It was a little like walking through a time-warp last week. Coors, the brewer formerly known as Bass, was contemplating buying a major pub chain to guarantee sales and quality of its beers, or so the report said.
Vertical integration was alive and well; the tie was back with a vengeance.
Coors is not commenting on the rumour, but the story shows both how much and how little the UK beer market has changed. With only Scottish & Newcastle of the major players with a pub estate, the rest are having to rely on other means to secure business – competition is keen. But the old solution of controlling the means of distribution, in other words the pubs, is still deeply imbedded in the brewers’ psyche.
Brewers running pubs on a large scale is not a good idea. Beer tends to be treated as a commodity and pubs seen simply as a beer “outlet” not a retail proposition in their own right. The Beer Orders may have done little for brewing competition, but they prompted a pub retailing revolution that has irrevocably changed the industry for the better.
The relationship between brewers and retailers still has a way to go to cast off the old ways of doing things and for each to understand fully what they are trying to achieve with their respective businesses.
Brewers moan about pub groups not caring about quality and brand-values and only being interested in price. Pub retailers complain that brewers take no interest in their retail objectives and are only interested in throwing money at them to support products they don’t want.
There is a great opportunity for both sides to start a better dialogue. Money will always be an issue. Coors may well end up with its Carling-branded pub chain but perhaps by working in partnership with local pub retailers with mutual support rather than having to go out and start looking through the Christies’ ads.
But also when has there been a better time to talk about the intrinsic value of brands to businesses?
National brewers may be down to four – S&N, Interbrew, Coors and Carlsberg-Tetley – but with South African Breweries increasingly looking to support its brands, such as Pilsner Urquell in the UK, Heineken set at some stage for a solo role away from its old Whitbread friends, regional brewers like Greene King and Charles Wells developing specialist brand portfolios and newcomers such as Refresh buying up local brewing interests, the market may be developing a new dynamism for the benefit of both the beer and pub industries.
Vertical integration was alive and well; the tie was back with a vengeance.
Coors is not commenting on the rumour, but the story shows both how much and how little the UK beer market has changed. With only Scottish & Newcastle of the major players with a pub estate, the rest are having to rely on other means to secure business – competition is keen. But the old solution of controlling the means of distribution, in other words the pubs, is still deeply imbedded in the brewers’ psyche.
Brewers running pubs on a large scale is not a good idea. Beer tends to be treated as a commodity and pubs seen simply as a beer “outlet” not a retail proposition in their own right. The Beer Orders may have done little for brewing competition, but they prompted a pub retailing revolution that has irrevocably changed the industry for the better.
The relationship between brewers and retailers still has a way to go to cast off the old ways of doing things and for each to understand fully what they are trying to achieve with their respective businesses.
Brewers moan about pub groups not caring about quality and brand-values and only being interested in price. Pub retailers complain that brewers take no interest in their retail objectives and are only interested in throwing money at them to support products they don’t want.
There is a great opportunity for both sides to start a better dialogue. Money will always be an issue. Coors may well end up with its Carling-branded pub chain but perhaps by working in partnership with local pub retailers with mutual support rather than having to go out and start looking through the Christies’ ads.
But also when has there been a better time to talk about the intrinsic value of brands to businesses?
National brewers may be down to four – S&N, Interbrew, Coors and Carlsberg-Tetley – but with South African Breweries increasingly looking to support its brands, such as Pilsner Urquell in the UK, Heineken set at some stage for a solo role away from its old Whitbread friends, regional brewers like Greene King and Charles Wells developing specialist brand portfolios and newcomers such as Refresh buying up local brewing interests, the market may be developing a new dynamism for the benefit of both the beer and pub industries.
