Three tiers for Anheuser-Busch!

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The Kentucky ABC laws can be described as finicky to those inside and outside of the beer industry.  They can possibly be classified as archaic since the first beer was cracked post-Prohibition, but they serve a purpose whether we imbibe by them or not.  From a three-tier system requiring breweries to sell their beer to a distributor to not being allowed to give away free samples of beer outside of your taproom, the laws can create some questions amongst beer geeks.  Let me explain the latter first.

Breweries in Kentucky cannot give away free beer.  For our Kentucky Guild of Brewers (KGB) Enthusiast membership, we dabbled with having a punch card, but chose to stray away from the idea due to potential legal complications.  Now if you own a micro brewers license, you are permitted limited sampling but only on your licensed brewery premises.  With this, the Liquor Barns and Old Towns of the beer world cannot give away free beer legally.  They can give out samples of wine and liquor, but beer is a no-no.  They must charge.

Let’s go back to that three tier system.  For a good explanation of it, read this.

Level 1: Producers (in our case,in-state or out-of-state breweries or microbreweries).

Level 2: Wholesale Distributors (River City, Dauntless, Beer House, Heidelberg, etc.)

Level 3: Retailers (Liquor Barn, Bearno’s, Holy Grale)

Simply, producers cannot sell directly to retailers.  They must sell their beer to a wholesale distributor who then sells their beers to retailers.

Most recently, Anheuser-Busch does not want to follow this system in Owensboro and myself, the Kentucky Guild of Brewers, and many other important entities are trying to prevent this.  You can read the detailed story here and here.

“It’s Budweiser, I don’t drink that stuff.  Why should I care about them directly selling their beer all the way in Owensboro?

You should.  Let me explain.

Our local breweries are reliant on the network of independent beer distributors in the state to get you their beer.  Also, those same distributors that get  out-of-state beers you hoard in your basements or fill up your recycling bins with.  If the worlds largest beer manufacturer is allowed to control its own distribution, our smaller breweries will be shut out of the market in areas they may not be able to provide the same incentives as Anheuser-Busch can.  For our growing industry, this loss of market access would not be good for Kentucky breweries and would also not get you the local beer you need.  Also, some out-of-state breweries may pull out of Kentucky because they cannot compete with the Goliath that is Anheuser Busch.  For example, Yuengling wrote a letter of protest to prevent AB from getting their own distributorship because they place to come to Kentucky.

This is why distributors and retailer organizations like the Wine and Spirits Wholesales of Kentucky, Kentucky Association of Beverage Retailers, American Beverage Licensees, and National Beer Wholesalers Association have provided protest letters for Anheuser-Busch’s Owensboro distributorship.  These independent distributors and retailers help create an open market place for all beer brands under their management (see also why Kroger and other local establishments are getting more craft beer friendly).  If Anheuser-Busch starts to acquire self-distribution in Kentucky, expect to see those beers you love replaced with their “crafty” impostors (God, who am I Roger Baylor?)

To the Kentucky Guild of Brewers, it makes no sense why the largest brewery in the world would be able to self distribute and our smaller, in-state operations are not allowed to.

The good news, thankfully our protest letters are working.  For the time being.

Soon, we’ll need beer drinkers to provide one solid voice of protest towards this acquisition.  W will be calling on you to write, call, email those who may attempt to let this distributorship go through.  Because god knows, if a video of a monkey riding a dog can go viral, a few thousand beer geeks in Kentucky can make some noise in legislature.

 

 

What's your take? Please comment below.