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INTRODUCING A QUOTA for craft beer taps in pubs could help bolster Ireland’s craft beer industry, according to one brewery that’s seen the challenges facing Irish brewers.
“We’ve seen craft breweries close down – at least four gone this year,” Paul Mullin, managing director of the four-year-old Sligo-based brewery The White Hag, told TheJournal.ie this week. Mullin made the comments as he prepared for the Hagstravaganza event, to which The White Hag has invited breweries from across the world to visit Ballymote to show off their wares.
Why are Irish microbreweries shutting down? “A lot of them are finding the going very tough in the domestic market,” said Mullin. “It’s got to the stage where probably 50% this year of [our] output is going to be for export, and 50% for the domestic market. If we weren’t doing export, it would be really tough for us to get the margins we need to keep the business open, solely on Irish sales.”
Macro (mainstream) breweries like Diageo, C&C and Heineken hold such prominent positions in bars that it makes it tougher for pubs to choose to feature micro craft breweries, and having the macros then create their own ‘craft’-style beers can make it even harder.
Mullin said such macros have “been able to use innovating distribution methods and marketing to… essentially grab the market and get a monopoly, especially in the last 50/60 years”.
“Some would say the craft market is flooded, but that’s purely down to the distribution of the bigger breweries, your macros,” said Mullin.
“It’s making it easy for a publican to say ‘I have craft beer – it’s Hop House [owned by Guinness] or Cute Hoor [a Heineken beer]‘ for example. That’s very challenging for us, to get tap space,” said Mullin.
That elusive and all important tap space – which means beer is served on draft – is what craft breweries want, said Mullin. The business can often have long lags between payments. You get more volume and make more money from taps, compared to packaged beer, which makes things easier for small companies.
But this has been incredibly challenging for craft breweries – how do they promote their beer, and how do they access taps?
Quotas
What The White Hag wants to see is “anti-competitive practices” stamped out. Some craft drinks producers have already told Fora.ie about cash sweeteners that some big companies offer pubs, which they fear lock them out.
It would also like to see a quota put in place, similar to one regarding Irish music played on radio, where a certain percentage of taps in a pub have to be Irish craft beer. Many radio stations have a quota of 30% Irish music, but there was a call in 2016 for a 40% quota.
“You could apply the same thing in Irish pubs – give over a certain percentage of your taps to Irish breweries. The whole beer industry could benefit from it and certainly Guinness isn’t solely living off what it makes in Irish pubs, but it’s very valuable to it,” said Mullin.
He said that the craft beer industry employs the equivalent of seven times more people than macro breweries.
It’s also creating jobs in rural areas – these aren’t all Dublin based. The county with the most craft breweries is Cork. Every county is getting a spread from this.
The idea of a local craft brewery isn’t a new one. “If you go back 200 years ago, you had several breweries in every major town and county,” said Mullin.
A 2017 report by Bord Bia found that the number of craft breweries has grown by a huge 500% between 2012 and 2017, going from 15 to 72. Together, they employed 500 people.
Naturally, you’d hope that this went hand-in-hand with a rise in consumption of craft beer. According to the report, the craft beer consumption market share went from 0.6% in 2012 to 3.0% last year.
Denise Murphy, Beverage Sector Manager at Bord Bia said at the time: “Demand for craft beer is rising in most markets around the world, driven by consumer preferences for premium product and artisan production.”
Why craft?
Why do people choose craft beers? Is it just a status symbol, or do people really care that much about the beer they sup?
“The taste that Irish people are developing for local produce – we’ve seen it with food. We’ve come a long way in Ireland, we’re looking for provenance and indigenous Irish food,” he said, mentioning the likes of the late Myrtle Allen as responsible for stoking this appetite for homegrown grub in particular.
The same thing is happening with beer, it’s down to discerning consumers. Craft beer shops and pubs who are insisting on stocking good Irish beers and who are insistent on stocking beer they can trace the provenance of – the brewers and businesses. With that they are able to transfer knowledge of the brewery onto the consumer, and are able to talk to them about the beer.
This personal touch isn’t something you can necessarily get with the bigger beers, and it “creates a bit of a revolution within the beer market industry”, said Mullin.
