Franklin Liquors
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Today’s Industry News
Five years later, a more global A-B
Source: St. Louis Post Dispatch
By Lisa Brown
July 7th
Five years ago this week, Anheuser-Busch Cos. agreed to be acquired by Belgian brewer InBev, creating the world’s largest brewer and setting off ripples of worry throughout the region as uncertainty loomed over one of St. Louis’ most revered homegrown businesses.
In the years since the $52 billion deal was announced on July 13, 2008, much has changed at A-B’s corporate offices at One Busch Place.
The Busch family that ran A-B for more than a century would ultimately exit the company whose beers had become iconic symbols of Americana, marking an end of an era.
Now, St. Louis is the North American headquarters for the combined A-B InBev, responsible for U.S. and Canadian operations, and the company’s world headquarters is in Belgium.
The change has been jarring. A-B InBev’s local workforce before the merger was about 6,000. A-B declined to release its current local figure, which was trimmed through layoffs and buyouts following the sale, but the brewer has said that it employed 4,000 at the end of 2011 in St. Louis.
Also cut loose to help pay for the massive merger: Busch Entertainment. In 2009, A-B sold Busch Entertainment’s 10 theme parks, including Busch Gardens and Sea World, to private equity firm Blackstone Group.
But doomsday scenarios of St. Louis losing its place as the epicenter for the company’s U.S. operations failed to materialize. In 2011, A-B said it planned to invest more than $1 billion in its U.S. facilities from 2011 to 2014, including upgrades to modernize operations at its St. Louis brewery.
A-B InBev remains the largest brewer in the country, with its market share accounting for close to half of all U.S. beer sales. Bud Light remains the best selling beer in the country.
This year, the brewer marked the 80th anniversary of its iconic association with Clydesdales, and the company says it’s exploring ways to extend the horses’ visibility internationally. One of A-B’s three teams of Clydesdales is based in St. Louis, and its breeding facility is near Boonville, Mo.
“There was a tremendous amount of concern that something bad for St. Louis was going to happen, like them closing the brewery or getting rid of the Clydesdales,” said Glenn MacDonald, an economics and strategy professor at Washington University’s Olin Business School. “The fear was that A-B would be downsized to oblivion, and that clearly hasn’t happened.”
MacDonald said some of the changes made after the sale have helped solidify the company’s long-term viability.
“It had the trappings of a family company before, and A-B clearly did become a trimmer, more modern company,” he said. “In a way, A-B being less efficient was probably a much bigger risk to St. Louis than InBev.”
In January 2012, Luiz Edmond, president of North America for A-B InBev, assumed leadership of the brewery’s U.S. operations in St. Louis upon the departure of president David Peacock, a former head of marketing at A-B who became president after the 2008 sale.
In front of more than 100 employees in May at a groundbreaking for a new 300-seat biergarten at the St. Louis brewery, Edmond said the company remains committed to investing in St. Louis.
“We guarantee you that this is just a first step in a three- or four-year project that will bring new news every year and will make this a real attraction,” Edmond said of the new biergarten.
Referring to the Budweiser sign that’s been atop the Bevo building since the 1940s, Edmond said: “We hope it’ll be here for another 100 years.”
‘A NEW COMPANY’
After the merger, the combined companies went through an integration period followed by what executives call “optimization.”
One of the changes after the merger included adding elements of Six Sigma – a management philosophy that uses data to cut waste and make improvements – throughout A-B, even in human resources.
“It’s a new company,” said Tom Pirko, president of Bevmark, a food and beverage industry consulting firm in Buellton, Calif. “The culture’s changed. The philosophy’s changed. The psychology’s changed. It’s a more disciplined company now and more a philosophy of a global company. We’ve seen a sea change. I hardly recognize it.”
Yet the change hasn’t been one-way.
“A lot of people say InBev changed A-B, but A-B also changed InBev,” said Vice President of People Jim Brickey, a 24-year A-B employee who oversees human resources and is a member of the North American Zone’s management committee.
Some of A-B’s training programs have been rolled out to employees from around the world, and a long-term incentive program for compensation developed at A-B also has been adopted companywide, he pointed out.
The change in ownership also has made A-B less risk-averse, executives say. Faced with competition from craft beer and lower consumer spending during the economic downturn, A-B’s innovation pipeline for new products and packaging has been in overdrive.
In 2010, A-B added red, white and blue stars and stripes to Budweiser cans. During the summer months, the packaging has helped spur Budweiser sales, which have been declining each year in the U.S. since the 1980s.
The year after the red, white and blue cans debuted marked “Budweiser’s best summer in the past 10 years,” said Rob McCarthy, vice president of Bud Light brands, who oversaw Budweiser from late 2009 until January.
So far this year, its U.S. product launches include Beck’s Sapphire, Budweiser Black Crown, Bud Light Lime Straw-Ber-Rita and Stella Artois Cidre, in addition to the bowtie-shaped Budweiser can. Those new additions followed the launches of Bud Light Platinum and Bud Light Lime Lime-A-Rita last year, which helped A-B InBev’s beer volume in the U.S. grow in 2012 for the first time in four years.
“The new company is about taking big bets,” said Pat McGauley, vice president of innovation and new products at Anheuser-Busch. “If we believe we have the proper data, we’re willing to make a bet behind it, and I think that differentiates us from our competitors.”
GLOBAL CONNECTIONS
Under CEO Carlos Brito, A-B InBev has set out to grow Budweiser and other brands to a broader worldwide audience. Budweiser volume grew 6.4 percent in 2012, boosted by Latin America and Asia, despite declining U.S. sales.
Last year marked the first time that more than half of Budweiser production sold – 51 percent – was outside of the U.S., versus 28 percent in 2009. A-B InBev recently acquired the half of Mexico-based Grupo Modelo it didn’t already own, adding Corona to its stable of “global brands” alongside Budweiser, Stella Artois and Beck’s. Victor, N.Y.-based Constellation Brands acquired the Corona license and other Grupo Modelo brands in the U.S. to gain antitrust approval.
As A-B InBev grows, ideas generated here in St. Louis are finding their way around the world.
Margarita Flores, A-B’s vice president of community affairs, said a 25-year-old partnership between the brewer and the American Red Cross to provide canned drinking water in emergencies is being replicated where the company has operations elsewhere, including Western Europe.
The St. Louis brewer also has become a model for other A-B InBev facilities as the parent company seeks to reduce the use of water in plant operations worldwide.
In 2007, the last full calendar year before InBev acquired A-B, the St. Louis brewery used 6.3 hectoliters of water for every hectoliter of beer production. The gauge includes every drop of water used – from cleaning beer tanks to water used in brewing beer; a hectoliter is equal to 26.4 gallons. By comparison, this ratio was 10-to-1 in 1997.
Prompted by a corporate push to reduce water and energy use companywide, the St. Louis brewery’s water usage ratio was cut nearly in half to 3.31-to-1 at the end of 2012.
The St. Louis brewery was able to achieve the lower level by simple fixes such as turning off a hose immediately after a floor is washed, said Jeff Pitts, general manager of the St. Louis brewery. More complex engineering changes include the deployment of new technology on reclamation systems.
“Before, when we were A-B, it was a big deal, but our new company has taken it up a notch,” Pitts said of water and energy reduction goals. “The global initiative is to take all breweries to 3.2 hectoliters, and St. Louis will be expected to be less than 3,” Pitts continued. “St. Louis is the proving ground. If we can run it, it’s rolled out at other breweries” worldwide.
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Pennsylvania: Liquor lobbyists spent over $900,000 towards privatizing alcohol sales in Pa.
Source: Lancaster Online
By GIL SMART
Jul 07, 2013
So close and yet so far.
Last week, Gov. Tom Corbett’s dream of privatizing liquor sales in Pennsylvania went down in flames, as state senators couldn’t agree on a plan to get the commonwealth out of the booze business.
