Too Many Breweries? Probably.

Before I was diverted from sitting on my arse doing sod all by Manchester Beer and Cider Festival (MBCF) - more of which soon - I put up a little poll about whether there are too many breweries in the UK.

Now I had a kind of idea that the answer would be "Yes" and indeed that proved the case with 57% of the respectable 103 respondents agreeing that there are. Only 28% thought that there aren't too many breweries with 14% undecided. most respondents have a pretty good interest in beer and pubs I imagine and likely a fair knowledge of the issues, so I'm reasonably confident that the result reflects a general feeling of unease about the seemingly unstoppable growth of new breweries in the UK.

While at MBCF I took the opportunity to ask brewers big and small what they thought. Tellingly they more or less all thought there are too many and a shake out is ahead. Not them of course though. It is hard to be sure, but with dog eat dog at the lower cask end, regional brewers as the squeezed middle and too many brewers chasing too few opportunities you can't help but think something must give. Whether you are big or small, one thing is for sure, if you have found a niche or market that suits you and makes you money, stick to it and nurture it.

And for those that aren't in such a happy place, better find one quickly or you might be heading for the rocks.

One thing though. Brewers are the most amazing optimists. They have a propensity to find a way round problems which is wholly impressive.

Oh. And you must make good beer. There is a feeling around that quality needs to be upped and the smart ones recognise that. 

Live at MBCF (3)

Well it's all happening or happened here. A great crowd, fantastic beer and the two biggest days still to go. OK, my knees are knackered but today's highlights include a very tasty brekkie from Greggs - don't knock it you snobs - seeing loads of friends and my lass laughing a lot with cask beer in her hand - the wonderful apple and pork pies from the Crusty Pie Company, a very inadvisable hat photo and last, but by no means least, the couple who were chucked out for shagging in the toilets.

Now you may think the latter outcome was unfair and  I must admit the rules of the festival are silent about sexual intercourse in the privacy of trap one of the ladies - we'll learn from that one - but in fairness to the complainant, her pint, carefully placed on the floor of the adjacent cubicle while she did her business,  was knocked over by the vibrating wall of the trap next door. That was a step too far. This is a beer festival after all. You can't have rampant passion at the cost of someone's ale.The complaint was upheld and the miscreants ejected - albeit grinning widely.

This was a tricky situation, but looking at this as a whole, two very satisfied customers - albeit taking no further part in proceedings - can't be a bad thing. Please don't try this at home though. Keep your beer well away from such shenanigans.

I understand that the stewards called to this unpleasant scene decided to wait until events had reached their natural conclusion. Discrete or what?
 
Just been called to another Health and Safety incident. A guy fell off a chair while blowing up a balloon. "I'm alright" he said," but the balloon got away as I fell over."

 

Live from MBCF (2)

Two and a half hours to go before the Trade Session and it is looking good. Site teams are finishing some of the bespoke stuff like brewery bars, Bar Managers are getting pumpclips on, doing price signs, checking quality and much more. The place now has the appearance of a beer festival though there is some tidying up to do. Most of the food stalls have set up, beer judging has started and we are getting there.

Update. Events overtook me and it is now less than half an hour to opening. We are now though much more ready. Hi Viz off, hall inspection with Security passed. Health and Safety good to go.  We might even have a few hundred beers available

I need to go now. Duty calls, but I could do with a pint. Now less than 25 minutes!

Eventbrite - our ticket people - intervened. God they are complicated in many ways and hard to contact in every way.

Now 20 minutes to that beer.

Live From MBCF

Or the "Big Cold One" as it is now.  This is the first of a number of posts live from Manchester Beer and Cider Festival. If I have time of course.

Today is day three of set up and it is starting to look like a beer festival. The bars are mostly built, the beer is all up, cooling is starting to flow and there are fewer of the myriad of jobs left to do.  The odd thing is that it is the little things that take time such as signage, pricing and cask end cards and many more - such that these are the things you suddenly run out of time on. The food stalls have started to arrive led by the Crusty Pie Company, familiar to anyone who has experienced GBBF. The various brewery bars are being built, keg walls being set up, containers being shunted into cold stores and bottle fridges put in place. Foreign beers have arrived, the foyer is coming together and the cider lads have started grading the cider.  Now Cider grading is a mysterious tasting ritual driven no doubt by the need to ensure the cider producer knows what he or she is talking about when they describe the appley delight as dry, medium or sweet and points in between of course. I am assured that it is nothing to do with getting a head start on the supping.

