Life on Tap.

Home Beer What it’s like to work for a brewery that “sold out”

What it’s like to work for a brewery that “sold out”

An insider’s perspective on the good, the bad, and what the rest of the industry gets wrong about working for an AB InBev-owned brewery.
SHARE
/ 32

BreweryBuyout

Yesterday, the beer world was ablaze with the news that beer giant Anheuser-Busch InBev had purchased Wicked Weed Brewing, North Carolina’s beloved producer of wild ales. The response was as harsh as it was predictable: The outcry of “sell out!” ran rampant across Twitter and Facebook.

This is a narrative we hear a lot—that brewing megalodons like AB InBev, MillerCoors or Constellation Brands are out to gobble up every small brewer they can, crush the ones they can’t, and turn the beer their new subsidiaries produce into bland, watered-down swill. What we don’t often hear, however: What it’s actually like to be an employee at a brewery that’s owned by one of these dreaded macro-brewers.

So we found one: a high-level staff member at a brewery that had been purchased by AB InBev. This person felt there were too many misconceptions about the process of brewery acquisitions and its effects on the purchased brewery’s products and people. They wanted to give us an inside view of the acquisition process and its results, both good and bad.

Our source did have one stipulation, however. Fearing backlash from the beer community at large as well as from their new employer, the source wanted to remain anonymous. Thus, some of these responses have been edited to disguise his identity; the rest we present uncut. This is the view from the other side.

The integration period took a while. [AB InBev] doesn’t know as much as people think they do about these breweries when they purchase them. I’m sure they look over the big-picture financials, how much debt do they have, things like that. But the inner workings, there are a lot of surprises that they find. So there’s this integration period that goes on where they are really assessing what the brewery has, what they need. There are a ton of meetings. … It’s a big organization, and they’re learning too. That’s the biggest thing that you take away. They don’t know a lot about craft beer, and they really want to learn from these craft breweries.

No one at our brewery lost their job due to the acquisition. In fact, we hired around 12-15 new people that year.

One thing people lament after a big brewery purchases a smaller one is that the big brewery’s going to change the culture, replace all the people who make the most money, etc. Farthest thing from the truth. They really go above and beyond anything I’ve ever seen to ensure people stay. They want people to be happy. They take that part very seriously, even to the point that if there’s overlap—say, a brewery they’re buying has a finance department that does things that will already be covered by AB’s finance department—they’ve gone above and beyond to repurpose people into jobs that use their skill sets. They work with the brewery so no one leaves, which I think is really cool.

The brewers have been really happy with all the changes. The benefits have gotten way better, our safety has stepped up way more, our brewers are getting to go do all these fun things, collaborate with brewers they’ve never met before. The money’s there, which is really nice, and it’s being spent well.

There’s more paperwork and bureaucracy to work through now, but not a lot more. I’ve worked in this industry for a while, and the biggest thing I learned during that time is how jaw-droppingly loosey-goosey most breweries are and how little structure there is with most craft breweries. You’d be surprised how many craft breweries don’t even know their real margins. It’s just basic business things. So to answer your question about whether there’s more bureaucracy and oversight now, I’d say no more than your average company; it’s just that most breweries have so little.

More attention is paid to growth and sales, too. There’s more accountability. A certain amount of liquid has to be coming out of the brewery every day. If something happens one day and the production drops, brewers will have to get creative to make that volume up, whereas before, it would have been fine to miss that mark.

There isn’t more pressure to grow and to sell, because that’s already a given. As long as we keep our current markets moving along, we’re good. But you know what there is pressure to do? Innovate. That’s what they really, really want. They want to see more new, exciting things. That’s communicated a lot: “Do these crazy things. Come up with the next big-deal beer.”

Here’s the thing I learned from AB: They spend a ton of money on research and focus groups, and the biggest thing they’ve learned is that the vocal people, the people who are very active and complain the most, really represent the smallest amount of beer that’s purchased. You’re talking two or three percent. Yet these people are the most vocal. It happens everywhere that one of these buyouts occurs, people screaming about how they’ll never buy X brewery’s beers again. But if you look at the organic growth of those breweries, they’re still all growing. For some it was even to the point where they couldn’t find volunteers to pour their beer at beer festivals. But look: They’re up 30 percent in their home states.