It was the fourth time privatization has come up in the Legislature, said G. Terry Madonna, director of Franklin & Marshall College’s Center for Public Affairs. But, he noted, when the House voted to privatize state stores in March, it marked the first time either chamber had passed a privatization proposal.
“This came a lot closer than it’s been in the past,” Madonna said.
The final push – and the goal-line stand – were both funded by prodigious amounts of money poured into the political process by those with a stake in the outcome.
According to records from the Pennsylvania Department of State’s Lobbying Disclosure database, $925,898 has been spent on alcoholic beverages lobbying so far in 2013. Corporations, unions, wineries, beer distributors and trade groups sought to make their voices heard above the din of what one newspaper called one of “the largest public flocks of lobbyists” in recent memory.
Stakeholders also poured thousands of dollars into the campaign coffers of influential legislators who helped to craft, or cripple, the legislative proposals.
Legislators insist the money can’t buy their votes.
“The notion that my vote is for sale is bull, frankly,” said state Rep. Mike Sturla, D-Lancaster, who got campaign contributions from several political action committees that opposed privatization.
But Barry Kauffman, executive director of Common Cause Pennsylvania, a good-government group, said if the Legislature takes up privatization when it returns in the fall, the gravy train can keep right on rolling.
“There are some fairly wealthy campaign contributors who, if you drag debate out to the fall or spring, will have more opportunities to give campaign contributions,” Kauffman said.
The big pockets dug deep in the first few months of the year.
Wegmans, the food market chain headquartered near Rochester, N.Y., with six outlets in Pennsylvania, spent $67,225 in the first three months of 2013, according to Pennsylvania Department of State records (information on spending from April-June was unavailable).
Wegmans sells beer at eat-in cafes at all its Pennsylvania locations. In May, Craig Hoffman, senior vice president for Wegmans Pennsylvania division, told a state Senate hearing that the chain wants to be able to sell wine and spirits in its stores.
In a statement last week, Wegmans spokeswoman Jo Natale said the firm supported privatization “because it would have provided consumers with greater convenience and more choice. We certainly hope it will be resurrected in the future.”
Sheetz, the Altoona-based convenience store chain, the United Food and Commercial Workers Local 1776, the union representing approximately 3,000 state store workers, and Pittsburgh-area food market chain Giant Eagle all spent more than $50,000 on lobbying between January and March, state records show.
Big beer also was part of the process; Anheuser-Busch spent $37,008 on lobbying, while MillerCoors LLC spent $21,961. In March, both firms objected to the House privatization bill, saying that by permitting hundreds of additional wine and spirits license, the legislation would harm beer distributors and tilt the playing field in favor of the wine industry.
Diageo – a multinational firm that owns Smirnoff, Johnny Walker, Captain Morgan, Gordon’s gin and other liquor brands, as well as Guinness beer and several wineries – spent $25,635 on lobbying, records show. Wal-Mart and Target spent $30,695 and $10,863, respectively. Officials with both organizations said the chains would sell liquor if privatization became law.
Trade groups were heavily represented among the organizations that spent the most. These included the Wine and Spirts Association of Pennsylvania, the Pennsylvania Licensed Beverage Association, representing the tavern industry, the Pennsylvania Restaurant & Lodging Association and the Malt Beverages Distributors Association of Pennsylvania.
Jay Weiderhold is president of the Pennsylvania Beer Alliance, which represents beer wholesalers. The group spent comparatively little on lobbying ($5,341), but has dispersed more than $44,000 in campaign contributions so far this year, according to state records.
“PBA represents local businesses that employ local people throughout the Commonwealth. … [and] should be no surprise that these businesses are interested in being a part of the political process,” Weiderhold said in a statement. “Contributions are part of being politically engaged. In the political realm you win some fights and you lose some fights, but being actively involved is part of the process.”
One of the biggest campaign contributors has been the 1776 PAC, the political action committee representing UFCW Local 1776, the union representing most Pennsylvania Liquor Control Board employees.
The PAC contributed $67,086.69 through June 10, according to state records, most of it to privatization foes like Senate Democratic Leader Jay Costa Jr., D-Allegheny County, who led opposition in the Senate to the Republican-backed plan. Costa’s campaign got $5,500 from the union PAC, state records show.
Last week, Mediatrackers, an online news site, reported that state Sen. Jay McIlhenny, R-Bucks, received at least $43,000 from privatization opponents in April. That same month, McIlhenney unveiled a plan to privatize liquor sales gradually, with the PLCB permitted to decide when to close unprofitable state stores, and beer distributors, taverns and restaurants and some supermarkets allowed to expand the type and quantity of alcohol they sell. The state would have retained ownership of the wholesale liquor distribution system.
The bill was widely seen as a retreat, with the Allentown Morning Call newspaper predicting, accurately, that it “could spell political doom for Corbett’s liquor privatization plans.”
A call to McIlhenny’s Harrisburg office last week was not immediately returned.
Senate Majority Leader Dominic Pileggi, R-Delaware County, got at least $6,500 in campaign contributions from those with a stake in the privatization outcome, including DisPAC, the Malt Beverage Distributors Association’s political action committee, the Pennsylvania Beer Alliance, Tavern PAC and Wine & Spirits Brokers. Pileggi had been consistently skeptical of privatization plans, though he did support McIlhenny’s bill, provided changes were included to provide beer distributors and restaurants and taverns more flexibility.
Locally, Sen. Mike Brubaker, R-Warwick Township, got two separate $500 contributions from political action committees representing liquor interests: Greenlee Partners, which represents the Distilled Spirits Council of the United States, Wal-Mart Stores and Brewers of Pennsylvania, among others, and Pugliese Associates, which represents the restaurant and hotel industry. He also got $500 from DisPAC, the political action committee of the Malt Beverage Distributors Association of Pennsylvania.
Those donations came before Brubaker announced he would not seek a third term in office.
Sturla’s campaign arm, Mike Sturla for State Representative, got $2,000 from the 1776PAC, $1,500 from the Pennsylvania Beer Alliance and $500 from the Tavern PAC.
Sturla’s opposition to privatization, he said, “had nothing to do with who gave money to me. I make decisions based on the best interests of my constituents.”
Sturla also suggested there was more money poured into the political process by those who favored privatization than could be definitively traced. Ideological backers of privatization, he said, are often represented by big firms that lobby on behalf of dozens of clients representing a plethora of different industries. Definitively tying the dollars spent to the privatization issue would be nearly impossible.
And some political action committees contribute on behalf of a number of causes. For example, the Pennsylvania Chamber of Business and Industry backed privatization, but its Chamber PAC supports many candidates for many different reasons.
Kauffman, of Common Cause, agreed.
“You’re probably only seeing the tip of the iceberg,” he said. “It’s almost impossible to get a good grasp of what’s really going on.”
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Diageo Raises Stake in United Spirits, But Falls Short of Target Again
Source: MoneyBeat
By Shefali Anand
Jul 5th
The U.K.’s Diageo PLC, DGE.LN -0.30% the world’s biggest spirits maker, has effectively gained control of India’s United Spirits Ltd., but it hasn’t gone as planned.
Diageo said late Thursday that it had completed the acquisition of another 15% of United Spirits, India’s top spirits producer, from a group controlled by billionaire Vijay Mallya. That brings its total stake to 25% at a cost of around 52 billion rupees (US$872 million), it said.
This is well below the 53.4% stake it had in mind. In November, Diageo said it planned to buy 53.4% in two pieces-27.4% from holding company United Breweries Holdings Ltd. and related entities and 26% from general shareholders in an open offer.
In April, Diageo offered to buy the 26% stake, which totaled around 38 million shares, in an open offer at 1,440 rupees a share-around 20% below the stock’s closing price the previous day. The offer failed, a person familiar with the matter told The Wall Street Journal in late April.
The remaining 27.4% stake was to come from a fresh issue of shares by United Spirits, and the holdings of United Breweries and related entities.
