Don't really follow the beer industry but found this article interesting about the distributors.
https://www.americanthinker.com/blog/2023/05/why_the_bud_light_disaster_could_cripple_the_entire_companys_many_brands_for_years.htmlThe damage done by the casual embrace of a transsexual by Bud Light came at an extremely bad time for not just the brand, but for all the brands sold in the US by the parent company, Anheuser-Busch InBev (ABI). The reason is rooted in a critical aspect of commerce that mostly escapes public notice: physical distribution.
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Writing in American Greatness, John Conlin reveals how ABI has been restructuring its beer distribution, no doubt in the name of increased efficiency and market power, and thereby made itself very vulnerable to a slowdown in sales.
When InBev was analyzing the Anheuser-Busch acquisition, it determined substantial profits could be gained by consolidating the AB wholesaler network.
In reality, InBev thought it could erase the AB network and take over distribution entirely. The multinationals soon learned just how politically powerful U.S. beer distributors really are, and came to accept this likely would never happen.
But the financial allure of consolidating the AB network remained strong. They started a program where distributors were chosen to be a “preferred” distributor. These folks were given the opportunity to make acquisitions and act as consolidators. These were also the folks most likely to go along with ABI desires.
In ABI's mind, these were the best of the best distributors. Over the past five years or so, a lot of the country saw these consolidators making significant acquisitions of other ABI distributors. And these deals don’t come cheap.
Owning a beer distributor is as close to printing money as is possible, so it took a substantial amount to convince an ABI distributor to leave the industry. The vast majority of these were family businesses, many of them multigenerational. Selling any family business is no small deal. So that created an even bigger hurdle to convince these folks to leave.
Thus, they sold but at astronomical values. The preferred ABI distributors stepped to the plate and paid these amounts because they trusted ABI would continue to be good stewards of the brands and historically there were few investments better than an ABI distributorship. So, they paid many years of cash flow. And remember, the distributor is the only one of this entire crew who actually has skin in the game.
In a lot of the country, the ABI distribution network went from smaller, generally debt-free family businesses to much larger wholesalers with either a far bigger distribution footprint and/or they began operating in multiple markets—all sitting on a mountain of debt. In total, I’d guess the debt number is well over a billion, likely billions.