As we hinted last week, Beer Inst named new leader just in time for its annual meeting which kicks off this evening.  Jim McGreevy gets prexy and CEO title.  Most recently Jim was Sr VP Govt Affairs for American Beverage Assn, which he joined in Dec 2005.  So Jim’s got tons of beverage experience including key tax battles, health issues and both inside-the-beltway/state legislature know how.  Should be able to hit ground running in adult bevs at a solid pace.  Jim starts Jun 23, but will be at BI mtg tonight/tomorrow to say hello.

Northwest primed for another pricey privatization battle.  DISCUS just pumped another $100K into pro-privatization side, taking total to $300K, reports The Oregonian.  Recall, DISCUS maintains neutral stance overall on privatization but if wheels start turning, distillers want to be part of debate to make sure their products get best access possible and not orphaned in new system.  Pro-privatization side has raised $2 mil, sez paper.  And big disrib Young’s just gave $63,200 to opposition side.  This ain’t the multiple millions involved in epic Wash battle led by Costco, but it’s building.  Back east, ongoing bid to privatize Pennsy stalled for now.  As we’ve been hearing for weeks, current Repub-backed bill to ease into privatization just can’t muster 26 votes it needs to pass Senate.  There are 27 Rs in chamber and apparently almost that many views on how to shape privatization.  Meanwhile, Ds united against this specific plan, lotsa industry interests oppose as well (including DISCUS, again, more vocal than in past) and strident union of state-store workers which is actually running ad claiming that privatization “kills” children.  Behind scenes, some small brewers angling for franchise reform/tax breaks, we hear, but looks like nothing’s moving anytime soon.         

Lotsa familiar memes in long Bizweek article detailing attempts by AB InBev to make inroads in tiny Guatemalan beer mkt via Brazilian Ambev unit.  Tale involves warring family  -- one side beer, one side soda  -- with latter aligning with Ambev side to compete in beer and claims (and denials) of attempted buyouts, efforts to prevent stock purchases from family members, legal squabbles, charges of undue political influence and much more.  Ambev considers itself an “underdog” in country (it has 20 share, Central American Brewery has most of rest), but it’s growing and trying to sell both less expensive beer (including sharp discounting in mainstream) and higher priced Stella and Corona.  Beyond discounts, Ambev reportedly “giving free trucks to distributors” (!!!) and “selling cases of [mainstream] Brahva with a 2-liter bottle of Pepsi attached.”  “They’re just doing crazy stuff,” charges competitor.  AB execs/distribs in US will find very familiar story about culture change when Ambev came in to build soft drink side’s beer biz: “Ambev executives wear jeans.  They don’t have offices, instead working at communal desks like Wall Street traders.  CBC has embraced the culture.  ‘They did it voluntarily,’” said Ambev exec, adding “in the Dominican Republic, we had to make them do it.”  Click here to read story.      

Tom Looney has been at the helm of Diageo Guinness USA for a little more than a yr, and he’s a 26 yr Diageo vet.  He came to DGUSA at a rough time with lots of overhang from overly ambitious launch of pouches and Guinness Black Lager. So DGUSA took a hit. Recall, DGUSA was down 8% by volume, 10% by revs in 6 mos thru Dec, the co reported.  But trends are improving in available data this yr.

DGUSA down 3.8% yr-to-date thru Apr 20 in IRI multioutlet + convenience (compared to -7% in 2013), even tho still dragged down by pouches and Black Lager.  Goals are to stabilize Smirnoff and grow Guinness, Tom told INSIGHTS. And Smirnoff Ice down just 2.5% yr-to-date plus Smirnoff Screwdriver up 23.6%.  So it is making some headway there.  While Guinness Draught down 3.5% in IRI, Guinness Stout Extra flat.  And Red Stripe up 3.5%.  So biz getting better, according to IRI, tho still not where DGUSA wants it to be.  Just over half of DGUSA biz is in chains and it is beefing up natl accounts, Tom said. 

