With more than 1,300 breweries in the UK, the beer sector is booming, but is this growth sustainable? Nick Miller, chief executive of Meantime Brewing Company gives James Wallin his view
Nick Miller’s move from global drinks giant SABMiller to the relative minnow of Meantime Brewery in 2011 took many in the industry by surprise and he admits there was plenty to adjust to.
“I had my share of sleepless nights,” he laughs as we sit in the newly opened Tasting Rooms at the company’s Greenwich Brewery.
“At SAB, I had a finance department and all sorts of resources but when I got here, it was very much a case of rolling up my sleeves and getting it done. I learnt an enormous amount and I have to say that I enjoyed the challenge.”
Four years on and Miller’s impact on the business founded by Alastair Hook is clear to see. The Tasting Rooms crown a £6.4m investment in the brewery during the past 18 months, which has given it the capacity to make 120,000 hectolitres of beer per year.
The company has just secured a new warehouse in Woolwich, which will act as a hub for the logistical side of the business, allowing the Greenwich site to become a showcase for everything the brand has to offer. The company is also building a small brewery, with a 20-hectolitre capa-city, to allow the brewers to “play around”.
Miller admits that the scale of ambition can be daunting, saying: “You are always bolting on capacity as your business grows because that is how you stay ahead of the curve. That’s always the nerve-wracking bit because you have to start building capacity with an eye on two years in the future. So, you have to be very sure of your overall strategy.
“The problem in the brewing industry is seasonality. January will account for 4% or 5% of your annual sales, July and December will account for 12%. You need three times the amount of capacity during your seasonal peaks than you do in the slower months. So, you are always trying to manage the yield and the seasonality.”
Meantime’s big focus during the next year is to increase its prominence in areas outside the capital, but Miller admits that pubs around the UK are not short of brewers to choose from.
He says: “There’s been an explosion of new breweries during the past few years and when you think of where the industry has been – dominated by a few big brands and with no innovation coming through – then that must be positive.
“But there are two major issues. The first, and my biggest bugbear, is quality assurance. Of the 1,300 breweries out there,
I think a maximum of 100 breweries have got the proper facilities to ensure that every time you have a pint of their beer it will taste the same as the one you had last week.
“I think you will see retailers getting wise to this and I think you will see a sort of quality assurance ‘Pass Go’ style accreditation required for suppliers.”
Miller says the second challenge for the brewing industry was the impact of progressive beer duty.
He adds: “The smaller breweries will use it to gain distribution and grow to a point where they lose that progressive beer duty and suddenly find they can’t grow any further because they have discounted away that saving – it’s people hitting glass ceilings.
“You are already seeing brewers starting to go out of business.”
Miller said this was one reason there would never be a Meantime cask beer.
He says: “I have to pay duty whereas I’ve got a brewer down the road producing his 5,000 barrels, paying half as much as I do. He’s always going to outgun me on price because it’s an unfair platform.
“I understand why they do it but it would be far more progressive to give every brewer duty after a certain level, so they enjoy the benefits of that lower duty rate and it encourages people to invest in their breweries and ensure quality is of the level it should be. There should be a long-term view on how you incentivise the industry to grow and ensure that the quality of the product, the education and the marketing is done appropriately. But, of course, that is the Utopia – there are too many political agendas in the way. “
Miller says he has listened with interest to the debate on including a market rent-only option in the pubs code.
He said: “I can see both sides of the argument but I think there is an element that those calling for it need to be careful what they wish for.
“People tell me it will be great because we will have access to a load of tenancies when the buying decision has been transferred from head office to the tenants.
“But it’s already the tenant who is looking down that list of beers from Punch and Enterprise and choosing what to order, so that hasn’t changed at all. What it does mean is that the route to market becomes more difficult.
“This industry has gone through so many changes – it is nothing if not resilient.
“Do I think there will be a seismic change in our route to market? No, but I think it will evolve.”
One way in which Meantime has evolved is through its ‘tank beer’ – delivered direct from the maturation tanks at the brewery into specially engineered tanks, installed in the pub, from where it is dispensed.
Miller said: “We have just done our 25th installation and there’s another eight on the blocks ready to go in the next six months. Other competitors have entered the market after us but I think the closest has two or three so we are way ahead of the competition.”
Asked about the age-old debate between the traditional cask-ale lobby and the rabble-rousing craft beer crowd, Miller sighs.
He said: “There has been a lot of hot air in the craft v cask debate. And, hands up, I’ve added to that. Ultimately, it doesn’t matter what we say – it is the drinker who will decide – not us.
“Drinkers know that a cask ale is not a modern craft beer. That’s not to say it
hasn’t been crafted because all beer has. You could call it a traditional craft beer. It has English heritage and provenance. The name craft has been aped from America but it’s just a label.
“If we can replicate as an industry what the coffee sector has done, then we will all be laughing. All this constant knocking doesn’t get us anywhere. There is no bad beer – there is just some that’s better than others.”
