Value of Indpendent Distribution
Competition in the U.S. beer market thrives because of a robust system of open and independent distribution, rooted in effective regulation. This system – comprised of brewers/importers and retailers – provides access to market for all brands and generates vast choice for consumers.
The more than 140,000 men and women in the beer distribution industy help build brands; generate unprecedented consumer choice; and contribute to local and national economies.
Marketplace Competition
The Senate Antitrust Subcommittee and the Department of Justice (DOJ) conducted a comprehensive review of the American beer industry and independent beer distribution system related to the Anheuser-Busch InBev acquisition of SABMiller.
After the review, the DOJ issued a proposed final judgment that maintained the strength and integrity of the independent beer distribution system, saying:
The settlement preserves the ability of smaller brewers to compete… by protecting their access to important distribution networks. And independent distributors… will have the freedom to sell and promote the variety of beers that many Americans drink.
The DOJ's action helps ensure that the U.S. market can remain a "consumer pull" market through independent distribution, where consumer demand is what determines product choice and variety, and to prevent a "supplier push" model where consumer choice is reduced.
Consumer Choice
The Boston Consulting Group has said the current system of beer distribution in the U.S. is “open, freely competitive, and driven by consumer choice.” That’s because the independent distribution system reduces barriers to market for all brewers, creates a competitive playing field for all brewers, fosters innovative new products and keeps pricing competitive for consumers. Because of the open and independent system of beer distribution:
- More than 6,000 breweries now operate in the U.S. – compared to fewer than 50 in the 1980s – and more breweries continue to open every day.
- Craft beer sales now represent more than 12 percent of volume, and imported beers represent more than 16 percent of volume.
- Distributors deliver more than 6 billion gallons of beer per year to more than 600,000 retailers, such as stores, bars and restaurants.
- The average independent beer distributor handles more than 1,000 product SKUs.
The winner is the American consumer who can choose from thousands of brands from around the country and from around the world.
Economic Value
Independent beer distributors deliver direct economic benefit to their communities. They provide more than 140,000 quality jobs with great benefits. Beer distributors directly impact the economy through $34.5 billion of production. When including indirect effects on other industries, capital investment spending that is different from other wholesaling operations, and charitable activity, beer distributors help to add $87 billion to the national total value of production (Gross Domestic Product). Beer distributors directly generate $12.2 billion in federal, state, and local tax revenue through business and employment taxes.