Where Does the AB-InBev Craft Project End?

It’s been a while since AB took over a craft brewery but today, they struck again, taking over a Texas brewery we’d never heard of but…

Here’s a quick­ly hacked togeth­er map of the US states where AB-InBev has acquired brew­eries so far:

Map of the US with AB-InBev acquisition states (Washington, Oregon, California, Texas, Illinois, Virginia, New York, Arizona, Colorado) marked in yellow.
SOURCE: Adapt­ed from Wiki­me­dia Com­mons.

(Note: that’s Alas­ka and Hawaii tucked in under­neath for tidi­ness as is the norm for dis­crete maps of the US.)

Can you see a strat­e­gy emerg­ing? We’re not sure we can, not quite yet, but there might be a vague cor­re­la­tion with states where peo­ple have rel­a­tive­ly high­er incomes. If what’s dri­ving their deci­sions is that, com­bined with a reach for geo­graph­i­cal cov­er­age – which would make some kind of sense – then we’d be plac­ing bets on the next tar­get being a fast-grow­ing brew­ery in the Upper Mid­west (Min­neso­ta, North Dako­ta). After that… Maybe they’ll just go all in and aim for a pres­ence in every state?

So, that’s the US (where – just a reminder – we’ve nev­er been and only know-about through books and arti­cles, so cut us some slack) but what about Europe? As far as we can tell their only craft beer acqui­si­tions so far have been in the UK (Cam­den), Italy (Bir­ra del Bor­go) and Bel­gium (Bosteels, which is debat­able). Here’s (very rough­ly bodged) how that looks:

Map of Europe with Italy, Belgium and the UK highlighted.
SOURCE: Adapt­ed from Wiki­me­dia Com­mons.

In some ways, this is eas­i­er to read: these are sim­ply the coun­tries where you might say, in one form or anoth­er, ‘craft beer’ is a big ‘thing’ right now. So, in terms of where might be next: France just topped 1,000 brew­eries ahead of sched­ule; Ger­many is def­i­nite­ly hav­ing some kind of craft beer moment, although it’s com­pli­cat­ed – what is the Ger­man ver­sion of Cam­den? Assum­ing some of these coun­tries go through the same explo­sion the UK has, lead­ing to a slew of brand-savvy and rapid­ly expand­ing craft brew­eries, here’s a guess at how it might look in two or three years time:

Europe map with Germany, Spain, France, Italy, Norway, Sweden, the UK, Poland and Ireland all highlighted.

Add to that the pur­chase of indie dis­trib­u­tors here and there (France, the UK) and the very odd acqui­si­tion of a US home­brew sup­ply firm, what else can they be up to oth­er than an attempt to build an entire­ly AB-InBev owned craft beer infra­struc­ture?

In which case, might they not also fan­cy a mag­a­zine or two? A fes­ti­val-con­fer­ence oper­a­tion such as Craft Beer Ris­ing?

And some Brew­Dog style bars of their own, too? Draft House might look tasty in the UK, espe­cial­ly giv­en the involve­ment of Luke John­son, famous for tak­ing over, expand­ing and sell­ing off firms like Piz­za Express and (beer relat­ed) Bel­go.

What­ev­er hap­pens the next few years are going to be inter­est­ing and, frankly, we’re inter­est­ed to see the fin­ished prod­uct.

11 thoughts on “Where Does the AB-InBev Craft Project End?”

  1. I have two com­ments. The first: I believe peo­ple read more into the strate­gic ele­ment than exists. As the Cig­ar City weird­ness illus­trat­ed, you can bet that for every announced acqui­si­tion there are many “in talks” and prob­a­bly a load of col­lapsed deals that we nev­er hear about. I’m not sure it’s as orga­nized or tac­ti­cal as we might think. It’s more of a seller’s than a buyer’s mar­ket.

    But sec­ond: you’ve nev­er been to Amer­i­ca?! First, you must come; but also, you write with a com­mend­ably flu­id famil­iar­i­ty. I would nev­er have guessed!

  2. A US acquain­tance wrote that this is all about hav­ing enough brands to fill a few fridges, which adds to AB’s dis­tri­b­u­tion strength to pro­pose a sce­nario where dis­trib­u­tors strong-arm retail­ers (remem­ber that the US has a bizarre/Byzantine reg­u­la­to­ry regime for beer dis­tri­b­u­tion) to favour AB brands, of which there are lots. Con­sumers get the illu­sion of plen­ty of choice, while true indie brew­ers get squeezed out. That makes a lot of sense to me.

