Monday, October 27, 2008

Old Dominion, Anheuser-Bush, and Local Allegiances

Much has been written on this blog and other forums about the recent and impending changes at Old Dominion Brewery. There's been plenty of teeth-gnashing over these changes. But what's really behind the vitriol?

Back up to last year when the brewery was sold to Coastal Brewing, a joint venture of Maryland-based Fordham Brewing and St. Louis-based Anheuser-Busch. Almost immediately local craft beer fans began decrying the sale, and remarking how A-B would destroy the brand. Fast forward a year, and the Old Dominion brewpub is now closed, and Coastal has announced the impending shuttering of the Ashburn brewery along with the transfer of brewing operations to Delaware. When this last announcement was made, the discussions on DC-Beer and the web forums heated up. One common thread arises in the discussions: Anheuser-Bush. But why?

Recently on the DC-Beer list Greg Kitsock asked "Will you still consider Dominion brands to be local beers?" That's a thought provoking question. On DC-Beer and other forums, many folks have said they will no longer buy Old Dominion Beers because they are no longer "local". Many commentators also brought up Anheuser-Bush and have implied they would no longer buy the beers because of the ownership of A-B.

Is Old Dominion still a local beer? Well that really depends on your definition of local. Some commentators remarked that they wouldn't buy Old Dominion because it was no longer brewed locally. Does that mean these folks also don't purchase Dogfish Head beers, also brewed in Delaware? Others make the local ownership argument, pointing to Anheuser-Bush. Old Dominion is owned by Coastal Brewing. The majority of Coastal Brewing (51%) is held by Fordham Brewing, an Annapolis, MD/Dover, DE company. I find it very telling that the majority of the anger over the Old Dominion changes is directed towards A-B, not the local majority owner. Why does Fordham get a pass?

Many craft beer drinkers seem to wallow in A-B hatred. A-B is an evil corporation they say, bent on destroying craft breweries. (Much of this discourse is undoubtably written on computers running Windows or Apple software, and maybe even sent via their Google email account. All of these companies decried as "evil" at one time or another.) With the impending buyout of A-B by the Belgian company InBev, things heat up even more. Do the folks who are upset at this change still buy imported Belgian beers? As a proud American, I do hate to see American companies being taken over by foreign firms. However, Anheuser-Bush employs thousands of Americans workers at their numerous breweries. The company employed more than 30,000 people in 2007. Hundreds more are employed by associated distributors, retailers, etc. We should keep in mind that corporations employ people. Coastal Brewing is 51% a local company, employing local people.

Let's also look at the case of Virginia's Starr Hill. Last December, owner Mark Thompson signed a distribution agreement with A-B to expand Starr Hill's distribution. Despite Mark's statement that he retains control over the beer production, and that this move was about distribution, we saw comments on various online forums about the eminent destruction of Starr Hill by Anheuser-Bush. Again, arguments seemingly based on A-B hatred, despite the fact that the agreement means more people will be exposed to true craft beer. By entering into this agreement, A-B likely gives up shelf space for it's house products by filling it with Starr Hill beer. That hardly seems like a way to destroy a product.

My remarks shouldn't be construed as a wholesale defense of macro-breweries. I generally don't drink most A-B brands, just as I don't drink Miller or Coors. That decision is based on my taste preferences. (I do admit to a bit of anger over the damage to beer's image caused by factory brewers' inane, and misleading, advertising campaigns.) Rather, this is a look at what I consider some of the misplaced anger directed at Old Dominion. Indeed some of the criticism is well-deserved and Coastal isn't blameless for the expressed anger. As recently as last month a Coastal spokesman was assuring local drinkers that the brew pub at the Ashburn facility would reopen. It's hard to build brand loyalty with confusing or misleading statements.

I will likely continue to drink Old Dominion beers, as long as the qualities that attracted me the beer in the first place remain. Will I purchase Beach House Pilsner next summer even if it is brewed in Delaware? Surely. I'm a fan of good beer, and I base my decisions first on flavor and the enjoyment I get from drinking the beer. Rejecting a brewery solely on the involvement of Anheuser-Busch is misdirected and short sighted.


  1. This was very well written and thought-out. Thanks for speaking up in this way.

  2. At the end of the day, a local brewery is equally adept at making swill as a major multinational. I believe very strongly in supporting local business, is part of the problem with Old Dominion, and forgive my outsider perspective, that not enough locals thought highly enough of the beer to keep it going locally?

  3. There's plenty of discussion on why a local group never bought the brewery. Jerry Bailey tried for years to sell it, and several times there were rumors of an imminent sale. Only those close to it likely know why it failed. I think the beers were generally well-liked, though from my perspective in this out-of-the-way small town, not always readily available.

    As far as the consolidation to Delaware. The two breweries are only around a 130 miles apart, so it probaby makes economic sense.

    At the end of the day, at least for now, the beers will still be produced, and probably won't change. Coastal wouldn't have bought OD if they didn't want to make money with it.

  4. I agree with most of what you had to say, but I've got a less positive outlook about the future of Old Dominion, because this seems less like a company streamlining to get over an economic hump and more like a brand in its death throes. Completely disowning the brand because of Anheuser-Busch's influence is indeed "misdirected and short-sighted," but in my opinion, so is expecting this company to survive, at least in its current form.

    I'm amazed that some folks are surprised when corporations (breweries being part of that umbrella) of this size "trim the fat," so to speak. If Coastal/Fordham deem it necessary, it's their right to do so; they're the proprietors. While it may be unfortunate to lose a certain beer or an entire brand, that's the way the cookie crumbles.

    Lew Bryson made a good point about how the people who are selling it actually market the OD brand now. There seems to be less interest in reviving it at present than there was when Jerry Bailey sold it. And the beat goes on...


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