual brand licenses to Constellation for USD 2.9 billion, subject to a post-closing adjustment. This price is based on an assumed 2012 EBITDA of USD 310 million earned from manufacturing and licensing the Modelo brands for sale by the Crown joint venture, with an implied multiple of approximately 9 times. The sale of the brewery, which is located near the Texas border, would ensure independence of supply for Crown and provides Constellation with complete control of the production of the Modelo brands for marketing and distribution in the U.S.
AB InBev and Constellation have agreed to a three-year transition services agreement to ensure the smooth transition of the operation of the world-class brewery, which is fully self-sufficient, utilizes top-of-the-line technology and was built to be readily expanded to increase production capacity. During this 3 year timeframe, Constellation plans to invest approximately USD 400 million to expand the Piedras Negras facility, which will then enable it to supply 100% of Crown’s needs for the U.S. marketplace. Today, Piedras Negras fulfills approximately 60% of Crown’s current demand.
As previously announced on June 29, 2012, AB InBev has agreed to divest Grupo Modelo’s 50% stake in Crown, the joint venture between Modelo and Constellation, that currently imports and markets Modelo’s brands in the U.S., to Constellation. The transaction value remains USD 1.85 billion, providing Constellation 100% ownership and control of Crown.
Carlos Brito, Chief Executive Officer of AB InBev, commented, “The AB InBev and Grupo Modelo transaction has always been about Mexico and making Corona more global in all markets other than the U.S., where the brands will be owned and managed by Constellation. We are pleased to have reached this revised agreement that preserves the merits of the Grupo Modelo transaction while allowing us to move expeditiously to the Modelo integration process and the capture of approximately USD 1 billion of synergies, up from our original estimate of USD 600 million.”
Rob Sands, President and Chief Executive Officer of Constellation Brands, said, “The revised agreement with AB InBev will make Constellation’s Crown beer division a fully independent competitor and the third largest producer and marketer in the U.S. beer industry. This is a transformational acquisition for our company as we will hold perpetual rights to Corona and the Modelo brands distributed by Crown in the U.S. We will have autonomous control of production, distribution, marketing and promotion of these brands in the U.S. Bill Hackett, President of Crown, and his management team have decades of experience in the beer industry with the iconic Modelo brands. I am confident that all Constellation and Crown stakeholders, including our valued wholesalers, shareholders and employees will see the benefits of this amended agreement.”
Should be all over but the shouting at this point.
This ran in The Street a couple of weeks ago, and I meant to post it before but it kept getting pushed down in the queue. Portland writer Jason Notte does an interesting job dissecting the industry and the recent kerfuffles over taxes in Why Success Is Killing the Craft Brew Industry. If you follow the business side of the beer industry, it’s worth a read.
For our 75th Session, our host is Chuck Lenatti, who writes Allbrews. His topic is about the business of beer, how to get a new brewery up and running or keep one going. It’s the part of the process that many would-be brewers aren’t experts at, and often trip themselves up at various points along the way from concept to being a going concern. So here’s his invitation to The Session for May 2013 and his topic, The Business of Brewing:
Like sandlot baseball players or schoolyard basketball junkies, many amateur brewers, including some beer-brewing bloggers, harbor a secret dream: They aspire to some day “go pro.” They compare their beer with commercial brews poured in their local pubs and convince themselves that they’ve got the brewing chops it takes to play in the Bigs. Some of them even make it, fueling the dream that flutters in the hearts of many other home brewers yearning to see their beer bottles on the shelves at City Beer or their kegs poured from the taps at Toronado.
Creating a commercial brewery consists of much more than making great beer, of course. It requires meticulous planning, careful study and a whole different set of skills from brewing beer. And even then, the best plan can still be torpedoed by unexpected obstacles. Making beer is the easy part, building a successful business is hard.
In this Session, I’d like to invite comments and observations from bloggers and others who have first-hand knowledge of the complexities and pitfalls of starting a commercial brewery. What were the prescient decisions that saved the day or the errors of omission or commission that caused an otherwise promising enterprise to careen tragically off the rails?
So on Friday, May 3, think about all of the breweries you’ve witnessed open, the ones that have succeeded and the ones that have come and gone. What was the difference? Which ones made it, and why do you think that is? What exactly makes a brewery successful, apart, of course, from making good beer.
This is my seventh annual annotated list of the Top 50 so you can see who moved up and down, who was new to the list and who dropped off. So here is this year’s list again annotated with how they changed compared to last year.
