On Monday, Reuters reported that the Department of Justice was "probing allegations" that AB InBev has been attempting to stifle competition from craft brewers by choking off their access to distributors, thus making it harder to get their products to thirsty beer fans. If true, that would be something to get agitated about.
In the vast majority of U.S. states, beer makers are not allowed to sell directly to bars or grocery stores. Instead, they have to work through middlemen known as wholesalers, or distributors, who exist solely to market alcohol to America's retailers and watering holes. Known as the "three-tier-distribution system," the setup is basically an outmoded holdover from the early post-prohibition era that persists largely because wholesalers are major political donors. As archaic as the system may be, the bottom line is that without a distributor, a brewer can't really get its ales and lagers on shelves or on tap.
As the brewer of all things Bud, AB InBev already has plenty of heft with wholesalers. But in recent years, it has tried to slash its distribution costs by taking advantage of state laws that allow beer makers to purchase wholesalers outright so long as they operate independently. Thanks to a spate of recent acquisitions, Bud currently owns17 of the 500 companies that move its beer, with operations in cities including Boston, New York, and Los Angeles.
Craft brewers say that AB InBev is abusing its growing power over America's beer distribution network in two ways. First, they claim that some distributors purchased by AB InBev either stop selling products made by rival brewers outright, or seemingly stop making much of an effort to sell them. Second, they claim that AB InBev has pressured distributors it doesn't own "to only carry the company's products and end their ties with the craft industry." Conveniently, AB InBev has also purchased a number of well-loved craft brewers, such as Elysian and Goose Island, which it could readily offer to wholesalers as substitutes for other small brands.
