Are beer mergers a good brew for biz?
TEXT OF STORY
Kai Ryssdal: Beer drinkers can be a particular bunch. So today’s news that the Dutch brewer Heineken is going to buy the beer business of the Mexican beverage company FEMSA — it makes Dos Equis, Tecate, and Sol — comes with no small amount of trepidation. Big beer getting even bigger. More homogeneous. The nearly $8-billion purchase does makes Heineken, the world’s number three beer company, even bigger.
But Marketplace’s Amy Scott reports the recent wave of macro beer mergers might actually be good for micro-brewers.
AMY SCOTT: The little guy is actually doing pretty well.
Eric Shepherd is executive editor of Beer Marketer’s Insights. He says overall U.S. beer sales fell about 2 percent last year. But craft brews were up 5 or 6 percent.
ERIC SHEPHERD: It’s a phenomenon that everybody’s watching very closely. Most of the large beer brands were down in 2009.
Shepherd says it’s easier to grow when you’re small. But he says more drinkers are opting for the flavor and local character of smaller brews.
Uli Bennewitz owns the Weeping Radish Farm Brewery in Jarvisburg, N.C. He also runs a butchery and an organic farm.
ULI BENNEWITZ: Everybody is wary of “where does this stuff come from?” There is clearly a move towards local, local, local. And I think that is an advantage for small breweries.
Analysts say the Heineken-FEMSA deal won’t affect the U.S. market much. But big mergers can hurt the little guy.
Paul Gatza represents small brewers as director of the Brewers Association. He says when Miller and Molson Coors merged a few years ago, their distributors consolidated too.
PAUL GATZA: So that meant one less wholesaler in each market, which meant fewer choices for the small brewer in terms of a company that would represent their brands.
But some small brewers got a boost when Belgian giant InBev bought Anheuser-Busch in 2008. Uli Bennewitz says InBev wanted to sell its other brands in the U.S. and asked Budweiser distributors to carry imports and microbrews like his too.
I’m Amy Scott for Marketplace.
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