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Global brewers dressed up as local crafties: How can local beer companies stand out in the crowd?

Step inside any local supermarket or liquor store and the beer selection is filled with provenance. There’s the lagers, the Speight’s –  an icon of the ‘great southern man’ and the Lion Red, built on the stiff, yet romantic, legacy of patriotism. There’s the vast selection of middling beers, on the fence types, which are almost always average. Then there’s the craft beer selection that you can’t really afford – Moa, Panhead, Tuatara, Garage Project, and the rest – emblematic of the true New Zealander, who watches the cricket at the basin reserve and sometimes plays the guitar. 

As an article states in the Sydney Morning Herald, it’s hard to tell who owns what these days. To the naked eye, it would be fair to assume that all these beers are bastions to our fertile soil, bootstrapped breweries owned and operated in New Zealand, foaming with authentic local ingredients. 

It’s emblazoned in the design and deafened in the marketing. But the reality is, most of the time, these brands are owned somewhere far removed from our agrarian lands. 

The same could be said about many of our markets, but the beer industry seems especially resonant, with a number of standard lagers dressed up in crafty clothing, and global beer brands painting pictures of our cultural identity. 

However, many of these brands continue to have strong roots in New Zealand, so does it really matter where it’s owned?

It mattered to Damaris Coulter, owner of Auckland restaurant Coco’s Cantina, when she explained to Stone Soup Syndicate how brands with enough budget can buy themselves a personality, embodying Bob and Bill from Papakura, when in fact they are owned and produced somewhere overseas. 

It led to the creation of The Realness, a platform made for locally owned and operated independent restaurants and cafes to showcase themselves affordably and make themselves visible to the public. It also provided consumers a place to find independent, locally owned and operated eateries. 

Perhaps it is time for a beverage equivalent to The Realness, where consumers are given a chance to weed out global craft beer washers and support the local brands. 

It also matters to the general manager at the Gisborne-based Sunshine Brewery, Joe Williams, who says, we can better support locally owned and operated brewers in New Zealand, “without a doubt”.  

He points to Australia’s Independent Brewers Association, which has created a ‘‘seal of independence’’ that brewers can put on beer labels, as a possible solution for New Zealand. 

“On one hand, you’ve got to respect the local brewers that have built themselves up to be bought out overseas, but on the other it can be misleading when overseas brands release micro products targeted to the regions without any transparency as to where it is owned or produced.” Williams said. 

“Some have sold out, but retained everyone on board and kept control of its operations, which is an interesting model.”

Questioned whether he would open the door if an international investor came knocking, Williams says, it depends on what is involved. 

“Everyone has a price at some point, so while it’s a passion, it’s also a business.”

Unleashed Software is an inventory management software company that has conducted research on 22 local independent brewers in Australia and New Zealand. The CEO, Gareth Berry, knows local beer like the cat that got the cream. 

He argues, “What I would like to see in the market is more emphasis on the brewer, not so much on who owns the brand. Lion is owned by Kirin offshore, Behemoth recently did a capital raise, whereby a large percentage of that was from overseas. But I think buyers should care less about who owns the company and rather who runs it.

“If the brewer is born and bred Kiwi, it’s them who is deciding how the beer is being made, not the person behind the balance sheet.” 

Emersons, for example, has been touted as a national success story, building the Emerson’s brewery in Dunedin, with its founder Richard Emerson lauded as the ‘godfather of craft beer in New Zealand’, despite selling out to Lion in 2012. Then Otago Chamber of Commerce chief executive Peter McIntyre, told the Otago Daily Times “I don’t see it as a bad thing at all. It is a natural progression for a successful business looking to expand.”

New landscapes: 

The local beer market has changed plenty since the 1980s and ’90s, when DB and Lion owned the circulation of beer controlled inside established pubs, the main watering holes for consumers. 

Over the years, it’s become fragmented, with multiple offerings across supermarkets and liquor stores, enabling niche products to a wider variety of customers. Craft beer was born, and finally people with beards found a renewed sense of community. 

Now, after years of swimming through rivers of opportunity and the arrival of over 200 local breweries, some reckon our craft beer industry may have burst

According to data conducted by Unleashed Software, sales growth in value is still strong for our New Zealand breweries, but has dropped from 51 percent to 31 percent growth. But Berry says craft beer isn’t dying, it’s changing. 

“We’ve seen the growth of that sector has tapered off, so perhaps the data tells us that those people who are gravitating towards craft beer have been going there already. So, craft brewers are sharing from the same group of buyers rather than growing their market share.

“Therefore, there is a need for local brewers to come up with new innovative products and ways to capture different areas of the market.”

Williams says the market continues to change and evolve and that “noone really knows where it is going”, but argues that craft beer still takes a relatively small chunk of market space, so there is room for local brewers to grow if they are creative. 

New alternatives are seen in the recent varieties of sugar-free, carb-free, or even alcohol-free beer. And while alcohol-free beer probably sounds like a cardinal sin to some New Zealanders, it’s been refreshing for others. 

Heineken recently released it’s Heineken premium 0.0 percent beer, enabling people to drink beer at the gym or at their desk, which has taken off across the world, according to Forbes. 

Moreover, in the U.K, sales of low and alcohol-free beers jumped 28 percent in the year to February 2019, which spurred the arrival of a raft of independent breweries dedicated to alcohol-free varieties across Europe. 

Other trends across the globe has seen the rise of cannabis-infused beer in Portland and brew pubs, which have also become increasingly popular in New Zealand.

Berry adds, “On the finance side, there will be some issues on pricing, people will price beer differently and package it up differently. People are also moving to cans, brands like Behemoth and GarageProject have adopted cans as its primary distribution product, which has been met with strong success.”

Garage Project has paved the way for small Kiwi brands tearing up the craft beer rule book, pioneering new beer art by employing local artists and illustrators in the community, building breweries and pubs up and down the country, creating over 300 different beers.

In 2017, Idealog interviewed its co-founder Jos Ruffel following Tuatara selling to Lion Breweries, he remained unfazed about its effect on the local craft beer market.  

“For us, we just set out to start a brewery. We don’t even call ourselves a craft brewery, we just say we’re a small brewery that started out in a garage,” he said. 

“We try and be genuine in every possible moment we can, and I think people respond to that. Other breweries are perfectly welcome to pick their own path, but we’re just doing the path that we think is right for us. We don’t really try and focus on what other people are up to.”

Sounds like sage advice to us. 

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