However, Diageo wasn’t able to get all of this either, the company said Thursday. Around 2.4% of United Spirits’ shares are held as collateral by lenders who refuse to release them, it said, leaving it with only 25%.
Diageo added that it would buy the additional 2.4% if the lenders agreed in the near future to release them.
The U.K. company said it was comfortable owning a smaller stake in United Spirits because it will still get management control. The deal entitles Diageo to nominate directors to the United Spirits board, which it did. In addition, United Breweries and some other parties are obliged to vote at Diageo’s direction for some years, Diageo said.
Diageo added that it expects to turn a profit from the acquisition within five years.
“India will become one of Diageo’s largest markets, with its increasing number of middle-class consumers looking for premium and prestige local spirits as income levels rise,” Diageo Chief Executive Ivan Menezes said.
Diageo said it had used cash and debt to pay for the acquisition.
As part of the agreement, Mr. Mallya will continue as a non-executive director and chairman of United Spirits, while Ashok Capoor will continue as chief executive officer.
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Washington: Small Wash. liquor stores get aid from state
Source: Komo News
By MIKE BAKER
Jul 6, 2013
State lawmakers extended a lifeline this year to small liquor stores who had struggled under the new privatization rules, but that change has also opened the door for large retailers to ask for the same break next year.
In one of the final votes taken by the Legislature before adjournment last month, lawmakers agreed to limit the fees paid by the smaller stores that used to handle liquor sales when the state controlled the market. Those outlets will no longer have to pay a 17 percent fee for sales to bars and restaurants.
Voters approved an initiative in 2011 to privatize liquor sales and dismantle Washington’s state-run liquor system, which was formed in the 1930s in the aftermath of Prohibition.
Trent House, a lobbyist working for a company that operates two of the former state-contracted liquor stores, said the initiative caused many of the small operations to lose much of their restaurant and bar business. Those clients instead have the option of buying directly from distributors and get a lower price by avoiding the markup that comes from the 17 percent fee.
“What was most important for our survival was making sure that the 17 percent came off for us,” said House, who represents Monroe-based Clearview Spirits and Wines.
Larger retailers, however, also want the same benefit. Holly Chisa, a lobbyist with the Northwest Grocery Association, said the retailers believe the state did not properly interpret the language of the liquor privatization initiative – passed by voters in 2011 – and that the 17 percent fee should not apply for such retailer-to-restaurant transactions.
Grocery outlets had tried to get that changed this year, but Chisa now says that they will work with lawmakers next year to get it implemented.
“We’re not giving up by any stretch,” Chisa said.
Senate Republican Leader Mark Schoesler of Ritzville said lawmakers didn’t have the votes this year to expand the measure to other retailers. He said there was a lot of sympathy for the former contract stores who needed a break, so lawmakers focused primarily on providing aid there.
Next year, Schoesler said it’s a possible that the Legislature will expand the rule, but he said budget writers may balk at the plan since it would likely impact state revenues.
“I think everybody’s just taking a wait-and-see attitude,” Schoesler said.
John Guadnola, executive director of the Association of Washington Spirits and Wine Distributors, said the group supported exempting the former contract stores from the 17 percent fee, since a lot of those people are small businesses trying to fill a niche. The group opposes the idea of eliminating the 17 percent fee for large retailers who are trying to act more like distributors.
If large retailers don’t pay the 17 percent and don’t pay the 10 percent fee paid by licensed distributors, Guadnola said those large retailers would have a significant and unfair competitive advantage.
That would make it difficult for distributors to compete in some ways. And, if restaurants and bars rely on retailers for their supply instead of distributors, it could mean less selection and variety for consumers, Guadnola said.
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Seasonal Beers showing signs of a strong 2Q13 in On-Premise after a weak start to 2013
Source: GuestMetrics
July 8, 2013
According to GuestMetrics, after starting out the year with on a relatively weak note in 1Q, seasonal beer volumes are showing signs of a healthy recovery in the on-premise channel for 2Q thru June 16th.
“In analyzing the approximately 400 seasonal beer brands we track in our system, seasonal volumes were off to a fairly weak start in 1Q13 with year-over-year volume declining -2.4%, but thus far in 2Q, have experienced a solid bounce back, with volumes up +5.8% through June 16th. Given the fact the first quarter of the year tends to be the smallest one for seasonal beers, it is encouraging to see the recovery thus far during the second quarter,” said Bill Pecoriello, CEO of GuestMetrics LLC. Based on data from GuestMetrics, year-over-year on-premise retail dollar sales for seasonal beers were up +0.7% in 1Q13 but accelerated to +9.1% in 2Q13 to-date, with price/mix showing a slight acceleration from +3.0% in 1Q13 to +3.3% in 2Q13 to-date.
“To get an understanding for the relative importance of the various seasons of the year, we also analyzed seasonal beer data with respect to the four quarters. Looking at 2012, 19% of seasonal beer’s volume came during 1Q, 26% during 2Q, 26% during 3Q, and 28% during 4Q,” said Peter Reidhead, VP of Strategy and Insights at GuestMetrics. “In the same vein, we also analyzed seasonal beer’s share of overall beer volume, and saw a similar pattern. Seasonal beer’s share of overall beer volume was 1.3% during the first quarter of 2012, 1.7% during the second quarter, 1.8% during the third quarter, and 2.0% during the fourth quarter. Looking at 2013, seasonal’s share of overall beer volume was 1.2% during 1Q, so just slightly below its share for the same period during the prior year, and is back to 1.8% during 2Q to-date, above its share during the second quarter of last year, an encouraging sign.”
“While seasonal beers are a fairly small portion of the overall beer category with generally less than a 2-share of total volumes in on-premise, given the competitive nature of the alcohol industry and the generally sluggish growth being experienced in overall on-premise, the trends thus far in 2Q for seasonal beers are encouraging, and could be a source for incremental growth for both suppliers and operators as we head further into the summer season,” said Brian Barrett, President of GuestMetrics.
About GuestMetrics LLC
GuestMetrics, LLC is revolutionizing how the hospitality industry operates. Despite the dawn of the Digital Age having begun more than three decades ago, the hospitality industry essentially functions the same way it did centuries before. GuestMetrics has cracked the code by collecting billion dollars in sales from tens of thousands of restaurants, and turning billions of raw transactions into intelligible data that is fundamentally transforming the business operations of everyone from the independently-owned bar/restaurant on the corner, to multi-national chains, to the food & beverage companies that supply them. Please visitwww.GuestMetrics.com for more information and to arrange for a free demonstration.
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10 States Where People Drink The Most Beer
Source: Huff Post
07/05/2013
We are a nation of beer drinkers. And if you don’t agree, consider the fact that Americans of drinking age downed an average of 300 beers last year, according to a new report by the Beer Institute, a national trade association.
So who drinks the most? The Beer Institue crunched the per-capita numbers and discovered it to be none other than North Dakota (while Utah ranked dead last).
To find out which other states’ residents drink the most beer, click through below:
http://www.huffingtonpost.com/2013/07/05/states-beer-per-capita-consumption_n_3551085.html
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Refresher Course: Shandies to Drink This Summer
The world’s favorite beer cocktail is finally catching on in the U.S.A
Source: WSJ
July 5th
AMERICAN DRINKERS have, historically, preferred their beer straight, whether poured from a bottle or drawn from a tap. Lately, though, stateside bartenders and brewers have begun to mix things up with a style of beer cocktail that’s well-established in other parts of the world: the shandygaff. Also known as the shandy, it typically consists of equal parts beer and ginger beer or lemon soda. You’d think it would have caught on sooner, light and refreshing as it is, with just enough booze to take the edge off a hot day.
Though the drink’s precise origins are unknown, it dates at least as far back as the mid-19th century. The British hold the strongest claim to its invention, and the shandy can be found, with slight variations, throughout the Commonwealth. Its cousins around the world include the German radler (beer and lemonade) and the Mexican michelada (beer, lime juice, chili sauce, Worcestershire and spices).
