New research led by Northumbria University has identified innovation as one of the key factors shaping strategies for resilience and future growth in the UK’s craft beer sector.
The studies, carried out in collaboration with Anglia Ruskin University and the University of York, investigated the impact covid on breweries and showed that, despite the challenges they faced, the pandemic also provided opportunities for some to reinvent their businesses. Their reinvention has established a blueprint to sustain business in an economic climate which is posing new challenges.
The studies surveyed breweries across rural and urban locations which highlighted the importance of local support and enhanced online engagement as two vital steps. Direct sale became even more crucial, enabling brewers to develop closer relationships with customers and to learn from them. The studies found that many companies have chosen to invest in smaller packaging, purchasing their own packaging equipment and thereby increasing their profit margin by eliminating the cost of using third-party packagers.
The findings also revealed that, in general, breweries remain heavily dependent on variety-seeking consumers. That means reduced scale economies for craft breweries due to the frequent need to use different ingredients, which in turn requires more efficient and reliable technical processes and supplier networks able to supply specific ingredients on demand.
The findings of the study certainly reflect the conversations which Collective Motion Brewing have had with brewing clients across the UK. Many brewers have emerged from the pandemic with more efficient and reliable direct sale operations which have been expanded due to their increased profit margins, countering the impact of rising energy costs. They have invested in technology and production equipment to support product diversity and in-house packaging solutions.
The same investment has been made in improving energy efficiencies amid a global energy crisis. One of the most common questions we hear from brewers is “how do I reduce my energy consumption and running costs?” Thankfully there are various measures, including some very simple adjustments, which provide a workable answer. Within the industry there is a growing appreciation of the value of automation. In the coming years, automated processes and control will be the most effective way for beverage manufacturers to grow sustainably, increase consistency, improve reliability and reduce their energy and resource usage. Collective Motion Brewing have written more about this here. Covid may have receded in the minds of businesses and communities across the UK, but there is no doubt that its legacy for many brewers is a new business model supported by more robust operating procedures, more efficient production and less reliance on outsourcing. Those attributes are proving to be essential in meeting the challenges of 2023 and beyond.