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Beer industry contributed $2 billion to Michigan economy in 2012, says trade group study

By Garret Ellison | gellison@mlive.com 
March 25, 2013 at 4:25 PM

An economic impact study commissioned by a trade group found that America’s beer industry directly contributed more than $2 billion to Michigan’s economy last year.

The Beer Institute Economic Contribution Study released last week pegged the number of breweries in Michigan at 120 in 2012, alongside 141 distributors and 16,744 retail establishments selling beer in Michigan.

Together, that trifecta generated more than $911 million in federal, state and local taxes, and paid more than $293 million in federal and state excise taxes in Michigan. The analysis did not include local sales taxes, although Michigan does not allow city or local governments to impose sales or use taxes.

The study, jointly commissioned by the National Beer Wholesalers Association and the Beer Institute, a Washington DC-based lobbying group, was conducted by John Dunham & Associates of New York City.

The beer industry accounts for 37,220 jobs and $949 million in wages in Michigan, according to the study. The vast majority of positions, 32,050, are in the retail sector, which encompasses employees in restaurants, bars, stores, hotels, airlines, and venues like stadiums.

“Industry-related” jobs, in agriculture, transportation, construction, and other sectors, accounted for another 27,301 positions.

Source: The Beer Institute  

According to the study methodology, researchers compiled the number of jobs and wages paid to employees in each of the industry’s three-tier system of brewers, wholesalers and retailers, and measured the “value added and total output of each.”

In addition to direct impact, the study also measured “induced impact” of the industry, which accounts for the multiplier, or “ripple” effect of spending by industry employees on living expenses like housing, food, educational services and medical care.

Measured by “induced impact,” the national beer industry totals $246.6 billion in output or 1.6 percent of gross domestic product, and through production and distribution linkages, impacts all sectors of the U.S. economy, according to the study.

The study did not spin out impact numbers specific to the craft beer industry, which is surging in Michigan. Craft brewers are represented by a separate trade group, the Brewers Association, which is releasing state-specific impact data in May.

According to that group, craft brewers reached 6.5 percent of the total U.S. beer market in 2012, up from 5.7 percent in 2011.

Michigan experienced 20 percent increase in craft breweries in 2011, which outpaced the national trend of 12 percent, according to a report by the Demeter Group Investment Bank of San Francisco.

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fewer than 250 Form W-2s for 2011). Nevertheless, employers must be able to track the cost of includable coverage beginning in 2012 in order to be certain to have the information that must be included on Form W-2s in 2013, and employers who automatically provide Form W-2s to employees who terminate mid-year, must include the aggregate reportable cost of coverage in Box 12, using Code DD. Employers should be taking steps now in order to be ready by 2013. Steps employers may want to take include: x Consult with your tax advisor at an early date to ensure that you will be able to complete needed action steps on a timely basis. x Identify what information on health coverage is currently being collected and transmitted to payroll. x Determine if any self-funded health plans need to be valued before they can be reported. For example, a wellness program that provides biometric screening or annual executive physicals that include biometric screening and for which the employer charges a COBRA premium. x Determine what additional information (if any) the employer should begin tracking. When reviewing what should be provided to payroll, employers may also want to consider the type of reporting that may be required for the “cadillac” tax beginning in 2018. While similar, there are differences such as the type of health coverage that must be included. For example, salary reduction contributions to a health care FSA, health savings account contributions, and Archer medical savings account contributions are not includible using Code DD for W-2 reporting, but must be included when determining if the “cadillac” tax applies and if it applies how much tax will be owed. x Decide how to handle special situations such as reporting for situations where coverage is part active and part COBRA or part retiree coverage because an employee terminated or retired midyear. x Coordinate with payroll – whether an internal department or an external vendor – to ensure that the appropriate information is tracked, transmitted to payroll and included correctly. x Make any needed systems or recordkeeping changes and test the system(s) before the employer needs to begin producing Form W-2s. x Develop communications that will explain briefly the new reporting requirement and reassure employees that this does not affect the tax status of their coverage. Employers may want to use this as opportunity to let employees the true cost of their health care benefits. 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It does not necessarily fully address all your organization’s specific issues. It should not be construed as, nor is it intended to provide, legal advice. Your organization’s general counsel or an attorney who specializes in this practice area should address questions regarding specific issues. 

