Craig A. Purser is the President and CEO of the National Beer Wholesalers Association (NBWA), a trade association that represents the interests of the 3,300 licensed independent beer distributors before government and the public. From March 25-28, the NBWA is holding its annual Legislative Conference on Capitol Hill, which brings together distributors, members of Congress, and industry leaders for policy work (and the occasional beer). DCBeer.com recently had the chance to speak with Mr. Purser on the phone and ask him about some topics facing the distribution industry. The following is an edited version of that interview.
DCBeer: Thank you for taking the time to speak with me.
Craig A. Purser: No problem! I just went on your website and – kick ass! I mean, really cool!
DCBeer: Thank you. As I understand it, you’re a local as well, so hopefully some of that information is useful for you, too.
CAP: Yeah, I’m in Alexandria, and it’s encouraging to see how much variety and choice we’re getting on King Street, which is the closest area for me. But I like to head out into DC – beer’s been great for growth in some of the revitalized parts of DC. The H Street Corridor[‘s success] has been hard to believe. It ended up being a win-win for the local community, as far as jobs and a successful recipe for economic growth. And the great thing is that beer has been a huge driver of that model.
There’s lots of excitement out there. The growth in craft [brewing] continues. There’s incredible opportunity for consumers: you have more choice, more variety, more access, more mobility. All sorts of new brands and new styles coming out.
DCBeer: Absolutely. For those of us not in the industry, could you describe what NBWA does and how you interact with wholesalers and your partners at either end of the process, the brewers and importers and the retailers?
CAP: Sure. We are the primary trade association for beer distributors, so if you see a truck that says – name the brand – Sam Adams, Fat Tire, or Coors Light, that is our member company.
We’re the clearinghouse for distributors from a national standpoint. First and foremost, we advocate for their interests. We educate members of Congress, policy-makers, and the public. We congregate, inasmuch as we bring people together. And we communicate with folks up and down the line – obviously, with our members, we encourage them to communicate with one another. But it’s really those four legs of the stool that inform what we do: advocate, educate, communicate, and congregate – meaning that we bring people together, and that’s what we’ll be doing at the Legislative Conference.
DCBeer: With the Legislative Conference just around the corner, what is the current mood in Congress toward the beer industry?
CAP: The mood toward the beer industry, I think, is good. I think members of Congress understand that, first and foremost, beer distributors are great providers of employment for 98,000 hardworking men and women. We’re a relatively small industry compared to other[s], but having that many people directly employed by our members is something I’m very proud of. We serve every state, all 435 congressional districts, so the distributor’s identity, not unlike the small brewer’s, is very local.
[Another] thing I think the policymakers are aware of is an overall consumption decrease. One of the things that’s very front and center for most businesses is an unemployment rate that’s hovered between 8 and 10% for three years. And I think that unemployment [for our members] is very much tied to some of the volume decline that we’ve seen in the total beer industry. It’s hard when you look at that unemployment number, but we’re also concerned about the underemployment number. We want Americans to get back to work. I think the policymakers are aware of that. We all want to work together to advocate for policies that will provide more employment and more growth for American business. A rising tide lifts all boats.
DCBeer: Beyond the economy, what are some of the major federal initiatives NBWA is working on? Is there anything you’re specifically hoping to accomplish at this conference?
CAP: One of the things we’re interested in doing is continuing this successful system that we think has given rise to a lot of great experiences for the industry and the public. In 1983, there were only 80 breweries in the United States. Today, we have over 2,000, with another 400-600 breweries in the incubation stage. That is an American success story. We believe that a big reason that we’ve been successful and seen all this growth and new interest in the marketplace has been an independent three-tiered distribution system.
We look at other direct-store delivery industries: soda pop, soft drinks, salty snacks, cookies. You don’t have the same record of success. You don’t have the same new companies that are quickly becoming American icons. I try not to pick out too many individual breweries because you inevitably leave somebody out, but Sam Adams was just an idea 30 years ago, a concept; now, it’s a product that’s available in all 50 states. New Belgium Brewery just celebrated its 20th anniversary and it’s on its way to becoming an American icon. You look at the vast amount of imports that are out there and the new products that are being brought in week after week.
