Are Brewers Cutting Off Their Nose to Spite Their Face?
For a while now, I’ve
recently noticed a disturbing trend amongst a number of craft brewers across the country. Who are unintentionally causing consternation for on-premise venue owners (aka publicans) by selling direct to market (either via online or brewery-door). Often undercutting venue (wholesale) pricing, reducing product range/offerings, and pulling customers away from the venues (and into their own premises/breweries).
Whilst I appreciate we’re living in interesting times, and not everyone can (or wants to) visit a venue to drink a tasty ale. Brewers have had to adapt accordingly, leading to a rise in online platforms to purvey their wares. Whilst not specifically a COVID thing, craft brewers have historically been slow in adopting ecommerce as a distribution channel. Hence the pandemic is forcing a lot of them to play catch up.
Add to this, the proliferation of brewery destination venues. Where a portion of the brewery is set aside to effectively operate as a small bar. Often selling food & brewery fresh beers, that directly compete with the on-prem venues.
Which leads me to wonder, are brewers potentially cutting off their nose to spite their face, by selling direct to the public, and effectively disinter-mediating the venues/bars.
The reality is, without on-prem as a distribution channel, brewers would need to rely solely on digital or brewery-door channels to generate revenue.
Whilst this may not necessarily be an issue for some of the more popular brewers (given a lot of them only produce small or limited quantities, often selling out days/weeks/advance). The majority of brewers, still rely heavily on venues to support and promote their products.
So whilst I absolutely support brewers doing everything within their power, to ensure the success of their businesses. A large number of them are just not thinking strategically. Preferring to focus on short-term gains, often to the detriment of the venues who have heavily supported them in growing to the viable concerns they are today.
I also appreciate that this is not a binary argument, and there are a number of complexities at play. However, I believe the smart, strategic brewers will understand the importance of the long game. Preferring to work collaboratively with venue owners, rather than against them.
A couple of good examples, would be breweries that brew venue-only releases. Where the brewery only releases a beer to partnering/participating venues. Or perhaps a venue-first release, where the beers would be released first to venues (for a fixed window of time), before being added to other distribution channels such as online.
At the end of the day, we should never forget that fresh is best when it comes to beer (especially if it’s straight from a draught tap). So until the day when we all have pubs in our back yard lets do our part and collectively support our local craft beer venues – cause the world would be a pretty boring place if we only had packaged beer.
# minor updates for additional clarity#