Over the past couple of years, U.S. brewers including Leinenkugel’s, Samuel Adams and newcomer Traveler Beer Co. have released bottled shandy blends. But it’s bartenders who are really remaking the shandy, cutting brews with everything from spirits, aperitifs and drinking vinegars to fruit purées and even kombucha, the fermented tea touted in some quarters for its liver-cleansing benefits.
“Detoxing while you’re toxing” is how Eric Childs, founder and co-owner of New York kombucha company and homebrewing center Kombucha Brooklyn, describes the effects of his own kombucha-pilsner shandy. At Chicago’s Billy Sunday, owner Matthias Merges combines lemon juice and a star-anise-infused rhubarb simple syrup with a bottle of Japanese hefeweizen to make what he calls a Shandinsky, in tribute to the Russian painter Wassily Kandinsky.
The shandy meets the Bloody Mary at Sunshine Tavern in Portland, Ore., in a cocktail of light kölsch-style beer, tomato juice, horseradish and lime juice finished with a few dashes of Tabasco for extra kick. And at New York’s Back Forty, the Penn Shandy is a combination of floral gin, freshly squeezed lime juice, ginger simple syrup and crisp pilsner-a play on the classic French 75, with beer taking the place of Champagne. Hybrids like these provide a lower-alcohol alternative to the cocktails that inspire them, a sensible choice at a time of year when you’re all too likely to drink more than one.
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Sam Adams Beer Ad Omits ‘God’ Reference From Declaration Of Independence
Source: CBS Boston
July 6, 2013
A controversy is brewing over the latest Samuel Adams beer commercial.
The ad asks, “Why name a beer after Samuel Adams?”
It quotes the Declaration of Independence, but omits a portion that references God.
“All men are created equal, that they are endowed with certain unalienable rights: life, liberty and the pursuit of happiness,” the actor in the ad states.
The actual document reads, “.that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.”
Samuel Adams’ Facebook page has been bombarded with both positive and negative comments over the ad.
The company reportedly issued a statement acknowledging it was an intentional omission, and noting that the decision is in line with industry guidelines.
“The Beer Institute Advertising Code says, ‘Beer advertising and marketing materials should not include religion or religious themes.’ We agree with that and try to adhere to these guidelines. While we understand your objection to the omission of the phrase “by our creator” in other circumstances (after all, they occur in the Declaration of independence which Samuel Adams signed and helped author) we believe it would be outside our industry guidelines to invoke those religious words in a beer commercial,” the statement said.
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St Gobain/Ardagh: through a glass darkly
Source: FT
Jul 7th
Venetian glassblowers, finding flaws in unfinished items, turned them into bottles and called them fiascos. Glassmaker St Gobain and privately owned packaging group Ardagh must hope they are not heading for something similar. Last week, US regulators claimed a $1.7bn sale of St Gobain’s American glass container arm to Ardagh would leave three-quarters of the US market for beer and spirit bottles in just two hands. They moved to oppose it; the groups pledged to fight on. So debate about relevant market definitions, even potential remedies, will now ensue.
Arguably, the transaction matters more to Ardagh whose decade-long, debt-funded acquisition trail has created a sizeable European packaging group. It could add more than ?1bn in sales to the group’s existing ?4bn-plus. Talk of a 2013 stock market listing has been rumbling, but this may now await a US resolution. The sale, though, is also a tidy deal for St Gobain, which first pledged to sell its entire packaging arm in 2007 and then had to pull a 2011 IPO because of market turmoil. This time, St Gobain plans to dispose of about one-third of the division on a higher multiple – enterprise value to earnings of 6.5 times – than the rating put on the entire unit in the aborted IPO (in spite of lower US operating margins).
And a deal mishap is the last thing the French group needs. Its shares have gone nowhere in the past 12 months, underperforming the Stoxx 600. Exposure to western Europe (70 per cent of sales), and to the construction and auto sectors, is partly to blame. Slow progress in pushing through glass price rises – up 1.2 per cent in 2012 and under 1 per cent, year-on-year, in 2013’s first quarter – has led to some earnings estimate downgrades. That said, at ?30 and on a forward earnings multiple of under 13, the shares are not dear. With ?580m in cost savings targeted this year, investors may even scent a recovery play. A clearer US picture would help, though.
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Currency drop boosts Casella’s confidence
Source: ABC Rural
Laurissa Smith
Jul 4, 2013
A drop in the Australian dollar is set to help major Australian wine exporter Casella’s stay out of financial trouble.
The company based in Griffith in southern NSW has managed to secure finance from its bank after recording its first ever loss of $30 million last financial year.
Managing director John Casella says a weakening currency is a big confidence boost.
“We were able to secure two years of finance from the National Bank of Australia,” he said.
“But the important thing for the wine industry and all exporters is the way the dollar has dropped rapidly and the confidence it gives them going forward.
“There was talk of $1.20, $1.30. Now obviously that’s a long way away and that won’t be discussed for a long time.”
“Really, the discussion will be about 80 or 90 cents and I think at 90 cents, companies can begin to compete.”
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Good article, worth a read
A Nation of Wineries
Source: New York Times
July 5th
Wine regions have been developing across the country, as diverse landscapes and weather patterns allow states to grow a variety of grapes.
http://www.nytimes.com/interactive/2013/07/07/business/a-nation-of-wineries.html?_r=0
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The Actual Facts Behind the Rise of Natural Wine
“Natural” is a small but growing category in wine, signaling biodynamic, organic or vegan winemaking practices. But Lettie Teague wonders: Is the movement about taste or just ideology?
Source: WSJ
LETTIE TEAGUE
July 5th
WILLIAM JAMES was not only a famous philosopher but a source of some pretty memorable quotes. One of his better-known observations, “Belief creates the actual fact,” came to mind recently as I was researching the topic of natural wine. When I asked wine professionals to define the term, each gave a different reply. Natural wine, it would seem, has a lot more to do with individual belief than it does with incontrovertible fact.
Although the number of natural wines in the world is relatively small, the topic has loomed large in recent years. It may be one of the most controversial in the wine world, with strong feelings expressed by partisans of both the “natural” and the not. Natural-wine proponents describe their wines as “pure” and “kind to the planet” and other wines as “industrial” or worse, while non-naturalists have likened their natural counterparts to cult members.
The term “natural wine” is fairly new, at least in terms of general parlance. According to Alice Feiring, a natural-wine authority, one of its champions was famed Beaujolais producer Marcel Lapierre, who, along with his compatriots, began using the term about 10 years ago after adopting the teachings of the late French chemist/winemaker Jules Chauvet.
Ms. Feiring, who writes both a natural-wine newsletter and blog, offered this definition via email: “It needs to be natural from the ground up. Nothing added, nothing taken away. No additives, no adjustments and very little added sulfur.”
That sounded all well and good. But would a vintner agree? I called Jared Brandt, a well-regarded natural winemaker and proprietor of Donkey & Goat Winery in Berkeley, Calif., and asked for his definition. “Natural wine is open to interpretation,” said Mr. Brandt. “People have their own concepts of what it means.” (Mr. Brandt, and his wife, Tracey, offer their full thoughts on the subject on the “Manifesto” page of their website,donkeyandgoat.com.)
Mr. Brandt said that he thinks the one thing that “people can seem to agree on” is that natural wines cannot be made with commercial yeast. Winemakers use different types of yeasts-some are “wild,” i.e., occurring naturally, while others are cultured for the specific qualities they impart.
Stu Smith of Smith-Madrone winery in the Napa Valley isn’t a natural grower by naturalist standards (which he rejects), though he, too, makes well-regarded wines. Mr. Smith called Mr. Brandt’s wild-yeast definition “complete hooey,” saying, “Can you smell and taste a wine and actually say, ‘This one is made with wild yeast and this one is made with commercial yeast’?” I called Mr. Brandt to see what he thought of Mr. Smith’s assessment. He replied via email, “I would be happy to taste with him and compare-I bet he and I could tell the difference more often than not.”