I have been busy with various stuff including Health and Safety and a load of more mundane items as well as spending time with a university student who is studying Event Management. She seemed impressed by the scale of things. It is a big place.  Oddly she doesn't drink beer but says she is looking forward to trying some to see if we can change here mind.

We'll try and that reminds me. The membership stand is setting up too!

The photo shows the festival from the inside. Literally. Behind some of the many bars.

Sticking to the Knitting

Being a moaning man I've mentioned that over the festive period I've not been well. I'm still not 100% and one of the casualties in this has been beer. In the last four weeks I haven't really felt like drinking any and on the few occasions times I did, the after effects knocked eight bells out of me.  Not that I got particularly pissed or ill, but it made me even less inclined to have some the next day.  Fortunately that's receding.

Now I may have mentioned my local brewer is JW Lees. Or have I? Maybe  not. Well it is - or they are -  and it is that brewery that has provided me with liquid sustenance on the times when I felt like a beer and on Sundays when I went to my local to meet my friends even when I didn't fancy it.  Man does not live by Lemsip (or generic equivalent alone.)  Now I like Lees beer. Frankly, living where I do, if you don't like Lees then get out of town and while I have my ups and downs with the output - and who doesn't - over all the years I've lived here, despite my nearness to Manchester, it is still Lees I sup mostly. I'd guess these days around 4 in every 5 pints is one of John Willies. It is rarely a hardship.

Fortunately Lees Bitter is going through a bit of a purple patch. The beer is clean, bitter-sweet and moreish.  I had a couple of pints with Paul Wood, Lees Brewhouse Manager who lives near me last week and when I remarked that everyone was praising the beer at the moment, he replied that "the yeast is behaving itself". That apparently is the real secret. If the yeast is being a good lad, then your beer, if all other processes are followed precisely, will be as you intend. That bitter interspersed with the seasonal Plum Pudding - a brilliant incarnation of a perennial favourite - has sustained me, throughout my feeling unwell.  That and being in the company of people I know in my local and one or two others - all Lees pubs - where I do most of my supping. Much is said about wonderful micros, but when you just need good beer and good cheer, traditional breweries and their pubs have a lot going for them.  Their commitment and passion is every bit as strong as the feistiest new brewer and when you want to swoop a few well made, easy drinking beers, then there is little better.

At this year's Manchester Beer and Cider Festival there will be an Independent Family Brewer's of Britain Bar. I'm not sure how many we have, but certainly around 20. Don't overlook them amongst all the exotics and you know there may even be a surprise or two.

One surprise is cask conditioned Lees Harvest Ale, a cheeky little 11% number which is a bit of a cult beer in the USA. It is nearly always bottled, so a lot of a coup.

We'll also have Cloudwater's last cask production too. That might be a bit of a draw as well.

The photo is of course of JW Lees himself. John Willie to his friends. 

Too Many Breweries?

Amid all the heat generated by Cloudwater's decision to abandon cask beer, one or two key points started to emerge. Firstly there was a not wholly - well maybe by no means - accepted allegation that certain brewers cannot make money out of selling cask beer and a secondary and sort of glossed over one that links to it, is that there are too many breweries seeking too few accounts.

Now let's start with the first one and its ancillary argument that cask beer is more expensive to produce. Well that does kind of fly in the face of what has been going on since keg beer was invented. Since that point, keg beer  - or rather brewery conditioned beer - whether it be from kegs or tanks has always been more expensive. Where the two are sold side by side keg beer is always more expensive. If it is proprietary lager or a national brand, it has always been more expensive and it still is.  Who can doubt that?  Just go into any pub and see for yourself.  I don't intend to go into the many variables that change that for individual breweries, but these will include, ingredients, kit, how tight the operation is run on one side and on the other side, to whom and where he or she sells their beer and for how much. Neither list is exhaustive.  Is there a degree of tradition in this? A kind of hangover from the past? I sort of doubt it. Keg beer was more expensive when we had the big six brewers and they didn't do that for no good reason. It simply cost them more to make it.  It is only traditional in the sense that it has always been like that - but for a good reason.