This is also reflected in the experience of one of the world’s top craft brewing companies, Cloudwater. Paul Jones is the founder of Cloudwater, which is a Manchester-based craft beer company that offers seasonal, rotating beer styles.
In setting up the company, he was inspired by experiences he had around coffee and food, where he put his trust in local restaurants and cafés to be tastemakers for him. He was happy to rock up to an eatery that offers its own unique blackboard menu every evening.
“It made sense to apply those same philosophies in beer,” he said.
People in the craft beer industry tend to have a lot in common, said Jones: “They are also people that might be coffee geeks, that might like small batch wine – they might be really into niche spirits. Our consumers are generally excited about new sensory experiences in some way, shape or form.”
What about people who find the world of craft beers confusing, or just not for them? Jones said he understands this. “If there’s any discomfort, where’s that really coming from? At the base of it people come to a glass of beer or a bar because they want to relax,” he said.
“Maybe they don’t want to be faced with another difficult decision in their day. I completely understand the people who want a glass of something they know they damn well like.”
He said that craft breweries have to help people feel comfortable with and excited about beer.
We’ve always got to pay attention to not getting carried away with ourselves to the point where there is any element of snobbery or elitism in the way we talk about our beers.
For want of a taproom
What The White Hag and some other Irish craft breweries want is a taproom, where customers can visit, try products and buy directly. Mullin explained that this means selling directly to the public, so there’s no middle man, and the cash goes straight to the brewery. It also offers a lower-risk way to try out new beer styles.
“We have lots of friends across the industry in the UK and USA who are thriving off the taprooms,” said Mullin.
Although The White Hag gets between five and 10 requests a week from tourists looking to visit its brewery, it’s currently illegal to sell them beer without taproom legislation. That’s set to change when legislation drafted by Labour’s Alan Kelly is introduced – it will allow breweries to offer beer for sale after visitors have completed a tour, between defined hours.
Alan Kelly TD / TwitterAbsolutely thrilled that my #CraftDrinksBill has become law after being passed by #Dáil tonight. I want to thank all the Craft Brewers in Ireland for their overwhelming support.Big shout out to @whitegypsy & Cuiláin Loughnane for inspiring me to legislate for this. @labour pic.twitter.com/RKOFg2AYJ3
— Alan Kelly TD (@alankellylabour) July 12, 2018
“If we can turn that into a tourism industry, there is another spoke in the wheel of creating a self-sustaining industry,” said Mullin. The hope is that it will help craft breweries to bring in cash and enable them to reach their customers in a better way.
Independent Craft Brewers of Ireland – which represents microbreweries here – anticipates the first taprooms and sales from breweries will kick off in 2019.
Brexit and brewing
The impact of Brexit is something that is worrying UK-based brewers like Cloudwater. And it turns out the taproom is helping some of them deal with the impact so far.
“We lost a ton of money overnight and we have continued to face higher and rising costs ever since, so we are working on absorbing those rising and higher costs by focusing on self retail,” explained Paul Jones. “We are developing a couple of new taprooms so we can sell direct to consumer and not only give a better experience, but fix cash issues going through distribution.”
Could some British brewers move to Ireland as a result of Brexit? Jones agreed that it is feasible to imagine that at least some breweries could wind up producing in Europe – but others might just concentrate on the domestic British market.
But Jones isn’t just thinking about the financial impact of Brexit. He’s concerned about its impact on his customers, and hopes that in its own way, beer can bring people together.
“The interesting thing about craft beer is we have consumers that are in so many different industries that affect so many parts of society,” said Jones.
If we can succeed in making craft beer a truly wonderful and open and positive movement, [then] craft beer bars aren’t just somewhere you can get drunk like the place down the road. They can feel very welcome irrespective of who you are or how you feel. It could be a model to the wider drinks industry.
Neither Mullin nor Jones believes that bars should be solely about craft – but they want their respective home countries to have a flourishing craft beer industry too.
“It’s not all about craft – it’s about balance,” said Mullin. “Balance will deliver what we need to sustain a craft beer industry in Ireland.”
The White Hag’s international brewery festival, Hagstravaganza, takes place on 28 July at their brewery in Ballymote, Co Sligo. For details and tickets, visit the website.
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I like a couple of craft beers and generally try them when I see them around but the idea of saying that the established companies have to move over to make room just seems like nonsense.