We had some retailers tell us after the acquisition that they couldn’t carry us any more, they couldn’t support us because of this. We were like, “We’re sorry to hear that. We’re always here and we want to maintain a partnership. We look forward to the opportunity to work with you again.” Well, they would take of our handles and try a number of other beers, and either their customers were demanding they bring our handles back or what they put on was not selling anywhere near the amount. And about a month or two later, they started buying us again. The more this is happening, the less you’re seeing these negative reactions. People care more about how the beer tastes.

We were expecting a little bit of push to start using certain vendors for ingredients. Not at all. They said, “You buy from who you want to buy from.” When it came to procurement of supply and ingredients, they left it up to us.

When something is cross-brewed, meaning beer from one brewery is made at another facility, it’s totally up to the brewery whether they want to do it. So they start on a small scale first. There are a lot of moving parts—this takes months and months to do. Flavor-matching, to make sure everything is okay. And then they bring it up another level. And they always check with the brewer to see if it passes; if it doesn’t they start from square one. And all this beer that gets produced is dumped, no matter what, because it’s still in the testing phase. And all along the way, the brewery owners have final say on the product before it goes out. I cannot stress that enough. Even the big batches—once they bring it up from those small test batches to the big brewhouse and fermenters, if it does not flavor-match, it does not get sold, plain and simple.

Something that disappointed me, and this got no coverage: The High-End breweries did very well at the World Beer Cup at this past CBC [Craft Brewers Conference]. They’re making quality products, and it’s a blind tasting, no ifs, ands or buts about it. But at the Great American Beer Festival—the rules of GABF say you’re allowed to enter in six or so different beers per location. And almost all breweries take advantage of that. But the BA [Brewers Association] limits the number of beers a brewery group can enter, so the High End could only enter 10 beers, total, for all those breweries combined.* That pissed me off. I see that as a tainting of the credibility of the competition. My analogy is like the Olympic Committee going to the United States and saying, “Well, you have a lot better training facilities than Jamaica, so you can only enter in X number of athletes.” It should be about whoever makes the best beer, man. And it breaks my heart to say that, because I’ve always believed in the BA, and I understand what they’re trying to do and that they want to be a resource to help new breweries and educate consumers. But it’s supposed to be about the beer, and when you’re limiting things, it’s no longer about the beer. … All it says to me is that the BA is scared of these breweries cleaning up at their competitions because they’re producing some great beer. Isn’t that the whole point? I get it. It’s their contest; they can set the rules. But come on. It’s a blind-tasting, and we see every year some little no-name brewery with a five-barrel system clean up in awards. It’s a blind tasting; the best beer wins. Don’t handicap us.

Here’s the deal: What’s happening is beer is cannibalizing itself. Yes, the craft segment is growing, but beer overall is down. In the long run, that’s not good for anybody—craft brewers included. That’s fewer people drinking beer. What I think High End is trying to do is draw more drinkers into the beer category. They love that some craft breweries are selling beer at $15.99 per six-pack; it’s proof of concept. That’s great. Beer has always had that perception as the layman’s drink. Sam Calagione said once—I’m paraphrasing—“Think about the best bottle of wine in the world; how much is it going to cost you? You’d pay thousands of dollars for it. Now think about the best bottle of beer in the world. You can get some of the best beer ever made for $30 or $40 a bottle.” There’s such a price variance. Some people can afford Hondas; some people can afford Ferraris. But even a brand new Honda still costs a certain amount, and if the price of cars goes up across the board, that’s a good thing for the car industry. Think about this: The variance right now between craft and domestic beer isn’t that wide. The cost-per-ounce between domestic and craft is getting narrower. If you can raise that bar, it raises the whole category. And for a company like Anheuser-Busch, that helps them on both ends, but it’s going to help everybody.

It’s not like everything they’re doing is perfect, but it’s nowhere near what people are making it out to be. Sometimes it’s the complete opposite. The biggest thing I could say about the High End is that it’s a whole different thing from AB. You’ve got the core brands—Bud, Bud Light, all that—but that’s its own thing. The High End is like this separate organization that uses the resources of AB to grow the smaller breweries. But they’re on their own, for the most part.