Does that still apply nowadays? Well yes it does and some reckon it shouldn't.  The argument goes roughly "if cask is a premium products, then why doesn't it command a higher price?"  Superficially one might agree, but it doesn't take long to demolish the argument. Cask beer per se isn't a premium product though some cask undoubtedly is. Some is more or less commodity and some is in between. Also there is no guarantee that what you buy will be sold in the sort of condition that would command a supplement. (In fact a lot of keg beer on presentation alone, shouldn't command a premium either but that's a different argument.) Cask beer is a much more perishable product than keg. It has to be "priced to go". If you want to see the argument taken apart, read this from Phil's Blog.  Special pleading by breweries who reckon their operation is different/ better/more exclusive don't cut much ice with Phil or indeed me.  This kind of sums it up for me: " Not, that is, unless I can persuade a substantial number of punters that I should be able to make cask beer in precisely the way I want to, and that this is important enough to make it worth paying more for my beer. But that’s a really hard sell; mostly punters (and publicans) are liable to take the view that beer is beer, and that the world doesn’t owe anybody a living. Not because they’re evil or selfish or brainwashed, but because that’s how selling stuff in a free market, and the rationality the market is based on, work."

I'd contend that is a persuasive point and that attempts to artificially raise the price of cask beer are doomed to failure. Thus it is that certain breweries look for a way round this by using their capacity to produce higher margin keg or - even better - small package beer - as this market is far less congested and margins still exist. This has legs - in the short term at least - as this is a less congested market. 

So back to the other side of this which is alleged over supply is pushing prices down.  There must be a degree of truth in this, but there are several flies in this ointment.  Even if we shake out some breweries, we can't guarantee to shake out the right ones. You only need to read Dave Bailey's Blog here to understand that isn't likely to happen. Nobody would suggest Dave is a bad brewer, but he is seemingly in a bad place. In the meantime, all the hobby brewers, regionals and nationals will undercut him and others. With nearly 2000 breweries, just how many would need to go to make the market a better place? Even if a third went, would that guarantee anything? I doubt it.  On the keg side there are uncomfortable times ahead. The big boys, using the craft beer companies that they have purchased are sniffing around. The multi nationals are loan tying lines left, right and centre. Strikes me things will get worse unless you really know your business, your market and your customers. One thing is sure. If you don't have a reputation for great beer, you are likely to be in trouble of some kind. Sadly, even if you do have such a reputation, there is no guarantee you'll survive.

Are there too many breweries? Probably. Would many fewer solve the underlying problems of brewing beer profitably in the UK? Probably not.  Beer wise, we live in interesting times.

As I started to write this, I realised I was tying myself in knots, so this is a truncated version just to get the main points across.

Please take the survey which is simple enough. I was going to do a binary choice of yes/no until I realised I don't really know myself.

Nothing Much to See Here. Move Along

I was woken yesterday by a tweet from a branch member to advise me that Manchester's Cloudwater Brewery was to cease brewing cask beer. Now my first thoughts were "Oh. Not sure I like that", but reading Paul Jones piece about why they came to this conclusion, I started to see the simple truth, varnished though it was by the usual red herrings about low prices, bloody CAMRA and poor cellarmanship. "We took the decision to make more money from the same production and had to really, as we don't make a profit currently".  My paraphrase, but who can blame them then? Certainly not me. A brewery has to make money and when you have limited capacity and bills to pay, using tank space for a low margin products when you can small package and keg beers for the same effort and make lots more money on them - then you can see the point - while not necessarily agreeing with some of the supporting "evidence."

