Thursday, 26 February 2009

Scaremongers

The recent report from SIBA indicates that there is growth of success for the many microbreweries in the country. This is such fantastic news for anyone in the freetrade or who are owners of a small local independent brewery. It is also good news for the discerning beer drinker as the opportunity for choice increases. The only limiting factor to this success is probably a limit to the number of freehouses that these breweries have as outlets. Hopefully the Fair Pint Campaign will help to do something about this.

The Independent Family Brewers of Britain are obviously worried. In the Morning Advertiser there is an article that rather over exaggerates the role of the family brewers in providing choice. Furthermore, there is a claim that cask ale would have died out had it not been for the family brewers. Interestingly, I cannot find the article online but only in the printed version of the trade publication.

In the article, Paul Wells who is the chairman of the IFBB is quoted as saying.

"Cask ale has only survived because of the tie. Consumers only have choice of beer and regional diversity thanks to it. It is only because of the tie we have been able to resist the lager tide that Edward Taylor created with Carling Black Label through the '50s and '60s onwards, and the subsequent rise of the property pubcos."

The article seems to me to be suggesting that if the tie were to be outlawed then we would see the end of real ale and choice. I'm sorry Paul, but from where I am the freehouse is where you find good real ale. The freehouse is where you often find interesting beers from small independent microbreweries.

The industry figures would suggest that as a proportion of the total number of pubs there is a continual increase of tied houses. If we believe that the tie should remain to keep the family brewers in business then I don't think that's a good enough reason. When there is an increasing demand for micro brewed beer and an increasing number of microbreweries starting up, maybe we should consider how valuable the tie really is.

If a brewery is good enough and the beer is good enough it should not need to monopolise an estate of pubs to survive.

14 comments:

Curmudgeon said...

I think he's quite right. Without the tie, real ale would have been virtually wiped off the map in the 60s and early 70s. Fortunately many independent breweries kept faith with it, but without them it would have been swept away in a tide of fizz.

Take things forward to today, the tie as it applies to small and medium sized independent breweries is a completely different animal from the tie as exercised by the giant pub companies.

Remove the former and it would lead to a major loss of choice and diversity in the on-trade beer market.

The USA may have a thriving brewpub and microbrewery scene, but the vast majority of bars just serve heavily promoted crap.

Without the tie, a small percentage of pubs in the UK would cater for beer enthusiasts, but most would serve nothing of interest.

(dons flame-proof suit)

Woolpack Dave said...

Na, you don't need the suit.

I think you have some good points. Perhaps though the interesting thing about the article is that it suggests that Real Ale would die out without the tie. I think that is untrue. CAMRA and The Good Beer Guide, despite the fact that I sometimes doubt them, would ensure that Real Ale will live on.

Curmudgeon said...

Without the tie real ale would not die out, but it would become restricted to "specialist" pubs. In the Western Lakes that might be 90% of the pubs, in Stockport or Eccles it might be 5%. A lot of "ordinary" pubs that currently serve it would have nothing better than John Smith's Smooth. Some might say that would be a good thing, of course.

Tandleman said...

Curmudgeon has the absolute right of this I'm afraid Dave,as does Mr Wells.

The tie as it pertains to brewers is not the enemy. The enemy is the bastardised form that is forced on the trade by PubCos. That's where it needs to be loosened, as it is akin to the truck arrangements whereby workers in return for their labour, were forced to use company issued banknotes to buy company goods in the company shop.

Family brewers know their business and their people. They by and large treat them in the old way. A lowish rent in exchange for a beer tie.

The tie shouldn't be changed to protect Family Brewers but it should be changed to protect everyone. The Family Brewers have kept the faith. They don't extort money the way the PubCos do. That is why I assume the Fair Pint Campaign recognises that brewers should be able to have up to a maximum of 500 pubs.

The free trade nirvana you visualise will never happen. It would be a scramble for the lowest price and small brewers would be left behind as would quality. When brewers got out of brewing, the tie on these houses should have gone. It is a corruption of what the tie was about. I agree that getting beer a wider "in" for small brewers is absolutely essential but don't aim your guns at the wrong enemy. They have less than 5% of the UK's pubs. Look at the 95% and re-calibrate I'd say.

Finally, I have just read the MA article which was, I thought, balanced and fair.

Woolpack Dave said...

Curmudgeon

Well we might have to accept we disagree to some extent. I'm not convinced that only specialist pubs would serve real ale. Good landlords want to serve real ale. Customers want to buy real ale. It is proven that a pub that serves real ale is likely to be more profitable and a pub that serves something more interesting is also likely to be more profitable. The wise landlords know all of this.

I agree that here In Cumbria we have a special place where it is unusual for a pub to not serve any real ale at all. 50% or more pubs will have more than one real ale on at any one time. This leads me on to my real gripe.

