Beer Marketer's Insights
Pennsy Distrib Sues Yuengling to Halt Termination; Had $5.8 Mil Deal to Sell Brand Rights
Ain't just big brewers who have issues with distribs. Northeastern, Pennsy AB distrib in Reading area, just sued Yuengling for "unlawful termination," breach of contract, tortuous interference, etc. Northeastern has been Yuengling distrib since 1990, now sells about 500,000 cases of its brands per year. Had oral agreement, but never a written one, that Northeastern claims establishes full distrib rights under Pennsy law. That law requires "good cause" to terminate and stops brewer from interfering with sale of brand rights. Earlier this year, Northeastern reached agreement to sell its Yuengling brand rights to distrib All Star for $5.75 mil. Subsequently, according to complaint, Yuengling started "secret negotiations" with All Star and a 3d distrib Eagle, which Northeastern is also suing, so that Yuengling would sell brand rights. Yuengling also started to reduce deliveries to Northeastern. Over the summer Yuengling sent a termination notice, revoked it, told Northeastern it would pay $1.2 mil and try to get a new distrib to kick in more, then finally sent termination notice effective Nov 4, according to complaint. Northeastern believes Yuengling has agreed to name Eagle its successor. Northeastern seeks injunction to stop termination, a declaration that it is primary and exclusive distrib for Yuengling and/or $5.75 mil, plus interests and costs.
Yuengling Grows, Going Against Grain, Sings Praises of 3 Tiers Too
Yuengling will jump to 1.2-1.25 mil bbls this yr, exec veep Dave Casinelli told NY distribs, up from a little over 1 mil bbls last yr. Had done only about 200,000 bbls a decade ago. As it grew, built new 1.2-mil-bbl brewery and bought Stroh
In pointed panel discussion sponsored by NABI (National Assn of Bev Importers) at NBWA, distribs and consultants told importers to be more targeted and better prepared to get more accomplished with their distribs. "We expect our supplier reps to come in and be well-prepared," said Bruce Leetz, prexy of North Coast Distributing in Ind, adding that some of them aren
Cautionary Tale for Distribs, State Execs; Top Wisc Pol Accused of Extorting Distrib Assn
Not often that ugly details of political rough-and-tumble go public, but that just happened when two big state pols in Wisc were charged with a bunch of felonies, including extorting state beer assn. Details of scandal splashed all over Wisc media; Journal Sentinel called it "most damning public corruption case in Wisconsin history." NY Times op-ed article 10/24 noted Wisc Senate majority leader Chuck Chvala "finally ran into trouble when
Diageo pulled plug: Captain Morgan Gold officially dead. Took another $28 mil charge, bringing total Diageo charges on the Captain to $66 mil. Ouch! "Captain Morgan Gold has been forced to walk the plank," wrote columnist Lex in Financial Times, calling it a "high-profile setback." Behind-the-scenes, there have been tussles over who will pick up bill for unsold Captain Morgan. Distribs think Diageo should foot entire bill for blunder. But that
Big news for Coors in 3d qtr: early signs of better Coors Light #s, up 2-3% in US. "We really believe our new creative is working," prexy Leo Kiely told analysts, "we have strong indications of that. It
While total malt bev shipments up estimated 740,000 bbls, 1.3% in key summer qtr, AB and importers gained share yet again. AB at 49.8 share during peak-selling season (tho under 49 for 9 mos), and imports just about 11% of US mkt. Others struggled to stay even in share or reduce dropoffs. Domestic taxpaid shipments up 434,000 bbls, 0.9% Jul-Sep, according to Beer Inst's Matt Hein. Imports up 5% Jul-Aug; no Sep number. For 9 mos, domestic taxpaid shipments up 1.2 mil bbls, 0.8% and imports up 806,000 bbls, 5.4% thru Aug. So US biz up about 2.1 mil bbls, 1.3% thru Sep, including malternative intro volume.
AB picked up gain pace in 3d qtr
. Got its biggest bbls and % increases since 2d qtr 2000 as shipments up 700,000 bbls, 2.6%. Sales-to-retailers up 3.3%, also an acceleration. For 9 mos, AB shipments up 1.6 mil bbls, 2.1%, and share up 0.4 to 48.9, we estimate. YTD STRs up 2.2%. In 4th qtr 2002, a decent gain should be lay-up. AB will go against just 0.4% shipments gain in 2001, while it begins 4th qtr with 1.5 fewer inventory days than last yr. SABMiller hasnMore on Alcohol
A new poll of 5700 Americans supports recent statements by Diageo
In the States: More Controls in Some, But Sunday Liquor Sales Spreading; Different Views Outside US
States and local communities continue to investigate and adopt stricter controls on alcohol sales (number of outlets, product and promotion bans, shorter hours of sale) to reduce abuse. But there
A recent small-scale study found moderate beer consumption significantly reduces C-reactive protein levels, which are a marker for systematic inflammation that can cause a heart attack. In fact, C-reactive protein levels dropped by an average of 35% in a group of 19 men and women who consumed 4 and 3 beers respectively with meals during a 3-week period. On top of that, fibrinogen levels (a protein associated with blood clots) dropped 12.4% after 3 weeks of moderate alcohol consumption. While these findings came from a small study, they may have huge implications for the alcohol industry as scientists have recently found C-reactive protein levels to be a better predictor of heart disease than cholesterol. Cholesterol levels have long been thought to be the most important predictor of heart attacks, but a separate study of 28,000 found those with high C-reactive protein levels doubled their heart attack risk.
It has long been known that other factors besides cholesterol were influencing heart problems since half of all heart attack victims had normal cholesterol levels. Now researchers think they have the answer. "The implications of this are enormous," Dr. Paul Ridker of Brigham and Women