Local business donates goods to St. Vincent & Sarah Fisher Center

 

DETROIT (Dec. 20, 2012) – Employees at family owned company Eastown Distributors are banding together for the 22^nd straight Christmas to play Santa and bring some holiday cheer to children in Southeast Michigan.

The third-generation Detroit-based business and its employees are donating $6,000 in goods and funds this year to the St. Vincent and Sarah Fisher Center, doubling last year’s donation to the Center, which provides a range of support programs to at-risk children in Detroit as well as adults.

“Our team at the St. Vincent and Sarah Fisher Center can’t thank the staff of Eastown enough for their generosity,” said Diane Renaud, Executive Director/CEO, The Education Experience at St. Vincent and Sarah Fisher Center. “Eastown is a Detroit based, family owned business that raises moneythrough a variety of employee activities, as well as individual contributions. Many of the children in our program actually have a Christmas, thanks to the good hearts of Eastown.”

In 2012, Eastown is doubling its contribution to the St. Vincent and Sarah Fisher Center. The donations were delivered to the Center on Dec. 11 and 12.

“We know that without our donation to the Center, some of the children there might not be celebrating with a new gift or toy,” said Eastown President Paul J. Quasarano. 

In addition to purchasing gifts for children in the after-school program, Renaud said the donation will be used to purchase much-needed materials for the Center. 

For more than two decades, Eastown and its employees  continue to see the great work  that the Center does in the Detroit-area  community, and are proud to support a program that brings cheer to children in need who live right in the communities the company serves. 

Founded in 1933, Eastown Distributors is a family-owned business now in its fourth generation.  Eastown has grown from a 1,000 square-foot warehouse to its current 120,000 square-foot facility employing 100 employees and servicing 1,700 customers.  This year Eastown added the Coors and FEMSA brands to its distribution.  For more information, visit www.eastown.com.

Founded in 1844, the St. Vincent and Sarah Fisher Center began serving southeast Michigan as a residential-foster care agency for children. In 2006, the Center closed its residential campus and launched the St. Vincent and Sarah Fisher Center Education Experience in Detroit.  The Education Experience offers basic skill-building and academic enhancement for at-risk children and GED assistance for adults.  The programs are designed to help build self-sufficiency and dignity, and help Detroiters achieve employment success and other personal goals. For more information, visit http://www.svsfcenter.org/

H. Cox & Son updates a 25-year tradition, in partnership with Salvation Army TRAVERSE CITY – Family owned beverage distributor H. Cox & Son announced it is donating 65 turkeys to local families in need and will distribute the turkeys in partnership with The Salvation Army. For 25 years, the company had donated turkeys to their employees for the holidays – and this year, they and their employees decided to donate those turkeys instead. “As a local family company, we strongly believe in giving back to our community, and our employees wanted to be sure families in need can enjoy a traditional Thanksgiving with turkey on their tables,” said H. Cox & Son Vice President Ryan Ribel. “We’re proud to partner with the Salvation Army, which does tremendous work in our community serving families in Northwest Michigan and across the state. Our employees deserve all the credit for updating a long-standing company tradition that we hope can spread some cheer to families in our community.” “Local companies like H. Cox & Son are stepping up to help families in their time of need yearround, and the Salvation Army is extremely glad that we have the support of local businesses that give back to our community,” said Captain Daren Spencer of the Salvation Army. “The donation from H. Cox & Son will do more than just put turkeys on 65 tables. It will also encourage all of us to do our part to strengthen our community.” H. Cox & Son was established in 1933 in Traverse City, and is a distributor of beer, wine and pop to seven counties in Northwest Michigan: Antrim, Benzie, Leelanau, Grand Traverse, Kalkaska, Wexford, and Missaukee counties. H. Cox and Son employs more than 60 full-time employees, and services more than 500 retail accounts with a fleet of 15 delivery trucks. H. Cox & Son is active in many local charitable and humanitarian activities, including the Father Fred fundraiser, which raises money for furniture, clothes and other necessities for families in need.