The best thing I can recommend for any craft brewery: It’s easy to complain about the big guy, but, you know, be better. In any industry, there’s always going to be a huge player. It’s possible to compete; it just takes innovation and hard work. Too many of these breweries fall back on this idea that AB’s going after them or trying to shut them out. That’s just not the case.

There are always going to be big guys. There’s always going to be a big guy who’s in a way better position than you are. You have to be smart; you have to be innovative. That’s what all these breweries should be focusing on, instead of blaming AB for their problems.

*GABF rules say groups that own multiple breweries, whether packaging breweries and/or brewpubs, are limited to a total of 20 entries across all locations. The number of entries allowed per location varies every year; last year’s maximum was five. Had each brewery in the High End been allowed to enter the maximum number of beers at the 2016 GABF, 40 beers would have been entered into competition.

 

Related Articles

32 Comments

  • Ron says:

    A very interesting read. I belong to a local beer club (tasting and brewing). There are several members who fit into the “sell out, I’ll drink another one of XX breweries products after AB acquired them. I fall in with the other group that doesn’t care who the corporate owner is as long as the beers remain unchanged. I think the ones who refuse to buy the acquired craft brewery remember what happened to Dominion Brewing after AB purchased them – they are no longer in business..

  • Great perspective and an excellent read! One quick note regarding the point about GABF rules: We actually covered the entry criteria issue here: https://www.brewbound.com/news/following-gabf-error-brewers-association-change-category-verification-process

    From our story:

    “In an effort to judge as many beers from as many breweries as possible, the BA has capped how many products multi-layered brewing groups or corporate entities such as Anheuser-Busch or MillerCoors can submit, even as those conglomerates have started to scoop up craft breweries. Multiple brewery owners are limited to a total of 20 combined beers from their holdings, according to the GABF website, and the BA also limits the number of beers a single brewery location can submit to five. But those rules apply to both multinationals with more than one beer brand and also to chains of breweries and brewpubs — so a Karl Strauss or Fat Head’s, which owns and operates multiple brewery or brewpub locations, cannot exceed 20 total submissions.”

    Cheers!

  • Jordan says:

    This was an interesting read, What I disagree with is how he speaks to the intentions of AB-InBev. I doubt he, or anyone outside of AB-InBev fully understand why AB is acquiring these companies. He is a cog in the machine, and like any cog it doesn’t know that’s what it is, it does it’s assigned job without a greater understanding of the overall picture. If AB-InBev didn’t lack creativity, they wouldn’t need to misguide consumers by buying these other companies. Thinking that these acquisitions will increase quality of the industry overall, seems misguided as well. At the end of the day it seems their true goal is to capture a market they never planned for and put dollars back in their pockets.

    • Mike says:

      If he is just a cog in the wheel of the machine that is ABI I recommend that you personally stop buying food, gas, clothes, and stop being a cog.

      • Jordan says:

        Mike, so ABI is now in the clothing, gasoline, and food business. Good argument though. I will play it safe though and avoid your well thought out recommendations.

      • Jim says:

        I buy my crude oil directly from Jed Clampett and refine it myself, but some people say that Jed’s a sellout too.

    • JIm says:

      Of course their goal is to put money in their pockets. The point is that not everything surrounding the process is automatically bad.

  • Casey says:

    I’ll just leave the comment from our local group here..

    “I thought it was (an) excellent (read) also until I realized there is no author, the source is anonymous, and it was probably a warm fuzzy piece witted by abinbev pr team and paid to be put on drafts online magazine.”

  • ABInButt says:

    Nice PR piece. Just wait. When 3G’s henchmen get involved — the subject of the interview will get shown the door and floor sweepings will be thrown in the kettle. The place is nothing short of evil.

  • Lyle says:

    The quality of the beer, and the quality of work experience, for “bought” breweries is all well and good, but I’m more worried about ABI getting more power to influence laws, distribution and now even raw material availability. It is ABI’s (mostly InBev, AB was never at the level things are now since that buyout) mafia-style market tactics that are the real issue.

