When we were looking to write our look-back blog on 2016, we originally just wanted to do one that was fun and celebratory looking back on the year, similar to the one we wrote last year.
But, as with most things here at the brewery, it grew over time and the more we wanted to put in, the more we realised we’d need two blogs to fit it in. The biggest reason for that being that whilst we do want to look back with rose-tinted specs at the beers we released and the awards we won, we also wanted to talk more seriously about what happened with production, packaging, sales, and the industry in general. And we found it tricky to get both in the one article, especially with all the other more serious, transparent blogs being released by other breweries.
So we will be releasing a fun article chatting with the team about 2016 and 2017, but for now here’s our take on a few key points.
First up, Gavin weighs in on our Production and Packaging.
Production and Beers
2016 saw an increase of 2000hl of annual fermentation capacity, 2017 we will look to add at least the same again with additional conditioning vessels and bright beer tanks. We’re also going all veggie on our beers with coarse filtration removing the bulk of hop particles and yeast solids, complimented with vegetarian friendly finings to keep the gunk out of your beer.
We’ve worked hard at getting the best balance of flavour in our ingredients, recipes and production methods, we manage three in-house cultivated yeast strains – pilsner, ale and saison – and will be soon be culturing another interesting ale strain for big IPA’s.
Going forward our new beer releases will always be carefully crafted, our philosophy has always been learning the craft of quality production rather than R&D on our customers. As well as new beers, we’re looking forward in 2017 to releasing some interesting variations on some of our core beers. What would Long White Cloud be like fermented with our pilsner yeast? Bomber IPA with a nice acidic tang?
Safe to say, we’ll be continuing our attitude towards coming up with new beers which is that we’ll make beers that we’re excited about, and that we want to drink. We’ve never paid attention to trends, and we intend to keep it that way.
This year there’s going be a few changes to how we package our beer. More of our core beers will be going into 660ml bottles, but maybe a bigger change will be our first foray into canning. We won’t be getting a canning line any time soon due to space restrictions, and our main concern with contract canning has been the loss of control over quality of the fill. Recent investment in in-house laboratory equipment will enable us to measure and meet our packaging parameters, specifically dissolved oxygen during the filling process, allowing us to sleep easy at night knowing we’re hitting the quality mark.
For now, we can say that the plan is to introduce Long White Cloud and Pale Armadillo to cans, as well as migrating our Berliner series over to can format including a couple new versions.
Next on the packaging agenda, the change in split between Keg, Cask, and Bottle.
Both keg and bottle seen an increase – we’ll have final figures at the end of February – and a decrease in cask. And yes, we know that cask has been the hot topic on Twitter recently, and we will come back to that at the end during our Q&A section.
Next year will be especially interesting to see what happens to that graph after we’ve had time to release cans and see where the knock-on effect of those is.
Next, Annika’s take on the nitty gritty business stuff that often goes unsaid in the craft industry including our sales, growth, and export.
Sales & Growth
Over the last year we’ve seen a pretty substantial growth, in fact it’s probably what won us Growth Business of the Year at the Scottish Beer Awards.
In the year March 2015 to February 2016, our sales revenue grew by 216% more than the same period the previous year. This can be attributed largely to our move to Tweedbank in February 2015, where we upped our capacity and production significantly.
So far between March 2016 and December 2016, we’ve grown a further 30% and the final tally in February will likely be just a bit higher. We’re anticipating continued growth of 30% in the year 2017/2018. Of course it could be a lot more depending on some deals and possibilities we’re exploring right now but I like to take a conservative approach to my sales forecasting.
We also ramped up our exports in a big way. In 2014 our exports were non-existent, we could barely make enough to satisfy our local market never mind abroad. In 2015, we started shipping our beer out into the world and it made up about 7% of that year’s turnover. In the period, March to December 2016, this figure had increased to 20% of our total sales revenue. Our aim is to have export sales accounting for 30% of our total revenue for there is still plenty of room for development on this front.
