How the Alliance Works
Here’s a general overview of how our purchasing alliance works and what it’s like to be a member – including answers to frequently asked questions.
The Independent Brewers Alliance is 100% owned by brewers who join as Member-Owners. Each Member-Owner 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 savings programs the alliance develops. Because we know brewers are busy, the day-to-day work of running the alliance is done by a full-time, professional staff.
Brewers who choose to join the Affiliate Program pay no dues, are not owners and have no voting rights. But they are eligible to “tap into” most of the IBA’s most popular savings programs. See Two Ways to Join for more on the difference between joining the Affiliate Program and being a Member-Owner.
Other Frequently Asked Questions
What will it cost me to become a member of the alliance?
It depends on how you join. If you brewery joins as a full-fledged Member-Owner you get full access to all our savings programs including any supplier rebates. You will also need to make a $1,000 initial stock purchase, which is fully refundable if you ever leave the group, plus your brewery pays annual membership dues of $2,500 plus $.05 per barrel produced.
If your brewery joins our Affiliate Program, no stock purchase or dues are required. You get access to most of our savings programs, but will not be able to participate in any supplier rebate programs (see Two Ways to Join for full details).
Q: Does joining change my ownership structure in any way?
A: No. Never. You stay completely independent, but if you join as a Member-Owner your brewery owns part of the alliance which in the end can actually increase the valuation of your business.
Q: Does joining the IBA affect my brand or the beer I make and sell in any way?
A: No. Never. Your membership is invisible to the public.
Q: Who can join and what are the requirements for membership?
A: See the Two Ways to Join page.
Q: Do I have to participate in IBA savings 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 is on both price discounts and on rebates, although many suppliers prefer to offer a rebate rather than “lowering” their prices. In the end, the goal is the best deal we can negotiate for members.
Q: What material discounts and support programs does the IBA currently offer?
A: Our focus is on negotiating discounts with leading suppliers on operational costs like payroll processing, insurance, consulting and office supplies and on materials like cans, lids, chemicals, labels, crowns, packaging, kegs, hose, equipment and more. New programs are always under development. Contact firstname.lastname@example.org for current program details and visit our program page.
Q: What kind of savings can I expect on operational costs and raw materials?
A: Your savings will typically be between 3% and 20% depending upon the category and your current pricing. Keep in mind that some savings will come in the form of end-of-year rebates. Most Members-Owners can recoup their cost of membership many times over by participating in just one program.
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 are part of the alliance and offer you savings and rebates accordingly.
Q: Does being part 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 brewers just want to “plug into” the savings programs that interest them. Others 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 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 the best deal. It’s about establishing long-term relationships with great suppliers who want the added volume and the direct access to the large group of reputable brewers that the alliance gives 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 the Executive Director is Matt Hopkins. His more than two decades of experience crosses a broad range of skill sets – including expertise in operations, innovative sourcing strategies, and managing supplier relationships. Leading the IBA’s brewer recruitment initiatives is Laurie Jeffries, an industry insider, cofounder of the successful Jolly Pumpkin Artisanal Ales and an expert in brewery operational needs. And managing supplier relations for the IBA – including working on new savings programs for members – is Peter Licht, an industry expert with 28 years of experience as a brewmaster and a wide network of supplier contacts. Learn more.
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 Member-Owners own voting stock, ensuring that the focus is always on the issues most important to the group.
- This is the first program designed to offer discounts on both raw materials like cans, kegs and bottles and on operational expenses like freight, office supplies, energy and credit card processing.
- This is the first program created and managed by 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.
Read more about cooperatives and how our craft beer cooperative got started.
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