Beer Institute, NBWA Vow to Improve Beer Category Health

The Beer Institute (BI) and the National Beer Wholesalers Association (NBWA) have made an early New Year’s resolution: improve beer category health.

The boards of directors for the two industry trade organizations each passed resolutions earlier this month pledging to work together with other industry players in support advancing the beer category and reclaiming market share from wine and spirits.

The resolutions come at the end of a year in which several executives from the largest beer manufacturers in the world implored fellow industry members to stand united and reclaim dwindling market share. In fact, U.S. beer volume sales have remained roughly flat through the first 11 months of the year, according to the latest off-premise retailing sales data provider IRI Worldwide.

“2018 has to be a year in which we take action,” Beer Institute CEO Jim McGreevy told Brewbound. “And there seems to be a growing consensus — at least among some suppliers and distributors — to do that.”

In a unanimously passed resolution on December 6, the NBWA vowed to work with the Beer Institute and the Brewers Association (BA) “to provide leadership, support and assistance to improve the health of the beer category,” which is “experiencing volume trend challenges, which is of concern to all segments of the industry (suppliers, distributors and retailers).”

“All beer industry participants must be engaged in a united effort to advance the beer category,” the resolution read.

A week later, the Beer Institute’s board of directors passed its own resolution, in which it pledged to “engage with other beer industry partners and stakeholders in a positive, productive, and collaborative manner to advance beer and the beer industry.”

“Such collaboration should be done in an environment of respect and cooperation for the roles all companies, partners, and stakeholders play in our industry,” the BI’s resolution read.

Although the Brewers Association has not released a resolution, the non-profit trade group representing the interests of small and independent brewers is in active discussions with other industry members about bettering beer category health, CEO Bob Pease wrote to Brewbound in an email.

“The Brewers Association has been taking part in these discussions and others to promote beer category health,” he wrote. “The Brewers Association is committed to helping drive beer category health.”

At several beer industry gatherings throughout the year, high-level executives from A-B, Moslon Coors, Heineken and Constellation Brands challenged fellow industry members to stand united and win back market share from wine and spirits. The most sobering discussion came during October’s NBWA convention, when Heineken USA CEO Ronald den Elzen told a room filled with thousands of beer distributors that the industry has lost 35 million barrels — or 11 billion servings of beer — to wine and spirits over the last 20 years. He added that beer’s so-called “share of throat,” compared to wine and spirits, had dropped from 62 percent to “a mere 50 percent” during that same period.

“If this is not a wakeup call that we need to do something, I don’t know what is,” he said.

Those comments followed a speech given by MillerCoors CEO Gavin Hattersley at the annual Beer Institute meeting, held in July, in which he warned of “internal assassins” causing strife. He was alluding to the BA’s independent craft brewer seal, which he called “self-serving icons touting so-called independence.”

“We must all be pro-beer first and try to differentiate our category from wine and spirits, and we must do that together,” he said.

In a conversation with Brewbound, McGreevy said no meetings have been scheduled to discuss strategies for cooperating, although he expects those to be made soon.

“You have to get people around a table to have the conversation and agree that there are issues that can be addressed and then agree how to take care of them,” he said. “We’ve been doing some research on this to identify ways to promote the category better. We think now there is a lot of interest in finding actions to take, which is very positive.”

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