Fabiano Brothers Acquires Wisconsin Based Company Monitor Township, Bay County, Michigan: Fabiano Brothers, Inc. a Bay City, Michigan Corporation with additional operations in Saginaw and Petoskey, Michigan has announced the purchase of an Anheuser‐Busch distributor, Baer’s Beverage in Wausau, Wisconsin. Fabiano Brothers, which has been in business for over 125 years, is one of the largest Anheuser‐Busch distributors in the country and is looking forward to expanding into the state of Wisconsin. John M. Bicknell II, current Vice President of Sales for Fabiano Brother’s Michigan operation, will move to Wisconsin to become a Principal and Chief Operating Officer of Fabiano Brothers – Wisconsin, LLC. For further information please contact: James C. Fabiano II President Fabiano Brothers, Inc. 989‐509‐0200

U-M vs. MSU game like 'major holiday' for beer distributor serving downtown Ann Arbor Posted: Oct 8, 2010 When it comes to beer sales, a big game means big business. “For us, in downtown Ann Arbor, it’s the equivalent to a major holiday,” said Kit Morgeson, vice president of marketing for O & W Inc., the Ypsilanti-based distributor for Miller Lite, Heineken, Corona and a host of other beers, along with Bo Wines, a wine series in the memory of Coach Bo Schembechler. With the University of Michigan and Michigan State University set to faceoff in Saturday’s showdown, the beer is already flowing fast, Morgeson said. It's just another economic indicator of what the big game means to local businesses. Beer sales are expected to be so brisk that special runs have been added to Saturday, Morgeson said. “Businesses are afraid they’ll run out because they don’t have the capacity to hold what they need.” Between 200 and 250 kegs of beer were delivered to downtown Ann Arbor on Friday, she said. A normal game sees about 100 kegs delivered and a non-football fall Friday sees between 50 and 100 kegs. “That’s a lot of beer,” Morgeson said. This year is a perfect storm for beer sales. Both teams’ undefeated records, the fired up rivalry and the late game start time combine for increased sales, Morgeson said. “The 3:30 p.m. start means there’s more time to party," she said. "Then after the game, they go downtown for dinner.” U-M’s winning season has helped. Beer sales took a beating the last two football seasons when U-M has disappointing records. “People do pre-party, but not as much. Winning really does affect business,” Morgeson said. “If we lose, people just go home. But (this Saturday), win or lose, we’ll have a big day.” Party stores near the heart of campus see the biggest uptick, Morgeson said. But supermarkets on the city fringes and hotels around Ann Arbor also see action. The most popular beer of the day? Miller Lite is O&W's biggest seller. And while plenty has been shipped for revelers on Saturday, that may not mean there's much left on Sunday. “Everyone gets wiped out,” Morgeson said. 

Bo Wines is a joint project between Kathy Schembechler, the widow of the great U of M Football Coach Bo Schembechler, a handful of lifelong friends and Doug Wanty of O&W, Inc., a local beer and wine distributor. The project started in 2010 with just Bo Merlot in the first series of the collection and followed up in 2011 with the edition of a Sauvignon Blanc to the lineup. Each year a $2 per bottle donation has been given to the U of M Cardiovascular Center where Bo was treated in the last years of his life. Bo Wines have been well received by Michigan fans near and far and to date the sale of the wine has generated over $150,000 in donations for the U of MCardiovascular Center.

Now in its third year, the team of longtime friends and family have stepped up the project and made changes to Bo Wines that are sure to create excitement! The 2012 edition of Bo Wines includes a Steel Blue Merlot and a Pasadena Pino Gris and are both Michigan Made wines! There has also been a package redesign with beautiful graphics; Bo’s signature and the Michigan Cardiovascular Center logo have been added to the label.

The selling season will be shortened up this year to match the U of M Football season, but will be sold throughout the state of Michigan so “Cheers” to a good cause.

