Anheuser-Busch InBev denies distributor plan harms craft beer
AB InBev is reportedly promoting the distribution of its brands through incentivisation
Anheuser-Busch InBev has defended a new incentive programme for US distributors after a media report claimed it will stifle craft beer's route to market.
The Wall Street Journal has reported this week that the programme, launched last month, could see distributors who carry 98% or more AB InBev brands given an extra US$1.5m in annual reimbursements. Also, those with 95% or more AB InBev brands would have up to half of their marketing costs covered for those products, the report said, citing two unnamed distributors.
Yesterday, an AB InBev spokesperson declined to confirm the details of the incentive plan, saying the figure stated in the WSJ story was "neither sourced nor confirmed by Anheuser-Busch".
"The benefit offered is based upon each wholesaler's minimum marketing spend, which varies by wholesaler," the spokesperson added.
The spokesperson said the new incentive plan "is a reflection of just how competitive the US market has become and is specifically designed to strengthen the ability of our company and our distributors to compete".
The spokesperson also said the plan would not hamper smaller breweries as under it, more than 93% of small craft brewers' products can be sold in any quantity the distributor chooses "at the highest level of benefit".
"Distributors that choose to sell a lower percentage of AB InBev brands can still benefit by making other types of commitments - for example, performance in our excellence programme. Nothing in the programme prevents distribution of other brands."
The spokesperson added: "Craft brewers are thriving with unfettered access to market, and our incentive programmes don't interfere with that."
Speaking to the WSJ, Oregon craft brewer Deschutes Brewery refuted that stance, saying it had been dropped by its distributor because it "had to make a choice to go with the incentive programme or stay with craft".
In October, regulators in the US probed allegations that A-B InBev's US arm, Anheuser-Busch, is buying distributors in an attempt to stifle craft beer competition.
A-B has recently ramped up efforts to strengthen its distribution network with a number of swoops for US distributors. In July, it said it was to buy Colorado's American Eagle Distributing in Loveland as well as transfer ownership of its Kentucky operations to Standard Sales Co in exchange for operations in Littleton, Pueblo and Colorado Springs, also in Colorado. In August, the brewer agreed to buy New York distributor R Ippolito Distributing for an undisclosed fee.
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