(04-22-2023 07:37 AM)Mr_XcentricK Wrote: How is that BUD stock doing?
Bud stock is doing well because investors are betting Americans will return to their normal buying habits. They may be right but I doubt it.
Unfortunately for them they don’t understand production operations and supply chain management. Keg Beer is only good for 50 days. Canned and Bottled beers last 110 days… That’s where the Born on Date comes from
The Bud Light buycott started picking up steam around April 4th. All Bud Light in Kegs produced after that date would have to be sold and consumed by May 24th. Based on present sales figures AB is already pouring beer down the drain. Distributors began shipping kegs back to AB two weeks ago and have cut replenishment orders.
Problems in the Canned and Bottled product will take longer to manifest because they can hold the product in inventory longer. Product made after April 4th will need to be sold and consumed by July 23rd.
If the buycott continues AB will have real problems by September 1st with 40% of annual beer sales happening between May - August.
There is evidence that the buycott is working. Costco has Bud Light clearance priced at $14.97 for a 36 pack. Just checked Walmart and they’re holding at $27.27. Looks like Costco is just trying to not take a loss.
Keep in mind the above only addresses Finished Goods Product. AB has to already be experiencing raw materials problems in their Bud Light supply chains. Most manufacturers use JIT for WIP inventory control. They don’t bring in raw material inventory until it’s needed. Considered most raw materials beyond packaging are perishable, AB partners have to be sitting on barely, hops, and other ingredients.
While it’s true some raw materials are being diverted to other brand uses, I doubt all of it can be since Bud Light is AB’s flagship brand.
I would expect AB to eat some of the initial raw material costs like paying for raw materials already in transit but not received. That however won’t continue for long.
AB has already had the idiots of the National Republican Party appeal to conservatives to stop the buycott. Donald Trump Jr has been begging for conservatives to stop the buycott. Turns out AB donates a lot of money to the morons that run the RNC. Most beer drinkers are saying no.
What AB Marketing, NRC, Donald Trump Jr, Howard Stern, and countless other talking heads don’t realize, is beer drinkers are loyal. They have faithfully supported AB for over a century. Now they’ve made their product undesirable by allowing their marketing vp to publicly disparage their customers. That wasn’t smart.
It’s going to be interesting watching how AB stock prices go over the next few months, especially if the buycott continues.
Old Milwaukee used to own the market with “It doesn’t get any better than this” then they changed their marketing and killed the brand. There was a lesson there for AB marketing.
