selling out beer and coffee

Selling Out: Aussies, Americans, and Coffee

Photo Cred: justdoc.com

Last week, it was announced that 4 Pines Brewing, Australia’s largest independent brewery, was purchased by AB InBev through its ZX Ventures which they have coined their “global disruptive growth group.” While AB InBev buying up a craft brewery is hardly news anymore, this brewery purchase if a first fo ZX Ventures. It was recently reported by Forbes, that the High End, the craft beer division of AB InBev, was no longer looking to acquire new breweries, that it was instead going to focus on organic growth (i.e. open up breweries that were even murkier when it comes to AB InBev’s ownership). They must have meant, “in the U.S.” Possibly this deal was on the books long before that interview with Forbes or perhaps ZX Ventures is the newest golden child at AB InBev and for some reason, AB InBev is going to funnel their acquisitions through that arm now. Either way, 4 Pines has learned some things from the sell-outs that came before and they took an unapologetic stance in their announcement on Facebook, trying to get ahead of all the brouhaha that was sure to come by pre-emptively answering the most-asked questions when a brewery sells out. From their Facebook announcement:

Here are some answers you might be looking for:

Yes. 4 Pines will continue to operate all existing venues.
Yes. Everyone keeps their job.
Yes. 4 Pines is now 100% owned by ABI.
Yes. The Brookvale brewery will be expanding its capacity in the very near future.
Yes. Some people will think our beer tastes different.
No. It doesn’t.
Yes. We will have access to even more ingredients and better brewing toys.
Yes. 4 Pines has already started developing plans for national and global expansion.
Yes. ABI and 4 Pines fat cats have a squash game and a hot sauna locked in to celebrate.
No. Costs won’t be cut; in fact, we’re looking to invest.
Yes. Our commitment and investment to sustainability will grow.
Yes. We will join ABI’s global plan to be a 100% Renewable Energy Brewery.
Yes. As part of ZX Ventures, we will be part of the global forefront of beer innovation.
Yes. Our current beers will remain.
Yes. We’re looking to grow Keller Door and Keller Door Barrelled even more.
Yes. The founders and all the key people are hanging around.
Yes. 4 Pines did treat themselves to a case of Crownies to celebrate.

While some of the commenters on their page felt that this cheeky reply was disrespectful to their very real feelings of disappointment, it does show that 4 Pines did their homework before announcing the sale or they got the “selling out talking points” memo from AB InBev. All of these answers are well and good but they don’t address consumers’ concerns about putting money in the coffers of a business that consistently undermines smaller breweries at a legislative and business level (i.e. pay-to-play). So yes, all of these elements of 4 Pines may stay the same, but that’s not really the point for people who are anti-AB InBev because of their business practices vs. their ability to create opportunities for breweries that they buy.

Do Aussies handle indie beer sellouts the same way that American craft beer lovers do?

4 pines vs. Wicked Weed

It turns out, maybe not. In an entirely unscientific examination of the Facebook pages of 4 Pines Brewery and Wicked Weed (which sold to AB InBev earlier this year), a couple of things stood out. First, I took a look at the posts on each page announcing the ownership change. We can compare the “likes” to the emojis for “Angry” and “Sad.” For 4 Pines, their likes on the announcement post were at 498, “Sad” came in at 98, “Wow” got 44 and there were no “Angry” emojis. Seems pretty reasonable when you compare that to the Facebook page of Wicked Weed. Not only did the “strategic partnership” announcement on their page show 2005 “Likes”, 1045 “Angry” emojis and 982 “Sad” emojis (bringing the negative reaction tally ahead of the positive one) but even though the sale was back in April, the most recent posts are still dumpster fires. People are still posting negative comments on every post, making jokes about Wicked Weed selling out or just expressing their undying displeasure no matter what the topic of the post is.

This was a surprise because when I checked the Facebook pages of other breweries that sold to AB InBev (Karbach, Devil’s Backbone, Breckenridge), most show no recent activity from the anti-big-beer crowd save for a few stray comments on random posts. Maybe it has to do with Wicked Weed being the most recent of the American acquisitions or maybe it’s because Wicked Weed was beloved for its sour program and specialty beers and fans feel like the sellout is an especially big slap in the face. Either way, it’s a stark contrast to the more mellow reaction from our Australian brethren.

Coffee vs. Beer

It’s not just craft beer consumers who freak out when their beloved, local shop sells out to a global conglomerate. It turns out coffee lovers are just as testy.  This past week, it was announced that artisan coffee company, Blue Bottle Coffee, based out of the Bay Area, sold a majority share of its company to Nestlé. The resulting online fury was swift as former fans raged all over Blue Bottle’s Facebook page. Nestlé not only has been accused of pushing infant formula in developing countries where access to clean water is a struggle but apparently, they siphon water out of National Parks as well as drought-sensitive areas to the tune of billions of dollars in profit, paying little to nothing for the water taken. Furthermore, a recent NY Times article outlines how Nestle is contributing to getting people hooked on junk food in isolated areas of Latin America, Asia, and Africa and the resulting negative impact on those communities. People were angry the company they loved and supported was now controlled by a corporation with such a track record.

