This Telegraph article from last week is relevant to recent debate.
How ‘big lager’ crushed Britain’s craft beer revolution
How ‘big lager’ crushed Britain’s craft beer revolution
Multinational brewers are drowning start-ups with ‘fake’ independent brands
Daniel Woolfson Senior Business reporter
When Christian Townsley and his business partner John Gyngell began selling imported Belgian, German and American beers at their bar in Leeds in the late 1990s, they were among a small group of outliers in the drinks industry.
At the time, British pub-goers had limited choice: cheap lagers or traditional cask ales served at cellar temperature were the norm. But Townsley was more interested in the wilder, experimental and higher-strength beers being made abroad.
His first experience of Liberty Ale, an archetypal American beer made by the now-shuttered Anchor Brewing Company, was “a technicolour moment”, he said.
“I went from thinking that American beer was bland, flavourless lager made with rice to ‘wow!’ The aroma, the palette – it was like Turkish delights.”
Many British beer drinkers exploring the bar taps at their local may be able to recall a similar “wow” moment today.
Varieties such as IPAs, sour beers and saisons are no longer a fringe pursuit, thanks to a boom in demand for craft beer over the last two decades that has seen countless small breweries and taprooms pop up across the UK.
But now there are fears that Britain’s artisan brewers are being
overshadowed by multinational global giants passing themselves off as independents.
This week brewers warned that beer drinkers are at risk of being misled about whether the beers they buy are genuinely independent – when in fact many are now owned by huge global brands.
The Society of Independent Brewers (SIBA), a trade group representing hundreds of breweries, has taken aim at the global beer giants and accused them of taking credit for the work of Britain’s independent brewing scene.
In an attempt to push back against the multinational beer makers, it has recently launched an “indie beer” label, calling on British brewers to add it to their cans and bottles so aficionados can tell the difference.
“Between them, independent brewers employ 10,000 people, run over 2,000 pubs, bars and taprooms and pay millions in taxes here in the UK,” says Andy Slee, SIBA’s chief executive.
“They are a force for good in the local communities they represent, and it’s essential global beer companies are not taking credit for the hard work of true independent brewers.”
The rise of craft beer has certainly not gone unnoticed by the global beer giants.
Massive multinational brewers such as AB InBev (maker of Stella Artois), Heineken, Asahi, Carling’s owner Molson Coors – known as “macros” to many craft beer fans – have collectively splurged millions snapping up independent brewers to cash in on the boom over the last 10 years.
They include Camden Town Brewery, which AB InBev bought for £85m in 2015; and Beavertown Brewery, which Heineken took full control of in 2022 after buying a minority stake in 2018. Heineken also bought the smaller Brixton Brewery.
Asahi, meanwhile, bought Meantime Brewery in 2016 and went on to acquire Fuller’s brewing brands – including London Pride – in a £250m deal in 2019. The formerly independent Sharp’s, which makes Doom Bar ale, has been owned by Molson Coors since 2011.
Many of these brands have enjoyed wider success since the “macros” swept in, boosted by the backing of their global owners – but some indie brewers have found it tougher.
These brewers have had to deal with the soaring cost of everything from ingredients to fuel and labour. Economic pressures have pushed swathes to the brink.
“I think it’s fair to say that the explosion of craft beer in the last 10, 15, and 20 years has somewhat been hijacked by big brewers buying up some of the more successful brands,” said Jack Hobday, co-founder of craft brewery Anspach & Hobday, which makes London Black porter.
Some, such as London’s Brick Brewery and Brew By Numbers, went into administration and were bought by private equity, while others have disappeared altogether. According to audit company Mazars, the
number of UK breweries entering insolvency in 2023 rose by 82pc to a total of 69.
“It’s much more challenging out there for indies,” said Townsley, co-founder of North Bar and North Brewing.
The Leeds-based North Brewing business itself went into administration earlier this year and was rescued by the owner of Kirkstall brewery, also based in Leeds. North Bar remains a separate entity.
At the same time as rising costs, demand for craft beers has also stalled as Gen Z cut back on alcohol or choose to drink spirits and ready-to-drink cocktails instead.
The
most-hyped beer brand in 2024 is none other than Guinness, owned by global giant Diageo, which overtook Carling to become the highest-grossing beer in pubs last year.
Trevor Stirling, drinks industry analyst at Bernstein, said the craft beer crowd were now slowly moving to become the new Guinness drinkers.
“People who might have drunk a lot of craft beer are either getting slightly older and they just can’t cope with the alcohol levels, or they’re watching a rugby game and they want to drink three or four pints of beer rather than two and Guinness fits very well in that framework,” he said.
While craft brewers have been battling to keep afloat, he said the multinationals have been using their financial heft to muscle in.
Bernstein said for big brewers, selling craft beers alongside their main lagers is more attractive to big pub groups and makes it more likely their products will be given more space on the bar.
“The macros have got a very easy route to market and can deliver regularly and put the price in at a very competitive rate,” said Townsley.
The same thing is happening in the supermarkets.
According to Circana data, the number of brewers sold in the supermarkets has dropped by more than 17pc in the last four years – leaving more space in the hands of the biggest players.
Still, acquisitions of craft breweries have not always gone to plan.
When Australian brewing giant Lion bought the lauded UK breweries Fourpure and Magic Rock in 2018 and 2019, it promised to become a major force in the UK beer industry.
Fast forward to 2022, and it ended up selling them both and exiting the UK market blaming difficult trading conditions.
Japanese giant Asahi, too, closed Sussex craft brewery Dark Star in 2022. The brand is still around but is now made at a brewing “hub” in London.
This sparked a fierce reaction from the Campaign for Real Ale (Camra), which called it “another example of global brewers playing chess with their assets” and a cause for “great sorrow and sadness”.
Hobday supports SIBA’s campaign and said he believes most customers would prefer to buy from independents, given the choice.
“People do want to support the local, and they do want to support independent businesses, and they certainly don’t want to feel like they’re doing that but actually supporting very much a macro business that’s not local or independent.
“What gives many beers and brands a spark is that those independent brewers are putting their heart and soul into what they’re making. Some of that is just about simple quality.”
Not everyone agrees it is that simple – especially at a time when living costs are high and consumer confidence is stuttering.
“The vast majority of consumers want a good liquid at a fair price. The ownership of the brewer is very much a secondary or even tertiary to that objective,” said Stirling.
SIBA’s members will be hoping that the trade body’s campaign will help convince drinkers otherwise.
So far it has even won the backing of Camra, which seeks to preserve the standing of traditional ales served in a cask rather than the kegs that craft beer styles are typically served in.
However, even if drinkers can be persuaded to ditch the likes of Camden and Beavertown for independently-made beers, brewers worry it will not be enough to address the steep challenges they face.
“There are so many things that impact negatively on cash flow that it’s an incredibly hard industry, especially if you are saddled with any debts inherited during the pandemic,” said Townsley.
“A campaign like this will take a long time to seep into the consciousness of consumers. It doesn’t happen overnight. The industry needs quicker fixes.”
