Thursday, 10 March 2016

Mad March

"You've not been blogging for a while" said Rob

"yeah, not had the incentive, or motivation, or inspiration to be honest" I replied "This year's beginning has been less than ideally inspirational" I complained.

Rob Millichamp is head brewer at Mordue Brewery. We had called in to pick up some empties they had collected for us, and we'd got some for them.  Despite trying very, very hard to organise better routes to market for our beer, the distribution systems have just not been performing well in terms of volume for draught beer1. So we had decided to make the trip over to the NE with some beer, and pick up the empties.

It is my feeling that this year the post Christmas beer sales slump have been worse than ever. Dry-January seems to be getting ever more popular. Yes, I'm sure you, the reader, who has decided for whatever reason that you are right to take part. You help us out every other month of the year shouldn't feel any guilt. Perhaps you are right, but it still puts a great big hole in our cash-flow and our yeast maintenance alike2. Not to mention the problem of managing stock. You see, most cask beer has at best 6 weeks best before date on it. This makes it hard to sell any stock in February that was racked at the end of December3. Rob, I noticed, has a post on his blog mentioning this headache.

I get asked, when I travel outside Cumbria, if we were effected by the floods. "Not directly" I tend dismissively reply "We're well away from any flood risk" - Which is true, but still there is a huge knock-on effect. The A591 is still severed just north of Grasmere causing a problem distributing to the north of Cumbria. Visitors to our county have been staying way in their droves meaning many of our customers are likewise ordering less beer. This, along with some significant over-supply and undercutting by new and often boring beer has resulted in a struggle at the start of the year.

Of course, there is that daft alcohol consumption advice issued by our neo-prohibitionist fitness-freak we have as a health minister. Jeez.

But we've managed to get to March, somehow. We have a couple of customers causing us some real issues with invoices remaining unpaid beyond a reasonable time, and we have suppliers quite rightly shouting for their invoices to be paid. Keeping the show going can be tricky when there is little slack at this time, how do you buy more malt and hops4 when the suppliers won't send them out until you pay down the previous? And how do you do that when you've got customers that owe from such a long time ago?

I noticed Boak and Bailey's post on a certain bar that had received public shaming on twitter. I missed that, I don't do that. I wonder if I should, but anyway us brewers talk, it's best to pay our invoices really. It turned out, after some investigations, that we too are being caught out by that very same bar that is not named in Boak and Bailey's post.  I'm not entirely sure, but I doubt that particular business will be there for much longer, and if it does go down it'll do so collectively owing us small brewers a huge amount of money. I may at that point in time have comment, it has been very tempting to do so previously about poor accounts, but you can never be sure when one might pull through good. Besides, it might not be great for customer relations in general to be seen to do such things. I decided to stop supplying one route to market after another brewer contacted me regarding late payment from the same distributor. A threat to put them on stop and perhaps take other action simply antagonised the situation.

Mixed emotions about daffodils
they'll be dust someday too.
At some point in time during the dray run around Newcastle I noticed some social media activity from Chester. A bar called Kash, which I do not believe I've been to, but have supplied with beer and have heard lots of good things about is running a beer festival. They are entitling it Forgotten Heroes. We are to take part it seems. A nice idea that warmed my heart significantly. With all the new shiny breweries staring up it does feel a little like some of us have been somewhat forgotten, despite us getting better and better and better at brewing stunning beer5.

And so that day, with it's long and tiring drive, did give me a boost, and enthusiasm to look towards a future. We've got some exciting new things going on, new beer, new plans and now that the daffodils are coming out I might just get my blogging head back. I need that inspiration, as it is difficult to focus on getting more really stunning beer out to more really great people when you feel a bit demoralised by it all. Plus, I fear this post might just be the sort of negative projection that fails to improve my situation. I need to feel inspired so that you can feel inspired about our inspirational beer. I may end up feeling a backlash from Ann and the team for posting this, but I feel it is difficult to engage my enthusiasm without projecting to people just how difficult this time of year really is. I do at least know there are far more brewers feel like this than the general beer drinker is aware of.

Meanwhile, when did you last drink a Hardknott beer? When did you last even ask in a pub or bar if they were going to get any in? Are we really forgotten heroes? Does the majority of beer drinkers no longer love Hardknott like you used to, despite the fact our beer is better than it has ever been? Have you all moved on to newer, shinier things and lost interest?

