After 35 yrs with AB, region 3 veep Dirk Danklef (Southeast) will be leaving AB, AB told distribs yesterday.  Dirk was a “key contributor to our integration and wholesaler panel initiatives,” wrote sales veep David Almeida.  He has been “the constant coach and mentor to many employees throughout his career.”  Replacing Dirk will be Sanjiv Chhatwal, most recently AB’s vp of trade marketing, who “led a transformational, new direction for the company’s retail strategy,” David said.  Sanjiv, who played a prominent role in AB sales conventions in recent yrs, will be relocating to Atlanta.  

Red-hot Lagunitas will come in at around 390-395,000 bbls in 2013, founder Tony Magee told INSIGHTS.  That’s slightly less than Lagunitas had expected earlier in the year, but still up by more than 150,000 bbls, about 2/3 bigger than 2012 and 4x the size of 2010.  Lagunitas still having trouble filling everyone’s orders. 

Early next year, its Chicago brewery will come on stream, with 300,000 bbls of capacity on day one, according to Tony, to go along with 500,000 bbls of capacity out of Petaluma.  While the opening is a bit of a moving target, Tony expects to be shipping from his Chicago facility by March.  Lagunitas will expand to all remaining states once its 2d brewery comes on stream.  It is budgeting for another 40% growth in 2014.

While beer shipments trend reverted to negative this yr, spirits slowed, especially in control states.  Raw data showed modest decline in Nov, but adjusted for same selling periods across states both yrs, volume +1.2%.  Still, for 12 mos control state volume up just 1.1%.  That’s compared to +4.2% for 12 mos thru Nov 12.  Would that beer sales had picked up in the wake of such a slowdown!  Meanwhile, perhaps one cause for slower spirits volume, pricing stronger for spirits this yr.  For both Nov and 12 mos, spirits dollar sales +4% in control states, reports NABCA.  Control states are about ¼ of overall spirits volume. 

Spirits biz actually down 2.5% on-premise thru Nov, according to latest GuestMetrics data, which also pointed to increasing bright spot in spirits world: craft spirits. Craft spirits are up 26% per GuestMetrics, led by Tito’s, which is up 66%, while mainstream brands down 3.5%.  Craft spirits up to almost 4 share on-premise in latest qtr (3.7%) compared to just 2.5% last yr.  

Taxpaid shipments by domestic brewers down another 50,000 bbls, 0.4% in Nov, estimates Lester Jones at Beer Inst.  So last 3 mos still in the black, +200K bbls, 0.5%, but 11-mo drop now 2.7 mil bbls, -1.6%.  And wacky imports figure stands at -2.8% for 10 mos.  Overall yr-to-date figure now -3.4 mil bbls, -1.8%.  Easy import comps Nov-Dec should help, but barring big Dec surprise, 2013 US shipments trend will look a lot more like 2011 than 2012.  

While retailers point to a slow economy for their sales woes, that “tells only half the story,” wrote Financial Times, because “at the root of retailers’ problems is a supply glut they have created themselves.”  Too many stores “are second rate,” and blame dates back to building boom of the 70s, noted FT.  Intl Council of Shopping Centers found Germany has avg of 2.7 sq ft of retail space per person, Japan has 3.9 ft, UK has 5ft and in US we have whopping 23.8 sq ft!  While some retailers like Best Buy cut stores to react to online commerce, others like Walmart want “to fix not ditch” underperforming locations.  Instead of cutting losses, retailers are cutting prices. “This is a dangerous race to the bottom that is destroying profits,” wrote FT. Slashing glut of stores “would be a better way to relieve retailers’ collective desperation,” in FT’s view.  Interestingly, the amount of US retail space is still going up, up 0.3-0.4% per yr last 4 yrs. Part of problem is “psychological” as retailers are being “led by a generation of chief executives that climbed the ranks in a go-go era of expansion,” however “this mindset is obsolete.”  

