Freedom Isn't Free

Pete Coors
Pete Coors
FILED SEPTEMBER 12, 2013

Dear Client:

It didn't feel right yesterday to not acknowledge the terrible events that happened on September 11 twelve years ago. Like many of you, I was attending the National Beer Wholesalers Association's 64th Annual Convention in Las Vegas at the time, where I actually grew to know many distributors who were, like me, stranded after all flights were grounded. I was actually just heading down to the session when I heard the news from former Boston Beer exec Rhonda Kallman, who was crying so hard it was difficult to understand what had happened. Rhonda and I walked together into the General Session, where a pall fell over the room as the news of the events spread. Keynote speaker Pete Coors took to the stage, where he discarded his prepared speech, turned off the teleprompter, and made extemporaneous remarks.

"Thank you for being here. Maybe there isn't anyplace to go, but it's great to have this family together this morning," said Pete, echoing the sentiment of everybody in the room. "I had a spell-binding speech prepared, the obligatory speech about responsibility and how we are becoming a more responsible industry," he added.

"One of the first paragraphs in my original speech read that there is nothing that can take the fun out of this business. But this today has certainly taken a punch at it. In our business, when things are tough, and things aren't going our way, we can usually still have a beer together and try to figure it out.

"We live in a great country," he continued. "In the last year, I've had opportunity to be in a couple of places that haven't been as fortunate. Last year, my wife Marilyn and I went to Northern Ireland, and saw first-hand a country with great potential. People who worship the same God, and want many of the same things out of life--education for their children, a good life, a decent standard of living. But the citizens of that country don't have the courage to learn to live together..... These travels brought home to me how great this country is. But we can never forget that freedom isn't free. It comes with a price. Every Memorial Day and Veteran's Day we stop and think about some of the sacrifices that have been made to assure our freedom. Freedom to speak your mind, freedom to enjoy prosperity, and to do the job you want. That's why my great-grandfather came to America. He lived in Germany under an almost feudal system where there was no chance for advancement. But freedom isn't free. Sometimes, with all our prosperity, we may forget that. Maybe today is an awakening of sorts, but it sure is a tough lesson.

"I am honored to be here to participate in this convention. We may have differences, and the world is not perfect. But by working together maybe we can come a little closer to what we all want. This is a very tough day for everyone in this room. My prayers are with each and every one of you, and with your family and friends that may be affected by events this morning. God speed getting home to your families. Thank you for giving me the opportunity to say a few words," Pete concluded, to a standing ovation.

After that, many wholesalers took to the phones to secure travel back home, with many buying cars and vans to get back, or renting U-Hauls or RVs. A top Diageo exec kindly offered me a ride home in their van, even though San Antonio was way out of their way to Norfolk and even though I hadn't treated Diageo particularly well in BBD at the time. But I elected to wait it out at Bally's. Each day a group of wholesalers and myself would meet down at the Napoleon's Bar, where Bally's had set up a large TV, to watch the news unfold. There were A-B distributors, Miller distributors, Coors distributors, small brewers, large brewers. One thing we all had in common: wanting to get home to our families, but grateful to have each other to help curb the awful feeling of helplessness. For me, it was an incredibly potent moment in time, where I realized more than any other time in my career that I was proud to be a part of this great United States beer industry -- not just for the great nature of the beverage we sell -- but more importantly to be associated with the people who work in the business. I still am proud.

Freedom certainly isn't free. Pete's words were prescient, as we realize every time we disrobe to fly and each time we see a wounded soldier returning home. Forgive me for indulging in such saccharine sentimentality in my old age, but I'm grateful that we're free to work in such a great industry, and I'm grateful for my friends in this business.


WINE OUTSHINING BEER IN THE DISPLAY DEPARTMENT; I SMELL OPPORTUNITY

Ever wondered about how the number of beer or wine displays in stores compare to each other in relative terms, as well as to other prominent categories shopped by consumers in stores that carry beer and wine? Me too.

