Small brewers locked out of pubs by big corporates: Choice
Australian boutique brewers have long complained that they are getting squeezed out of the market by anti-competitive tactics from their big rivals.
Now the consumer group Choice has said it has evidence of one big brewer putting pressure on pub owners.
It has been given copies of a contract that is says shows Carlton United Breweries demanding exclusive access to beer taps in return for generous cash rebates.
It is a tactic that smaller brewers argue is holding them down.
Six months ago Scott Brownless and a friend set up the Angstrom Brewery in Sydney, with the aim of making at least 8,000 litres of beer every year.
"We're quite a small brewery, so we supply to between 10 and 20 pubs but not on a regular basis," he told The World Today.
Mr Brownless said expanding the business is proving a challenge.
"I actually personally go round to sell my beers and you pretty much just walk into these pubs and you can see their tap light up and you ask the bartender, oh are you on a line contract? And he's like, 'Yes, I can't take your beer'," he explained.
Audio: Big brewers squeezing out craft beer: Choice (The World Today)
A line contract is a deal between a pub and brewer to exclusively sell the brewer's varieties of beer.
Scott Brownless believes two companies are behind most line contracts in Australia: Carlton and United Breweries (CUB), which was part of Foster's before it was bought by the South African giant SABMiller; and Lion, owned by the Japanese brewing powerhouse Kirin.
Consumer group Choice told The World Today that the contracts are damaging competition.
"It puts them at a significant advantage over the small craft operators," said Choice spokesman Tom Godfrey.
"We know that about 83 per cent of revenue in Australia flows to the big beer barons Kirin and SABMiller, and I think the question is, if exclusive dealing cuts competitors, forecloses markets and keeps competitors out, well then it may well be unlawful."
ACCC investigating beer contracts
Last year the Australian Competition and Consumer Commission (ACCC) began an investigation into the wholesale beer market.
It told the ABC that those inquiries are still underway.
However, in the meantime, Choice has produced a part contract it says demonstrates the terms Carlton United Breweries is demanding.
"The contract is very clear; it says Foster's will have exclusive supply of all light-strength draught beers, Foster's will have exclusive supply of all specialty and craft beers, and so the list goes on," Mr Godfrey said.
The contract does not name the pub CUB is dealing with, and it is not dated.
Jeremy Griffith from Carlton and United Breweries says it only has contracts with a minority of the pubs it supplies.
"Seventy per cent of pubs and clubs simply don't have any contracts and, where there are any contracts in place, very few of those are actually exclusive contracts, so it might be you know 50 or 60 per cent of the taps," he responded.
"So there's plenty of opportunity for craft beers to be put online."
Mr Griffith said many of the contracts are formulated by the pubs themselves, and the company is cooperating with the ACCC's inquiry.
"Having a look at these, making sure that it is a competitive market, and we feel very comfortable that it's an extremely competitive market in the beer sector at the moment, so we welcome and we're cooperating, working very closely with the ACCC, as always," he added.
Source : ABC Online Pat McGrath 10th February 2015
