Distinguished Brands International – Street Talk, VOL VI Issue 8

USA / BELGIUM – It is reported that AB-InBev is exploring possibilities of selling its struggling Rolling Rock brand. This comes just three years after Anheuser-Busch bought the brand from InBev for $82million. Rolling Rock sales have been declining in recent years, down 13% last year to 7.4 milliion cases, but due its very recognizable name and look, it could be an appealing brand to a company looking to expand its US market. Rolling Rock pale lager originated 70 years ago in Latrobe, PA and is sold in very distinctive green bottles.

One possible buyer could be North American Breweries, Inc., owned by New York-based private equity firm KPS Capital Partners LP, which has already reached deals to acquire High Falls Brewing Co. and Labatt USA, both located in upstate New York. When asked about the possibility, A KPS spokesman declined to comment. Another potential suitor could be C2 Imports LLC, which also vied for Labatt USA. C2 Imports is a California-based beer importer led by former Anheuser executive Charlie Cindric.
A spokeswoman for Anheuser-Busch InBev, which is based in Leuven, Belgium, declined to comment on the possibility of a sale.

UTAH – Beginning July 1st bars will no longer required to be a “private club” thanks to a new state liquor law signed by Gov. Jon Huntsman on March 30th. The new law eliminates the rule where customers are required to fill out an application and pay a fee before being allowed into a bar. It also allows restaurants to remove the partitions, commonly called the “Zion Curtain”, that separate the bartenders from the customers within restaurants allowing them to directly serve patrons over the bar counters. These changes have been the most radical changes made in 40 years. The changes are being made for efforts to increase the state’s tourism industry which is currently $6 billion per year.

ALEXANDRIA, VA – The National Beer Wholesalers Association (NBWA) and the Brewers Association (BA) are now accepting nominations for the 3rd Annual Craft Beer Distributor of the Year Award. This award is presented annually to a beer distributor who actively markets, sells and promotes craft beer. This year’s 3rd Annual Craft Beer Distributor of the Year Award will be presented at the Great American Beer Festival, hosted by BA September 24 – 26, in Denver, Colorado.

Beer distributors and craft brewers can nominate any distributor they believe is deserving of the award. Nominations will be accepted until 5:00 p.m. on July 31, 2009. For entry rules and nomination forms, visit http://www.nbwa.org/Industry_Technology/distributor_of_the_year.aspx.

BELGIUM – InBev plans on putting new product launches on hold for the time being. The company states that consumers are nervous with the current economy and, as other reports have shown, they are sticking with brands that they know. Planned brand extensions for the Becks’ and Budweiser brands have been put on ice.

As for further efforts to raise money to pay down debt stemming from its $52 billion acquisition of Anheuser-Busch last year InBev is still considering letting go some of the brands in its portfolio – included in possibilities are the ale brands, Estrella Damm and Michelob as well as Leffe and Hoegaarden. Some say that the company has also been in discussions with Dutch brewer Heineken to sell its Czech unit, Pivovary Staropramen. Pivovary Staropramen is the second-largest brewery in the Czech Republic and has been valued at $255 million to $306 million. InBev executives are not commenting on this speculation.

Stuart MacFarlane, InBev president of UK and Ireland, said the company will focus its attention behind its core brands-Stella Artois, Becks Vier and Budweiser.

KENTUCKY – As of April 1st, Kentucky introduced a 6% sales tax on spirits, wine and beer sold at package stores. This same tax is already in effect at bars and restaurants. Brown-Forman makes the point that after this tax, Kentucky has the nation’s second-highest tax on alcoholic beverages at retail level. Alaska is number one in this category. Brown-Forman also feels that Kentucky is punishing its signature product – Bourbon and along with the Kentucky Distillers Association feel the new tax is putting state distillers at “a significant competitive disadvantage.”

UNITED KINGDOM – The UK’s leading premium ale, Fuller’s London Pride, returns to TV this spring with the heaviest-ever on screen activity from April 1st through the end of May. Starting April 1, a new version of London Pride’s ‘ingredients’ advertisement will appear in prominent slots during the ITV network’s most high profile sports, drama, documentary and entertainment programming, including International, Champions League, FA Cup and Uefa Cup football as well as the popular new series Lewis and a number of films. For additional support for the TV ads, London Pride will also feature poster campaigns across London and the southern half of the country.
John Roberts, managing director of The Fuller’s Beer Company, said: “London Pride is the UK’s leading premium ale and is well-known to discerning beer drinkers. This campaign will see us reach more of those drinkers than ever before.”