The established companies are established because they have spent decades promoting, marketing and taste testing to ensure there is sufficient demand for their products. It’s hardly fair to them come along and say “hey, this geezer with no track record and very little demand needs to be treated as equal and given premium space”.
@Eoin Finnega: but if you’re using your position in the market to force the bars not to stock competitors it’s a problem. If you want to buy health insurance and you had to buy from only one company all the time because they don’t allow smaller companies to operate in the market then you wouldn’t be happy. You would call that a cartel or monopoly. It’s not much different.
@Eoin Finnega: there are thousands of local breweries across Germany, many hold their own by concentrating on local hotels, pubs and restaurants. Some outgrow and spread, but it’s the local game that sustains the small ones. It’s fine to aim at craft fairs and hipster haunts, you might get a nice spell of popularity, but working the local scene hard gets better long term results, that’s why very old small breweries have survived the global market over there.
@Greg Blake: Exactly those thousands of local breweries have been around since year dot..and many thousands more have closed during that time. There are undoubtedly some great craft beers in Ireland but the majority of it is absolutely amature muck that any self respecting beer fan shouldn’t put up with. What’s really not helping things either are the multitudes of brewing competitions all calling themselves along the lines of “world brewing medals” or something basically handing out participation trophies instead of telling people that their product sucks, giving them false hope instead of the motivation to improve their stuff to meet market tastes and ultimately expand their business..
@Greg Blake: That’s actually not entirely true. While there are many ‘breweries’ in Germany – usually each city having their own – in general (90 +%) of them and the distribution companies are owned by Anheuser-Busch. Also the vast majority of bars are contracted to sell only products approved by these breweries/distributors therefore stalling any growth in quality within the market. I live here and the beer is generally rubbish. That being said the German beer industry is extremely complex especially when trying to unravel the ownership tears. It’s a total myth that Germany is a proud beer country and most German’s would tend to agree considering the lack of choice and the fact that they have to spruce their beer up with coke and sprite half of the time. Germany should not be a model for any country when it comes to the beer industry.
When the likes of Diageo can roll out and mass market a new flavoured p1ss like Rockshore over a few weeks, it’s always gonna be tough. I go to the Galway Bay bars occasionally, some great beers on tap and not a Guinness tap in sight…
@Tomás O’Loughlin: love the Black Sheep in Dublin
@Tomás O’Loughlin: rockshore is a great example of a 51th3 beer robbing a tap from local brewers. Imagine being a tourist (10 million a year) having to drink that instead of a good beer produced up the road.
Publicans also have questions to answer, not just macro breweries.
@jar.ie | Bars & Pubs: The Palace on Fleet Street have it right. All the usuals on tap, but a decent selection of craft beers too. Proper order.
@Tomás O’Loughlin: good bar that and that’s what locals and tourists want to see.
@Tomás O’Loughlin: Galway Bay is top notch beer, its just a pity that some of the other craft beers are manky harsh tasting stuff.
@Tomás O’Loughlin: what’s wrong with Rock shore?its a very nice beer.there are to many craft beers.no harm for a few of them to bite the bullet.
@Seriously stunned: It’s generic muck, produced by a multinational with a multi-billion dollar budget and only exists as a way to keep genuine, local and domestic craft beers out of bars. Along with all the other “Open Gate” dishwater produced. That ok?
@Seriously stunned: ah here it’s rice water piss, you welcome to it.
@Tomás O’Loughlin: ah now a pint of plains your only man
craft beer is simply too expensive
@Dáithí: you get what you pay for. Diageo have some lovely rice watered piss
@Dáithí: Yeah if you’re skulling them. I’d easily drink half the amount in craft beer, than I would of Heineken or Smithwicks or such. They’re nicer to drink and you can take your time with them.
Craft beers have probably reached saturation point at this stage. Not enough hipsters out there.
@John Flood: why are you even reading this you lager lout
@John Flood:
Trouble is that craft beers in ireland are onlu sold in bottles.
@Martin Lintzgy: Plenty of craft beers in Cork and Kerry are on tap.
@Martin Lintzgy: Plenty on tap in Sligo.
PUBLICANS!
Do you notice someone walking into your bar, survey the cooking lager options and walking out?
That’s me, and I suspect I’m not alone.
