I Hope We Know What We Are Doing...

So, we have massive hikes in raw material prices, allied with global shortages of the same, spiralling (upwards, of course) fuel & energy prices, an ever-shrinking marketplace thanks to restrictive trading & too much competition (much of it from breweries that aren't run to be commercially viable, but as a 'hobby'). And if that wasn't enough, we have State Nannies hell-bent on over-demonising all forms of alcohol to stop a tiny, tiny minority who still behave like idiots even when they are sober. That is our market in a nutshell.

There is only one obvious course of action. Expand!

Whilst we have been planning this for a long, long time (longer than was planned), it is, given the above, even more important that we grow - because then we can afford to target new markets, grow successfully into the shrinking existing one, and expand our offerings in the process.

So just what are we doing then? Firstly, we are putting in a new beer store - our existing one is cramped, badly located (it was always temporary), and hard work. Not only is the new one bigger, it is at ground level - so we can use a fork lift (and that, believe me, will be a God send in itself). It will also enable us (for a variety of reasons) to allow our beer to mature in tanks, which will free up some more casks not only to help cover increased production, but it also means no more being unable to brew just because we have no spare casks. Secondly, we upgrade our cask washing facilities, speeding up that particular job immensely. Thirdly, we will have more storage space for malt supplies - so they won't be in the way (and as a side benefit, malt handling prior to starting each brew will be simplified, and easier). And last, but not least, in the middle of it all will sit a rather useful, and somewhat flash, automated bottling line. Which is of course where new markets come in. If the drinker increasingly won't go to the pub, the pub, it seems, is increasingly expected to go to the drinker. Enter Bottled Beer. And of course having a full range of bottled beers gives us the chance to look at restaurants (Beer and food? A fine match, much better than wine.), off-licences, supermarkets etc.

Yes, I did say supermarkets. I will go one further, and say Tesco. It was winning their Bottled Beer Award (East, 2008) that sparked this off, and we'll be on their shelves (if all works out to a mutual advantage) by the summer. It has been suggested, nay hammered into us in some cases, that Tesco are the root of all evil, and not very nice to be dealing with. But our eyes are open - they are a huge dominant global corporate giant, we are but a small little concern where even the vehicles have names not ID numbers. This is not good for us? Maybe not. But if we follow their requirements (and in a past life I got to learn why these requirements were needed, and their is some common sense involved), supply the sort of product we would be happy to drink, and do our best to be flexible, I think we'll be alright. And if it doesn't work? Well, we'll have had some immense exposure to the public. And we certainly don't ever intend to have any one customer so big that we can't manage without them. Yes, we'll want to court other large chains, but it will be different beers.

Of course in an ideal world, we'd all be drinking down the pub - but that is not happening, and we'd be stupid not to follow the market. Ironically, I suspect the day of the pub will return - but not in the villages that are already without, and those that quite possibly soon will be. Let's just hope in the meantime that alchohol isn't priced out of the reach of the sensible, moderate drinking majority, in a flawed attempt to control the few idiots, who, quite frankly, are only idiots because society has fromed that way. But then I guess I am missing the point. Education costs money. Alcohol brings it in. It just depends how much they think we'll pay for it, because we can't as a Nation afford to reduce tax revenues. Too many buffoons to pay for.

So all in all, I'm not worried about knowing what we are doing. I'm more worried that everyone else knows what they are doing....

Oh Look, Another New Brewery...

According the mighty font all knowledge brewery wise, www.quaffale.org.uk, 58 new breweries have opened so far this year, while just 7 have closed - so that's an increase of 51. In 2006 82 opened, with 27 closing - an increase of 55. Go further back and it's the late 90's before the opening/closing figures balance. Now of course at first glance this all suggests a very healthy, buoyant & expanding marketplace, and to a point this is the case. Except that the market is not actually expanding - there are less pubs each year, and the good free houses are slowly snapped up by pub chains with tied supply agreements. Of course some pubs become free, and more and more tied pubs are being allowed to by from a vastly expanded range of breweries, often local. But the crucial thing is that the market is not expanding - it's changing, yes, but in terms of cask beer outlets, there is no actual growth. That said, the sales volume of cask beer is growing each year, but that is partly through the fact that for years most small breweries sales weren't included in these figures, whereas increasingly they now are. So yes there is room for some new players - but 50 each year?

Now of course the most important part of starting any business is the advanced planning. Do I have a market place? Can I get raw materials? Will I make money? And so on. And such information is processed by the financial backers and used in the decision of whether to stump up the cash. Trouble is, most new breweries don't start with any financial help - the money comes from savings, redundancy payouts etc. Indeed this is how we started as well. So there is no need to do a full business plan, and research the market, because no-one is actually asking you to. Some new breweries are pub based, so obviously they have their marketplace, others are very small and are never intended to be commercial concerns. But the rest, well they have to play in the real world.

And herein lies a problem. We can't get guarantees on raw material supplies from our hop merchants & maltsters. And those that have got some guarantee have had to buy up front. We know that some maltsters are not accepting new customers, because they don't have enough malt to go round. This is a result of a bad harvest of both malt & hops globally, compounding the growing problem of the ever decreasing acreages grown each year. So would start up a business under these conditions? One new brewer I have spoken to recently buys all his malt & hops from the bloke who sold him the brew plant in the first place, so knew nothing of any potential shortages. And it seems he is not alone.

This industry has traditionally been very friendly - OK there has always been the odd unfriendly character, but mostly we all get on very well as we share common problems & worries, and we all look out for each other. This stems from the days of yore when a yeast infection was a greater risk, and you needed to know that you neighbouring competitor would be happy to offer some of theirs - so naturally you made sure you were happy to help them. Yeast, while still very important, is either used from a packet, or obtained from a bigger brewery with a lab to keep it clean, and hold a reserve for emergencies. So whilst the need for good relations may have diminished, the philosophy still holds true. And new entrants have always held to that. Until now. It's not only us noticing that increasingly relations are straining within the industry, all quite probably through the fact that we are all competing for an effectively shrinking share of the market,

And then we have the matter of quality. You can't learn brewing in three days. You just can't. Using a proper yeast beer can take 7 days to ferment & finish, and indeed an old brewers saying goes 'Every Brew Should See A Sabbath', which backs up the 7 day cycle. So how can three days work for training? Theory is great, but practice is the key. Now of course you don't have to have any training - I certainly never did any brewing course. But at the very least you need to work for another small brewery. I learnt this the hard way, but my time helping someone else (unpaid I might add) for nearly 2 years was invaluable. Indeed without it I wouldn't be able to be here know on my high horse, as those who have followed us from our first days will testify. But not many new brewers go this route, as they have done home brew. Oh yes. This is like comparing changing tyres at Kwik-Fit with being able to work in the Maclaren F1 pit crew.

So how do you set up a new brewery? Well, you go to the back pages of any beer-related journal, find an add for a brew plant, and buy it. Put it in a building, and let the guys who sold you the plant tell you how to use it in less than three days. Hey presto, you are a brewery. Did I say packet yeast will ferment beer in two days? No? Well it often does. But then you can also by white wine for £1.99, if you want.

Alternatively, you shop around amongst the specialist plant manufacturers, realise that purpose-built brew plant isn't cheap, but used nonetheless by all those breweries that do well, win awards, and are well known. You then look for advice, and realise that the names behind the big, successful breweries, the well known beers, the big award winners, and the the breweries that have grown over the last 15-20 years, are not the names offering to help you. And if you can't answer why, then maybe you should open a kennels instead. But first there is a simple, but very important thing to do. Make sure you can get enough dogs.