INSIGHTS visited Tom at Diageo’s NY office yesterday.  He was bullish on beer’s role in total Diageo, DGUSA’s oppys in US and some new innovations.  Most interesting innovation idea will be coming this fall: a Guinness Blonde Lager that will be brewed here in US at City Brewing in collaboration with unnamed US (craft?) brewer.  It’s part of new “Discovery” series of beer brands that Guinness will be brewing around globe. DGUSA also testing new non-carbonated FMBs called Tragos Frescos in 7-8 heavily Hispanic mkts. It will also bring a Parrot Bay Margarita with splash of coconut water in cans and have Guinness slim kegs.  None of these likely to move needle all that much, but they do show DGUSA’s continued commitment to innovation.  Some past innovations have faltered, like discontinued Jeremiah Weed and fast-fizzling pouches. But Tom touted all of these as valuable learning experiences, including pouches, which he said were still a 3 mil case category where Diageo has 20 share at good margin.

Recall, Guinness is sold in 50 countries and is key part of Diageo’s route-to-market in parts of Africa and elsewhere. What’s more, Diageo likes its total alc bev model. And DGUSA alone spends over $100 mil in advertising and promotion, plus Diageo investing $250 mil in Guinness brewery.  All these points suggest Diageo not likely to sell DGUSA, tho some distribs have advocated that in recent yrs as its biz declined.  Tom has goal of making DGUSA “easy to work with” for distribs, in addition to returning to growth.  

Beer Institute is on verge of naming new prexy, INSIGHTS has heard several times this week.  Word is that BI zeroing in on DC insider.  Could be done deal in advance of its annual meeting next week. Stay tuned. 

Reyes Bev Group is testing a new distrib unit called Unique Craft Solutions that services parts of SoCal where it doesn’t have full-service distribs and enables it to provide suppliers with a one-stop solution for all of SoCal.  “We plan on a portfolio of local and regional craft brands, along with complimentary specialty imports,” said Harbor’s Ned Hall.  RBG “developed the idea to compete with other Southern California distribution solutions.”  Those include Wine Warehouse, Craft Guild of Calif (L. Knife), Stone.  So Unique Craft Solutions only sells in territories where RBG doesn’t have full-service distribution, principally LA area. Local MC distribs Classic and Beauchamp likely view this warily.  But Unique Craft very small volume so far and really just starting out.  Principally, it enables RBG to sell some brands now thruout SoCal.  Brands included so far are Paulaner, Belching Beaver (a North County San Diego craft), San Tan (Ariz) and starting later this mo, the Hess brands, another rising SoCal craft.  Unique Craft Solutions will also sell craft spirits.  Very interesting development.   

Yuengling went with MC distrib C&C (Mancini family) in Rhode Island and will enter state in Jun.  After going with all AB distribs in several states, that’s at least 3d departure by Yuengling in last 2 mkts.  Recall, Yuengling went with MC distrib Atlas and L Knife’s Craft Guild of Boston operation in Mass.  How’s Mass going so far?  Pretty great, according to state shipment stats.  Yuengling shipped over 30,000 bbls in Mar, for about a 10 share of shipments in its intro mo. That’s strong, tho sales-to-retailers reportedly not quite half of that.  Meanwhile, Yuengling put Connecticut on hold because “we’re not ready to make final decisions,” said Yuengling coo Dave Casinelli.  Yuengling is going to “reevaluate” and “spend more time” before entering CT.   

Stay on top of beer’s rapidly growing high end trends.  Join us at the 2014 Beer INSIGHTS Spring Conference at the Ritz Carlton in Chicago, June 9-10.  Space is limited.  For more info, click here. To register, click here.   

David Steinman, our newest employee, has filed another blog post about his early experience in the beer biz and here at BMI.     

MolsonCoors jumped 4% to very near a 52 week high this morn, and still up 3% at presstime.  TAP had “big beat” of analyst estimates with “better expense control” and “lower taxes,” wrote Judy Hong of Goldman Sachs. Underlying EBITDA jumped 20% to $251 mil.  Yet MillerCoors’ STRs down 3.4%, MolsonCoors also down 5.7% in Canada (compared to 4% drop for ABI).  At least European volume up 5.6%. TAP’s intl biz unit lost $3 mil pretax for the qtr, better than the $5 mil it lost last yr. Stifel’s Marc Swartzberg “encouraged by” 1^st qtr EBITDA increase “and management’s emerging capital discipline,” and also continues to “see upside from improving capital allocation plus unreflected upside if ABI buys SABMiller.”