You see, what we need is y'all to buy more of our beer, then we can move the whole financial stagnation through a bit and get this show back on the damn road.

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1In contrast to the supply arrangement we have with Morrisons and M & S where the margins are at least solid, if slim. The fact is that although the price to supermarkets is low, the impact on overheads is also minimal compared to draught into trade. Plus, payment terms are generally reasonable, but more importantly they pay when they say they are going to pay. All in all highly manageable, repeatable and predictable.

2Sarah, our resident microbiologist, has been doing a great job of managing our yeast, but it really needs a good brew schedule to keep it going. During January the last two years that has been a bit difficult to say the least due to dropping brew regularity. Added to that the timings get shot at due to problems with the cash-flow resulting in orders for malt being delayed as we wait for the cash to ripple through. We then find that we can't brew when we want, we don't have the right beer when we want it so as we now ramp back up for spring we can't sell to capacity.

3Who would buy beer with just a week left before best before? Or even two weeks. Most pubs start to worry if it has less than 3 weeks best before date on the cask on delivery. A week to get from us to a distributor, a second week in the distributor's warehouse. Before long that 6 weeks from racking to best before date has disappeared.

4I'd really like to single out various supplies for the variety of support, or otherwise in this regard. Some are simply fantastic. I hope you know who you are and give yourselves a huge pat on the back for helping, and frankly taking a bit of a risk. The others, well I guess you are just running your business in a tight and orderly fashion. I'm trying to do likewise.

5It continually annoys me the critiques of various brewery PR tactics. Yes, some of them are lame, naff, crass and frankly stupid. But despite assertion from some quarters it is simply not good enough just to make really, really fantastic beer. If it was we'd be doing better than we are.

15 comments:

Ed said...

If the beer's going to move slowly fine it on dispatch not when racked, and do the best before from fining date.

Yvan Seth said...

A slight aside — I still can't work out what's up with BB dates on casks. I get 4 weeks, 6, 8, 12... six months... on fined casks. No pattern to it. (I get up to 9, even 12 on unfined stuff.)

Is it the finings? If so then why still so much variance?

On some other stuff I have more to say, but won't do so at the moment. Sleep must be attempted.

Tandleman said...

Excellent and insightful piece Dave. I always buy your beer when I see it and had never until now thought of you as "forgotten".

I'll do my bit. Later this morning I'll ping a couple of ails off to a couple of my favourite free houses.

Chin up. The problem with fashionability is it is fickle. Quality always is preferable but we can't take it for granted. You need to buy quality for if to continue to be available.

Dave Bailey said...

Thanks Tandy, any help at all is greatly appreciated. Even just encouragement is nice.

retiredmartin.com said...

I have clear recollection of drinking one of your beers this year and tweeting about it, it was so good. Like Mordue, would choose your beer with confidence. Hang in there.



This is the year I spend proper time in Cumbria. Think it'll be a great summer.

Stonch Beer said...


A very interesting and candid post. I can see the combination of January, consumer abstinence and the serious flooding have combined to cause you problems. I hope it picks up for you. I found in my own business that things don't really cheer up til April.

One thing I must comment on:

"us brewers talk, it's best to pay our invoices really"

Yes the problem is brewers do talk, and when they talk to customers - pub operators - it's usually to slag each other off. Nobody seems willing to acknowledge just how unbelievably bitchy microbrewers are. Also there are so many breweries that a pub operator who wants to be a very slow payer of brewers can just move on to using others.

Cooking Lager said...

can't remember when I last had one but I do like it and often drink it if I see it. Unless there is a cheaper more boring one, then I have that. But otherwise, I'd neck one if I saw it about.

Dave Bailey said...

With apologies to Phil. This comment below came in via email to my phone. I tried to publish it but hit the "delete" option by mistake. Blogger doesn't seem to have an undo function.

"Bloody 'dry January' - one less sin FFS. Hates it, we do.

"That apart, I think you and a number of other breweries with similar kind of age profile are in a really difficult position, fashion-wise - what you need to do, to consolidate the image of HK & build it further, is "more of the same only better", but that's not a story! "Wild and crazy" is a story, "guerrilla marketing" is a story, but they both carry the risk of falling flat on your face - and distracting from the real business. It's a tough one, & I wish you well with it; I'll certainly have HK on the list the next time I'm in Morrison's or M&S."

