In a word, the craft beer movement seeing huge growth in other parts of the world is being suppressed in the North of Ireland by the Macro beer brands, the craft beer market is being prohibited from growing because of anti competitive tactics which leads to lack of support from the on trade market.
Combine the anti competitive tactics with the current out of date licensing laws our craft breweries really need support from the public to grow and survive and our politicians need to start lobbying for change of the licensing laws to help the small craft producers sell direct.
The main problem is anti competitive practices from the big drinks distribution guys, our own brewery was hit with such tactics recently. We brewed a beer specifically for a large hotel and they stopped buying from us so we sought clarification on what was happening, they advised us that they had been given 350k over a ten year period not to allow other breweries in that they didn’t represent. This is the first time we experienced this with a bottle contract, we had never seen that type of activity before, usually you can expect it to be just in relation to draft beer lines.
In simple terms Macro beer brands can buy the rights (not lawfully btw) to have just their beer pouring in bars, restaurants and hotels, some craft brewers simply wouldn’t have the ability to compete with such deals so their growth is suppressed.
Another major problem is licensing laws, now NI is isolated with out of date legislation, the South of Ireland recently changed their laws with a successful Craft Drinks Bill and the UK breweries can sell direct, they can open tap rooms they can generate a revenue from direct drinks sales but NI can’t without approaching a bar to get the use of their occasion licence and making an application to the court.
The lack of a sitting assembly at Stormont means any work that had previously been achieved with craft producers and MLA’s working on a change in law will have to start again IF they ever get back to actually legislating. What is shocking is that political parties in NI don’t currently even acknowledge correspondence in relation to this.
Another issue is that NI craft brewers need volume sales to survive, the margins in Craft Beer are small and with the suppressed local craft beer market the consumption rate is low so they need to look at supermarkets or exports, now we have the impeding circus show that is Brexit looming without any guidance to how the local craft brewing business community is being affected plus the catch with supermarket sales means most independent off sales will abandon them as they say they won’t stock breweries that are in supermarkets yet they still stock macro beer that is in the supermarket, that itself doesn’t seem fair really, again a different rule for macro beer.
Export is what is helping NI breweries grow , the consumption rate of craft beer in Northern Ireland isn’t large enough to support the amount of brewers. There is few breweries in NI that work fulltime brewing without some form of supplementary income for eg our main business is selling ingredients to brewers but we do co own a local brewery. Those that are working full time are really making the effort to push their brand as its the most difficult place to open and operate a brewery. We have some incredibly talented brewers in Ireland and Irish craft beer is respected on the world stage. Export markets are competitive , the margins are low but if you can achieve some decent volume then it can create revenue to allow the brewery to grow that growth leads to larger scale which in turn brings efficiencies and savings.
Direct sales from the brewery is what is really needed, taprooms across England for eg are selling their beer on draft direct for say £4 per pint, 95% of what they are brewing is being sold onsite, this is allowing them a consistent and sustainable revenue stream. I have visited some of these tap rooms and they have become the hub of the community in some small country villages.
So why don’t more NI brewers open tap rooms?
Some do and make use of occasion licences in their breweries and I love what they are doing here…. Checkout Boundary, Lacada and now Knockout doing this. Location is key too, if your brewery is based in the countryside for eg that might not be practical. So if we look at premises in major towns and cities they have prohibitive rent and rates and if you want to buy a licensed premises they are crazy expensive. We looked recently at a licence that became available in Randalstown and the asking price was 200k, with the current licensing laws no new licences can be issued so if you own a licence its worth money.
Some of our NI brewers are making incredible craft beer yet local support isn’t on their side. I recently went to a well known Belfast Bar with several other brewers, we were offered samples and asked if we would like to try something on their board (this part i thought was a good thing btw) but….. When we looked at the board I said I would like to try something local. This then kicked off a talk from the bartender about how he couldn’t get any kegs from local breweries. This really got my attention so i started asking some probing questions turns out he was talking out his arse. I started asking basic simple questions like which local breweries did you approach? I was shocked and equally pissed off at the response, the bartender ran down several respected local breweries one by one. Largely inaccurate info I may add, yes our brewery was mentioned and apparently I don’t need beer sales as my income comes from meat sales from our beer fed beef project – really wtf!! our business partner in the brewery Nigel was there with us and runs the farmshop with his brother and he will confirm that isn’t a main revenue stream, it takes it all to get a little return. Good brewers who I rate were slagged off one by one, I challenged this with some effort and said we were all brewers and what your saying is wrong and if thats the message you are portraying to customers then you are damaging the local beer scene. Guess what we chipped away at all the bullshit and it boiled down to distribution companies, who they can and can’t buy from, frustrating to be honest………
This is written to help create awareness of what challenges local brewers have here, yes we co-own a brewery ourselves but our main business is supplying brewing ingredients, we want all local breweries to be supported, we are passionate about this industry and as a small family business we have built relationships with the brewers we supply we know how hard they work, we know they can make awesome beer we just want you to see how much they need a little help. If we could get the licence laws changed and more taprooms opened these are the places i’d like to spend my sparetime, please challenge your local bars and off sales to make an effort to support your local brewery, or as many local breweries as possible, this will greatly help the craft beer movement.
Does your local MLA know we need these laws changed, the more constituents asking the more chance for change, just saying, we genuinely appreciate your help with supporting local brewers.