Industry luminaries turn out for Brewers Association of America meeting

The 53rd Annual Brewers' Association of America convention was marked by insightful speakers, a surprise visit from August Busch III and Patrick Stokes of Anheuser-Busch, and an optimistic tone about the future of the small brewing industry.

BAA attendees were also treated to some thoughts by Russ Cleary, the individual who could be considered the trend setter in regional marketing of specialty products, a key to the success of the small brewer today.

Cleary, former CEO of the G. Heileman Brewing Company, and newly appointed co-CEO of a "new and improved" G. Heileman addressed the 53rd Annual BAA convention in Tampa Florida November 12-15, and spoke of 1994 as being the "Year of the Animal" in the beer business, noting the prevalence of wildlife on today's packages--Red Dog, Red Wolf, Elk Mountain Lager, Elephant Malt Liquor, a white wolf on Cleary's own Schlitz can, and boar's heads on countless other craft beers.

Perhaps more importantly, the year has been the "year of The animal" for the small brewer in other ways as well.

After all, as Cleary noted, "the small brewer is the business. The small brewer lives the beer business, and has almost a religious fervor about taking care of the business." This integrity, high level of involvement, spirit, camaraderie, and involvement is unmatched, Cleary noted.

And, while Ray McGrath, President of The Beer Institute noted that the new Republican Congress is "a recipe for real chaos," with "an overambitious agenda" he, Cleary, and each presenter at the BAA had only optimism regarding the small brewers' future in the U.S. beer industry. Each suggested that the American brewing industry has got to be ready and able to educate the new congress about the benefits that beer has to offer society.

Noting that anti-alcohol critics are organized and ruthless, McGrath urged a strong response to the neo-prohibitionist threats.

As a means toward this end, the Beer Institute has put together a worthwhile and potentially quite powerful tool for every craft brewer to use to his or her advantage. This took is a new database that has been created by the Beer Institute for every congressional district in the country. Currently, BAA members represent 169 of 435 congressional districts in the country, with new members joining each month.

The databases, 435 individual studies in all, have been created to assist every brewer who is interested in lobbying his or her congressional leader in order to educate him or her about the benefits of having a brewery, microbrewery, or brewpub in that district. The packets, available on disk or in print within 24 hours, will help BAA members and brewers across the country to put together a grass roots education campaign regarding the numbers of jobs created, the numbers of allied businesses positively effected by the operation of that brewery, and the dollars contributed to that district Continued on due to the operation of that brewery.

Additionally, the Beer Institute addressed the importance of telling the congressional representative, "I am a brewer, and business person bringing money into this district, and I vote in this district." This approach may help to get the brewers in the U.S. some additional bargaining power in the Congress, but only if all segments of the industry participate in a unified and educated manner.

McGrath noted that more than 50% of the new 104th Congress have either 2 years on the job or no experience at all in Congress. He pointed out that there are many members of Congress uneducated about the benefits of beer to our society, and this therefore also means that the beer industry has an Augean task ahead in order to educate this group of green congressional representatives.

The challenge put forth at the BAA conference, and the challenge for the US beer industry as a whole is to use the membership and organization to carry this message to Washington. Major General Donald S. Dawson, Esq., who worked for President Truman, and was the President of BAA from 1970 to 1982, urged BAA members to invite Congressional members to their breweries and brewpubs for fundraisers, thus building good relations with the Congressional representative and building up new business for the brewery as well.

General Dawson also contradicted some of what NBWA President Ron Sarasin had to offer the BAA. NBWA has a very strong PAC organization which it uses very successfully to help to elect officials who understand the benefits and interests of the beer industry. Dawson, however, suggested that brewers contribute to congressional incumbents and candidates personally and directly rather than through a PAC, in order to identify the brewer individually and give the contribution a personal tag, so that the candidate is very clear as to who the contribution is coming from and what his or her interests, as a small brewer are.

On hand at the 53rd Annual Convention of BAA was William Earle, Associate Director of ATF. Earle urged the beer industry to stay away from legal battles with ATF over label approval laws, which invoked an exchange between Earle and small brewer Bert Grant, who has recently hit some bumpy roads with the ATF over his label approval on several brands, including a cider. Grant has also caused some heat at ATF over his claim on a label that "Ale Drinkers Live Longer and Love Better."

Earle argued that he did drink that the consumer has a right to know of the alcohol content of beer, but that the information should not be used to promote the product. Earle remarked also that, "health claims regarding beer belong in the public sector, not on labels, not in advertising, not on promotional materials."

According to Earle, the ATF has also been discussing a federal certificate of label approval that would work for each state, and perhaps even moving the filings into an electronic and computer mode. These welcome avenues to expediting the label approval process are most likely several years away from fruition. It is refreshing to note, however that the ATF is looking to simplify this timely and arduous process for the brewer.

Ron Sarasin, President of NBWA, addressed the attendees with some vigor and anger over the state of affairs at the Federal Government level. The Government, according to Sarasin, is trying to put the brewer and the wholesalers in the United States out of business. The mere mention of alcohol and other drugs' by the government, is, according to Sarasin, a deliberate attempt to put the beer industry out of business, or, at the very least, to restrict the business. According to NBWA studies, the government wants to bring number of states providing for equivalency to 30. Presently, there is not one state in the union that provides for equivalency.

"The Government is lobbying the individual states to achieve its goals," Sarasin noted. "The Federal Government is using Federal taxpayers' dollars to try to influence what the individual states are doing," Sarasin added. The Government is trying to impose equivalency and restrict beer advertising, promotion and sales, and, if we are to take the NBWA's research to heart, they are doing these things with the very money that the industry is giving to the Federal Government in taxes. The beer industry, however, has a leg up on the neo-prohibitionists within the Federal Government, since the industry, through the NBWA, has been very active in getting to know the candidates. "Through NBWA PACs, the beer industry has made 1.3 million dollars in contributions, and has gotten many pro-beer industry candidates elected." Sarasin noted. "The legislative conference has been extremely successful in reaching out to wholesalers and brewers and bringing everyone up to speed on the legislative front," a key to the industry's success in Washington.

According to Bob Weinberg and the Association of Brewers, there are close to 500 specialty brewers alive and kicking today, outpacing the 28 national brewers, who, for the first time in brewing history, are mimicking the actions of the smaller brewers.

Weinberg said the next challenge for the microbrewer, and small regional craft brewer in the U.S. is to get and maintain the `share of mind' of the wholesaler, in order to get the quality product sold and recognized in the marketplace. This will undoubtedly bring new challenges to the industry and to the small brewer.

However, the microbrewery, brewpub, and specialty beers continue to be the shining stars of the U.S. beer industry currently.

According to Weinberg, the small brewers will outperform the large national brewers in share of competitive turnover for the first time since the inception of the movement in the early 80s. This means that wholesalers may have to begin to look at the specialty beers in their house, most of which are being brewed by the microbrewers, as the future of their business.

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