MillerCoors has drawn a line in the sand over the Chesbay-Reyes issue and maybe it’s about time! I’ve read many of the comments from the industry regarding this big issue but first, let me tell you about my experiences with Reyes. I will defend their right as a wholesaler to create their own business model, however, the same goes for the vendors. Vendors need to have the right to either accept it or find another alternative.
In 2006, Warsteiner’s largest wholesaler was Union in Chicago. Union had made a decision to sell their beer division to the MC network which included Reyes. As President of Warsteiner, I sent not one, but two certified letters to Reyes informing them that I would not approve their Chicago operation based on their performance in selling Warsteiner in Maryland. I was in Chicago finalizing the change of network when I agreed to meet with the VP of Reyes. Given the two letters I had already sent, I was curious to find out why they still wanted to meet with me. We met over coffee and I once again said, no to approving their operation. When the Reyes VP finally realized that he wasn’t going to get the brand, his last comment was, ” If you don’t go with us, we will bury you in Chicago!” Those were his exact words! Had he said, “I understand you have issues with our operations, let’s discuss them and I’ll present them to ownership and get back to you with some answers, at this time, however, will you accept our business plan to review for Chicago?” I would have considered it. All this VP did, however, was to confirm my earlier decision not to go with Reyes. Today, Warsteiner is doing just fine in Chicago.
As the afore mentioned conversation ended that day, I casually mentioned that we would more than likely cross paths again. And, two years later, Reyes consolidated the San Diego market. Because Warsteiner didn’t want to leave that market, and this consolidations gave us no other options, we met with the Reyes VP of Marketing. We were assured that they would handle our draft, our brands and promote our Oktoberfest. Even through my Director of Sales was located in near-by LA, Reyes still did not keep their commitments and Warsteiner struggled. Reyes was up front when they’ll told us forth right that they would deliver the product, but without Warsteiner putting someone in their market they didn’t put any effort behind the brands.
Not long ago an AB (and former Schlitz) distributor in Florida, who I think highly of, told me that he and his family owed everything to AB for helping them get their distributorship. AB had made this distributor wealthy and he was extremely grateful! So to the MC distributors who are criticizing the breweries decision, I say that they should be asking, “What can I do to increase my MC business and help them (and all my vendors) achieve their goals?”
Wholesalers enjoy exclusive brands and territory, franchise protection, no receivables, attractive ROI, rising value, and a model B schools, will tell you that it is one of, if not the only business that has little risk of failure. So, what exactly am I missing? Maybe MC doesn’t want to get “buried” either, then don’t let your ego get in the way of your ignorance!