AB InBev buys Wicked Weed Brewing
AB InBev buys Wicked Weed Brewing is the big news in craft beer this week. It is the first craft brewery purchase of 2017 as Wicked Weed Brewing gets added to their portfolio called “The High End”. Read the full press release here.
Like similar craft beer buyouts, it is causing shock waves through the industry. AB InBev buying craft breweries is nothing new. They have purchased Goose Island, Elysian, Golden Road, Breckenridge and many others over the past few years. Check out the entire list here.
But how does a buyout like this affect the beer industry? And what does it mean for craft beer drinkers?
The Great Craft Beer Debate
One of the biggest debates in the beer world is determining how these buyouts impact the craft beer industry. Here are two of the most common reactions that I hear after a buyout.
Reaction 1: As Long As Their Beer Tastes Good, I Will Drink It
For many, it is all about the taste of the beer. They really do not care who owns the brewery. They didn’t know the owners when it was independently owned and they don’t know the owners now that a corporation owns them. While the Brewers Association defines craft beer as small, independent and traditional; most american define it by taste.
Furthermore, many get excited about these acquisitions. Wicked Weed is not available in most areas but I can almost guarantee that will change rapidly over the next year. It won’t be long until Wicked Weed is a staple in every bottle shop and grocery store across the nation. And that is reason for many to get excited.
Reaction 2: It’s The Worst Thing Ever And Craft Beer Is Coming To An End
Ok, that is not a direct quote but it is how many feel. They are not willing to support macro beer or any brand that is owned by them. And it has nothing to do with the beer but rather business practices.
Many are fearful of what AB InBev is capable of doing as the largest beer company in the world. Or should I say, what they are already doing. It wasn’t long ago that macro lagers seemed like the only beer option outside of the occasional import. Now the beer market is a war zone and the company with the biggest weapons is AB InBev. They have the ability to leverage partnerships, control distribution, demand shelf space and take over tap handles. Craft beer fans worry that this kind of power hurts craft breweries ability to sell their product.
Related Post: What Is Craft Beer: My Opinion
They Aren’t Buying The Beer
AB InBev isn’t buying these companies for their beer. They have the resources to open new breweries, hire the best brewers and produce the same styles of beer. They don’t have to buy these breweries to make beer. Believe me, they aren’t buying the beer; it is the brand and their loyal fans that they want. These acquisitions directly insert AB InBev into the craft beer community or at least that is their hope. They know that the way to re-capture their lost market share is to just buy it back. This isn’t new; check out this article by Time in 2015 which shows how AB InBev planned on fighting craft beer.
And it doesn’t stop there, AB InBev is using its power and money to prevent the growth of craft beer. Check out what Jeffery Stuffings of Jester King said about this acquisition. He is cancelling a collaboration that was planned with Wicked Weed because of the buyout. He cites that it has nothing to do with the quality of beer that will be produced but rather the business practices of AB InBev. Well written but strong words from a highly regarded member of the craft beer community.
Will Cincinnati See A Buyout?
In my local beer scene, Rhinegeist was approached by AB InBev last year for a meeting. Luckily, this local brand turned down the meeting and even publicly announced they had no plans of selling. Rhinegeist has a strong brand and has grown rapidly over the past 4 years. AB InBev would love to get their hands on a brand like that. And every company has a selling price (in theory) so I fear it is just a matter of time before a Cincinnati brewery accepts a buyout. I hope my Cincinnati breweries can stay strong and remain locally owned.
My Opinion
So are these buyouts good for craft beer? No, when these companies sell it is not good for the craft beer industry. AB InBev is merely buying market share because the know most will not care where the profits go. But in the end, they will use their power and market influence to control the industry and make it more difficult for small breweries to succeed.
However, it does not have to hurt the overall community. The people that love craft beer love it because it is about more than just the beer. So instead of buying Wicked Weed, craft beer fans will shift to other local breweries. Because when these companies sell, they lose what made them great. It may be the same people, recipes and vision but it isn’t the same. AB InBev doesn’t want to help spread great beer; they want to control the beer market and craft beer enthusiasts recognize this.
Related Post: The Neighborhood Brewery
How Craft Beer Wins
Craft beer wasn’t built through big marketing budgets and mass produced beer. It was built through community; one beer at a time in local beer bars and taprooms. And I don’t think anything has changed. Yes, there are some really large craft beer brands that have widespread distribution but many of these brands started small and have maintained their vision and culture along the way. They value people and great beer equally and that shows.
So craft beer wins by doing what they have always done. Continue to build strong communities of dedicated followers. It is sad when these brands sell to large corporations but it’s just a reality of business. So regardless of how you feel about these most recent buyout; go to a local brewery and support them. Encourage and educate those around you to drink good, locally produced craft beer. Keeping your beer choices local is the best way to support craft beer.
9 thoughts on “AB Inbev Buys Wicked Weed Brewing: How Craft Beer Is Impacted”
I struggle to be too critical of the breweries that do sell… most of us will never know the difference it’ll make financially to those involved, often to people that took a real gamble and threw everything they had to pursue a career in beer making.
But, the more I hear about the business practises of the large brewers the more determined I become to support the little guys…
Great post by the way!
It is a struggle because I get wanting to take care of yourself and family; selling a company to AB InBev can definitely do that.
But I would have to think that there are other investors that would be willing to buy these breweries; maybe not for as much though. Most breweries make enough to grow, expand and take care of their employees but a truck full of cash is very tempting.
How many of these breweries purchased by ABI were started by brewers who got into it for the love of the craft and how many were started by investors who wanted a quick and large return on their investment?
That’s a great point. Some start a brewery because of their passion while others start to scale a business. Both can produce quality products along the way but the end goals look different. I have a feeling that many that have sold had the intent of making it a business more than a passion.
Consolidation didn’t go well for consumers last time. Hopefully the wave of small neighborhood breweries will persist.
Yes! Bring on more of the small breweries and I will be more than happy
We have great beer in America not because of players like InBev but in spite of them. InBev won’t ruin WW’s product line, but the big company bean counters are likely to change the company culture and innovation. We’ll never know what we missed.
As much as I love Wicked Weed’s pernicious, I’ll look elsewhere for a good brew. Support you local brewers
Hey David – Well said! It will be interesting to see if and how they alter the WW products. I know many say that Goose Island IPA is not the same beer it once was but those people may also be tainted by the thought of InBev owning them. Either way, I agree that the real tragedy is missing out on what could have been. Keep drinking great, local beer – cheers!