How the Alliance Works
Here’s a general overview of how the cooperative works and what membership is like. Details, including the specifics of programs offered, will be determined by you – the members.
The Independent Brewers Alliance is 100% owned by its member brewers. Each member is an equal shareholder, and pays annual membership dues. A member-elected Board of Directors and member Advisory Council set the direction, including membership criteria, and the programs the alliance develops for its members. Because we know that you are busy, the day-to-day work of running the alliance is done by full-time, professional staff.
Other Frequently Asked Questions
What will it cost me to become a member of the alliance?
A $1,000 initial stock purchase, which is fully refundable if you ever leave the group, plus annual membership dues of $1,000 plus $.05 per barrel produced (see Who Can Join Section for full details). This too is fully refundable during your first 12 months of membership should you feel the alliance is not working for you. See 12-Month Risk-Free Trial for details.
Q: Does joining change my ownership structure in any way?
A: No. Never. You stay completely independent, but you own part of the alliance which in the end can actually increase the valuation of your business.
Q: Does membership affect my brand or the beer I make and sell in any way?
A: No. Never. Your membership will be invisible to the public.
Q: Who can join and what are the requirements for membership?
A: See the Who Can Join page.
Q: Do I have to participate in member programs or buy from suppliers that offer discounts or rebates to the alliance?
A: No. While you are encouraged to participate in programs – that’s what makes the group strong – you are under no obligation to participate in any program. You will choose which categories to participate in. If you have certain suppliers you love, let us know so we can work together to get better pricing, as a group, with your existing vendors!
Q: Is the focus on negotiating supplier discounts or rebates?
A: The focus will be on rebates. Many suppliers prefer to offer a rebate rather than “lowering” their prices. In the end, savings are the same.
Q: What material discounts and support programs will the Independent Brewers Alliance offer?
A: There are some savings programs that you can activate instantly, including savings on operational costs such as credit card processing fees, freight, cell phone service and fuel cards. Raw material and ingredient programs are are being rolled out now, based on current member direction. Other programs are in development and will fall into one of the three categories below. Possible programs within each category (as requested by one or more brewers) are also listed.
1. Reduced Cost of Goods & Improved Access
You can leverage the group’s buying power to negotiate supplier discounts on the raw materials and equipment you need to brew and package your beer. It can also help get you better access to any materials in short supply.
2. Savings on Operational Expenses & Time
You can also leverage the alliance’s buying power to help you save money on common business expenses ranging from freight and office supplies to credit card processing fees. It can also help you save time and work smarter by sharing trend data and best practices in areas such as human resources, digital marketing and legal compliance.
Savings on Operational Expenses
Credit card rates
Waste and recycling
Flex warehousing space
Savings on Marketing Materials
Hats, T-shirts, glasses
3. Innovating & Collaborating on Shared Industry Challenges
Harder to pin down – but perhaps most valuable – are the new programs created as the group evolves and begins to apply their collected wisdom and experience to shared industry challenges. Imagine, for instance, new and creative ways to share costs, save time, and help your team work smarter.
Beer style trends
Best Practice Sharing
Opening new markets
Design: labels, packaging, web
Finding and hiring
Q: What kind of savings can I expect on things like cans, bottles, malt and merchandising materials?
A: Savings will be anywhere between 3% and 20% depending upon which categories members decide to tackle. Keep in mind that all savings come mostly in the form of end-of-year rebates, and go straight to improving your bottom line profit.
Q: To get discounts or rebates, do my purchases have to be grouped with other members’ orders?
A: No. You buy like you do now. Suppliers know you are a member of the alliance and offer you rebates accordingly.
Q: Does being a member of the alliance require a lot of my time?
A: There is some time required from everyone. For instance, we are going to ask you periodically about the programs you want to see developed, your preferred suppliers in specific categories and what you’re paying now. Beyond that its largely up to you. Some members just want to “plug into” the programs that interest them. Other members want to help create those programs and participate in the alliance’s leadership.
Q: What percentage of any supplier rebate to the group is mine?
A: Your rebate is proportional to your percentage of group purchases from that supplier. So, as an example, if you represent 10% of the alliance’s purchases from a certain supplier, you get 10% of the alliance’s net member rebate from that supplier.
Q: How many supplier options will there be for any given category?
A: There is no magic number, and it depends on the number of suppliers in a category. We understand that members want choices, so our member-run buying committees make all supplier decisions based on member feedback.
Q: What’s in this for the suppliers?
A: It’s not about squeezing suppliers, or constantly changing suppliers to try to get a the best deal. It’s about establishing long-term relationships with great suppliers who want the added volume and direct access to a large group of high-quality brewers that the alliance can give them.
Q: Am I liable for the the debts of the Independent Brewers Alliance, or the liabilities/debts of other member brewers?
A: No. You are protected from this by the By-Laws of the Independent Brewers Alliance.
Q: Who’s behind the Independent Brewers Alliance?
A: The planning group that put the alliance together is composed of cooperative development and purchasing group experts who jointly saw the need for the IBA and invested in its creation. These people include Greg Brodsky, the group’s leading cooperative expert. He previously organized the nation’s only buying group of bicycle stores – The Bike Cooperative with over 300 members. Greg has also worked for many years with his father, Howard Brodsky, who is in the Co-op Hall of Fame, and co-founder of CCA Global Partners, one of the nation’s largest purchasing cooperatives. Leading the alliance as its Executive Director, is Fortunato Mendes. His credentials include 10 years on the leadership team of Topco, the nation’s largest food buying cooperative which he helped build to over $15 billion in buying power. He understands what it takes to build and manage a successful purchasing alliance. He also brings extensive experience creating innovative sourcing strategies, and negotiating cost-reduction programs with suppliers in dozens of diverse industries.
Q: Why do you think you can make this work in the craft beer industry? Haven’t other people tried this before?
A: There have been a few attempts at group purchasing, but no one has had the time or expertise to do it properly. The IBA is different in three important ways:
- This is the first brewer-owned purchasing group for independent brewers where each member owns voting stock, ensuring that the focus is always on the issues most important to member-brewers.
- This is the first program offering more than just volume discounts. The Brewers Alliance also offer discounts on operational expenses like freight, energy and credit cards. Plus, it will develop support programs for members to share industry information and best practices in areas such as human resources, technology and legal compliance.
- This is the first program being built jointly by experts in the brewing industry and experts in purchasing cooperatives.
Q: What if I find membership in the IBA isn’t working for me?
A: It’s all about independence. You are free to leave the alliance at any time. In fact, if at any point in your first year of membership you feel the Independent Brewers Alliance is not performing to your expectations, you can quit and get a full refund of your original membership fee and stock purchase cost. Notify us by email within 365 days of becoming a member at email@example.com, let us know your reasons, and we’ll send you a check within 7 business days.