When we were in the research phase of Brew Britannia during 2013 we thought we observed a nascent trend: the cutting out of middle men.
A few years ago, there was a fairly cosy relationship between brewers, bar owners and distributors serving a nascent ‘craft beer’ (definition 2) market, each taking a slice of the cost of a third of IPA.
But brewers seem often to feel frustrated at the fact that their reputation so often relies on the care with which their product is presented by third parties — assuming, of course, that they can even get any pubs or bars to stock their beer. The building of a tap room or the acquisition of a tied pub is an obvious solution to these problems.
For their part, what publican could resist the idea of removing a layer from the supply chain, enabling them to offer something both unique and probably cheaper?
One of the most obvious manifestations of this trend was the installation in January 2013 of a brewery at the Sheffield Tap. It had previously been more-or-less (in some slightly convoluted sense) a Thornbridge tied house but the rapid expansion of Thornbridge’s own pub estate in Sheffield seems to have put paid to that arrangement. The Tapped Brew Co allows the Tap to offer novelty value — wacky one-off brews that aren’t on sale everywhere else in the city — at a price-per-pint that seems rather reasonable alongside imported keg products.
While we were interviewing them, we asked most of the brewers we spoke to if they had plans to run pubs, and also asked publicans if they planned to start brewing. The founders of North Bar in Leeds reacted with a bit of a jolt, as if we’d rumbled a conspiracy. (Which was rather pleasing…) John Gyngell eventually replied, after an exchange of meaningful glances with his business partner:
We haven’t ruled out opening a brewery, and we’ve talked about it for years. The name is registered. We just don’t want to do it right now — we want to wait a couple of years, until things have settled down a bit.
Then, this week, they finally made the big announcement:
[It] feels like the time is right to offer our customers a range of excellent, consistent beers that they can purchase with confidence whilst improving how competitive we can be in terms of pricing… in a climate of growing competition in the on-trade and evermore challenging economic conditions, the increased control over quality, availability and margin that will come from the vertical integration makes perfect sense.
In the meantime, to highlight just a few examples, BrewDog has continued to open bars around the UK and the world (Helsinki is imminent) at an astonishing pace; the Bermondsey Beer Mile with its run of brewery tap rooms has become a tourist attraction; Moor has moved to Bristol and opened a tap room; Hardknott have acquired its own track-side bar; and Magic Rock are almost there.
Here’s how Thornbridge boss Simon Webster saw things going when we spoke to him last summer:
All the [Thornbridge] pubs are fifteen minutes from my house, so I can drink in them! And all the old family brewers had a heartland estate and made beer first and foremost, and that’s our model. I see this — and this sounds a bit pompous, but, anyway… — as the first generation of a new family brewery. I’d love my son to take an interest and be the next generation to run Thornbridge. We want to achieve longevity.
Perhaps vertical integration is, after all, the natural state of affairs. Let’s just hope something isn’t lost as people cease to specialise in the things they’re best at and are really (sorry) passionate about, whether that is making beer or hospitality.
10 replies on “Bars That Brew, Brewers With Bars”
With all the interest in beer/food pairing, I foresee breweries allying with ambitious chefs and co-opening destination beerbar/ restaurants.
Up in Scotland, West have added a Glasgow pub, and Williams Bros have a couple of bars and a convolution at their Drygate joint venture where a brewery tap is an outpost of their Edinburgh establishment.
For the very small brewers – I’m thinking the railway arch chaps in London – opening a taproom has two major benefits.
Firstly, it adds a degree of sociability to something that otherwise be rather lonely (or, to be less kind, it gives the brewer a chance to strut around in his wellies with his new beard and body illustrations on display in front of a hopefully adoring public).
Secondly, it’s a lovely bit of direct cash flow to pay the bills at the brewery – no chasing up invoices if the end customer pays you directly, in cash no less.
For the larger independents it’s just a natural evolution of their business and follows in the footsteps of their predecessors who would eventually become regional brewers with tied estates.
It does feel somewhat that something has to give. Breweries opening bars, bars opening breweries. You can see the logic of it all, but are those in the middle going to be crowded out in the process?
On the one hand it’s interesting and I do wonder what North Bar will come up with. But then, what about their relationship with Kirkstall Brewery, who currently supply their ‘house’ cask beer. But then Kirkstall opened their own brewery tap fairly recently.
At the moment it all appears to be pretty friendly, but will it stay that way if people think they are getting their toes trodden on?
Plus it’s a great way of laundering money, should you have any money that needs it. Simply “sell beer” retail for cash, “buy beer” from yourself. Pay the VAT or the duty (it’s probably overkill to pay both) and call that the discount.
I am very interested in this line of thought. I recently heard of this perhaps/maybe/possibly happening. Not laundering but being very creative.
Trying to get my accounting head around that one – and failing. Intriguing…
Oh I dunno, it’s just something a man in a pub said.
London is awash with brewpubs but few are actually brewing good beer.You have no place to hide if the beer is poor but brewed on -site. cheers
Are these not simply brewpubs of some sort or other? Next thing to do is open a microbrewpub.
I probably view “pub starts brewing beer” with about the same wariness as “anyone else starts brewing beer” – exactly what are they going to do that someone else isn’t doing better? If anything I’m more wary in the case of a pub, because there’s potential for them to end up displacing much better beers with their own average stuff.
Come to think of it, “they brew their own beer on the site” is another of those annoying phrases like “they only stock beer from local micro-brewers” that a lot of CAMRA-ish type will say in approving terms without stopping to wonder whether it’s actually a particularly good thing…
“Good brewery takes over pub / opens bar” is more promising news, though.