E-Malt.com News article: USA: Labatt USA to move headquarters to Buffalo

Labatt USA has decided to move its headquarters to Buffalo, one of its strongest markets in the nation, company President Glen Walter said, according to Buffalo News. Having won over the region's beer drinkers, Labatt, a unit of Belgium's InBev, decided to set up its U.S. marketing outpost here. Well, the proximity of Labatt corporate offices in Toronto also helped.

"We've got a very large volume base in Buffalo, Syracuse and Rochester," Walter said. "Labatt USA is very excited to get back to Buffalo," where it was headquartered years ago, he said.

The corporate move, from InBev USA's current offices in Connecticut, will bring about 20 sales and marketing jobs to an office in downtown's Key Tower sometime this spring.

It will also bring the sponsorships and corporate resources that come with a headquarters office, which usually buys services such as advertising, consulting and corporate entertaining.

Labatt USA may not need much help with entertaining, however. Walter said he hopes to have a tasting room for corporate visitors with the company's brands on tap.

"I think, because they're going to be headquartered here, it's going to be good for a lot of professional services," said Daniel Fulham of Bridgepoint Partners, a consultant to consumer product companies.

The headquarters returns to Buffalo as a result of a global shake-up at Labatt corporate parent InBev of Belgium, which says it is the world's largest brewer by volume.

InBev transferred U.S. import rights for several of its European brands to Anheuser-Busch. Starting Feb. 1, the American beer giant will import and market Stella Artois, Becks, Bass Pale Ale and other brands from InBev's European lineup.

That leaves Labatt as InBev's main import into the United States. Besides Blue, Blue Light and other Canadian brands, Labatt USA will also handle imports of Brahma beer, a Brazilian brand that InBev calls the world's sixth-largest.

The economic-development coup came as a surprise to local officials.

"They did not [contact us], which makes it all the more impressive for the community," Buffalo Mayor Byron W. Brown said.The corporate relocation "has tremendous implications for future economic development efforts," hoping to position Buffalo as a U.S. base for other Canadian companies.

The region's development arm, Buffalo Niagara Enterprise, hadn't been in touch with Labatt, either, a representative said.

So it seems the economic win resulted at least partly from a grass-roots effort for which many area residents can take credit.

The local Labatt distributor, Try-It Distributing, says the brand's market share in the Erie Niagara region is 28 percent. That's a huge slice for an import and close to No. 1 Anheuser-Busch at 30 percent, Try-It Chairman Gene Vukelic said. Try-It sells the equivalent of 1.8 million cases of Labatt products in Erie and Niagara counties a year. That's 43 million 12-ounce bottles, or roughly a half-dozen six-packs per capita. That doesn't count the Labatts that area residents consume on trips over the border.

"Whether it's two people or 2,000 people, I think when you have the identity of a headquarters office, that means something," Vukelic said.

How did Western New York develop such a taste for the Canadian beverage?

Vukelic thinks it all began in the 1980s, when the legal drinking age on this side of the Niagara River went up to 21. That sent 18-year-olds streaming over the border, where they were still legal, exposing them to the brand and leaving it linked with their memories of youthful adventure.

Canadian commercial culture also plays a part. Regional TV carries binational ads that speak to the inner Canadian in Western New Yorkers, fuelling a craving for Tim Hortons doughnuts.

And then Buffalo has a taste for beer, period. It was No. 7 in a survey of 74 cities in which adults were asked if they had consumed a brew in the previous month. Fifty-one percent of locals had, compared with an average of 43 percent, Scarborough Research said. Milwaukee was No. 1 with 55 percent.


26 January, 2007