Anheuser-Busch InBev announced today a change to its sales structure that will result in layoffs of hundreds of employees in The High End, its division of craft and import breweries. The decision came on the heels of A-B InBev’s own internal research as well as a recent survey of wholesalers.
Due in large part to its recent acquisitions of craft breweries, A-B InBev has added more than 2,000 employees in recent years. Alex Medicis, the vice president of sales for Anheuser-Busch, explained in a letter to wholesalers how a new structure would allow the division to work with wholesalers in “a more efficient and effective way.”
District managers and sales representatives for The High End were most affected by the restructuring. Many wholesalers were working with multiple district managers–some that represented the brewery’s core brands, and others that represented The High End. The new structure allows for a single district manager to handle both core brands as well as those in The High End, according to Medicis.
The new structure also eliminates the role of sales representatives for The High End in an effort to simplify points-of-contact between wholesalers and the breweries. A-B InBev will, however, be adding inventory managers to work with district managers and regional craft brewery managers.
The letter to wholesalers included three additional announcements: that the company would also phase out brand activation manager programs and trade activation manager programs (a decision made after surveying wholesalers on their effectiveness); that the brewery will streamline its category management and trade marketing reporting structures; and that it would move A-B InBev’s Region 1 office from Boston to New Jersey next year “in order to centralize this team geographically within the region.”
“We have made considerable efforts to find new roles within our business for people affected by this restructuring,” wrote Medicis in the letter. “These are difficult decisions to make and ones we take very seriously. However, they are vital to ensure we are structured in the best way possible to better connect within an evolving industry.”
While A-B InBev is not sharing the exact number of employees affected, a spokesperson for the company said it amounted to less than 2% of the 18,000 employees that constitutes the brewery’s team in North America.
“The role and mission of The High End is unchanged,” wrote Adam Warrington, senior director of communications for The High End. “Feedback from our craft partners, wholesalers and retailers is that brewery reps are most appreciated in terms of brand culture and support. So we will be focusing our efforts in this direction moving forward.”
As a citizen, I am against wholesaler’s power and action to restrict smaller business that are craft brewers of their ability to grow as has occurred here in North Carolina! This move by Anheuser-Bush to further utilize wholesalers and phase-out jobs, may serve to further the growth of wholesalers and advance their restrictive nature and power! Small craft brewers are good for business development such as, taverns, restaurants and grills, hotels, and other small business, etc., that, also, usually carry some of YOUR brands for non-craft drinkers! This is SOMETHING YOU might be better served to be mindful! Thank you.
What does this have to do with wholesalers? This is solely an AB decision. Wholesalers are the ones who build those small craft brewers brands and get them access to market so consumers have the ability to get their hands on the product. Without wholesalers, brewers do not have the resources to brand and distribute their product effectively across markets.
By removing their sales people gives more jobs to the wholesaler. My concern is before the sales person had the brand in mind, many breweries sold out knowing that their beer was well cared for. Now the guy promoting bud is also promoting the smaller craft. Their final goal is to push out us small brewers, through brewery acquisition and national distribution they will have much more clout in taking up the shelf space. Watch the craft space for independent brewers diminish in the next few years. This will put some of us smaller guys out of business.
Wow. Martha, you clearly do not understand the beer distribution system. If AB and MillerCoors did their own distribution, regional craft beers would not exist (they would not have the scale and efficiency to cover the market outside their town).
You should hug the next distributor you see because they provide just that, distribution (aka access, exposur). And as scary as ABI is and how they could be seen as bad for the craft business, the huge numbers they paid to get 10 barrel, wicked weed, Elysian, etc gives brewers incentive to get in the game in a serious way.
guess what I do for a living. 😉
No big surprise here. Seek, acquire, assimilate, shrink, screw up, make more money. Repeat.
Ha. Well said!
Corporate greed..after I learned Bud was sold..i won’t drink a drop of it ever again
So you mean that anything that is not 100% US you don’t buy.
“Enhance shareholder value” is the only goal of any publicly-traded company. Always sad to see anyone laid off after a merger (happened to me) but that’s what all business do.
Well clearly Martha is an idiot. North Carolina Craft Brewers have benefited from one of the most progressive structures in the Nation, as evidenced by North Carolina having more new Craft Breweries than 90% of the states in the Nation. And for those Craft Brewers in NC who have elected to utilize the Wholesaler network, they have “suffered” with 5 times the volume growth they had prior to those assignments.
BTW–I heard Wicked Weed was crying foul all the way to the bank, which took multiple trips to deposit all the money they got from ABI.
Next Martha will say that NC’s beloved Fast Food is being unfairly restricted due to Whole Foods being bought out by Amazon. What an outrage.
Pretty sad, I have watched the greed slide for a long time and as said above, it never gets better.
I have been so disappointed in some of the best craft breweries taking the money and ran saying nothing will change, well, we know where that went.I don’t buy their beer(?)any longer. Patronize local.
Here here!
I hate when people use the word “greed”. It’s just business. The corporations have a duty to be profitable for the shareholders, whether they sell beer or fertilizer, so to try and personalize it only shows ignorance. If I owned stock in A-B, I’d applaud this move.
Having said that, I have the choice to patronize whatever companies I’d like to with almost all other products, but because of irrational and antiquated 3-tier systems, my choices are limited. So I ALWAYS try to support any brewery who remains independent, and always will. I appreciate the business decisions made by the breweries who sold their businesses and do not demonize them, but I won’t patronize them, either.
The trend is always for the big corporations to acquire, then downsize and/or close. The three tier system that was installed after Prohibition ended (It didn’t work!) was supposed to protect the little people. As soon as the big companies found that they could weaken the system by purchasing the distribution arm, the system is now a complete sham
Greed??? InBev is no less greedy than the smaller craft brewers who sold to them. And who goes in to business to not make a profit? In case no one noticed, for each craft brewer who sold out to InBev, dozens of new craft brewers have been established. Many of them doing extremely fine work and doing well as a business.
To put this in proper perspective, it might be well to remember what Lewis Lapham once said about the genius of capitalism is that it has no morality.
This is a natural part of big business buying up smaller businesses and the commentor MAS said it well above. As I read between the lines, I also believe that the craft brands that AB purchased are not performing as well that they thought because discerning beer drinkers know the difference and ar staying away in droves
I hope that this in part a result of people patronizing small craft breweries
Craft brewers love to use AB and Miller/Coors wholesalers to get their brands out there. Those wholesalers are more local and do way more for their communities then any craft brewer does. They have more employees, pay more taxes, buy more local goods to support their business. I could go on and on.
If AB/In-Bev and Miller/Coors were only distributing for the likes of Goose Island, Redhook, Widmer Brothers etc. that would be brilliant. When they start tampering with the production like they did with Honkers Ale then it becomes problematic. My two cents.
wallmart does not put small business out
of business – wallmart shoppers do