Mr. Smith has been growing and making wine for over 40 years (including some made with wild yeast) and said he was sympathetic to the natural-wine movement, which he called an “emotional reaction to an ever-changing world,” but he said he was troubled that it relied more on belief than science. And then, of course, there was its marketing side. “There are so many wineries in the world looking for publicity; a natural wine is a point of difference,” said Mr. Smith.
Michael Andrews of the Natural Wine Co. in Brooklyn, N.Y., also found natural wine hard to define. But surely he had some criteria? After all, he was selling the stuff. “At minimum, a natural wine should be made from organically grown grapes,” said Mr. Andrews. (Over at the Wine Hut in Manhattan, a clerk told me that “only biodynamic, not [merely] organic, wines” could be natural when I asked about an organic rosé.)
Mr. Andrews, who said his store wasn’t really based on an ideology, groups natural wines into four categories-biodynamic, organic, vegan and no-added-sulfites-and offered a brief description of each (which I’ve shortened further). The first two are straightforward: Biodynamic wines are made according to the farming principles of Austrian theosophist Rudolf Steiner, while organic wines are made without the use of chemicals and pesticides. Vegan wines are made without animal products-such as the egg whites used for fining, the process of clarifying wine with an added agent-but Mr. Andrews noted that “a lot of industrial [nonnatural] wines could actually be labeled vegan wines since they don’t use eggs for fining.”
The no-added-sulfites wines are “the most natural wines you’ll find,” Mr. Andrews posited on his website, though he also calls their makers “brave souls,” as wines without added sulfites are also the least stable. Sulfur dioxide is antimicrobial, killing off harmful bacteria, and it acts as a preservative, keeping a wine from becoming oxidized. Wines made with little or no added sulfur dioxide tend to be fragile and can easily lose their color and flavor during the stress of shipping. (That’s why Mr. Brandt said he adds sulfur dioxide to almost all of his wines.)
Natural wines are also at risk for higher levels of biogenic amines, according to Charles Massoud of Paumanok Vineyards in Aquebogue, N.Y., who has researched the topic. (Biogenic amines include tyramine and putrescine, which can cause severe side effects in large doses.) Mr. Massoud isn’t a natural-wine producer-and he said he resents that natural winemakers define the terms. “Natural as opposed to what?” he said.
When it came time to buy natural wines for my tasting, I turned to Mr. Andrews as well as Andrew Chen of New York’s Flatiron Wines & Spirits, another retailer specializing in natural wines. I asked them to suggest some of their favorites, whether biodynamic, organic or vegan. (I bought a few from other shops, too, but found none without sulfites.) I purchased 15 wines altogether, ranging from $15 to $40 a bottle, from France, Italy, Spain, Germany and the U.S.
The results were decidedly mixed: While I was pleased by almost all of the whites, sparkling wines and rosés, I was much less happy with most of the reds. The light-colored wines were generally bright and expressive (none was oxidative in the least). They included a stony German Riesling (Clemens Busch), a peachy Riesling from Alsace (Domaine Ostertag), a pretty Provençal rosé (La Croix du Prieur) and a terrific Sancerre made by Gérard Boulay.
The red wines were another story. Although a couple showed fresh fruit and bright acidity (Gueule de Loup, a red blend from Provence; a Tuscan Syrah from Stefano Amerighi), several were quite light and tart, and others tasted, quite frankly, like beet juice. Most of the reds were fairly low in alcohol (around 12%), which would have been fine except that they were also low in everything else-namely flavor and intensity. Maybe something should have been added or taken away?
My tasting didn’t lead me to any profound conclusions, although it did lead me to believe that some natural winemakers are more talented than others. What bothers me most about natural wine, beyond the off-putting categorization and the (unproven) specter of biogenic amines, is the ideology that its true believers espouse. I want a wine that simply tastes good; I don’t need to know What the Winemaker Believes Most. I wouldn’t buy a wine just because it’s purportedly natural any more than I would shun one because it’s not. After all, as William James also said, “The art of being wise is knowing what to overlook.”
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Wineries scrambling to make room for upcoming harvest
Source: THE PRESS DEMOCRAT
By CATHY BUSSEWITZ
July 7, 2013
As the summer days stretch long and hot, and grapes thicken with sugar on the vine, wineries are clamoring to ensure they’ll have enough space in tanks and barrels to fit the fruits of an early harvest.
Growers anticipate the grapes will be ready for picking two to three weeks earlier than usual, and many are expecting the size of the harvest will be average or larger.
That has some wineries scrambling to add capacity in their storage rooms, or to book additional space in the custom crush facilities that dot Wine Country.
“There’s a couple of wineries out there that are trying to put in new tanks, and they’re rushing, and we’ve got people trying to put in new storage, and they’re rushing,” said Glenn Proctor, partner and broker in the San Rafael office of Ciatti Company, a wine and grape brokerage. “And complicating things and making it more interesting, is this looks like it will be a relatively early harvest.”
Finding the space to crush the grapes and turn them into wine was a challenge in 2012, when a record crop sent more than 267,000 tons of grapes from Sonoma County vineyards into the wineries. Some of those wines are still aging in tanks and barrels, and have yet to find their way into bottles.
Major companies like E&J Gallo and Constellation Brands are expanding their cooperage capabilities by adding barrels or tanks, said Brian Clements, vice president of Turrentine Brokerage. Wineries that don’t have enough room in their own facilities also turn to custom crush facilities that handle the winemaking process, but they’re running out of time to line up the dwindling available space.
“If people that need custom crush space haven’t confirmed it or reserved it, I think they may see a problem down the road in the next couple of months,” Clements said. “This year, if the crop holds, if people are thinking they’ll just do custom crush later, they may be surprised that there’s not as much space as they think, and the price may be higher than they thought.”
Custom crush facilities, which are busy pumping wine out of tanks and barrels and into bottles to make way for the 2013 harvest, are finding a lot of demand for any available space.
“There’s definitely more activity,” said Robert Morris, president of Punchdown Cellars, a Santa Rosa-based custom winery that works with more than 40 wine brands. “We’ve been lucky that we’ve had to turn away business this year.”
Sonoma Wine Co., which process about 5,500 to 6,000 tons of fruit per year between its two North Coast crush facilities, is pretty booked up for the approaching harvest, said Natasha Granoff, director of business development.
“Because of the big 2012 harvest, we’re jammed packed,” Granoff said. “We’re bottling out the 2012 to accommodate the coming vintage.
“If this harvest is average or above average, it’s going to be pretty challenging, for some people who haven’t bottled out, or for those people whose 2012 stay in tanks longer than a year,” Granoff continued.
Sonoma Wine Co. doubled the tank capacity in its American Canyon facility over the last three or four years, Granoff said.
Requests for space have been rolling in earlier than usual at Rack & Riddle, the custom crush facility in Hopland that handles winery clients from Mendocino and Sonoma counties. The company started a waiting list in June, about two months earlier than normal, said Bruce Lundquist, managing member.
“If the crop is as large as some folks are predicting it is, I think it’s going to present some challenges in the months ahead in terms of crushing space,” Lundquist said. “I know there’s 2012 wine that’s not going to find its way to the bottle by the time harvest arrives.”
The rush for space has been a boon for local tank manufacturers.
Westec, a Healdsburg tank manufacturer that usually lays off workers during the slow off-season months, has kept its workforce busy throughout the year, said Jim Belli, general manager.
“There’s a much greater need for more storage than there was in the past, just because our markets have grown,” Belli said. “We’re not just selling down the street, we’re selling to China and around the globe now.”
For clients in the Central Valley, Westec has been building stainless steel tanks with the capacity to ferment and store up to 90,000 gallons of wine.
