COLUMNIST: BRFC ON BEER
You may have heard that Labatt Breweries of Canada (owned by AB-Inbev, not a Canadian company) recently purchased the Toronto craft brewery Mill Street. You also may have heard people yelling “sellout!” and vowing to never buy Mill Street again. By most definitions, the “sellout” label fits, but is it really such a big deal?
While the numbers are growing again, there was a time when there were only a few Ontario breweries. Following prohibition many were forced to close, consolidate, or were bought up, resulting in near monopolies for Molson and Labatt. Right now, the companies AB-Inbev and SABMiller control about 30 per cent of the global beer market and are planning to merge.
Craft beer is theoretically the antithesis of these macro-brewing corporations. They’re the little guys, brewing interesting beers with heart. When one of them starts to get bigger, it’s like when Rudy finally gets on the football field. They’re still not getting major percentage point shares of the industry, but they’re doing well. And that’s happening more and more often.
As craft beer sales grow, the big companies panic and try to fight back. One way they do that is by purchasing craft breweries. Another, arguably shadier tactic, is to create “craft” branches of their own breweries, and try to keep that fact quiet, as AB-Inbev has done with Shock Top, and MillerCoors has done with Blue Moon. It can be easy to understand why craft beer fans don’t like the macro breweries.
So why, then, am I not bothered that Mill Street was bought out?
Mill Street has never been the antithesis to the big corporate giants, never the folks brewing interesting beers with heart. They generally brew for a mainstream market. Even Mill Street’s more experimental brews, while well made, are bland.
Their populist strategy has already gotten them far, often making them one of the better choices in places with limited choice, and given their trajectory, you have to wonder if this is what they were aiming for all along. Labatt will be putting more money into their existing operation, so it doesn’t sound like things will change much, except that Mill Street might become the best boring option in more locations. Maybe I’ll have a Tankhouse the next time I’m at Swiss Chalet?