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Manistee —Kent Beverage, a Grand Rapids-based beer, wine and soft drink distributor, expanded its reach north last year when the company purchased and merged Lakeshore Beverage out of Manistee Township and Caswell-Latosha out of Ludington. The Gary family, which founded Kent Beverage in 1962, didn’t waste any time in getting involved in their new community. They recently made the company’s first major philanthropic contribution to the area when they agreed to donate $30,000 to the revitalization efforts of the historic Vogue Theatre in downtown Manistee. “Having been from Grand Rapids and seeing what a vibrant downtown does for a community, we see the important role the Vogue can play in Manistee,” Kent Beverage chair Kim Gary said. “Grand Rapids has been focusing on its downtown for about 15 years or so and right now it’s the place to be at night.” Kent Beverage is a family-owned company currently in its second generation and preparing to welcome the third to the table, so being a part of the community where they do business is important. When the Gary family was made aware of the needs of the Vogue Theatre, they jumped at the opportunity to contribute. Gary said he sees the Vogue Theatre as an opportunity for a similar downtown revitalization in Manistee that he has witnessed in Grand Rapids. The family has developed a reputation for helping out in their community since Kim and his brothers founded the Gary Family Foundation 10 years ago in honor of their parents. Their mother has since passed away and their father, who founded Kent Beverage in 1962, is 90. Since the establishment of the foundation, they’ve donated about $100,000 each year - more than $1 million total- to various non-profit organizations in their distribution area. Having just celebrated their 50th anniversary, Kim Gary said the company is pleased to have expanded into the Manistee area in the past year and looks forward to other opportunities to make a positive impact in the community. “I’m actually a resident of Baldwin and have been for the last seven years, so I’m not unfamiliar with the Ludington-Manistee area,” Gary said, adding that two of his brothers own property in nearby Pentwater, so the area has been “on our radar for a while.” Kent Beverage, which started 50 years ago with eight employees and has expanded its ranks to 180, has full coverage of 21 counties with distribution ranging from South Haven to Arcadia and reaching as far east as 7/5/12 www.ludingtondailynews.com/print.php?story_id=66191 www.ludingtondailynews.com/print.php?story_id=66191 2/2 Lansing. The company is primarily a Miller/Coors distributor, but also specializes in craft beers, imports and Michigan-made beers, wines and soft drinks. The Manistee office, which employs 25 people, oversees Manistee, Mason, Oceana, Lake and Osceola counties. PHOTO: Steve Brower, Vogue Theatre CapitalCampaign Chair, accepts donation from Kent Beverage chair, Kim Gary Alliance for Economic Success 1361 US 31 South Manistee, MI 49660 www.allianceforeconomicsuccess.com (231) 723-432 Date published: 7-3-2012 

LANSING (May 1, 2012) — Local beer distributor Dan Henry Distributing Co. announced today that company President Dan Henry has won the national “MillerCoors Legend Award,” given at the annual MillerCoors Distributor Convention in Las Vegas in front of some 2,000 fellow distributors from across the country. “I am truly honored to win this national award,” Henry said. “We at Dan Henry Distributing are committed to providing the widest choice of beers to adult consumers and partnering with local businesses to provide quality service to everyone. I am proud to lead a company that delivers quality products, creates local jobs and gives back to the Greater Lansing community.” The Legend Award recognizes distributors who have acquired at least 30 years of service as a Miller or Coors distributor; invested in and grown their MillerCoors business over those years; demonstrated a passion for the beer business and MillerCoors portfolio of brands; and garnered the respect of their peers. “MillerCoors Legends represent the heart, and soul of this business,” MillerCoors President Tom Long said. “They’re the pillars of their communities. They have earned the respect and admiration of their peers and their commitment has been critical to the strength of the entire MillerCoors system.” Founded in 1990 when Henry purchased DeRose Distributing, Dan Henry Distributing delivers the world’s finest beers to more than 600 retailers in Ingham, Eaton, and Clinton counties, as well as part of Livingston County. The company has won numerous national awards recognizing its commitment to quality, service and community development. Dan Henry Distributing employs 88 local residents in good-paying skilled jobs. For more information about Dan Henry Distributing, go to www.danhenrydist.com.