Santa Rosa Stainless Steel has been busy welding tanks for new and existing wineries, said Nathan Williams, head of sales. The company built about 435 tanks last year, and will probably make even more this year, he said. It typically generates $8 to $12 million in annual revenues, he said.
“There are quite a few expansions going on,” Williams said. “There’s still not enough space, so people are still buying tanks.”
Rodney Strong Vineyards is among those that have increased its cooperage in the past year, said Robert Larson, public relations director.
“We had some space issues last year, because we had a new vineyard coming on, just above Lake Sonoma,” Larson said. “But as a result of last year we prepared ourselves pretty well here, with the proper number of tanks and all that jazz.”
Barrel companies also have been busy filling orders. Canton Cooperage, a Kentucky-based barrel manufacturer with a sales office in Windsor, has been challenged to keep up with demand, especially for its barrels made with 4-year-old wood, said Bruno Remy, vice president of sales.
“Last year, we could not offer these barrels, and we closed all the sales in July, more or less,” Remy said. “After July, everyone who was contacting us was told we could not have any more barrels for the rest of the year, because the wood was already used or in inventory for orders to be made.”
The company, which employs 48 people globally, sold about 15,000 barrels worldwide in 2012, up 5 to 10 percent from the year before. It is on track to sell that or more this year, Remy said.
Even though there’s anticipation for what many believe will be a sizable crop, there’s no telling how the weather may change that outlook over the next few weeks.
“The biggest obstacle that we have at this point is what Mother Nature is going to give us,” Morris said. “There’s so much time between now and when the fruit starts rolling through the door, that there’s a lot of variables.”
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It’s fizz, but not as you know it: French wine firm horrifies wine snobs by creating world’s first bottle of red flavoured with COLA
Source: Daily Mail
By Olivia Williams
5 July 2013
A French drinks company is launching a red wine that will have the edge on its competitors – by adding a dash of cola.
In a break with tradition Rouge Sucette, French for red lollipop, is made from 75 per cent grapes with water, sugar and cola flavouring making up the remainder.
Sure to horrify connoisseurs, it is designed to appeal to the younger ‘Coke generation’.
Winemakers fear that young people who drink endless spirits and mixers will be difficult to attract if they do not adapt to their sweet palette.
The 9 per cent ABV blend is part of a new range by Aquitaine-based firm Haussmann Famille.
They also make fruity Passion Fruit and Grape Fruit blends.
The company recommends serving it ice-cold for the summer weather.
It went on sale this week for 2.95 euros a bottle and is hoped to become a feature of French barbeques and summer drinks parties.
Pauline Lacombe, Marketing Director of Haussmann Famille, said: ‘The result is surprising; the balance between the bitterness of the wine and the sweetness of the cola is perfect.’
‘We did a lot of research to elaborate the best recipe and the best mix between wine, water and the aroma.
‘The packaging is fun, with a label in the shape of lollipop.
‘This kind of product is more dedicated to young adults, and women.
‘We have worked closely with a lab in Bordeaux, specialised in aroma.’
Despite having a reputation for their snobbish attitude to wine, the French themselves have actually embraced flavoured wines, drinking a predicted 30 million bottles in 2013.
Cola wine could also be a big hit in Britain, as sugar consumption has increased by 31 per cent since 1990, with the average person consuming 700g of sugar a week.
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Jancis Robinson tastes some of the world’s most expensive wines
Source: FT
By Jancis Robinson
July 5th
My Greek host had lured me to Switzerland with the promise of a complete vertical of Pétrus, famously the most expensive red bordeaux of all.
Over nine days recently I was ridiculously lucky enough to be treated to no fewer than five very serious wine dinners – serious as in the quality and age of the wine rather than the demeanour of the attendees. Vintages included three from each of the near-mythical 1959 and 1945 and two each from the famously long-lived 1928 and the best wartime vintage of 1943. If the dinners had taken place in the last century, chances are that my hosts would all have been British. But among these modern-day hosts only one of them was from the UK, a neighbour with a particularly enviable cellar. The others were born in Hong Kong, mainland China and, in the case of the last two of these dinners, in Greece.
My Greek host had lured me to Switzerland with the promise of a complete vertical of Pétrus, famously the most expensive red bordeaux of all, from 1970 to 1982, thereby filling in a whole nine gaps in my collection of tasting notes. The irony is that most of these are the weakest vintages of that period and were particularly difficult for my host to track down. He already had vintages such as 1982, 1985, 1990 and 2000 in quantity but it took some real sleuthing to track down lesser years from the early and late 1970s, most examples of which have presumably already been drunk.
Having assembled a group of friends, a couple of Bulgarian musicians to serenade us, and the young Czech chef David Jehlicka whose talents they had spotted on a private cruise, our Greek hosts plunged us straight into this world-famous Pomerol with glasses of the 1972 and 1973 Pétrus on their terrace before dinner. Neither of these years has much of a reputation but I was amazed by how delicious the 1972 was: seductively heady even if pretty lightweight. Clutching my BlackBerry so as to record every nuance, I actually found myself keying in the absurd phrase “an aperitif Pétrus”. The 1973 was looking pretty good too, even if more concentrated and austere, almost more like a Cabernet-dominated left bank wine than the all-Merlot star of the right bank of the Gironde. In fact I thought the 1973 still had quite a way to go, unlike our oxidised bottle of 1974, the light and charming 1976, the light and leafy 1977, the rather undramatic 1978 and, even more evolved, 1979.
None of the other vintages seemed to have reached its peak, even the less celebrated 1980 and 1981. Neither of them was short of charm though neither had anything like the intensity of the four famous vintages which had been kept for the end, to be savoured with our lamb served two ways (I enjoyed the slow-cooked shoulder so much that I had to decline the rack). There was a massive gear change with these last four vintages, all of them bought en primeur in original wooden cases. Both the 1970 and 1971 were quite stunning, the 1970 being a particularly fine bottle of this famous vintage. (With wines as old as this, individual bottles can vary considerably.) Another famous vintage for Pétrus is 1975 but this bottle was just a tad short of perfection. The 1982 – from such a celebrated vintage that, at over £4,000 a bottle, it was much the most expensive wine we tried – was still too young, and much less seductive than the 1982 from its neighbour Ch Lafleur had been the night before.
The previous night we had enjoyed not just this famous jewel of a wine but also Ch d’Yquem from the great 1928 vintage that was still going strong and, perhaps the most famous port of all, Quinta do Noval, Nacional 1963 that was still almost too young to broach. Almost, but I’m so glad I was not denied the pleasure.
Funnily enough that great 1928 Sauternes was effectively the synthesis of two Sauternes that had been served the previous Friday night at a dinner given by the Chinese businessman and wine lover Desmond Shum at Taillevent in Paris. After cheese we sipped a Ch Lafaurie Peyraguey 1928 that by now finishes quite dry but only after the most glorious crème caramel richness and amazing life. It was trumped however by the even more intense and unctuous Yquem 1955, a classic vintage, served with an intricate passion fruit and mango dessert and agreed by all of us to be the wine of the evening. This was despite competition from a Mouton 1928, a La Tâche 1980, a Cheval Blanc 1959, a Musigny Blanc 1992 and a Dom Pérignon 1966 inter alia.
Two nights later in London my metabolism was readying itself for an onslaught from another generous Chinese host, Paulo Pong, who has founded an exceptionally successful empire of restaurants and wine shops in Hong Kong, all fed by his import company Altaya Wines. This was far from the first time we had exchanged my husband’s cooking skills for a raid on the Pong wine collection maturing under the Wiltshire turf at Corsham, bottles to be shared with Hugh Johnson, my co-author of The World Atlas of Wine, and Michael Broadbent MW, whose Vintage Wine is an unrivalled record of a lifetime of tasting great bottles, mainly as head of Christie’s wine department. Explaining why he had picked out the likes of Mouton ’59 and ’29, Cos ’45, La Mission ’43 and a bizarre port in an Alsace bottle labelled 1893, Pong disarmingly explained: “I just ran down the list picking those that were duty paid.” The Mouton ’59 was the star of this particular evening, inspiring another great quote from Paulo, on this occasion acting as sommelier: “Michael, would you like more ’59?”
