Beer Marketer's Insights - NBWA Prexy Craig Purser & Rebecca on "Elephant in the Room"; More Trust Needed; Mike Madigan on "AB Situation"

"There are areas where significant improvement can be made in the trust between suppliers and distributors," said NBWA prexy Craig Purser at NBWA convention in Vegas, calling that "the elephant in the room today&hellip;. And I've heard from many of you that you want to talk about it." So he did, in some pointed remarks, albeit without naming names. "You have expressed concern about pressures from suppliers," Craig began. "Technology mandates, onerous performance standards, jamming inventory and pricing pressures," Craig ticked off. Those "all create tension between trading partners&hellip;. These actions aren't new, and we can look at similar examples from the not-too-distant past. It wasn't right then and it isn't right now," Craig asserted. "When multi-generational distributors are terminated or forced to sell, the impact isn't isolated, it reverberates throughout the system," added Rebecca Maisel in her own pointed remarks. "It not only affects those families, their longtime employees, and the local communities they serve, it erodes trust and shakes confidence across every network: blue/silver, red, and gold." These days, they're mainly talking about recent actions from Anheuser Busch, tho again they didn't name any co. "The reality is that everyone in this room partners with a supplier that has at one time or another realigned, or attempted to realign, their brands, or force wholesaler consolidation, pulling the rug out from under family businesses," Rebecca reminded.Beer biz is at a "crossroads," said Craig and "circumstances require that we work together." But "you have expressed concern, about some actions by our partners that put this very successful system at risk." For example, "when suppliers take a product or brand away from dedicated distributors, that challenges the partnership. It creates division." Craig likely commenting on AB's move to Southern with its Nutrl brand, away from its own distribs in CA, a move that sent shock waves to distribs beyond AB. Then too, "forcing distributors to accept product they did not order, without concerns for the consequences, calls into question the relationship. It makes folks wonder if they are on the same team&hellip;. And when long-time partners seek to terminate highly performing distributors without the opportunity to cure, that erodes trust for everyone." AB hasn't said anything publicly about these situations but would likely view them very differently.Attorney Mike Madigan specifically addressed what he called the "AB situation" in his morning seminar before the full convention program began. AB presented "between 5-10 distributors" with what he called a "Hobbesian choice." They could either "submit Exhibit 5" declaring their official intent to sell or face termination. AB "refused to provide a formal notice or opportunity to cure" alleged deficiency, according to Mike. These were "all small rural wholesalers" who are likely not going to be litigating" against "an 800-lb gorilla in a battle that would take years" and "cost 7 figures." While those AB distribs probably did "breach" equity agreement, he acknowledged, he strongly disagreed with AB's assertion of "fraudulent conduct," arguing in detail that it didn't meet legal def of fraud, and under franchise laws, distribs should have had oppy to cure.

NBWA Prexy Craig Purser & Rebecca on "Elephant in the Room"; More Trust Needed; Mike Madigan on "AB Situation"

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