What makes a beverage an FMB?
Flavored malt beverages are alcoholic beverages which by regulation must be made of 25 percent malt and 7.5 pounds of hops per 100 finished product barrels. Through processing, as much malt, flavor and color as possible is removed (characteristics which are typical of beer) before different flavorings and colorings are added. Flavored malt beverages were born in the 1990’s in an attempt to exploit the tax loophole that taxed malt-based beverages like beer at a lower rate than spirits-based beverages.
Flavored malt beverages are a popular alcoholic drink at convenience stores. After regular beer sales, FMBs were the next best-selling beer-based beverage, ahead of craft beers, cider, and non-alcoholic beer. FMB sales also resulted in the largest gross profit margin among beer sales in convenience stores. Gross profit margin is the percent of revenues that remain after deducting the cost of selling goods.