Independent Craft Breweries vs. Macro Breweries

Gary Fish, founder of Deschutes Brewing, isn’t surprised by the macro takeover strategy. Fish and his company, of course, are among recent converts to Employee Stock Ownership Plans in the beer business, which help thwart takeovers.

“It had to happen,” said Fish. “It’s a natural response. Anheuser-Busch has billions of dollars and they’re getting their clocks cleaned by these little brewers that they can’t control. Their world is all about control. Well, how do they control them? They can buy them for a rounding error on their balance sheet.

“And why not?” he continued. “They don’t understand passion. They’re consumer goods people. They’re brilliant at what they do. They’re the best in the world. What they don’t do is passion.”

Like others, Fish remained cautious about the influence on market share that acquisitions will have in the long run. Also among the cautious was Bart Watson, the chief economist for the BA. He acknowledged that the battle cry of 20 percent of the market by 2020 by brewers who fall under the BA’s definition of craft may not happen. His primary point was that the 20/20 goal was as much about market planning as a specific sales target. If craft does double its market share in the next five years, goes this line of thinking, how many hops will be needed to make those beers? How will the market in general and hop farmers in particular prepare for that – even if the BA craft market share doesn’t quite get to 20 percent?

While Watson did not mention specifics, this position also seemed to recognize that the large barrelage from Lagunitas, after soaring sales of its hoppy IPAs, will no longer be tallied by the BA due to recently cutting a deal with the multi-national macro brand Heineken.

Others are cautious about the change in the craft brewing landscape as well. “Time will tell,” said Boston Brewing’s Jim Koch when asked about the loss of craft brewers to macro ownership and whether those big brewing operations will be able to take back some of the share of the American beer market lost to smaller brewers.

“I think there is a profound difference between an independent brewer where passion and freedom is found, the craft beer culture,” said Koch. “(The macros) are different. But don’t underestimate the power of money and marketplace clout.”

Eric Wallace, co-founder of Left Hand Brewing Company and chairman of the marketing committee for the BA, remains unconvinced that macro acquisitions of smaller brewers will change the beer world.