Matt Curtis and Ed Ray (and maybe others) have given their thoughts on this and you can take your pick which one you go along with. Matt takes the view that it is mostly down to low prices commanded by cask beer in the trade and a more questionable claim that cloudy cask beer produced by Cloudwater is also a factor. (For my part most cask I have had from Cloudwater has been perfectly clear, but opacity is a divisive factor that inhibits some modern producers of cask beer. There is a resistance to non clear cask beer - rightly in my view -  so only one point deducted there.)  Matt's other point about pricing and discounting is true and he blames drinkers for this. I am not so sure that this stands up to scrutiny though, as discounting is driven by the sheer number of cask brewers - nearly 2000 - competing in a diminishing pool and having the advantage of progressive beer duty.  Publicans often buy on price alone and if the beer is no good, then there are plenty more to choose from. I'd contend that the punter is the victim of this discounting, not the source of it. Prices are dictated by what the pubs charge in a competitive market. The customer has little say at all and often has to endure some bloody awful beers.

Ed points out a couple of things in Paul's statement that he disagrees with. Firstly on price of cask beer and secondly on the notion that somehow it is CAMRA's fault. This idea that CAMRA demands cheap beer is a pernicious one, but it simply isn't true.  Many CAMRA members, like many other people are price concious and why shouldn't they be if living on a fixed income in retirement as many do? But it isn't some kind of edict from CAMRA Central and anyway, CAMRA members have much less influence on the trade that many imply.  Ed concludes "let's face it, this side of libertarian communism you can't get away from the need to make money."  Can't argue with that any more than "if you haven't got the money, you can't buy expensive beer." (My quote not Ed's).

I have a couple of points of my own to make. Firstly the business model set up by the brewery has not proved robust enough to sustain the brewery going forward. After a couple of years it  has had to be reviewed and changed. 23% of Cloudwater's capacity is cask beer, falling from 45% in their first year. Already it is clear that the switch away from cask though isn't to keg, but small package - cans in this case.  Keg production will remain roughly the same, so cask is being replaced by the most profitable part of brewing. Shrewd move if you can sell it.

Another point I'd mention is that while the Americanisation of some of the modern British Brewing sector has brought many benefits, it has also introduced to some extent, overheads and risks. It is expensive to tie up strong beer in wood. It is expensive to have a team of brewers playing around with recipes, it is expensive to spend time on collaborations, tap takeovers, Meet the Brewer and messing about with other brewing pals. Constant "innovation" is costly too.  Maybe these aren't luxuries or nice to haves in that niche, but it certainly carries risk and relies on gaining a place in the market amongst other breweries doing the same thing. It also relies on the willingness of the public to pay for these things in higher prices. There is still in the UK  a narrow appetite for fancy and limited beer releases as Paul bemoans in his piece.  Maybe we'll never queue for hours in the UK for such delights?  The UK isn't the US - and sometimes that has to be remembered.

So to sum up, Cloudwater want to leave a low return, thankless cask market for a fun, innovative and much more profitable sector of brewing. A less "All things to all men approach". We shouldn't moan or blame them. For them it is clearly the right decision. Even if some of the supporting arguments, aren't 100% persuasive, the money one is.  Fortunately there are plenty of smashing cask breweries to replace them. Of the 2000 breweries in the UK, I'd guess 95% brew cask beer.  It is business that's all and the gap will be filled imperceptibly.  It isn't the end of cask conditioned beer, or even the beginning of the end. The way you make money from cask is to distribute fairly locally, keep a tight grip of costs, gain a good reputation and stick to your knitting. Plenty know that and will succeed.

Paul Jones says "Cask beer should take pride of place in every bar and pub". He is right and equally he has every right to say - though he doesn't, "but sadly, it won't be our cask beer."  He isn't announcing the death knell of cask beer. He is just doing the right thing for his business, that's all.  Nothing wrong with that.

If my maths is right then Cloudwater sold on average 56 nines of cask beer a week.  Not a huge figure and slack that will easily be taken up.

There are however lessons to be learned, the main one being that in some cases, the most highly thought of modern breweries won't produce cask.  Maybe they just can't in the kind of world they inhabit.  Maybe they just don't get it due to American influence?

I'll also add that both Ed and Matt make valid cases. You pays your money and you takes your choice.