@Páid Ó Donnchú: your not alone
@Páid Ó Donnchú: alawys a dissapointment when i walk into a pub, survey the taps and there are just the 5 usual suspects.
I sometimes ask the question.. “do you have any craft beers on tap” hoping that they will get the message.
Love the Irish craft beers especially all the IPAs. So much more flavour than the generic largers that are the same the world over but lack any soul or character. Would support iniatives to help them thrive and create local employment
So some of the breweries are charging 3.50 – 6.00 quid a bottle for their beer and there’s huge competition so if they are good enough they will survive, if not why should they expect to be subsidised or given special treatment? Also why do they only put 440 ml in this cans and also charge way more for less that the bottled equivalent? Taking the piss big style.
@Tom Finnerty: exactly, there’s only so much room in the market. Simple as.
@Tom Finnerty: They’re not looking for special treatment, they’re looking to not have to invest in putting a tap into a pub, only to have a macro brewery come along 2 months later saying to the publican “Take that tap out and we’ll give you 20 free kegs. And sure we’ll sell your our pretend ‘craft IPA’ so your customers can’t complain.” In other words, a somewhat more level playing field.
As to why craft beer is more expensive: a) economies of scale; and b) quality ingredients. They’re brewed to taste good, not to taste bland (sorry, “consistent”). And there are no chemicals involved.
I’m only aware of one Irish brewery doing 440ml cans (though they call it 10 oz or something like that) and my usual off-licences all do 4x330ml cans for €10 for good beer, which is a bargain.
Massive fan of craft beer here. A lot of craft breweries opened up also at the time of the initial boom a few years ago looking to make a quick buck too. Some breweries tried to sell some awful pish. They are being phased now, and the better breweries will survive. Eg blacks in Cork are thriving, trouble brewing doing great, kinnegar,Galway bay, yellowbelly, stonewell, etc… Will all survive and thrive because their products are great. I was disappointed to see independent go though, they made nice beer, but the marketing just wasn’t there at all at all
@Kevin: agree on them brewers , they are fantastic, as good as anywhere else in the world, sad for independent i love their IPA , Western herd is great also.
The biggest problem is lack of brand loyalty for craft beer. Yes there’s sector loyalty and local loyalty which is only short term unfortunately. There’s too many craft breweries looking for a very small piece of a very small pie. Also many of the products are not considered “sessionable” ie one or two and its back to the mainstream.
@Paul Jobs: very true, it’s funny because for decades since the sixties there has been an opening for a new Irish beer especially with the association of Ireland with beer worldwide but nobody tried it was just all left to Guinness. Then suddenly a plethora of craft beers all at the one-time and only because the trend had already started in America. It was always the case that if the big breweries were challenged they would take on the craft beers especially since most craft beers have no heritage or history. Guinness spent a lot of time and money building up their brand they also have a big stable of old Irish brands that they bought out decades ago. It’s simple for them to relaunch an old Irish beer brand from decades ago.
@Paul Jobs:
The big pie is craft beers on tap in your local pub.
Just walk into any pub. In England, and survey the choice.
Craft me hole, rip off, too high In alcohol because they can’t refine , lots taste muck , some good but it’s like craft/artisan anything it’s short on appeal , not one craft beer has shone / burst through
I love craft beers and red wine. However drinking them in pubs is a disaster, unless you’re a moderate drinker and stick to the one pub.
Craft beers are by and large too strong 5-8%, in comparison to the genetics 4-4.5%. IF you move pubs there’s a high likelihood that the next bar doesn’t serve the craft beer you were drinking and you end up mixing your drinks. If I’m out out then it’s generic weakish beers for me, otherwise I either fall asleep or go loo-la
The craft beers aren’t nice during the summer, too heavy and windy.
I love the way they are blaming the larger breweries for the current predicament, when, in truth, the larger breweries have all been around a long, long time, and the current situation has really only occured due to over saturation of the marketplace by these craft Brewers themselves.
There has been a 500% increase in the number of craft brewers over the last five years, for God’s sake. It’s simple math. Every Tom, Dick, and Harry has decided to make a quick few bucks off of the hipsters and millennials by selling over priced, very average beers, and is now complaining about a situation of their own making.
Should the larger “macro” breweries stop selling alcohol to give these guys a bigger cut of the marketplace? Sounds like these companies are run by self entitled millennials.