Amazingly, the seductive 1959 and unusual 1943 vintages popped up again – gloriously – the following night chez our wine-loving neighbour. To titillate the visiting American writer Jay McInerney, his wife Anne Hearst and Stephen Fry, he had put together the most extraordinary Haut-Brionfest, starting with a distinctly disappointing white 1982 but bursting into red wine life with the almost perfect 1964, 1962 and, especially, 1959. The 1945 seemed, amazingly, still too youthful, but was much, much more enjoyable than our bottle of Lafite 1945 was to be in Switzerland just a few days later.
Now, which chunk of this to send to Pseuds Corner?
Tasting notes on all 47 wines on Purple Pages of JancisRobinson.com
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Tasting Notes That Strike a Chord
Source: WSJ
WILL LYONS
Jul 5th
My mood and, indeed, the weather play a significant role in how a wine tastes.
I ONCE MET a winemaker who told me he played jazz to his casks to keep them happy. His name was Bruno de Conciliis and such was his devotion to modern jazz that he named his signature wine, Selim, after Miles Davis. (Selim is Miles backward.) His wines, from Campania, Italy, were sensational, but I’m not convinced they were improved by the purity of Davis’s trumpet ringing around the cellar.
While it may be hard to believe music can enhance fermenting grape juice, it’s not so much of a stretch to think it could affect the way we taste and perceive wine. Music taps into all parts of our emotional world.
A few years ago, Adrian North, then head of the Department of Applied Psychology at Heriot-Watt University in Edinburgh, published some research on this very topic. In his study for Chilean winery Montes, Prof. North found a link between the way we taste wine and the music we are listening to when we are drinking it.
“The Effect of Background Music on the Taste of Wine” (2011) cites research by experimental psychologists Massimiliano Zampini and Charles Spence explaining that the sounds certain foods make can alter our perceptions of what we taste. They use the example of a potato chip, or crisp. If the crisp made a loud crunch when bitten into, the taster rated it as fresh, as opposed to a quiet crisp, which was perceived as stale. One could argue the same with the temperature of a wine: The cooler the white is, the fresher and crisper it tastes. A red served too warm can taste flat and flabby.
But what about music-can it affect our taste? Prof. North’s research was based on interviews with 250 undergraduates who were asked to taste a glass of either red wine (2006 Montes Alpha Cabernet Sauvignon) or white (2006 Montes Alpha Chardonnay). They sampled the wine in five rooms, one silent and four playing different pieces of music, ranging from Orff’s “Carmina Burana” to “Just Can’t Get Enough” by Nouvelle Vague. The results were fascinating. On average, when zingy and refreshing music was played, the wine tasted more zingy and refreshing. And so it was with each of the rating scales.
I keep an open mind about these sorts of conclusions. Those who adhere to the biodynamic philosophy believe that our taste buds pick up different flavors depending on the calendar and the mood we are in. I have certainly found that my mood and, indeed, the weather play a significant role in how a wine tastes. I’m less convinced about music but am willing to give it a try.
I put Prof. North’s findings to Iain Foreman, an ethnomusicologist at the University of Aveiro in Portugal. He says that for some people there is a link between certain sound experiences, smells and tastes. “At least at a subconscious level, there is no denying that certain aural experiences, whether musical or not, affect our olfactory and gustatory experiences,” he says.
Who knows? The next time I pull out a slightly underperforming bottle, I may just have to play some uplifting and refreshing music.
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Sainsbury’s slashes Diageo promos in ‘huge rift’
Source: The Grocer
06 Jul 2013
Sainsbury’s has dramatically reduced the number of Diageo promotions in its stores following a “huge rift” between the two companies.
The spat is understood to have been sparked by Sainsbury’s decision to promote its own-label lines at the expense of brands, a move prompted partly by Diageo’s increasingly heavy promotional activity at other retailers.
A Sainsbury’s worker told a mystery shopper looking for Diageo’s Smirnoff Vodka and Cola on a recent Grocer 33 shop there had been a “falling out” with Diageo and he was “minimising the amount of shelf space given over to Smirnoff”.
A comparison of BrandView.com data for the first six months of this year versus the same period in 2012 reveals a massive decline in Diageo promotional activity at Sainsbury’s.
Sainsbury’s ran 18 deals on Smirnoff from January to June last year but only ran one Smirnoff deal in the same period this year. As a result, Sainsbury’s share of all Smirnoff promo activity at the big four has fallen from 29.4% to 1.6%.
The average price of a 70cl bottle of Smirnoff Red at Sainsbury’s this year has also been higher than elsewhere at £15.94 versus £13.65 at Asda, £13.80 at Morrisons and £14.30 at Tesco.
Similar declines in promotions were recorded on other key Diageo brands, with Sainsbury’s activity on Gordon’s dropping from a 22.4% share of all supermarket promotions to just 5.1% and Guinness deals falling from 40.2% to zero.
Sainsbury’s is currently promoting its own-label version of Diageo’s Pimm’s – Pitchers. The top two shelves of the fixture are given over to Pitchers, with Pimm’s relegated to the bottom two, and Sainsbury’s is not selling the newly launched Blackberry & Elderflower variant.
One senior drinks source said: “I have been aware since Christmas that something was wrong as Sainsbury’s promoted its own-label Irish Cream as opposed to Baileys.”
Another source said: “It’s a huge rift. It’s come down to the own-label and brand debate and how much and how long this promotional circus can go on for in alcohol . Sainsbury’s is preparing for the future very well . but it has to be careful it does not switch customers off by disengagement with the brands.”
In 2009, Sainsbury’s agreed to modify the label of Pitchers after Diageo alleged intellectual property right infringement.
Diageo said it did not comment on “commercial arrangements with individual companies”, but claimed: “Sainsbury’s is a highly valued partner of ours.”
Sainsbury’s said it did not comment on supplier relations.
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Iliinois: Gov. Quinn calls guns, alcohol ‘a toxic mix’ on Wrigleyville visit
Source: ABC
Friday, July 05, 2013
Gov. Pat Quinn has gone to one of Illinois’ most popular entertainment districts to press his message that guns and alcohol are a “toxic mix.”
Quinn spoke Friday outside Wrigley Field, standing with the many bars and restaurants of Chicago’s Wrigleyville neighborhood as a backdrop.
Quinn says letting people carry guns into bars and restaurants is “a prescription for violence and disaster.”
Earlier this week Quinn used his amendatory veto to send a measure that would allow the concealed carry of firearms back to lawmakers with several changes.
Among them is a ban on guns in any establishment that serves alcohol. Currently, the legislation bars guns only from restaurants whose liquor sales amount to less than half of gross sales.
Lawmakers will meet Tuesday to try to override Quinn’s veto.
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Australia: Coles tightens noose on agents
Source: The Age
Eli Greenblat
July 8, 2013
Huge job losses are feared among Australia’s 20,000 independent grocery agents.
Coles is considering extending a controversial overhaul of its supermarket supply chain to its almost 1500 Coles Express convenience stores and liquor outlets.
The likely shake-up would touch every grocery item from beer to bread.
A confidential tender document obtained by BusinessDay sets out Coles’ plan to restructure the relationship between it, suppliers and field agents – also known as ”reps” – and proposes the new arrangements could be implemented at its petrol station network as well as Coles liquor arms Liquorland, First Choice and Vintage Cellars.
BusinessDay has also learnt that Coles is now drawing up a shortlist of interested parties to fill the ranks of its maiden panel of ”approved” field agents for its supermarkets after its first tender round under the radical new plan closed last Friday.
