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Costco Will Market Its Own Beer Line

  • Ad Age, Thursday, January 31, 2008 12 PM
Costco, the warehouse retailer, is readying its first line of private-label beers. Brewed by San Francisco-area craft brewer Gordon Biersch and dubbed Kirkland Signature Hefeweizen, the rollout is most likely to hurt sub-premium brands, such as Anheuser-Busch's Busch and Natural Light, Miller Brewing's Milwaukee's Best Light and Coors' Keystone, says Stifel Nicolaus analyst Mark Swartzberg. But craft-beer styles might appeal more to drinkers who would otherwise be buying Michelob or Sam Adams, or expand the market.

Big-box stores such as Costco have been a lucrative source of case sales for brewers and any additional competition in the channel will not be appreciated at a time when those brewers are struggling.

A call to Costco's corporate office was not returned, but the retailer has been offering private-label wines--including a Champagne and a New Zealand sauvignon blanc from the heralded Marlborough region--and spirits for some time.

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