The folks at Nielsen recently collected display data collected over the span of a year, covering over 35 categories and over 30 major retailer trading areas that sell both beer and wine, (we're talking Kroger, Delhaize, Ahold, Safeway, Publix, Albertsons, Meijer, Giant Eagle, among others).

It clearly showed that the number of wine "Points of Interruption" (aka displays) rank among the very highest of all categories. While both beer and wine were in the top 10 of category displays, beer was No. 9 while the number of wine displays ranked it virtually tied for No. 3 with carbonated beverages, behind only the huge candy and snacks category, and ahead of other power categories such as cookies, juices and drinks, cheese, bread and baked goods.

How close were beer and wine? According to Danny Brager, svp bev-alc at Nielsen, "Not really that close. Wine display occasions in these stores were 60% more than beer. You don't have to go very far to pass by some wine while shopping the store, providing that many more opportunities to notice Wine and for it to make it into the shopping basket."

I know, I know. You thought this week was dedicated to reporting only good news on beer. Well, this is good news: It sounds like a huge opportunity, particularly for craft and imports.

AB INBEV'S JORGE PAULO LEMANN ON SUCCESS; PLUS, THEY MAY BE AFTER COKE, NOT PEPSI

Ever wondered what it takes to become a billionaire? We'll ask Jim Koch at some point, but in the meantime Forbes fronted a story chronicling AB InBev's major shareholder Jorge Paulo Lemann's secrets to his success. Don't forget, he also has a controlling stake in Burger King and H. J. Heinz Company through 3G Capital investment fund, so the dude is pretty darn solid. So below are his 20 secrets to success, per journalist Cristiane Correa, his biographer in the book "Sonho Grande" (Big Dream).

But before we get to the surefire ways to become a billionaire, which justifies your subscription to BBD for thousands of years, there was one tidbit in the book that surprised us: In spite of recent reports that have suggested a possible purchase of PepsiCo, the 3G partners could instead be considering buying Coca-Cola. Recall that their partner in Heinz is Warren Buffett's Berkshire Hathaway, which is already the largest shareholder of Coke with a 9% stake. Warren and Lemann are reportedly good pals and getting closer more recently.

So, without any further ado, here are his 20 secrets to success:

1. Good people working as a team and with common goals is the most important and differentiator asset of a business.

2. Finding, training and keeping good people around are a constant and permanent struggle for all shareholders.

3. People's earnings should be stimulating, fair and balanced with the general interests of the company.

4. The assessment of people is an essential and constructive item for the business.

5. The main function of the heads of a business is to choose people better than them to keep the company going even without its leaders.

6. Leadership is exercised by clear ideas and by the daily example in the smallest details.

7. To debate is important, but everything to be considered requires someone responsible for it, and at the end someone must make a decision.

8. Common sense is worth a lot and more than complex ideas. Simple is always better than complex.

9. A good business is always looking to improve. Whatever degree of success, there is always room for improvement. This ensures a lasting competitive advantage,

10. Always reduce costs. That's something that iss under your control and ensures survival.

11. Innovations that create value are useful. But copying what works well is way more practical.

12. The improvement and continuing education of people must be an ongoing effort incorporated into businesses' routines.

13. Only appear in the news with concrete goals.

14. Focus, focus, focus. Focus on the essential.

15. Communication and transparency with key data circulating help educate, pulling in the same direction and create a competitive advantage,

16.Appreciate the rearguard.

17. Always being ethical is essential.

18. It takes a lot to build a reputation that can fade away quickly.

19. In order to get to the pot of gold at the end of the rainbow you have to go all the way through the rainbow, but do it at a profit along the way.

20. A big, challenging and common dream is essential, and it helps everyone to work in the same direction.

There you have it. Go out and make it happen, captain.

Until tomorrow, Harry

"If we don't change direction soon, we'll end up where we're going."
-Professor Irwin Corey

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BEER INDUSTRY SUMMIT - January 26 - 27, 2014 in Scottsdale, AZ at the Phoenician Hotel. More info here: http://www.beernet.com/beer_summit.php

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