Page 96

THREATS (2) Competition within the Beer Industry – Craft Brewers ■■

■■

Although the US and Canada markets are still dominated by two companies – AB InBev and Molson Coors. The number of craft brewers in the US increased 312% between 2008 and 2017, from 1,521 to 6,266* and provides a different perspective on the competitive landscape. Hence, craft beer is called “The Strangest, Economic Story in America”**. The craft-beer revolution is driven by two factors: 1.

Tastes – The growing consumer preference for hops and sours (e.g., the hoppy India Pale Ales (IPAs).

2.

Regulation – The US alcohol regulations are designed to discourage vertical consolidation. Additionally, in 1978, US Congress approved the legalisation of homebrewing that was the genesis of the current craft-beer revolution.

Molson Coors counters this craft-beer revolution through the “premiumisation” of its brand portfolio. It has also been acquiring a stable of craft brewers around the world and also licenses/ acquires above premium beer brands. Currently “Above Premium” brands account for ~20% of Molson Coors’ volume and the category grew +21% in 2017.

#1 Craft Brewer in US

#1 Craft Brand in US

#1 Craft Brand in Spain

Leading craft brands in Canada

96

* https://www.brewersassociation.org/statistics/number-of-breweries/ ** https://www.theatlantic.com/business/archive/2018/01/craft-beer-industry/550850/

#1 Craft Brand in Ireland

Profile for Richard

Elevation Capital Research Annual 2018  

Elevation Capital Research Annual 2018