    In Europe, the dis­tri­b­u­tion busi­ness is rather dif­fer­ent and it’s about buy­ing brands. AB already owns sev­er­al in Ger­many, remem­ber, includ­ing Becks, Löwen­bräu, Spat­en and Franziskan­er.

    1. Those are also most­ly states with big pop­u­la­tions that already have a strong craft scene, or in the case of Texas and Ari­zona, with a mas­sive amount of scope for cor­ner­ing the mar­ket ear­ly. Look­ing at that map the ques­tion remains as to when they will add Ohio and Penn­syl­va­nia.

  3. these are sim­ply the coun­tries where you might say, in one form or anoth­er, ‘craft beer’ is a big ‘thing’ right now”
    I’d qual­i­fy that: “these are sim­ply the coun­tries with large pop­u­la­tions where you might say, in one form or anoth­er, ‘craft beer’ is a big ‘thing’ right now.”
    In the Nordic coun­tries, “craft” (hate that term) beer is huge. In Swe­den, with a pop­u­la­tion of 9 mil­lion peo­ple, we now have 250 brew­eries, com­pared to 20 in the 90s. Most of these are “craft” brew­eries. As far as I know the sit­u­a­tion is sim­i­lar in Fin­land, Nor­way, and Den­mark.

    What we’re sore­ly miss­ing is cask. I only know of two brew­eries mak­ing it (Nynäshamn and Ocean; the lat­ter is thank­ful­ly in my home­town Gothen­burg, so I can drink their cask ales in the one pub serv­ing it).

  4. AB InBev’s bag­man for Euro­pean brew­eries is an old muck­er of mine. I spoke to him last Sep­tem­ber and he said there’s noth­ing in Ire­land even close to hav­ing the size and mar­ket pres­ence they’re look­ing for, so you can safe­ly turn us grey again on your map, I think.

    1. No brew­eries with ambi­tious expan­sion plans? No prospect of a well-fund­ed Cam­den-type oper­a­tion pop­ping up? Just con­scious that, these days, two years is no time at all.

      1. I think the mar­ket here is just too small and under­de­vel­oped. In the last two years the craft seg­ment has gone from 1% to 3%. Even in two years’ time I doubt those num­bers will be attrac­tive enough for the big fish.

        1. the last two years the craft seg­ment has gone from 1% to 3%.

          So its tripling every 2 years. Not bad.

  5. All this activ­i­ty – it usu­al­ly focus­es on obtain­ing the whole bas­ket for a venue. Ie offer as much of the port­fo­lio a bar requires. So if that’s through own brands it’s ide­al sce­nario – make more mar­gin etc etc whilst always ensur­ing lever­age of No. 1 brand ie Bud or Car­ling or what­ev­er is no 1 vol­ume pro­duc­ing beer in port­fo­lio. Then in addi­tion buy in oth­er drinks offer­ings wines, spir­its, ciders, beers to dis­trib­ute to account. There­by ensur­ing the likes of com­peti­tors are squeezed out total­ly. In super­mar­kets it’s all about obtain­ing most shelf space and they’ll even do this by cre­at­ing beers they don’t even think will sell that well or is a deemed ‘hot’ gap fill cat­e­go­ry, just in order to take shelf space away from a com­peti­tor. Radlers in Uk any­one.…

    Big­ger brew­eries have merg­ers & acqui­si­tions teams (prob­a­bly in the finance depart­ment!) con­stant­ly look­ing for new poten­tial. It’s part of their strat­e­gy. Just look at Linkedln.
    Of course this isn’t just applic­a­ble to beer.…but lots of oth­er cat­e­gories. No one wants a monop­oly though eh? And when is enough for these mega-com­pa­nies?

    Tied in with all of this is a com­pa­nies abil­i­ty to increase and decrease pric­ing across its full port­fo­lio to trig­ger strat­e­gy with com­peti­tors.
    Anoth­er inter­est­ing dimen­sion in March 2015 AB-Inbev’s top share­hold­ers were behind a €40 bil­lion Kraft Foods and HJ Heinz Co merg­er which was com­plet­ed July 2015. Read Brewbound.com piece re fur­ther under­stand­ing on where this slots in.

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