Phil Rosse promoted from exec veep to prexy of Mark Anthony Brands Inc, announced founder Anthony von Mandl.  He noted that Phil has “demonstrated the ability to consistently deliver outstanding results while simultaneously building our culture.”  Phil joined Mark Anthony in 2008 (from Labatt).  “Successorship is a key metric at Mark Anthony,” noted Anthony “and I am particularly pleased we have had 78 internal promotions.”  Tho Mark Anthony only up 0.5% in IRI multi-channel yr-to-date thru 12/1, it’s up 5% last 13 weeks.  And the co expects 7% growth in 2013, Phil recently told INSIGHTS, plus “robust” growth next yr, according to Anthony. 

Graham Mackay, one of the principal architects of global consolidation in brewing, passed away earlier today at  64.  Graham became ceo of SAB in 1999, moving from South Africa and leading a listing on the London stock exchange. He went on to build a mighty business empire, through many acquisitions large and small, including Miller, Bavaria, Foster’s, and many more. “He had the foresight to see what the future held for the industry,” former SABMiller chairman Meyer Kahn  said as quoted in Bloomberg, “and had the courage to join what we called the dance of the elephants.” Today, SABMiller has annual revs of about $35 bil and its stock price has multiplied by 6x since its London listing, according to various reports.  Graham was operated on for a brain tumor back in April, resumed his role as chairman briefly in September, before becoming too ill again.  He leaves behind a wife and 6 children.  It is a shocking sadness that for all that he built, he will never get the opportunity to relax and enjoy the fruit of his labors.  Our heartfelt condolences go out to his family and co-workers.

Graham was one of the most impressive business leaders we’ve ever met, described in various obits as a “pioneer” (Financial Times) a “titan of the beer industry” (Bernstein’s Trevor Stirling) and more. Recall, Harvard Business Review earlier this year named Graham the 16^th Best Global Ceo out of 3000 across all industries and #1 in Europe.  “Those who knew him describe him as cerebral, inspirational and thoughtful,” noted Financial Times, “an ‘old school gentleman’ who preferred one-on-one talks to mass presentations.” 

INSIGHTS had the pleasure of a couple of extended meals/conversations with Graham and they were memorable.  Graham was indeed one of the most “cerebral” ceos.  Strikingly, in this day and age when so much is a soundbite or a talking point, he had the confidence in his own perceptions to simply speak his mind.  And what he had to say was almost always more interesting for that too.  Here is a link to our article on the last conversation we had with him a little more than a year ago.  He was one of a kind and he will be sorely missed.  

 Longtime exec editor Eric Shepard has sounded off on our blog with a lengthy essay describing the volume ills and $$ strength of the beer biz in recent yrs, including charts.  This piece is perfect for our recently launched blog.  It’s a deep dive that goes into more detail than we had room for in our publications, but it’s jampacked with interesting info.  And available for INSIGHTS readers here.  Check our blog for more posts in 2014 and beyond.  We welcome your comments.     

“The economics have changed” for smaller importers, noted Latis co-founder and ceo David van Wees. It “costs more to get a point of distribution,” there is “less loyalty” and lower “through put.” But instead of taking “defensive” approach, Latis and Radeberger decided to combine sales forces and go on offense, in what David characterized as “100% a sales agency agreement.”  The two cos “will continue to operate independently on all other aspects of their respective business,” said a joint release.   So they will combine to have 25 sales people in US under Radeberger Gruppe name, selling Radeberger’s estimated 900,000 cases and Latis’s approx 400,000 cases.  The sales force will be led by Anthony Giardina, “a former Latis executive” who will become exec veep of Radeberger Gruppe USA.  Key focus brands will be Palm, Clausthaler NA, Radeberger Pilsner, Schofferhofer Grapefruit and Rodenbach. 

Premium Plus category has been strong on premise most of 2013, up 5.3% in 13 weeks thru Sep. However in last 3 mos the category has suddenly taken a hit on-premise.  Segment was flat 4 weeks thru Oct 6, down 8% 4 weeks thru Nov 3, and down 10.5% 4 weeks thru Dec 1, according to GuestMetrics data.  Premium light beers have continued to decline at double digit pace on-premise.   Cider still up over 40% in each of those 4 week periods, however slightly slowed compared to recent mos due in part to decline in overall traffic.