Day One Focuses on Regulatory, Commercial and Economic Value of Distributors
NBWA’s outgoing Chairman of the Board Greg LaMantia spoke about recent changes in the industry noting, “Change can be good. That’s exactly why today’s state legislatures can – and do – change state alcohol laws if needed. All progress comes through change, but not all change is progress.”
LaMantia warned against attempts to make detrimental changes to effective state laws that support today’s independent distribution system, “the system that helps all market participants grow and expand.” Pointing to the more than 3,000 breweries operating in the U.S. today, and the craft segment’s 18 percent growth in 2013, he said, “With all the growth and success in recent years, why in the world would some say the laws and rules need to be changed? Small brewers are expanding because of the system we have in place here in the U.S.”
LaMantia also cited a report issued this year by the Boston Consulting Group which states, “Despite fears that small brewers can’t compete against the scale and reach of large, mass-market brewers, the opposite has proved to be true… Ironically, small brewers’ ability to reach more drinkers has been enabled by the open U.S. beer-distribution system — a system that was once thought to lock out smaller players.”
“The three-tier system was established for a reason, and it delivers great value today,” LaMantia concluded.
NBWA President and CEO Craig Purser expanded on the value that today’s independent beer distribution system provides, saying, “Distributors deliver commercial, economic, and regulatory value to local communities.”
Purser explained the commercial value of local beer distributors by noting the explosive growth in the number of breweries operating in the U.S. and the enormous choice and variety for consumers as a result of an independent, open distribution system. He said, “Independent distributors are why the beer aisle has so much more selection than the soft drink aisle.”
Purser described how local distributors listen to the desires of local retailers and consumers, then work strategically to place products and build beer brands.
He detailed the economic value that distributors deliver stating, “Beer distributors are Main Street businesses that deliver economic benefits to their local communities, by providing local jobs, generating local commerce, and collecting local tax revenue.”
Purser also emphasized the regulatory value that local distributors provide. This past year marked 80 years since the repeal of Prohibition, “which means it’s also been 80 years since the foundation was put in place for today’s effective system of state-based alcohol regulation which gave rise to today’s distribution system,” he said.
“This system continues to provide transparency and accountability, which means that product can be traced,” Purser continued. “Which means the consumer receives safe product. Which means beer recalls over the past several years haven’t caused national panic, and they haven’t been the lead story on the evening news… because brewers and importers have been able to rely on distributors to efficiently and swiftly track the suspected product and remove it from the marketplace.”
Purser cited distributors’ role in the Corona recall that took place before Labor Day, stating, “When a recall can be controlled, and managed in a systematic, organized manner – and when the public can be given assurances that they will be protected – this is a system that works. This is a system that is worth preserving and protecting.”
Gretz Beer Company President Mike Gretz moderated a panel of representatives from four breweries of various sizes. The discussion included John Bryant, co-founder of No-Li Brewhouse; Steven Crandall, founder of Devils Backbone Brewing Company; Tom Long, CEO of MillerCoors LLC; Tony Magee, founder of Lagunitas Brewing Company.
The panel discussed their views on issues facing the beer industry, the intense competition and access to market that exists in the American beer market and the three-tier system’s role in its success. They also emphasized distributors’ role in building brands and the importance of industry partnerships for growing the beer category.
The general session concluded with a presentation by Rob O’Neill, former team leader for the Naval Special Warfare Development Group and one of the most highly-decorated combat veterans of our time. O’Neill has deployed more than a dozen times, and he held combat leadership roles in more than 400 combat missions in four different theaters of war. As a former Navy SEAL who has trained more than 800 special operations and tactical operators, O’Neill shared with the beer industry some actionable insights on leadership, decision-making, operating in uncertain environments and how to become the “best of the best.”
Following the general session program, the Product Demonstration Showcase opened featuring products and services from more than 130 exhibitors, including imported and domestic beer from 30 different breweries, non-alcoholic beverages, warehousing technology, financial services software, promotional products and more.
NBWA’s 77th Annual Convention continues Tuesday, September 30, at the Hyatt Regency New Orleans. To view NBWA-TV reports from the convention, please visit NBWA’s YouTube channel at www.youtube.com/NBWABeer. Follow the conversation on Twitter using #NBWANOLA, and download the convention mobile app.