Originally it was planned for the new supermarket supply arrangements to be up and running from July 1, but that now looks to have been pushed back to the back end of calendar 2013. Starting with five suppliers in its first two months, it is then intended to be offered to all Coles grocery suppliers by late 2015.
As revealed last month, Coles is seeking to raise its own panel of approved field agents, who, armed with a range of fees negotiated with Coles rather than suppliers as is the case now, would go out to food suppliers to tender for their services. This would turn the relationship between these agents and suppliers on its head and carve out hundreds of millions of dollars in costs from Coles’ supply chain.
Under the new system these field agents on the Coles panel will also be required to invest in IT hardware and software as well as pay an as yet unspecified rebate back to Coles.
Coles argues that the new arrangements will drive efficiency and deliver a better service to suppliers.
”Most of our large and medium suppliers maintain a significant field force to visit our stores on a weekly basis,” the confidential Coles tender argues. ”Up to 30 field reps visit our stores in a day.
”There is a significant difference in the ways of working of the field reps of each of our suppliers and this causes disruption to Coles store operations.
”To resolve all these issues, Coles is exploring options for creating a panel of third-party field force companies that could be used by our suppliers.”
Working away in supermarket aisles with the name of the grocery brand on their workwear, these field reps typically replace perishable food stock, such as bread, and negotiate deals with supermarket store managers over special promotions such as in-store demonstrations and end-of-aisle displays. They generally charge a fee of about 5 per cent of sales back to suppliers for being their eyes and ears in the store.
But under the restructure Coles would use its market power to negotiate those fees down substantially, reclaiming much of those fees for itself through agent rebates while at the same time tightening its grip over its own supply chain.
The shake-up has shocked the field agents industry. They believe it will threaten the viability of Australia’s 20,000-strong army of independent grocery agents who act on behalf of grocery manufacturers, leading to huge job losses.
An industry representative met Coles merchandise director John Durkin last month to plead field agents’ case, but Coles looks to be pushing ahead with the restructure.
Especially worrying to the field agents is the idea that only accredited agents who make up the Coles panel will get access to the supermarket store, sidelining independent agents and rendering them of little use to grocery manufacturers who must have agents in the stores watching over their stock.
Until now that fallout was limited to its supermarkets but the supplier overhaul could soon be extended to 630 Coles Express service stations and roughly 800 branded liquor stores.
However, the confidential tender documents do state that currently there is no plan to expand the restructure to other businesses owned by Wesfarmers, the conglomerate that owns Coles, such as hardware chain Bunnings, Officeworks, Kmart or Target.
Coles has claimed that no field agents will be ”pushed” into the new system, though it maintains that any agents who wish to remain outside the system will need to complete a training course and pay an ”accreditation” fee to Coles.
The tender document states that once the tendering process is completed, Coles and its selected partners will enter into a commercial agreement and roll out the new service to five suppliers in the first two months, 30 suppliers in six months, 60 suppliers at the first anniversary and offer it to all suppliers within two years.
A spokeswoman for Woolworths said it had no plans to implement a similar policy at its supermarkets.
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Canada: Raising legal drinking age to 19 across Canada could reduce alcohol-related injuries : UNBC study
Source: Vancouver Sun
By Zoe McKnight
July 4, 2013
Raising the legal drinking age to 19 in all provinces could reduce alcohol-related harms and hospitalizations, says a new study from the University of Northern B.C.
The study, one part of a series of studies designed to inform legal drinking age policy in Canada, shows a 15 to 20 per cent increase in hospitalizations among young people when they reach 18 or 19, depending on the province.
It’s legal to drink at 19 everywhere but Alberta, Manitoba or Quebec, where 18-year-olds can drink legally.
Calling legal drinking age the “cornerstone” of liquor control, lead author Russell Callaghan said the study is the first to demonstrate it also has a powerful effect on sickness, injury and death.
“My sense is that if we were to raise the minimum age to at least 19 in every province, it is highly likely we would reduce alcohol-related injury among youth,” said Callaghan, who formerly worked at the Centre for Addiction and Mental Health in Toronto.
The study, “Impacts of the Minimum Legal Drinking age Legislation on Inpatient morbidity in Canada 1997-2007,” published in the journal Addiction this spring, followed Canadians aged 15 to 22 who were admitted to hospital.
Researchers found a significant increase in alcohol abuse and poisoning and other disorders immediately following reaching the legal drinking age, and next plan to study its impact on emergency room visit, car crashes and mortality.
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Nebraska: Pine Ridge, South Dakota Oglala Sioux Tribal President Bryan Brewer to meet with Nebraska Governor Heineman, Legislators and Liquor Control Commission to find solutions to end illegal alcohol sales on the border at Whiteclay
Source: Herald Online
July 7, 2013
Alcohol Justice is reporting that Oglala Sioux Tribal President Bryan Brewer will hold a press conference in front of the Nebraska Liquor Control Commission on Monday afternoon, July 8, 2013, to hopefully discuss new developments in stopping the illegal alcohol activity taking place in the town of Whiteclay, which borders the Pine Ridge, South Dakota Native American Reservation. Earlier that day President Brewer will be meeting with the Nebraska Governor, Liquor Control Commission, and key state legislators to discuss possible solutions.
“I am optimistic that my meetings in Nebraska will produce steps to mediate the issue of Whiteclay alcohol sales and the catastrophic impact they have on the Pine Ridge Indian Reservation,” stated President Brewer. “However, I stand firm in my belief that this liquid genocide inflicted upon the Lakota people, which produces great profits for Anheuser-Busch, Whiteclay alcohol retailers and the state of Nebraska, must end.”
Activists are charging that the illegal alcohol activity and bootlegging have not been stopped in Whiteclay, Nebraska because of heavy financial contributions to Nebraska legislators from Anheuser-Busch, alcohol distributors and alcohol trade associations.
Political financial contributions include:
Beer, liquor and wine companies have contributed $96,000 to Nebraska Governor Dave Heineman. Making the alcohol industry one of his top contributors.
Nebraska State Attorney General Jon Bruning has received $86,000 from the beer, wine and liquor industry since 2008.
Alcohol distributors and trade groups gave candidates for in-state offices $135,000 in 2010, according to the Institute on Money in State Politics.
75 percent of the beer bootlegged at Whiteclay, comes from the Pivo Anheuser-Busch distributor based out of Scottsbluff, Nebraska.
Over the past few months tension has intensified between Pine Ridge activists, Whiteclay liquor storeowners, and the Pivo Anheuser-Busch beer distributor. In several instances activists successfully blockaded the delivery of Budweiser beer to the local Whiteclay liquor stores. Storeowners responded by arming inebriated customers with bats and fireworks, and offering them financial compensation, to confront the activists. Since April 30, 2013, activists have maintained a Zero Tolerance Camp along the border to document illegal activities committed by Whiteclay liquor storeowners, such as selling to intoxicated patrons and solicitation.
What: Press conference to end illegal alcohol activity in Whiteclay, Nebraska When: 2 p.m., Monday, July 8, 2013 Where: The Nebraska Liquor Control Commission, 301 Centennial Mall S., Lincoln, NE 68508
Who: Supporters include:
Oglala Sioux Tribal President Bryan Brewer
Black Hills Sioux Nation Treaty Council
Deep Green Resistance
Nebraskans for Peace
Alcohol Justice
U.S. community allies
Why:
25% of Pine Ridge Reservation youth suffer from Fetal Alcohol Spectrum Disorder
2/3 of Pine Ridge Reservation adults suffer from alcoholism
To stop the illegal alcohol activity at Whiteclay, Nebraska such as: — Retailer participation in alcohol smuggling into the Pine Ridge Reservation — Trade of alcohol for sex — Loitering at the premises of alcohol retailers with open containers — The inability of Nebraska Liquor Commission to stop illegal retailer activity — Recent homicides and physical violence — Alcohol sales to minors — Alcohol sales to intoxicated people
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