- Anheuser-Busch InBev; #1 last seven years, no surprises
- MillerCoors; ditto for #2
- Pabst Brewing; ditto for #3
- D. G. Yuengling and Son; Same as last year
- Boston Beer Co.; Same as last year
- North American Breweries; 3rd year on the list, same position as last year
- Sierra Nevada Brewing; Same as last year
- New Belgium Brewing; Same as last year
- Craft Brewers Alliance; Same as last year
- Gambrinus Company; Same as last year
- Minhas Craft Brewery; Up 3 from #14 last year
- Deschutes Brewery; Down one from #11 last year
- Lagunitas Brewing; Up 3 from #16 last year after jumping up 10 from #26 the previous year, having been at #36 three years back
- Bell’s Brewery; Down 1 from #13 last year
- Matt Brewing; Down 3 from #12 last year
- Harpoon Brewery; Down 1 from #15 last year
- Stone Brewing; Up 1 from #18 last year
- Brooklyn Brewery; Up 2 from #20 last year, after jumping up 5 the year before
- Boulevard Brewing; Down 2 from #17 last year
- Dogfish Head Craft Brewery; Down 1 from last year, after being up 5, 9, 5 and 4 the four previous years
- Abita Brewing; Up 4 from #25 last year
- World Brew/Winery Exchange; Up 4 from #26 last year, after jumping up 11 the previous year
- Shipyard Brewing; Up 1 from last year, having moved up 4 the prior year
- Alaskan Brewing; Down 2 from #21 last year, their second drop in as many years
- August Schell Brewing; Down 2 from last year, also their second drop in as many years
- New Glarus Brewing; Up 2 again this year from #28 last year
- Long Trail Brewing; Down 5 from #22 last year
- Great Lakes Brewing; Down 1 from last year, after jumping up 4 the previous year
- Firestone Walker Brewing; Up 4 from #33 last year, after rising 3 spots the year before
- Anchor Brewing; Up 2 from #32 last year
- Rogue Ales Brewery; Up 5 from #36 last year
- Summit Brewing; Down 1 from #31 last year
- Full Sail Brewing; Down 4 from #29 last year
- SweetWater Brewing; Up 1 from #35 last year, having rise 3 the year before
- Victory Brewing; Up 4 from #39 last year
- Oskar Blues Brewing; Up 5 from #36 last year, having jumped up 8 the previous year
- Pittsburgh Brewing (fka Iron City); Down 7 from #30 last year
- Mendocino Brewing; Down 1 from #37 last year
- Cold Spring Brewing; Down 5 from #34 last year, after jumping up 13 the prior year
- Flying Dog Brewery; Down 2 from #38 last year
- Founders Brewing; Not in Top 50 last year
- Ninkasi Brewing; Up 2 from #44 last year
- CraftWorks Breweries & Restaurants (Gordon Biersch/Rock Bottom); Down 3 from #40 last year, after the two merged during 2011 and were #42 and #48 in the year before the merger
- Odell Brewing; Down 2 from #42 last year
- Bear Republic Brewing; Up 2 in their second year on the list
- Stevens Point Brewery; Down 3 from #43 last year
- Blue Point Brewing; Down 1 from #46 last year
- Southern Tier Brewing; Not in Top 50 last year
- Lost Coast Brewery; Same as last year in their second year on the list
- Karl Strauss Breweries; San Diego CA; Not in Top 50 last year
Not too much movement this year, except for a few small shufflings. Only three new breweries made the list; Founders, Southern Tier and Karl Strauss.
Off the list was BJs Restaurant & Brewery, Narragansett Brewing and Goose Island Beer, which had plummeted 30 from #18 the year before, after selling their production brewery to Anheuser-Busch InBev.
The Brewers Association has also just announced the top 50 breweries in the U.S. based on sales, by volume, for 2012. This includes all breweries, regardless of size or other parameters. Here is the new list:
- Anheuser-Busch InBev; St Louis MO
- MillerCoors; Chicago IL
- Pabst Brewing; Woodridge IL
- D. G. Yuengling and Son; Pottsville PA
- Boston Beer Co.; Boston MA
- North American Breweries; Rochester, NY
- Sierra Nevada Brewing; Chico CA
- New Belgium Brewing; Fort Collins CO
- Craft Brewers Alliance, Inc.; Portland, OR
- Gambrinus Company; San Antonio TX
- Minhas Craft Brewery; Monroe WI
- Deschutes Brewery; Bend OR
- Lagunitas Brewing; Petaluma CA
- Bell’s Brewery; Galesburg MI
- Matt Brewing; Utica NY
- Harpoon Brewery; Boston, MA
- Stone Brewing; Escondido CA
- Brooklyn Brewery; Brooklyn NY
- Boulevard Brewing; Kansas City MO
- Dogfish Head Craft Brewery; Miilton DE
- Abita Brewing; New Orleans LA
- World Brews/Winery Exchange; Novato CA
- Shipyard Brewing; Portland ME
- Alaskan Brewing; Juneau AK
- August Schell Brewing; New Ulm MN
- New Glarus Brewing; New Glarus WI
- Long Trail Brewing; Burlington VT
- Great Lakes Brewing; Cleveland OH
- Firestone Walker Brewing; Paso Robles CA
- Anchor Brewing; San Francisco CA
- Rogue Ales Brewery; Newport OR
- Summit Brewing; Saint Paul MN
- Full Sail Brewing; Hood River OR
- SweetWater Brewing; Atlanta GA
- Victory Brewing; Downington PA
- Oskar Blues Brewery; Longmont CO
- Pittsburgh Brewing; Pittsburgh PA
- Mendocino Brewing; Ukiah CA
- Cold Spring Brewing; Cold Spring MN
- Flying Dog Brewery; Frederick MD
- Founders Brewing; Grand Rapids MI
- Ninkasi Brewing; Eugene OR
- CraftWorks Breweries & Restaurants (Gordon Biersch/Rock Bottom); Chattanooga TN/Louisville KY
- Odell Brewing; Fort Collins CO
- Bear Republic Brewing; Cloverdale CA
- Stevens Point Brewery; Stevens Point WI
- Blue Point Brewing; Patchogue NY
- Southern Tier Brewing; Lakewood NY
- Lost Coast Brewery; Eureka CA
- Karl Strauss Breweries; San Diego CA
Here is this year’s press release.
In what is the worst brewery accident I can recall hearing about, seven men died while cleaning out a tank in “a confined area” at the Grupo Modelo brewery in Mexico City. Bloomberg is reporting that the seven men died “due to unspecified toxins.”