By David A. Wise
For WisBusiness.com
Small breweries in Wisconsin say they’ll be harmed by a legislative move aimed at prohibiting large breweries such as Anheuser-Busch from establishing brewery branch distribution centers in Wisconsin.
Deb Carey, founder and president of New Glarus Brewing Co., says budget language approved by the Legislature’s Joint Finance Committee on Tuesday takes away important business options from craft breweries.
Under current law, craft brewers can hold separate licenses for wholesale and retail distribution of alcohol.
The budget language passed Tuesday would exempt smaller brewers (those that manufacture fewer than 300,000 barrels per year) from many of the provisions that apply to larger breweries, but it would also remove some benefits they now enjoy.
The smaller brewers would be allowed to sell their own beer directly to retailers and to individuals at an off-site outlet, but they would lose access to separate wholesale and retail licenses. Instead, brewers would be issued brewer’s permits by the Department of Revenue that would permit brewing, direct sales to retailers, and certain retail sales as part of the brewery.
Carey says standalone wholesaler’s licenses, which allow the distribution of many brands, or retail licenses, which allow sales to consumers, are important assets for brewers. With separate licenses, these businesses could be sold separate from the brewery, which Carey said is an important option for entrepreneurs.
“Why is this being taken away at this particular juncture?” Carey said. “This is not an imminent threat from Anheuser-Busch. This is wholesalers tightening things up for themselves.”
Carey, who’s on the legislative committee of the Craft Brewers Guild, said craft brewers are not pleased with the provision and have been denied meetings with the governor and legislative leadership on the issue.
“This does affect many of us in a very big way, and we are extremely unhappy,” Carey said.
Tim Roby, spokesman for the Wisconsin Beer Distributors Association, said the provision is aimed at streamlining the regulatory process and preventing large brewers like Anheuser-Busch from monopolizing the market and restricting the brands they sell.
He said the legislation ensures that craft brewers will be able to continue to grow and ensures their products can get to market through direct distribution or through independent distributors.
In a statement, James Wright III, general manager of MillerCoors, said the legislation is makes sure the system operates fairly.
“MillerCoors applauds JFC members for strengthening the state’s three-tier system by eliminating the ability of major brewers to own a distributor here in Wisconsin,” Wright said. “The ultimate goal of the legislation is to make sure the system operates fairly for everyone — retailers, beer distributors and brewers. All of the business practices currently being used by this state’s brewers, in particular our ability to retail our own beer, are protected by this new law.”
The legislation was backed by the Wisconsin Beer Distributors Association, the Tavern League of Wisconsin, the Wisconsin Grocers Association, the Wisconsin Petroleum Marketers & Convenience Stores Association, the Wisconsin Wine & Spirits Institute and MillerCoors.
