Time for some Oktoberfest stats clear-headed investors can consider, as the last of the revelers stagger home.
The end of Oktoberfest is not typically when you might turn to your portfolio – the sofa looks much more inviting right now. But amidst the frothy beers and lederhosen, investors may find some companies, or larger trends, to consider.
Take craft beer. Americans drank roughly 28 gallons per year for every citizen of legal age, and craft brewers alone increased their market share by 15% from 2011 to 2012.
Although now those numbers might take a hit, thanks to the still on-going government shutdown. The Alcohol and Tobacco Tax and Trade Bureau (TTB), which does things like approve new breweries and recipes, is on hold along with most other government departments. You may wonder how this can impact your next beer run, so think about those seasonal pumpkin ales you've been looking forward to.
Smaller brewers who expected to launch new batches, or even open for the first time, now can't get permission to do so. For example, the owner of Brenner Brewing in Milwaukee is anticipating an $8,000 hit for every month he can't open the brewery's new doors.
So when the shutdown finally ends, what can investors expect? Consider a few scenarios:
- Demand for certain craft brews could get pent up.
- When the shutdown ends, brewers who act quickly to get products out can take advantage of waiting consumers.
- Or brewers based outside the US can use this as a time to pounce.
But back to Oktoberfest. These kinds of alcohol-centric faux holidays benefit the big names too, and many are large enough to withstand the impact of the government shutdown. Molson Coors Brewing (TAP) and Anheuser Busch (BUD) are two that dominate the market, although it's interesting to note they have turned to some rather bizarre tactics, hoping consumers choose one over the other.
Maybe it's time to take off the beer goggles and give brewers a closer look.
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