Kiwi craft beer is brewing up some appetising results with an increase in retail sales of 42 per cent in the last year. A report published by ANZ bank found that the starting increase in craft beer sales was despite overall beer sales falling 12 per cent since 2008 in New Zealand.
The report, launched on the eve of the Beervana trade show, found twenty-five New Zealand craft beer brewers were now selling their brews in offshore markets, even though local brewers face significant challenges when exporting craft beer.
Josh Newton, senior manager of client insights and solutions at ANZ, who helped write the report, says that getting the product to the customer through secure distribution channels was the biggest challenge facing Kiwi brewers, as DIY distribution simply isn’t realistic.
Image: Via ANZ’s Craft Beer Industry Insights report
“For the size and scale of [New Zealand craft beer brewers], distributing themselves isn’t really an option,” he says.
Getting secure distribution channels with some flexibility was what most local brewers were aiming for, a process which invariably involves “knocking on a whole lot of doors, getting professional services involved and having that option to get out [which is] good insurance.”
New Zealand’s clean and green image has been presented as a good selling point for Kiwi craft beer but Newton said there wasn’t a consensus regarding what helped the beer sell.
“In terms of how we position it, there is a lot of debate as to whether the New Zealand story is the selling point or whether it’s great beer, good branding [and] good business management.”
Newton says that in order to succeed, New Zealand brewers needed to put themselves at the high end of the beer market to maintain “a value add premium”.
Another challenge with exporting craft beer was maintaining taste after spending more time in storage.
“There’s a big quality component to exporting,” says Newton. “The fresher the beer the better.”
A solution to the problem of quality control for some exporters has been to brew the product in the overseas market, but Newton says one distributor in the United States rejected the idea of Kiwi brewers brewing in local markets, saying there was more leverage in focusing purely on the New Zealand story.
One apparent point of difference for the craft side of the beer brewing industry was the spirit of collaboration which helped when craft brewers were looking to scale up, something Newton describes as “an export collective which involves five breweries saying ‘we’re going to do this thing together instead of sending five containers each with a little bit we’re going to fill up the containers'.”
The bubbling mood amongst brewers Idealog spoke to at the Beervana event reflects the industry’s success.
“It’s been a really exciting journey,” enthuses Darrel Hadley, managing director of Good George, a craft beer which started in Hamilton.
Hadley had experience running restaurants and bars but said selling craft beer was a whole new ball game.
“To put it into a bottle, [sort out] labelling, distribution [and build a] sales force, that’s pretty full on.”
Image: Darrel Hadley, managing director of Good George
This is Hadley’s third year showing Good George at Beervana and he says he’s learnt how to attract patrons to his stall.
“You’ve got to come with something new or interesting to Beervana. That’s the way you can attract people.”
Another way to attract people is via unique market offerings, something Hadley is looking to exploit with his blueberry-flavoured beer. The beer has proved successful following its release last year.
“We did a small batch of it and it was sold out in a couple of hours,” he says.