03 Feb 2010 @ 8:08 AM 

I sat down to watch Beer Wars last night. It’s interesting doing this now, almost a year after it’s been released, seeing the original reviews, the reactions, and seeing what’s happened over the past year. As a note, one of the first columns that I wrote on this blog was about Beer Wars – actually about the hype surrounding it which, at the time, was kind of rubbing me the wrong way. Looking back, I’ll admit that one of the reasons that the hype was bothering me was because I wasn’t able to actually go participate in the one day release. I’m now glad that I didn’t, because I’m sure that had I viewed it then, I would have seen it entirely differently.

Yesterday, due to a new distribution contract with Warner Bros., Beer Wars hit streaming Netflix and I was finally able to get a look at it, albeit a year removed.

Allow me to start here: I enjoyed it.

In fact, I enjoyed it a lot more than I originally thought I was going to. The first 10-or-so minutes of it, in particular, I thought were playful, fun, and educational and really showed the ridiculous scale of the beer industry quite well. Jim Koch’s regular statement of, “Bud spills more beer in a single day than I make in an entire year” (featured in the film) is very apparent here and that message alone is worth watching the movie for. I wish the entire film had carried the tone of the first ten minutes, even so much as to carry the cartoon Anat Baron all the way through.

From a “I’m critiquing this movie” standpoint, I think Beer Wars suffered a little from not really knowing what it was. It wanted to educate, and then it wanted to criticize. At times it was a little unfair in its criticism, sometimes ignoring reality in favor of a flashy point and in general I’m okay with that if that’s your modus operandum – but it clashed with the educational and feel-good parts of the film. I found myself thinking that if Beer Wars had merely presented the facts of the scale of the industry alongside the wonderful story of how craft beer has evolved, without trying to be edgy and in-your-face and make points against BMC (and especially Anheuser-Busch), that it would have carried its point much more effectively. In the end, it felt like an Anheuser-Busch critique vehicle wrapped around a warm and fuzzy story about Sam Calagione with a little bit of feeling embarrassed for Rhonda Kallman on the side.

Like I say – I enjoyed it and I would recommend this movie to others. I wonder at how it would play to people who are not beer geeks. I will probably never know. I’m not sure I know non-beer-geeks that I haven’t at least somewhat indoctrinated, anyway.

I cannot say enough about Sam Calagione in this film. He makes the movie and without him it would not have been nearly as compelling. Nevermind that he’s the GQ posterchild of craft beer, the guy is so damn charismatic and.. and.. likable that it’s impossible not to root for him. When he’s sitting there with his kids climbing all over his shoulders with that goofy grin of his, it puts the, “Yeah, so I had to put my family into a crippling amount of debt to try to chase this dream” into harsh relief and you want nothing more than for him to succeed. He was the perfect centerpiece for this movie.

I wish there was more Dick Yuengling in it. He just makes me smile. Go get ’em Dick!

I cannot, however, figure out the choice of Rhonda Kallman and Moonshot here. It looks, in the movie, like a failing brand from the get-go. The problem is that the film doesn’t convince me that the reason that she’s failing is because she’s getting roughed up by A-B. It sounds like a gimmicky product, she even sells it like a gimmicky product in the parts of the movie where she’s looking for investments ($6 mil! Holy moly. I’ll take the $800,000, please.). I don’t know. Maybe my opinion is colored by the fact that I know that New Century, who makes Moonshot, also makes Edison Light which is my second least favorite beer in the entire world (behind Leinenkugel Sunset Wheat which, I swear, tastes exactly like circus peanuts). Sorry Rhonda, I’m just not a fan. I’d feel more empathy if I thought it was a great beer.

The one moment where I really wanted to back Rhonda up was a scene in a bar, where some jackass patron who is trying the free beer she’s given him asks her, “Does your husband know you’re out here doing this?” right before another one asks, “Will this cure whiskey tits?” I never felt as bad for her as when she laughed along with them like it was all some sort of joke when by all rights those guys needed a good solid cock punch.

“Does your husband know you’re out here doing this?” Really? You sexist assbag!

Anyway – without getting lost in these details, I went into watching this with a couple of questions in my mind:

1) In retrospect, did the movie live up to the enormous amount of hype that was generated?