  • qq says:

    Err – that is how the Olympics works, the US gets restricted to three or fewer entries so that Niger or the Bahamas can enter a race without the thousands of entries that would be needed if it was done strictly on merit but you wanted to set the bar low enough that the small countries could enter. That’s why the US qualifying competition is so fierce.

    This sounds like a job interview “I’m great, but if you had to name my biggest fault – I used to be a bit lax on the accounting side, and I was a bit unpopular with the cool kids but they like me now”.

  • AshvEd says:

    Living in Asheville we have noticed a lot of pushback since the deal was announced. The Weed has been my go-to place ever since it opened, and I was a bit miffed at the sale as well. I was at the Wicked Weed yesterday and had the opportunity to have brief chats with four employees, all working in different areas. Overall they seemed pleased with the sale. They now have better retirement plans, heath insurance, an opportunity for bonuses, and more. The afternoon crowd was noticeably smaller that usually experienced. It may be the result of the initial shock and only time will tell. There are over 200 employees that want to be successful if given the chance.

  • Michael says:

    I like that this is actually an insiders perspective, however as a follow up I would like to know how this insider now feels after AB-InBev has decided to not deliver hops to those that had contracts. Now what was that they were saying about it not really affecting other breweries? Sounds like AB-InBev has started their monopolization of the ingredient distribution chain.

  • Matt says:

    This guy sounds exactly like the epitome of a sell-out to me.

  • David says:

    What he doesn’t tell you is that ABI pays retailers and bars for their placements, effectively shutting out non-ABI brands. I distribute craft beer. I live this every day. They buy more brands so that they can cover a bars’ 20 faucet draught system with all the styles the bar would want while keeping everything in-house. Wicked Weed covers the handle placement that they couldn’t fill.

    Sure, seeing an Elysian IPA, Goose Island Saison, Wicked Weed Sour on every tap list might be a big improvement over 10 years ago, but all the smaller, incredible breweries aren’t given a level opportunity to compete. And sure, you might question the legality of this and no, it’s not supposed to be legal, but its happening constantly. Often times they pay for the entire draught beer system but put it on paper as loaned equipment in exchange for controlling all the handles in that bar.

    It’s the market we have and it’s fine, but please don’t act like ABI is innocent. Two middle fingers to the fellow that wrote this article.

    • Nicole says:

      Yes to this comment! I’m in the Craft Beer business as well and this is the life I lead. It’s an uphill battle, and even more disheartening that one of my favorite breweries sold out and I will be competing for the tap handle which will inevitably be theirs along with Goose Island, etc. To say I’m disappointed is a HUGE understatement!

  • Jim Smith says:

    The quality of beer nor the atmosphere at bought-out breweries has never been a concern of mine. If AB made BCBS taste like crap, it wouldn’t sell. My concern and why I won’t be buying WW or BCBS et. al. in the future is that I don’t want my beer dollars going to support an organization that has used every trick in the book to kill off craft brewers or at least make it extremely difficult to succeed. From Pay-to-Play for distributors to buying up the entire output of a hop variety to giving hundreds of thousands of dollars to politicians to keep beer laws restrictive. And no, Duvel-Moortgat, Heiniken and even MillerCoors haven’t been nearly as predatory or anti-competitive as AB.

  • dk says:

    It’s always good to look at both sides of any issue so I enjoyed reading this. However, I’m not convinced that AB has pure motives in growing and promoting craft beer. It’s about the $$ that can be made. One way to do that is push out the competition, buy out all the supplies (grain, hops, etc.), control the distribution, and on and on it goes. There are too many examples of this to ignore. Eg. AB just took control of all the hops coming out of South Africa. The smaller breweries who were able to experiment with these great hops are now screwed. Apparently AB wants these hops for their High End breweries only.

  • StVeronus says:

    No one doubted the quality and growth of any brewery bought out by AB. What people aren’t happy with is the money AB has spent to kill or slow growth of local breweries in many states. As a resident of Colorado I saw it personally last year when the grocery store liquor vote was a thing. They have the money to make anything go their way. I will not purchase anything AB as long as I live. I don’t see how anyone (home or pro brewer) would willingly give their money to a company who would rather see them jobless.