Kieran Lyons said...

Great read.
How about buying a couple of pubs? If you own the pubs they have to buy your beer ;0

Stono said...

actually "dry january" seemed to go abit better round these parts, compared to last year where pubs seemed to be empty all month and really struggling, there was notably busier trade,beer turnover and people out drinking in pubs, so my impression was maybe people are getting a bit tired of all those charity things, but everywhere is different.

I did drink a Figgy Pudding in January, but it was a bottle so I dont know if that counts, but it was the first Hardknott beer Id had for 3 years...though that was a bottle too (anyone remember the Sainsbury Great British beer hunt) you have to go right back to January 2012, so four years !!! to find the last Hardknott pint in a pub in this part of the country I had. kind of sums up the problem I think.

steve thackray said...

Round here the dry January effect seemed to be strongly outweighed by a ' the students are away but we didn't really notice that in December cos the locals were on a bender ' effect. And the 'we are all a bit skint after Xmas ' effect. By time students were back pubs were heaving with only a quiet week or so. The appeal of trying something new will always work in favour of new kids on block but hardknott I'd have assumed was one of those elite brewers that would be pretty hard to not drink if it was on. Kind of assumed reason we didn't see more hk in Yorkshire was down to you selling too much locally.

Dave Bailey said...

Stonch, I do try not to be bitchy, except where I detect deliberate attempts to aggressively and selectively damage my business. Copy my USP, after having previously told me my USP was bollocks. But I'l mention no names and rarely do.

There are a lot of great micro-brewers out there, and some who I do not think are quite so great. Universally, I think there is a camaraderie that kicks in when there is a particular common problem. There are some routes to market, both middle men and on-sale outlets alike, that really just need to be taken out of that game. They ultimately scavenge financial value out of the market in various forms of underhand payment delaying tactics or commercially unviable schemes.

Some brewers seem to want to support it. I've decided not to. Brewers are already unpaid tax collectors (as are all businesses, we just have the added headache of beer duty) Margins on beer are low, and I do not give a shit what anyone want's to say about that, they are, frankly, too low. To add to that the risks of delayed or even failed payment is something that we cannot afford to shoulder.

Of course it could quite rightly be identified that it is just business and survival of the fittest is the order of the day. I am personally monitoring my options in this regard. They say a good entrepreneur is one that can recognise a game they stand a chance of winning. The jury is out in that regard for me.

Dave Bailey said...

Kieran,

"How about buying a couple of pubs?" - great idea. Give us a clue where I'd raise the cash...

Steve,

The reason we are not in Yorkshire so much is because we determined that to make money we had to stop distributing directly to such distant places. It seems it is no more profitable to use middle men as the discounts needed tend to negate the advantages, and on top of the we then become just another brewery on their list. The idea that giving a discount and passing the sales over would reduce our work in some areas and reduce the risks too. Volume would grow, we'd get more exposure and so we'd grow the business. Margins would be lower but impact on overheads would be reduced.

In reality the risk has increased and the volume has dropped. I have always argued that we are brewers, not a logistics company. Seems I need to learn that we HAVE to be a logistics company too. So, the wholesalers do not agree that Hardknott.... was one of those elite brewers that would be pretty hard to not drink if it was on. We'd best take on the wholesalers then, rather than work with them.

Geez, this should have been a blog post in it's own right!!

ChrisM said...

Dave - if you can get some HK beer to Durham there's cash waiting! (Being a cash only pub means it's much easier for us to pay CoD rather than having to bank it and remember to pay the invoice a week or two later... Can understand that this isn't the case when a business grows, though.) Regular swaps with Mordue??

I'm also unsure about the best before date situation. We've had beer from the same batch that was much better a week or three after its best before, and equally some stuff that was crap with weeks to go (could this be a case of the best before being applied to the delivery date rather than the brew date??)

Dave Bailey said...

Chris,

Very happy to get beer to Durham. It is actually closer to us than Newcastle. Give me a shout - dave at hardknott dot com.

Mordue seems to be fairly difficult to sell over here, making cask swaps difficult. We have had van swaps before, which can work, where Morgue sell their beer direct, we sell ours direct and we each deliver for each other swapping loads at the cafe at the top of the A66. However recently Mordue haven't been able to get the volume over here.