Fuller’s U.S. products are imported and represented by Distinguished Brands International, LLC in Littleton, CO. Visit their website at www.distinguished-brands.com

NEW YORK – The New York wine bill that proposed selling wine in grocery stores was squashed by liquor store owners and other competitors in late March. Supporters of the bill are likely to try to revive it through a compromise bill this spring. The compromise would allow grocery store wine sales in exchange for allowing liquor stores to operate more outlets and carry more offerings like food and beer. The plan would also limit wine selections in grocery stores to winemakers who produce fewer than 250,000 gallons of wine a year, which means sales would mainly come from the state’s primarily smaller farm wineries. A spokesman for the liquor stores said they will oppose the compromise bill as well.

In addition, New York will be raising taxes on wine and beer. The final budget that was released at the end of March states wine tax will increase to 30 cents per gallon and tax on beer will go up to 14 cents per gallon – from the previous 11 cents. The taxes will be paid by the wineries and breweries and will most likely be passed on to consumers. This could feasibly result in a double tax increasing to as high as 58% for wine and 27% for beer.

POTTSVILLE, PA – D.G. Yuengling & Son is now producing a new Bock variety much to the excitement of their loyal drinkers. It has only been released in the past month and currently is only available on tap. It is expected to make a strong statement among the loyal Yuengling drinkers looking for something “a little different”.

Reviews of the new brew state the beer pours smooth like a Bock should. It has a dark-brown color with an off-white head. Its aroma is pleasant with notes of caramel and malts; however, these smells have a tendency to dissipate as the beer sits. The taste starts out strong but mellows after the first few sips. It should be compared more to Michelob’s Amber Bock versus the more robust and darker Dopple Bock. Overall it’s a very smooth tasting, balanced beer that’s very easy to drink throughout the night. Yuengling Bock has a 5.1 percent ABV.

UNITED KINGDOM — London brewer and pub retailer, Fuller, Smith & Turner P.L.C., is sending a clear bold message to the Chancellor ahead of this month’s budget announcement with a huge banner at its Griffin Brewery in Chiswick, West London. The banner, situated on the Hogarth Roundabout, will be seen by hundreds of thousands of motorists every day and it urges the public to say no to the Chancellor’s planned beer duty hike by lobbying their MP at the dedicated campaign website, www.axethebeertax.com. Concerned pub-goers can also send a message to the Chancellor by texting the word ‘Lobby’ to 81025. Through the campaign the Chancellor is being asked to abandon the 2% above inflation increase announced at the last budget and give British pubs a fighting chance of survival in the current downturn.

Unveiling the banner, Fuller’s Chairman, Michael Turner, said: “The tax on beer imposed by the Chancellor has been increased by 18% in the last year alone and British drinkers pay more tax on their pint than anywhere else in Europe. Enough is enough.”
“We have seen over 2,000 pubs close their doors for good in the last 12 months, with the loss of around 20,000 jobs.”

Fuller’s U.S. products are distributed by Distinguished Brands International located in Littleton, CO. You can visit their website at www.distinguished-brands.com.

INDUSTRY – Pointer Media Network (division of Catalina Marketing) has released numbers that show 7.5 million of total wine consumers, or 6.8%, drive 80% of the category’s total US volume. This indicates that the “targeted” wine consumer may be more concentrated than you think. For premium imported wine the number is even more concentrated. They found 5.2 million consumers, or 4.7%, drive the volume and for table/box wines it’s only 5 million consumers or 4.6%.
PMN says these numbers are important for wine marketers so they can “Precisely target brand messaging and find the best, most profitable consumers”.

UNITED KINGDOM – A source from U.K. publication The Morning Advertiser was quoted as saying that the rate of pub closures is likely to peak at around 46 a week at some point later this year. If this happens, it could leave only 56,000 pubs open and operating in the UK in the next five years – a startling decline from the 62,742 that are open currently. A CGA Strategy consultant says that although food-led pubs will out-perform; the community boozer is not in terminal decline. The consultant suggests that ‘what’s going on is a re-alignment’. We can continue to hope this is the case.