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Is it Best for Local Breweries to be Locally Owned?

By: Thomas Muller - Updated: 19 Dec 2012 | comments*Discuss
 
Is It Best For Local Breweries To Be Locally Owned?

Amongst beer lovers, it is widely assumed that local breweries being locally owned is always for the best, but are they right to think so?

The British Drinker’s Loss

It is a sad moment for beer lovers when their local brewery is taken over by large outside organisation. Time and time again it has been shown that such profit-motivated decisions invariably result in the drinker losing out, whether through the diminished quality of their beer, reduced diversity, production moving away, or even being ceased altogether.

When family brewers Boddington were bought out by Whitbread in 1989 – itself later absorbed by the future Anheuser-Busch InBev (AB InBev) behemoth – it set into motion a decline that saw production ceasing at its historic local Strangeways brewery and a name once synonymous with a celebrated complex pale cask bitter become associated with smooth, treated, characterless shadow of its former self.

The reputation of John Smith’s suffered a similar humiliation when its main brew became an extra smooth, filtered and pasteurised concoction that doesn’t even qualify as being a real ale anymore. The production of its original cask version was controversially moved from its traditional home in Tadcaster to Warrington, and the quality suffered as a result, with drinkers bemoaning its new tanginess and how quickly it lost its head.

Outside Interests and the Demise of British Brewing

Britain’s own one time big six brewers - Whitbread, Scottish & Newcastle, Bass Charrington, Allied Breweries, Courage Imperial and Watneys – played their part in crippling the country’s proud brewing heritage by promoting the demise of real ale and the rise of bland mega-brands, but by 2008 control was stretched across an even broader scale as each of these national companies were either under foreign control or no more.

Under the auspices of even less sympathetic multinational owners as AB InBev, SABMiller, Heineken and Carlsberg, who are much too large to be concerned with niche UK-centric markets and their quaint traditions, there is no hope for local understanding. When American brewing giant Coors – now allied with SABMiller – took possession of Bass they renamed its beloved brewing museum the Coors Visitors Centre before later closing it down altogether.

It is has been left to independents, microbreweries and organisations like CAMRA to help revive an ailing concern and promote quality traditional British beer.

Economic Concerns

If the attempted annihilation of heritage, quality, diversity and national heritage is not reason enough to prompt despair at the prospect of foreign ownership of local breweries then there are also economic concerns to consider.

To highlight this point we turn to another historic beer hub, the Czech Republic. In such transitional economies – one not long since free of communism – the major economic damage wrought by foreign brewery ownership is especially prescient.

Whereas in the UK most beer production now concerns foreign beers brewed under licence, the Czech Republic is still one of the one of the world’s most revered homegrown beer producers. The high quality of its product is one of the nation’s greatest assets and exports. It is therefore dispiriting to learn that an estimated 80% of beer production takes place in foreign owned breweries. Heineken, AB InBev and SABMiller all control a major share of the market, with the latter accounting for half.

What this means is that instead of being re-channelled into the Czech economy where it will ultimately benefit the local population – not least those actually consuming the beer - four fifths of the profits are redistributed in the company’s respective bases in the Netherlands, Belgium and England, some of the wealthiest nations in the world.

Exploit or Revive?

However, this is not to say that foreign ownership is always a solely negative phenomenon. Rather than buy out a successful brewery solely to exploit its reputation and market share, there are instances where local breweries have been bought by foreign investors to not only improve them but even to keep them in existence. It is said that the Czech breweries of Herold and Žatec would not have survived if it were not for foreign intervention.

There are even instances where local owners have even damaged their own beer and it has taken foreign ownership to revive its reputation. The once notable Krušovice Cerné was famously spoilt by its local owners who added artificial colourings and sweeteners before it was restored under its present Heineken patronage.

Suspicion

Ultimately, for many beer lovers it doesn’t matter how well their pint is treated by its new owners, if the company is a brewing giant then there is an immediate distrust. Distance from the source and sheer size means it is almost impossible for any takeover company to display any kind of sensitivity and connection with its product beyond a monetary one.

When faced with a beer that has been bought by a foreign owner, many beer fans will wonder what has been changed, what has been sacrificed to improve its profitability?

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