  • Lisa says:

    My Husband works for the Printing Company that made the labels for Wicked Weed Brewing- Pretty sure AB has their own label makers- so they lose that account.

  • darkdaddy says:

    To wit, the fact that the anonymous source wouldn’t go named speaks volumes on its own. Why remain anonymous? Anonymity is nothing but wearing a cloak of fear due to reprisal, rebuke or at minimum a political cover over that label which you now wear. “Fearing backlash from the beer community at large as well as from their new employer” isn’t exactly standing behind your brand, now is it? Or perhaps it is standing behind your brand, but if so, that’s not the kind of misspent pride I’d want hiding behind my glass.

    Remember this, friends: “Democracy dies behind closed doors.”

    If you want authentic beers, made by people you respect, drink them. If neither of the prior two qualifications apply, don’t.

  • Barrie says:

    I personally do not have a problem with AB or Coors or Constellation or whomever buying out another brewery. That’s just big business doing what it does. As long as the product remains good then more power to them. Good beer is good beer.
    However, the other practices that AB does are what I DO object to. Using their clout with distributors to block craft breweries from getting their product out, buying out available commodities for making beer so that others have to scramble to find barley or specific hops, these are unfair business practices and in quite a few other industries would already have placed under the scrutiny of Federal investigations least in the US.

  • Darren says:

    All this talked about was how great it was for them, I’m sure it was. What about taking away the distribution from the smaller breweries. How about the larger companies controlling the ingredients. Keep in mind these buyouts are selected more about that than the actual product at the brewery they are taking over.

  • Tom says:

    “Working for Ab-Inbev is great. They do all our accounting, throw money at us, and pay all our obsolete employees to pick their butts in the tap room. Some people get mad at us, but they eventually come crawling back because CREAM. The others are just internet crybabies who don’t buy much beer anyway. Honestly, I’m thankful for Ab-Inbev. How else would we have known that our true calling was mass producing flavor-neutered “urban” wheat beers. Prost!” – The Guy In This Article

  • Tim says:

    No one questions the talent or resources that are procured by AB-InBev even before their recent acquisitions of craft breweries. No doubt they employ the best Brewers in the industry, and use the best equipment out there. It’s what they choose to do with those valuable assets that we all question. Why not make the best beer you can possibly make instead of the swill you produce? You wanna keep all the South African hops you can suck up? We all know the logic behind this–it’s to hurt smaller breweries by cutting them off at the source. Good for you. It’s no wonder you keep losing market share. The big bully always picks up his ball and takes it home.

  • Dave says:

    I worked at an AB brewery before and after it was purchased by Inbev and the changes were painfully dramatic. The focus was entirely on cost cutting. The salaried staff was cut to less than a quarter of what it was before the purchase. Hourly (union) employees were offered buyouts. Any perks or benefits of working at a brewery were gone. There was a time when they would give you a case of a new product to hand out to friends and family. Now they give you a 2 oz sample to “taste” and pass the word. I lasted several years but the pressure to cut costs created so many process issues and the threat of termination if you couldn’t produce savings was so great that I had to look​ elsewhere. I worked there for 8 years and none (zero) of the middle managers from before the buyout are still there. Either they fired you or you were crushed.

  • Curt Johnson says:

    InBev wants to eliminate the competition, period. They will buy their way out of not being able to compete w/ craft beers. Then we will be where we were in the 70s and 80s, w/ crap beer only. This guy had to be anonymous. He could lose his job if he was known, if in fact it was a real person and not in InBev PR guy.

  • Alvin Mullins says:

    As a small brewery in planning, it is interesting to hear from the inside but it doesn’t jibe with the facts. We know AB is starting to brew their “craft” brands at AB plants. We know they restrict resources (South African hops for example) to their own. Malt is also highly controlled by AB. They definitely are putting pressure on retail to crowd out locals. It may be cherries for the sellouts but its not so good for the rest of us.

Leave A Reply to Tim Cancel Reply

Your email address will not be published.