Wholesalers gave highest marks to Anheuser-Busch InBev, Boston Beer Company and Constellation Brands Beer Division in Tamarron Consulting’s annual survey of distributors’ perception of key beer industry suppliers.
The survey analyzed results from 158 distributors (down from 228 in 2021) about their opinions on working with nine breweries:
- Anheuser-Busch InBev (A-B) – 39 respondents,
- Molson Coors – 121 respondents,
- Constellation Brands Beer Division – 101 respondents,
- Boston Beer Company – 96 respondents,
- Heineken USA (HUSA) – 100 respondents,
- Mark Anthony Brands – 92 respondents,
- Diageo Beer Company – 86 respondents,
- Sierra Nevada – 66 respondents,
- New Belgium Brewing – 75 respondents.
Respondents skewed toward larger distributors; 41% of respondents’ annual revenue is $150 million or more. Only 12% reported sales revenue less than $25 million. The average number of brands sold among respondents is 297, down 13 from last year; however, the average number of SKUs increased by 96, to 1,371 in 2022.
“A number of distributor comments referenced the pace of innovation experienced in 2021, and the increased SKU count reflects that,” Tamarron wrote in its report.
Tamarron asked respondents to rate the nine breweries based on their relationships – which the consulting firm defines as “relationships with local/regional teams” – and partnerships, which Tamarron described as “how well brewers collaborate with distributors and partner to grow the business.”
A-B ranked highest in relationship with a score of 97%, which Tamarron tempered by noting that “ABI had fewer responses than other suppliers” due to fewer of its wholesalers taking part in the survey. It was followed by Constellation (92%), Boston Beer (89%), Diageo (85%), New Belgium (84%), Sierra Nevada (82%), HUSA and Molson Coors (both 79%) and Mark Anthony (73%).
Constellation scored highest for partnership at 91%, followed by Boston Beer (90%), A-B (85%), New Belgium (84%), Sierra Nevada (82%), Diageo (79%), Molson Coors (69%), HUSA and Mark Anthony (both 63%).
Distributors were asked to identify one supplier as “best-in-class” among those in their portfolios in four core competencies:
- “Develops effective relationships and aligns with distributor’s culture to drive business;
- Ability to navigate all levels of your organization effectively to secure support on critical plan objectives and initiatives;
- Willingness to go the distance to bring value to distributor organization and partners with you to manage brewer’s business growth;
- Providing effective selling tools and training your team to use them during account calls.”
Boston Beer received the most best-in-class selections in all competencies except for providing effective selling tools, and it tied with Molson Coors for best-in-class for ability to navigate all levels of distributors’ organizations.
For developing effective relationships and aligning with distributor culture, survey respondents selected suppliers best-in-class in the following order:
- Boston Beer – 26.5%
- Molson Coors – 20.4%
- Constellation Brands – 19.4%
- Anheuser-Busch InBev – 16.3%
- Heineken USA – 6.1%
- Mark Anthony Brands – 4.1%
- Sierra Nevada – 3.1%
- Diageo and New Belgium – 2%.
On the ability to navigate all levels of a distributor’s organization effectively, Boston Beer and Molson Coors tied for first at 24% each, followed by Constellation (18.8%), A-B (16.7%), HUSA (7.3%), Sierra Nevada (3.1%). Mark Anthony, New Belgium and Diageo tied in last place at 2.1%.
Boston Beer (31.9%) received the most best-in-class votes for willingness to go the distance to bring value, followed by Constellation (20.2%), Molson Coors (18.1%), A-B (16%), Mark Anthony (5.3%), New Belgium and HUSA (tied with 3.2%), and Sierra Nevada and Diageo (tied with 1.1%).
Molson Coors was named best-in-class by 34.1% of respondents for providing effective selling tools and training wholesaler staff on their use, followed by Boston Beer (26.4%), A-B (18.7%), Constellation (13.2%), HUSA (4.4%) and Mark Anthony, Sierra Nevada and Diageo (tied with 1.1%).
The survey also asked respondents to use a 1-5 scale to rate the beer industry overall on nine competencies:
- Establishing and following a strategic plan (4.29);
- Developing effective relationships and distributor culture alignment (4.14);
- Developing effective relationships and engagement at senior levels (4.12);
- Building a valuable portfolio (4.1);
- Delivering the plan (4.07);
- Managing growth in chain/national accounts – off-premise (3.99);
- Partnering to grow the business (3.86);
- Providing effective category and brand selling tools for field sales and distributors (3.85);
- Managing growth in chain/national accounts – on-premise (3.76).
Distributors were asked to rank the industry on specific behaviors within those nine competencies. Of the 10 behaviors with the lowest scores, five were related to “managing growth in chain/national accounts” (three for on-premise, two for off-premise).
“Account staff training was identified as the biggest opportunity for the industry to improve upon again in 2022,” Tamarron wrote.
Respondents gave brewers a score of 3.49 out of 5 on accounts staff training for on-premise chains, which includes “knowledge of and ability to education on-preise personnel on general beer knowledge (e.g. categories, styles, consumer experience, brand-specific target consumers, profit, etc.) as well as brand specifics.”
Other areas for improvement for on-premise chain relationships include category management (“executes a category management strategy that drives growth in the beer category and builds value for on-premise national account customers”), and measurement and evaluation of national accounts performance.
Areas of improvement for relationships with off-premise national accounts included category management and convenience stores (“effectively secures brand/SKU placements, programming, pricing etc. in national/regional c-store chains”).
Tamarron added a new question asking distributors how suppliers can “be proactive in addressing future business needs of distributors – as consumer beverage and shopping preferences shift – requiring distributor[s] and brewer[s’] ways of working to evolve.”
Nearly one-third (31%) of respondents said brewers should practice “understanding and listening to distributors,” followed by e-commerce and digital marketing (19%), data and insights (15%), localized planning and measurement (9%), hot brands and timely innovation (8%), and supply chain efficiencies (7%).
About 90% of wholesalers named spirits-based, ready-to-drink offerings (RTDs) as the item they have most added or wish to add to their portfolios – “by far the No. 1 beyond beer category selected,” Tamarron noted. Wine-based seltzers and RTDs were the second-highest added or desired innovation product, with nearly 60% of respondents saying they have added them or would like to, followed by wine in cans (slightly more than 40%), CBD beverages (slightly less than 40%) and THC beverages (about 10%).
“Most distributors intend to train and use their existing teams to integrate these products into their organizations,” Tamarron wrote of the roughly 90% of respondents who said they would “train and use existing teams” to sell new offerings.