Over the last five years, we’ve spent a lot of time concerned about litigation against the states that would threaten that independent 3-tier system. So part of our messaging to Congress is going to be to ensure that they understand that states ought to be the primary regulator of this system, because it’s state laws that help level the playing field between big and small market participants; it’s states’ laws that balance the competing interests of an increasingly global supplier tier [and other stakeholders], because a lot of the big brewers have gotten a lot bigger in recent years. At the same time, a lot of the big retailers have gotten bigger, too, whether that’s by consolidation, acquisition, or just increasing leverage in the marketplace. So we’re constantly trying to examine policy items that help maintain a level-playing field.
We’re concerned about some of the regulatory issues at the federal level. As we’ll discuss at the Legislative Conference, we want to ensure that the Alcohol and Tobacco Tax and Trade Bureau – a small agency within the Department of Treasury – continues to be the primary federal regulators for the licensed beverage industry. We’ll talk about some of the growth and overreach of Federal Trade Commission as it relates to regulation of alcohol. One [of their purposes] is to protect the public and another is to promote competition. Oftentimes, when dealing with a product like alcohol, their thirst to promote competition overrides the states’ interest in protecting the public.
DCBeer: With a system based on state control, are there any major state issues that you’re facing at the moment?
CAP: We provide a lot of support and assistance to our state associations. And you’re right, there’s a lot of action each and every year in the statehouses across the country. Frankly, that’s where we think alcohol-related decisions ought to be made. It makes more sense to have discussions and decisions made more closely to the public because folks in my home state of Oklahoma feel a little differently about alcohol than people in New York City. While not everybody likes all of the alcohol laws in their local jurisdiction, if you ask folks in New York if they want Oklahoma’s liquor laws, it would be a clear no – and vice versa. So the system works very well and we want to maintain that.
DCBeer: We’ve been in an economic downturn and seen a dip in overall consumption. What are your thoughts on rebounding from the downturn and some potential growth areas?
CAP: It’s interesting because, while the industry has seen some volume decreases, one of the things we’ve been real proud of is that distributors have not made broad, across-the-board cuts to the way that they do business. They have continued to be a great provider of employment, to grow and invest in brands, to double down in this difficult period, while dealing with some huge changes in the industry. In 2008, we saw a couple of things happen that were a challenge for everyone in the industry.
One was the combination of Miller and Coors, forming a joint venture in the US. The other was the acquisition of Anheuser-Busch. Both of those companies have made enormous changes to the way they do business, the way they’re structured, personnel. The distributors have been constantly innovating and finding efficiencies, but they’ve not done that at the expense of headcount or on the backs of their employees. They’ve done that through strategic work, some consolidation, some shared services. It has been done in a way that positions us well for the long haul and respects the responsibility these business owners and operators have to their local communities.
DCBeer: For the average beer consumer, it’s hard to know what goes on behind the scenes. We know when a new beer enters the market, but we might not know what changes were made to make that happen. It’s good to hear that growth hasn’t come at the expense of workers.
CAP: I think that’s right. And this is where you have to recognize the role of small, entrepreneurial, risk-taking brewers. They’re part of this ongoing build-out story. I recently met with Bill Butcher [of Port City Brewing Company in Alexandria]. What he has done, besides make great beer, is really build a road map for growth and a solid business plan that has been exciting up and down the line, not just in Alexandria but in DC. The guys at DC Brau – same thing. It’s being replicated several places, alongside a vital, critically important independent distribution tier that makes certain that these great breweries can get to market and continue to brew.
DCBeer: Finally, if you’re comfortable answering, what was the last beer you had?
CAP: I had a Negro Modelo while out for Mexican. When I got home, I realized that I had promised my 10-year daughter that I would make a pie for her to bring into class. It’s a weird thing I do – I make pie. So when I got back from dinner, I thought, “Oh hell – I forgot to make the pie.” So at 10:30, I had a Port City Optimal Wit while peeling apples. And when she went to school the next morning, she was happy to see a homemade pie all set to bring in.
DCBeer: That’s as good a time as any for a beer.
CAP: Apple pie and beer – it’s what makes America great.