I think that the enormous amount of hype actually hurt this movie. It had such an onslaught of publicity that I think it needed to be Gone with the Wind to live up to the expectations of critics within the beer industry, much less traditional media. With all of the buzz, it needed to absolutely blow your mind to be treated with anything except let-down afterward. It’s really a shame. There’s a good story here and there are good messages, but because it wasn’t Citizen Kane it didn’t get the attention it deserved after release.

On the other hand, because Ms. Baron was working on getting this out without a distribution deal, because it was being released in the one-time-special-event manner that it was, I’m not sure I can come up with a better way to have marketed it. You had one shot, you had to make sure people were there or it was going to be an enormous financial loss. That’s rough.

With any luck, Warner Bros. will be able to help market it outside of the craft beer community which, frankly, is not the audience that needs to see this movie – it’s preaching to the converted.

2) Why was the BA so eager to support prior to screening it, and what, if anything, did they gain by it?

At the time of the Beer Wars release I kept asking myself: Why are so many prominent members of the BA wrapping themselves up in the promotion of this movie when, by their own admission, they have not screened it?

Watching it, it hit me: If I was filmed for a movie, and I knew that I was going to be on the big screen, I sure as hell would promo the shit out of it, too! In the grand scheme of things, they knew that the movie was going to be complimentary to their cause and their industry because they had spoken about the point of the film with Ms. Baron. At that point pushing this movie was a no-brainer; it was good publicity for yourself, your company, and the industry as a whole, regardless of whether or not the movie was brilliant.

I was surprised to find out that there were only small clips of Charlie Papazian, Greg Koch, Maureen Ogle and the Alström Brothers in this, though, considering how prominently they all featured in the promotion (and live discussion on release night). Good personalities! I’m glad they were used in the live discussion; it led me to believe that I would see more of them in the film than I did. I wish that a recording of the live discussion would have been available via Netflix.

So, what, if anything, did the BA gain? Awareness. But I think that’s it – not that that’s small. However, I feel that Beer Wars drew a harsh picture of the three-tier system and distribution that I’m not sure is necessarily in the best interest of the BA. The three-tier system and wide distribution networks have a lot to do with the fact that I’m currently able to drink Stone Arrogant Bastard and New Belgium Fat Tire here in North Carolina. Both Greg Koch (Stone) and Kim Jordan (New Belgium) were briefly featured in the film and I’m sure that they would both tell you that without distribution agreements that would not be possible.

She took a (warranted) passing shot at the tactics and bullshittery used by some distributors, but rather than doing an expose on slimy (and illegal) business practices, we got a short montage of Ms. Baron hunting for purportedly mythical Neo-Prohibitionists which, I might argue, are actually a real threat to the industry.

Overall, however, I think the BA – and the craft beer industry in general – receives a net gain here, even if just off of the first 10 minutes of the film, and the crazy freakin’ title that shows up on top of the Dogfish Head introduction segment: “Dogfish Head: 0.0002% Market Share.” I may have missed a 0 there. Regardless, it was REALLY effective.

3) What’s the best way to follow this up?

Yes, I’d like to see more. Maybe Beer Skirmishes. I’m just not a huge fan of war.

I think that, in actuality, there were 2 or 3 documentaries all smushed into one here and that either through lack of focus or lack of funding we got this movie. Here’s what I think we potentially have inside Beer Wars:

– The story of the craft beer industry, its inception and growth and a straightforward honest comparison between craft beer and BMC. ie – show off the little guys, and show just how little they are and what a disadvantage they are at without having to trash BMC. You catch more flies with honey than vinegar and all that. I suspect we’ll get a lot of this from the upcoming Beer Pioneers.

– An expose of the tactics of the less scrupulous members of the distribution industry in comparison with the distributors who are now focusing on craft and trying to play by the rules.

– A politico documentary of BMC lobbying vs. Beer Institute lobbying vs. BA lobbying. None of it’s pretty (lobbying just isn’t), but it would be fascinating to see where they differ and where they all overlap (and I’m sure they do).

Any single one of those could be a compelling documentary and some of them, if done correctly, could actually be a driving force for change in the industry. I hope that Ms. Baron will find success through her Warner Bros. distribution contract and will come away with the funding to pursue one of these topics in depth.