In the end, these sorts of sale/acquisitions/investments will continue on in the business world, so where does the outrage come from in the craft beer and coffee industries? Maybe it has to do with the demographics of consumers who can afford to buy craft beer and craft coffee and the luxury of being in that socioeconomic class which allows one to spend time being socially conscious. Or maybe it has to do with the handmade, artisan nature that sits at the soul of both of these craft communities. They offer something thoughtful, something special and people get to feel good supporting companies that often boast about their community focused, fair-trade, earth-friendliness. Maybe when those companies sell out, that craft consumer feels fooled and embarrassed they thought the company was something different than it was, because it’s ok for it to be about the money, just don’t pretend it’s not.

 

 

high end lay offs

Efficiency Experts: AB InBev Makes Deep Cuts to The High End

Yesterday was a rough day for many of the employees at The High End, AB InBev’s craft beer division. The night before, around 10 pm, The High End district managers and sales people started getting calendar invites for a conference call the next day. By the end of that call, approximately 360 employees or 90% of the national sales force were let go. According to Alex Medicis, the Vice President of Sales for AB InBev North America, the cuts were made in the name of efficiency. It makes sense too. After acquiring 10 craft breweries in the last few years, they added quite a few people to their payroll. Most of these breweries came with their own sales team and since sales people are often the face of the brewery to accounts, it makes sense that they would want to keep the “craft beer faces” around vs. the corporate sales employees. AB InBev is stressing to the media that this is not a big cut for AB InBev since it only amounts to 2% of their North American work force, which tops out around 18,000 workers.

What does this mean for the future of The High End? AB InBev said that it didn’t lay off anyone that worked directly with the craft breweries, so it sounds like they just went through a good ol’ efficiency downsizing. Interestingly enough, Forbes sat down with Felipe Szpigel, the president of The High End, on Wednesday, the day before the layoffs, and a few things came up.

First, Szpigel said that they would no longer focus on acquisitions. Does this mean they are done with their big, buying spree? Craft beer is still a bright spot on their less than stellar American sales record (of course they are doing just dandy internationally), so aren’t getting out of the craft beer game. Szpigel then stated that AB InBev would now “pivot to growing its ground-up model.”

As an example of this “ground-up model” Szpigel offered up the new  Vesa Sur brewpub in Miami, “a first-of-its-kind partnership between AB InBev-owned 10 Barrel Brewing in Bend, OR, and Colombia’s Bogota Beer Company.” Just an FYI, AB InBev also owns Bogata Beer Co., so they are really just partnering with themselves.

Now, this pivot is making sense. AB InBev is good with the 10 American craft breweries it already has. With the acquisition of these craft breweries, not only did they get a whole league of local sales people, but they got years of craft brewing experience. They don’t need to buy any more breweries because now they can create completely new craft breweries with the people they already have bought out. If you go to the Vesa Sur facebook page, things look great at the brewery. Who wouldn’t want to go to a new beautiful brew pub with Colombian inspired craft beer?

AB InBev has finally done it. They have managed to almost completely obscure their involvement in this new venture because it goes through 10 Barrel and Bogata. It’s just another degree of separation that will confuse consumers and people who don’t know about all the shadiness AB InBev has pulled in the industry over the last number of years. The more degrees of separation they create, the more likely people who aren’t specifically invested in the craft beer scene (ie. the majority of beer consumers) won’t have any idea that they own these new ventures.

The people over at AB InBev are definitely crafty. With the Vesa Sur venture, they have essentially leveled up when it comes to obscuring their involvement within the craft beer industry. In a few generations of opening breweries and brew pubs using these sorts of partnerships, people won’t be talking about AB InBev at all. They don’t need to buy any more breweries because they now have enough ammo to blast through the craft beer market one collaborative venture at a time.

wine tasting in the valle

Just Another Day in the Valle

One of the coolest things about living here in San Diego is our close proximity to Mexico. From the brewery, it’s a 15-minute drive to the border and from there the possibilities of international fun are endless. Superb food, delicious wine, craft beer, warm people and a scenic drive are all waiting for you in Baja, so grab your passport and use this day-trip itinerary that the Thorn crew recently followed in Mexico.

Mexican Insurance is Your Friend

heading to the valle

First things first, you’ve got to get Mexican insurance before heading across the border. Most American insurances will not cover you down there and you don’t want to have to foot the bill for both your damage and any damage you might cause. Mexican insurance is cheap and it’s easy to get. There are tons of places to stop at the border before you drive across. Our favorite is Baja-Mex, which is right by the outlet mall at the border, because not only can you get coverage there but you also can exchange your dollars into pesos. You can also buy get coverage through their website from the comfort of your own home, print out the documents and you are good to go. The exchange rate was 17.8 pesos to $1 when we went. To quickly calculate costs, just divide the cost of something (in pesos) by 17.8 and you will get the dollar cost of whatever you are buying. We were quickly taken care of by Chuy, the owner, and were off on our way within minutes.

