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Craft brewers may need to be careful what they ask for

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Let me start by saying I am a huge craft beer fan. I love craft beer. I love the very idea of craft beer. I love the taste, the smell and heck I even love the interesting artwork on the bottles. I especially love the pick-yourself-up-by-the bootstraps grit of the craft beer business folks.

But I can’t help but wonder; what might happen if the crafties get what they want from Florida lawmakers?

64 ounce growlers? Check. Got that. No brainer. A few tweaks, make sure they are sealed and don’t mess with open container laws, some simple labeling and we can all check that box. I can hardly wait.

But what about the more complex and nuanced idea of the ability to open – almost without restrictions – retail outlets? If the wish of the craft beer advocates were to become law, then brewers (of all shapes and sizes) would be selling direct to the public, opening corner pubs in competition with local craft brewers, local distributors and local retailers.

Sounds like beer heaven to me; except it may not be quite that simple.

Now before you blow up the comments section or send my Facebook/Twitter accounts into over-drive, hear me out.

There are other brewers that might just love these changes. These brewers churn out hundreds of millions of cases of beer each year. They are owned by international and national entities that I dare say have access to a lot of capital and a pretty decent line of credit…capital and a line of credit that could (should I say, “would”?) if allowed, be used to squash the competition.

And why not?

With a suite of dozens of separate labels, including some pretty decent craft and craft-like brands to keep even the Peach-Pumpkin Ale guys like me happy, why can’t these mega brewers purchase, for example Cigar City, and open their own Cigar City subsidiary “tasting rooms” or “brew pubs” or whatever the new law would designate as being designed to help the craft industry continue its rapid growth. And yes, I know the report of Joey Redners’ selling was premature, but the mega-brewers don’t need to buy other brewers. The mega brewers can do it themselves.

The mega and regional brewers could do this in the name of any brewer and offer dozens of products like Big Ballard Imperial IPA, Copperhook West Coast, Drop Tap Amber, Alchemy Pale Ale, Citra Blonde Summer Raw, Dragonstooth Stout or Jasmine IPA, as well as a nice assortment of foreign products not to mention some stand-by products from their own portfolios. There could be 50 taps along the wall and offer pretty much every style of beer known to man. Would consumers know that these are all affiliated or subsidiary owned beers brewed elsewhere? Would they care?

Now assume that the large brewers drop their prices to gain share of craft because they have efficiencies of scale from beer brewed elsewhere. Couldn’t they seriously harm or destroy a lot of local craft brewers?

Oh sure, there will still be a place for the hole-in-the-wall crowd. The I’m-not-going-there-because-it’s-owned-by-a-large-brewery crowd would likely avoid the place like the anti-vaxxers avoid needles. And when some local brewer wants to get access to one of those 50 taps, the large brewer owners can tell them to go to hell – and there will be nothing anyone could do about it.

If the compromises that are brewing (you knew I had to have at least one beer pun) pan out, then there would be a limit on the number of locations and requirements to actually brew on the premises. Small local brewers continue to grow but avoid the market domination they’d face at a whole new level if the big boys were allowed to get in on the brewer-retailer model.

If you think I am completely nuts, consider that I am not the only one thinking along these lines.

Commenting on recent acquisitions in the Pacific Northwest, Sam Calagione of Dogfish Head (maker of such exotic beers as Bitches Brew and a few others made with, of all things, raisins) said:

That’s something to be wary of as these large breweries are buying up small breweries, then brewing their beers in giant quantities and charging very little for them. Their end goal is to dominate every segment of the beer world. If they succeed in that, then beers will get homogenized back down again to a few simple styles again.

Look, I’m not saying that competition from the mega-brewers is bad. I am suggesting that craft might be wise to consider the idea that simultaneously restricting itself and the mega-brewers mostly to the brewing tier might be better for beer in the long run.

Okay, I now have on my flak jacket. Fire away.

Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including SaintPetersBlog.com, FloridaPolitics.com, ContextFlorida.com, and Sunburn, the morning read of what’s hot in Florida politics. SaintPetersBlog has for three years running been ranked by the Washington Post as the best state-based blog in Florida. In addition to his publishing efforts, Peter is a political consultant to several of the state’s largest governmental affairs and public relations firms. Peter lives in St. Petersburg with his wife, Michelle, and their daughter, Ella.

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