Friday, 8 July 2011

Scotland's ale market becoming saturated?

Now then, on Monday the Scotsman published the following article regarding the growth of the Scottish microbrew market and the relative complications that some industry bods are beginning to identify.

Initially I was incandescent with rage and took a week to calm down before blogging about it, primarily because I think it's incredibly misleading. I think it is misleading for the following reasons.

The 'experts' in question are brewery owners, and whilst they are most certainly experts with regards to their own businesses and customer base are they necessarily experts in the market as a whole? Moreover, are the concerns facing those respective businesses reflective of the industry as a whole? No.

Apparently the number of outlets that sell real ale are in short supply. That is cobblers. The number of outlets selling real ale is increasing fast to cope with the demand for cask beers and Black Isle, Harvieston and BrewDog have shown demand for micro kegs is on the up too. As the pubcos suffer and sell off sites in the thousands more pubs are becoming free of tie, and the more forward thinking such as Iona are offering more outlets on leasehold free of tie, recognising that the demand is for local and niche products.  We have had more enquiries from pubcos in the last month than we have ever had, and with outlets such as Wetherspoons upping the cask game and allowing their managers more freedom, I would say that anyone complaining about the lack of outlets hasn't looked hard enough.

Now for the 'saturation'....someone didn't bother doing their research. Look at the consumer stats, they will all tell you that microbrewed products are eating in to the industrial brew market, not eating itself.

So in reality, we have more potential outlets than ever before, and the market share is increasing consistently year on year.

By definition, market saturation is when suuply outstrips demand and currently that is not the case. However, if I were the MD of a brewery that is looking at their sales figures and finding them falling I would not be looking at the numbers of breweries or the number of outlets. I'd concentrate on quality and interest.

I mean absolutely no disrespect to any of the breweries mentioned in that article, I have drunk many beers from all of them and enjoyed many too. However, if that article had quoted Jamie Delap at Fyne, Rob Hill at Highland, James Watt at BrewDog, Gavin Meiklejohn at Tempest, My bosses or John McGarver at Tryst I would be thinking 'Sheesh, time to diversify'.

The truth of the matter is, the standard of beers in Scotland has risen, significantly, and those breweries who are producing the most exciting and interesting beers can't come close to keeping up with demand. Those who are not are going to start struggling.

We are not close to saturation, nowhere near, we're just getting started.

Incidentally, I wrote this for the Scotsman last year which (I think) gives a slightly more balanced view of what is happening.

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