In verbose conclusion I say: Go forth and watch this movie. Most especially, make sure that those you know that aren’t huge beer geeks watch this movie and be ready to go to the bar and talk it over with them over a pint of good, locally made, craft beer.

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 25 Sep 2009 @ 9:41 AM 

I’ve often had my share of kinda irksome moments about Sam Adams. I go through wide sweeping moments where I feel like Sam Adams is primed so that someday in the future we’ll be talking about them when we say, “The Big 3.” “You know, InBev, MillerCoors, and Sam Adams.” Sometimes I feel like they choke local craft markets with their ever-increasingly-wide distribution channels. Sometimes I feel like they’re a little too eager to trumpet their role in the “craft beer revolution.”

And then sometimes they prove to me exactly how much they’re worth to craft beer.

This week at the National Beer Wholesaler’s Conference, Jim Koch, Founder and CEO of Boston Beer Company, spoke about the future of distribution. (WSJ article here)

I don’t have many direct quotes from the speech, but the gist of it is this: A lot of people are worried that distributors are going to be falling on some hard times, and so they have to look at changing their models to cut costs and increase efficiency to keep up with the changing economy, even to the point of collaborating with your competitors to share delivery vehicles, personnel, and warehouse space.

Even while distributors are a federally mandated part of the three-tier system, and a good chunk of them maintain regional dominance through less than scrupulous business practices, there’s danger in the future for them. Some retailers, especially big-box retailers like CostCo, are pushing to bypass the middleman and buy directly from the brewery.

But! (I hear you say…) how could that be bad? Well, for big box retailers it’s not bad at all, they essentially have their own built-in distribution networks. For the small retailer and the small brewery, this represents a lot more work in terms of negotiating contracts, deliveries, displays, etc., especially as distributors lose business out of their large accounts and no longer have the capital to be able to support small specialty products that won’t be immediate profit vehicles for them like, for instance, craft beer.

Let’s go back through the short history of distribution companies in the 20th Century to see how much things have changed.

When the three-tier system was implemented after Prohibition, there were something along the lines of 40 – 70 breweries nationwide with a couple of giants in the mix. Regional distributors distributed regional beers and everything worked like it was envisioned and that was fine. The whole point of the three-tier system was to protect the consumer by keeping competition in the retail market. Prior to Prohibition, breweries often outright owned saloons and, thus, could control distribution through retail outlets, price fixing against competitors, or not carrying their products altogether.

As the number of breweries dwindled and the number of distributors increased things started to get a little bit wonky. You start to see megabrewery sponsored distribution who, again, are attempting to control distribution channels in order to attempt to smother their competition – this time in the form of other distributors. It probably wasn’t that bad in the 70’s and 80’s when there were only a handful of breweries in operation, so long as everybody was playing the same game.

The past 30 years, however, have seen the rise of roughly 1500 minuscule (by comparison) new breweries and all of a sudden we’re in an entirely different market again. Now, with scads of these small breweries, distributors are more necessary than ever to get beer to market. Plain and simple, a small startup business (with comparatively expensive startup costs), does not have the resources to compete in a distribution market. Certainly, they can self-distribute in a small geographic area, but at a certain point it is not cost effective and they must rely on a distributor to sell and distribute their beer.

So, if you’ve got mega-retailers that are attempting to bypass distribution networks, all of a sudden things get really difficult for the craft brewer, again. Why? Because distributors will suffer. If distributors suffer, small craft breweries suffer. It’s an easy equation.

Enter, Jim Koch.

Koch recognizes that that future of craft beer (even – and maybe especially – his) lies in efficient distribution and that craft breweries do not have the power to create said distribution on their own. We see more and more pressure from mega-retailers to cut the middleman out, coupled with the ever-increasing cost of fuel, refrigeration, and even warehouse space. Eventually, distribution is going to take a major hit and craft breweries are going to feel it more than most.

It’s going to take a lot of work to get to a more efficient model. We’re stuck in a 20th Century model of sales and delivery distribution networks and change is difficult on a corporate level. Koch suggested it was a 10-year-plan, and he noted that it would require some contract changes with the Big 2 – which may not necessarily be in their immediate interests in terms of distribution.

If distributors can get behind the idea (and they should, even though it seems a little radical up front), it could be a great day for craft beer.

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Categories: distribution, industry
Posted By: erik
Last Edit: 25 Sep 2009 @ 09 41 AM

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