Show notes
Craft Brew News 10/4/19
(courtesy of BrewBound www.brewbound.com)
Brewers Association: US Craft Brewing Industry Contributes $79 Billion to US Economy
Small and independent U.S craft brewers generated $79.1 billion in economic impact in 2018, which represented roughly 0.4 percent of the gross domestic product, according to industry trade group the Brewers Association’s (BA) 2018 Economic Impact Report.
The Boulder, Colorado-headquartered not-for-profit added that the $79.1 billion amounted to a 4% increase over 2017’s $76.1 billion in output. A similar report shared by the BA in 2012, reported $33.9 billion in economic output.
The release of the new analysis comes about a week before the BA’s largest consumer-facing event of the year, the annual Great American Beer Festival in Denver.
According to the BA, the craft brewing industry was responsible for creating more than 559,545 total jobs last year, with 150,055 jobs directly at breweries. The craft brewing industry also contributed more than $5 billion in direct wages and benefits to its workers.
The BA also broke down the economic impact in each state and released a list of the five states with the greatest economic impact. California — where 1,000 independent breweries are in operation as of August 2019, according to the California Craft Brewers Association — once again led the way with an output of $9 billion. Pennsylvania ($6.3 billion), Texas ($5.1 billion), New York ($4.1 billion) and Florida ($3.6 billion) rounded out the top five.
A-B’s Natural Light Hard Seltzer and Big 12 Conference Announce Partnership
Anheuser-Busch and the Big 12 Conference announced a partnership this week to make Natural Light Seltzer the “Official Hard Seltzer of the Big 12 Conference.”
The sponsorship will include elements during games, online and social media, as well as advertising during the conference’s baseball, football, and men’s and women’s basketball championships, according to Forbes. The partnership is solely with the athletic conference, not the 10 universities within the league, the outlet noted.
Ricardo Marques, vice president of core and value brands at Anheuser-Busch, told Forbes that the sponsorships would help increase Natural Light Hard Seltzer’s market share due to hard seltzer being “still in its early days as awareness.”
The deal is the latest is an ongoing trend of hard seltzer brands partnering with sports leagues and teams, including Boston Beer’s Truly Hard Seltzer being named the “official hard seltzer” of the National Hockey League earlier this week.
Anheuser-Busch InBev Acquires Markstein Beverage Co. in San Marcos
California’s beer distribution system is being shaken up once again.
Anheuser-Busch InBev announced Friday evening the planned acquisition of “key assets” from Markstein Beverage Co. in San Marcos, California. The company will add those assets to its existing wholly owned distributor, Anheuser-Busch Sales of San Diego.
The move comes about 15 months after Markstein, under threat of termination, was forced to sell the distribution rights to the Constellation Brands portfolio of Mexican import brands, including Corona Extra, Modelo Especial, and Pacifico, among others, in northern San Diego County to the Reyes Beverage Group.
Financial terms of the deal were not disclosed. The transaction is expected to close upon closing requirements being met.
Beyond A-B products, Markstein’s portfolio in San Marcos includes craft brands such as Sierra Nevada, Hangar 24, Speakeasy and Drake’s Brewing, as well as offerings from Craft Brew Alliance, including Kona Brewing, Redhook, Widmer Brothers and Square Mile Cider. The future of those brands’ distribution appears unclear.
White Claw Maker Investing $250 Million to Increase Production and Meet Demand
Starbucks, Apple, Tesla … and White Claw? Anthony von Mandl, the founder of White Claw parent company Mark Anthony Brands, told thousands of beer wholesalers Tuesday during the National Beer Wholesalers Association’s Annual Convention that his company is a disruptor in the vein of those iconic brands.
According to von Mandl, White Claw’s disruption is “growing beer and unlocking substantial incremental profits and sales growth” for its beer wholesalers and retailers. He expressed confidence that White Claw will be “an enduring brand” that will be “connected to consumers for decades to come” with “the potential to deliver billions of dollars of profit” to its partners.
“We are building an iconic global brand just as Starbucks did,” he proclaimed.
Despite a flood of new entrants into the hard seltzer category — von Mandl said there are more than 70 hard seltzer brands on the market now — White Claw has maintained 60% of the market share, and combined with Boston Beer Company’s Truly Hard Seltzer, commands about 75% of the market.
To meet consumer demand for White Claw, Mark Anthony Brands is investing $250 million to build a pair of production facilities on both coasts, as well as doubling its capacity at the Cold Spring contract brewery in Minnesota.
In New Jersey, the company plans to build a brownfield production brewery from the ground up that is capable of producing 50 million cases of White Claw annually. That facility is expected to be operational by April 2020.
Meanwhile, the company is still in the process of site selection for a potential West Coast brewery. Those three facilities, along with the company’s co-packer in Tennessee, will give it as much as 200 million cases of capacity in 2020, and 250 million cases in 2021.
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