@Alan Desmond: anti competitive practices. Some pretty shady stuff going on out there to prevent competition coming into independent pubs. Threats of supply or cash offers. Yes sure that stuff is all cool …… Right ?
Maybe their beer is just not that good.
When you have big players reps coming into large Irish towns, ones which may actually have a brewery just up the road that’s local and pay all the publicans in the town sky sports package for the year to not stock local breweries then you have a problem. That’s not right and that’s not on. It kills consumer choice and pretty much all the publicans will take the bribe. Because that’s what it is.
The idea that large operators like Diageo abs Heineken can’t produce decent tasting craft beer is a fallacy. Cute Hoor is brewed and marketed by Heineken and I find itquite drinkable. The same could be said for Diageos Hophouse 13. Having said that I would like to support the smaller craft brewer for the sake of diversity but it seems incredible to me that there is no label on the bottles that would immediately allow me to identify which beer has been produced by the small independent brewer. This has allowed the big boys to steal in with pseudo-craft beers. The time pressed consumer won’t always be able to tell the difference. Like all nascent industries e.g. the American car industry i would expect consolidation and mergers to swiftly reduce the number of players at this point.
@Sean: I’m no hipster or craft brewery follower. Il drink a nice beer but cute hoor is awful stuff just plain awful . Like beyond awful. The only reason it’s out their on draft is because it has money to back it I’d say it’s a loss leader. Terrible
@The Beer Nut: I’ll keep an eye out for it but will admit I’ve never seen that symbol before. Is it on the front of bottles? It should be.
Also I see Eight Degrees are still on the list. Should they come off now that they’ve been sold?
@Sean: It’s on different parts of the packaging, bottles and cans. I don’t think Eight Degrees ever carried the mark, but yes, they are no longer a member of ICBI so won’t be introducing it in future.
@The Beer Nut: Woefully underused and unmarketed, unfortunately :-(
Mcgargles 8 % is a nice sipper
If they’re finding it tough in the scenario where we have “nearly full employment”, it’s going to be tougher when that scenario changes. I can’t afford the bottled craft beer at my local or supermarket, nor can I afford the “craft crisps”.
Perhaps the fittest will survive or the best will come together and benefit from economy of scale.
If you are honest some craft is poor quality, it doesn’t deserve a 3 euro cost. They at least deserve a shot at the market though and that will answer that question fairly quick.
Like farmers supply chain is your issue and if they won’t open it up to you, your only chance is to create your own one collectively.
Sunbeam in Cork, Grand Lager
How is this even news?? Business go to the wall all the time. It’s market forces! I guess they needed something to fill the space?
Ireland is no place for small business weather that be anything from a cup of coffee to a burger or a beer, tourists come here to sample what’s unique about Ireland and end up having a coffee at Starbucks a burger at McDonalds and a pint of Budweiser in the pub!
Generic multinational Ireland, boring!
Tourists stop here in Ireland for a day or two and fly off somewhere different to say the USA…
Much as I love my craft beer I struggle to find a white hag beer I can drink kinnegar limeburner is definitely my favourite at the moment. Just trying to convince pubs to stock it is the trick now.
The Cotton Ball Indian summer. Be the flock what a beer to drink… If you haven’t……ya know what to do..
Craft beers and their gastro pub promoters had took off during the recession and the beers seemed to be priced cheaper which I presumed was down to low VAT. However as soon as claims of an economic recovery arrived prices started to increase along with the new gastro pubs becoming expensive. Also people set up these business’s outside but tried charging Dublin prices. I think this has been noticed by the public and led to mistrust. Having a very heavy beer with your dinner isn’t really suitable while after a couple of years its likely customers will have enough and go back to milder mainstream beers
Welcome to monopoly capitalism.
It’s funny.. it’s the opposite in the States .
Harp is a different label slapped on it. If stranded on a raft i’d still prefer my own Urine.
The craft beer market its saturated at the moment way too many out there, overpriced an alot taste like $hit.
Home brew without the hassle ..snowflakes!.
A good start on the “anti-competitive” practices would be to ask your friend, former Minister for Small Business, John Perry to blow the whistle on the phoney Competition Authority now (CCPC).
Yaaa and there Guinness is shit
@Bigboy: who’s Guinness is shlite? Diageo?
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