Two very good pubs in the Western Lakes have been taken over by a family brewer. They used to be excellent freehouses. They are now tied. They both used to sell Cumbrain micro beers. Once a freehouse turns to being tied it very rarely goes back. The system restricts the potential growth of the microbrewery market.

However, I wonder why I grumble. One of these example pubs is very close to me. I used to try and compete in the same market. Our establishments have moved away from each other in terms of style of business so much that I don't worry about them any more. This is partly as a result of them becoming tied.

Woolpack Dave said...

"The free trade nirvana you visualise will never happen." - defeatist!

"They have less than 5% of the UK's pubs. Look at the 95% and re-calibrate I'd say." - OK, I agree the pubcos are much more of a problem.

But, in Wasdale and Eskdale there used to be no tied houses, now there are two. This perhaps explains other dislikes I have, as they are both now Robbinsons.

Jeff Pickthall said...

Paul Wells of the IFBB would say that wouldn't he? It sounds like the IFBB are a bit rattled by the scrutiny the non-brewing pubcos are getting. IFBB members are pubcos too and the anti-competitive principle they also thrive on - the tie - is under scrutiny.

It strikes me that the stranglehold of the tie system can only be loosened by attacking its anti-competitive nature.

Those (such as Fair Pint) who are suggesting the tie is bad when it is utilised by the big pubcos but good when utilised by small pubcos and breweries (including the regionals) are not thinking straight. Their case against the pubcos is pure hot air if they are suggesting that the very same anti-competitive practise be retained by companies they like. Their case would be thrown out of court.

I'm interviewing Tim Farron next week - I'll be bring this up with him.

Tandleman said...

Jef - what you say is nonsense. There is no earthly reason why you can't have a cut off point. The Government recognised that with the Beer Orders when it was 2000. the law of unintended consequences brought as where we arte now.

A superficial conflation of pubco's with family brewers is comparing apples and oranges. To do as you suggest would just throw the baby out with the bathwater. I'm guessing Tim Farron will have thought this through. In any event the EU recognises this as the article says, so it wouldn't be thrown out of court.

You are probably right that IFFB are rattled. When they read muddled,linear, non discriminatory thinking, they have a right to be.

Woolpack Dave said...

As usual I find myself agreeing with some of what everybody says.

I found thinking straight == linear thinking funny. Also I though discrimination in this day and age was bad. So good healthy discussion as usual.

I still think the article was a little alarmist. Loss of the family brewers will not be as catastrophic as they try and make out, in my humble opinion.

But I've said before, taking a hatchet to the whole tie system in one go is probably, on balance, not a good idea. The article however polarised my view a little, which defeats the object of the piece.

Tandleman said...

Dave - I meant discrimination in its alternative meaning of distinction not its usual one of bias.

Curmudgeon said...

A further question is what you do about managed houses and pub chains such as Wetherspoons. By definition, the management of Wetherspoons determine what is sold in their pubs.

If all that was outlawed was the conventional tenancy/leasehold model, then many operators would be tempted to move to a managed or franchised style of operation.

And the idea that every single pub can be owned and run by a wholly independent free trader is pie in the sky.

Woolpack Dave said...

Tandleman, I know, I was just being wicked.

Curmudgeon,

For what it's worth I think managed houses are a far more honest way of doing business. I don't like Wetherspoons as a pub but at least their business model doesn’t’ rely on dashing the dreams of people who think they can run a pub only to find out that the profits they might be able to make end up going to the property owner.

"And the idea that every single pub can be owned and run by a wholly independent free trader is pie in the sky." - I agree that is unlikely to happen. I also think that it would be taking it too far.

I think 500 is the right cap for a pub estate, at least for now. I also concede that family breweries possibly look after their lessees better. I still don't like the original article. It feels to me that they are manoeuvring for the members of the IFBB to move in to the void left by the PubCos should any restriction on the tie be achieved. Let’s not forget they are businesses with share holders as well and the article is just PR, which appears to be working.

Tyson said...

My local sells 10 beers from micro breweries and is the pub that people come from miles away to visit. Proof, you might think, that the freehouse is the perfect model. But, hold on, it's owned by Orchid. To me this is a good role model and reinforces my belief that what we need is reform of the tie, not abolition.

As an aside, the local freehouse, whilst being good tends to get quite a few beers from a certain brewery. Why? Because they can deliver a firkin for under £50. So even if we had no tie, there would still be distortions in the market.

Curmudgeon said...

The Crown in Stockport is AIUI tied to some pub company and not genuinely free. Yet it still manages to sell 16 different beers including many from local micros.

Small brewers are fully entitled to negotiate with pubcos and isn't there now some kind of local delivery scheme?

This is not to say the pubco model isn't deeply flawed, but in some cases it does deliver results for the beer enthusiast.