The future is the past…unless you do something about it now.

About two months after joining Warsteiner, the brewery invited all the countries that sold their beer to Germany for spring meetings.  During that week, the brewery set aside two days for planning exercises.  As is typical of many corporations, when leaders of the organization are gathered, training or exercises designed to educate, improve moral, or build teams are often implemented.  Why waste a good meeting?

In this case Warsteiner had brought in a consultant who asked each country leader to project out what we thought our business units would look like in five years.  We were then to determine what would transpire during each of these five years to ensure we reached our stated goal.  Like most planning exercises it was all an educated guess but we went through the steps.

Industry pundits are now, or soon will be publishing their predictions for 2015.  Making these predictions for a single year is one thing; however making them for five years is another.  Not to diminish those one year forecasts, but what will the industry look like in ten years?  The industry might look something like this in 2025:

• Jim Koch will be 75 years old!
• The craft/import segment will be lumped together and known now as high end premiums.
• Bud Light/Coors Light/Lite and all other domestics will be grouped into one category: popular beers. High ends will be 50%+ of market share.
• European imports will be major players due to years of over investing in the US since the exchange rate is favorable and the changing demographics in Europe.
• Because of the legalization of marijuana, the drinking age will be lowered to 18 or 19 years of age in all states.
• College campuses will be a battle ground due to the lower drinking age and the fact that colleges liberalized drinking in stadiums and campuses, similar to what currently occurs in the NFL
• The three tier system as we know it will be gone, and direct sales to retail will be available to vendors who want to only high spot.
• Franchise laws will be modified to support contractual laws.  Distributors will represent vendors who want market penetration.  Contracts will be performance-based, time-bound and will supersede weaker franchise law.  Those contracts will support the three tier model.
• Beer real estate in the off premise chains will be virtual ensuring all SKUs will be available.
• Growlers will be the dominate packaging.
• If the Democrats win in 2016, beer and tobacco taxes will skyrocket to help pay for Obamacare.  If it is a Republican win than the tax increases will be much lower.
• Women will be running more beer companies than men.
• SAB Miller will not exist as it currently is, and ABI will be highly diversified into other non-beer products and goods.
• Finally, pay to play will be the norm for the on premise. Call it slotting fees for the tap handles, or just like what is going on today, but in 2025, it will be legal and in writing.

With these projections and ten bucks you can get a beer just about anywhere. When we look back at these predictions, however, some will be very close. Remember how many people predicted where they thought the industry would be back in 2005?  Think about ALL the changes that have taken place over these last 10 years.  As they say, the future is the past…unless you do something about it now…

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