Food First

dona estela in the valle

When setting out on a day of drinking, it’s always a good idea to put down a good base first.  There is no better place to get an authentic Mexican meal than La Cocina Dona Estela. This family-owned restaurant is at the end of a long dirt road in the Valle de Guadalupe. The restaurant is spacious with plenty of seating and while it doesn’t have AC, it does have lots of fans that keep it cooler in there than the 100 degrees it was outside when we got there. The highlights of the meal were the rojo chilaquiles, nopales, fresh tortillas, hand-squeezed lemonade and if you are feeling frisky in the morning, the sangria. Also, when you sit down they bring you a heap of freshly made tortilla chips, salsa, and queso fresco to get you started. The restaurant is surrounded by a bevy of animals like pigs, cows, and goats and we were treated to the incredibly enjoyable sight of pigs swimming on our way out.

Wine Next

wine tasting in the valle

After filling up on Dona Estela’s delicious food it was time to start wine tasting. Valle de Guadalupe is home to over 151 wineries ranging from small family-owned wineries to expansive wine-focused resorts. Being that this was a quick day-trip and we had plans in Tijuana at 5 pm, we decided to hit up 2-3 stops for wine. We started out at Adobe Guadalupe, a winery that is also a horse farm which happens to be the largest breeder of Azteca Sporthorses in the world. This winery is in a church type building and is air conditioned, which is a major bonus on a hot summer day. The wines were really tasty, especially the Bordeaux, and only $10 for a tasting of 5 wines.

Next, we headed to Monte Xanic (pronounced Monte Shaneek) for the next round of wine tasting. This winery is perched up on a hill and has probably one of the best views of the Valle. While not air conditioned, it’s hilltop location meant that there was a nice breeze that came through as we tasted away. Again, the tastings were a smashing deal at $10 for 6 tastings of both reds and whites. 

More Food

Any trip to the Valle isn’t complete until you stop at Finca Altozano from renowned chef, Javier Plascencia. This expansive, open-air restaurant has beautiful views of the Valle and some of the best food we’ve had anywhere. What’s cool about this place is that rather than just having one brand of wine to taste, they have an extensive wine and craft beer list from the local wineries and breweries. We settled on bottles of a dry Rose that was chilled and refreshing. Maybe it was that we were finally acclimating to the temperature or maybe it was that this was our third stop of th day but even though it was 100+ degrees, sitting on their deck sipping wine in the shade was relaxing and comfortable. The food was the star here, though. Our favorite dishes were the grilled octopus, handmade sausages, grilled corn, octopus ceviche, ahi tostada and their freshly baked bread with 4 different sauces of varying degrees of heat. The grilled octopus was definitely the must-have dish of the meal, with a savory, wine and butter sauce that was to-die-for.

Xolos Fever

Finally, we headed back to Tijuana for the last stop in our Baja day-trip, a Club Tijuana soccer game. For many of us, it was our first time at a Xolos game and it really was a blast. The huge red and black stadium arose out of a packed parking lot filled with tailgaters and bands. Not Mariachi bands, though, more like small vagabond marching bands which were jamming all throughout the parking lot, lending a celebratory feel even before entering the stadium. Once inside the stadium, it was impossible not to be caught up in the general excitement that was flows through the crowd. The soccer game was entertaining, but perhaps one of the best things at the game was La Masakr3, or the Massacre, which is a group of rabid fans that sit behind one of the goals. They literally never stopped moving the entire game. Whether flag waving, fist pumping or clapping, they moved to the intoxicating beat of multiple drums that would kick any drum circle’s ass from our hippie college days. In fact, it’s rumored that if the fans in this section stop moving, they get poked or are asked to leave, so they take their cheering pretty seriously.

Bonus: on our walk back to the van from the game, we came across a random zoo or big cat enclosure. There were tigers, white tigers, jaguars and more, all within arms reach and without the pesky safety enclosures that American zoos have in place. You could literally walk right up to the cages and if you are dumb enough stick your fingers through. I think that they are owned by Agua Caliente but it’s unclear from my internet sleuthing.

So there you have it, an easy Baja day-trip itinerary that will leave you full of food, wine, and fun. The best part is that it was a quick crossing at the border at 10 pm on a Tuesday night and we were all tucked in our own beds by 11 pm. If you have a weekend to spend at the wineries, that’s even better, but it’s such an easy day-trip, don’t put it off if you are searching for the time.

Want to win a trip for 2 to tag along the next time we go to the Valle? Just sign up for our Facebook Messenger group at http://bit.ly/2eqTcJp and type in the word “Valle” and you will be entered!