At the minute, 89% of our export sales are to Europe. Obviously, we’re paying close attention to what’s going on with the political climate given that this year we will be seeing more development from the UK government on what the deal will be with Brexit, and where Scotland will sit in this equation. We won’t lie, like many people in Scotland we were hoping for a different result in the referendum; we do great business with our importers across Europe, and we don’t like so much uncertainty around what’s going to happen. For now, Brexit hasn’t slowed our European sales, so we remain hopeful that we continue to see growth rather than decline in Europe. However, the reality of Theresa May’s hard Brexit with associated import tariffs and trade agreements may change this.
So, we are looking to diversify our export markets. Towards the end of 2016, we began working with new distributors in Scandinavia, had our first shipment of beer sent to New Zealand (something that I was particularly excited about!), and we began strengthening our ties with our current importers in Singapore and Malaysia. Throughout 2017, we will also be focusing attention on growing sales and distribution throughout Asia Pac and the USA. We expect sales to these regions to be on a relatively small scale to begin with however we have faith in the quality and taste of our products.
Everyone starts talking trends in these look-back blogs don’t they? Guess we should give it a token mention…
Trends in the Industry
When Gavin and Graeme were asked for their feedback on this, their responses were as per below:
Gavin – It would be good to hear from Graeme on this since I try really hard to ignore what the industry trends are…
Graeme – We don’t really pay attention to trends…hard to say!
Both make sense given how we like to run things, but in the interest of having some more content in this area, we asked Shannon as well given she’s on social media 24/7.
Shannon – Yeah, it’s pretty hard to say, being in the brewery what’s “on trend” is whatever we’ve currently got new in tank! And then all the trends last year and predictions for this year I’ve read about while preparing this blog…we’ve kind of already been making…Double IPA, we’ve already done that…low ABV beers, we’ve got Armadillo and Radler and our Berliner beers…
I guess we could talk about what we’re hoping for, and for me that’s just more creativity but with a foundation of high standards of production quality, and speaking of that wider availability of high quality beer. More bars getting more good beer in would be brilliant – I have to give a shout out to my man, Jamie McLean, and the team at New Wave who do a fantastic job developing that in Glasgow where I live!
I mean, it doesn’t have to be anything particularly new or wild in terms of being creative because I think you can get too bogged down thinking “oh we need to use this mad ingredient in a beer!” and then the quality suffers because of it because you’re not really thinking about why it makes sense being in the beer. Creativity can be anything from just doing a really solid, well-made take on a style, to developing a flavour profile, to working alongside local food producers to use their produce in a unique, considered way.
I hope 2017 is a year that’s all about a considered and creative approach to beer with a solid base in production quality, basically. I think we’ll start to see breweries without that fall off.
So that’s what we’re thinking about reflecting on the last year, and looking forward to this one. We’ll be releasing another blog in the next couple days with lots of lovely photos and some fun input from the boys about the beers we released in 2016, but for now we’re going to end with some questions submitted by our followers and answered by Gavin with some input from Annika.
Any plans for any old classics being brought back?
The last few years have seen us re-visit old beers as well as some modification of existing recipes which we knew would work well with new product ideas. The best example of this is Double Cresta becoming Double Shuck.
As well as new beers we’re looking forward in 2017 to releasing some interesting variations on some of our core beers, as we mentioned in the article already.
With additional warehousing space and a new warm room for bottle re-fermenting we plan to release more volume of our Barrel aged beers this year we particularly look forward to welcoming the Old Parochial back in 2017.
What’s your plans with Mexicake?
We like this beer a lot and so we intend to keep making it.. the balance in the spices and flavours are very difficult to beat. Once we have crafted a product as good as this the only thing left is to age it in wood. So watch this space…
Will you continue to produce cask beer or will you move to keg and bottle only?
Cask ale is currently about 10% of our overall production volume. We firmly believe its niche is in well-made cultured yeast traditional British beers and new world session ales with distinct but sessionable hop flavour. At the heart of our beer philosophy is that good beer should be both accessible and affordable to all and the real craft is much more than dumping expensive hops into fermenters. Going forward we will continue to offer our lower abv session beers in the cask format.
Are you looking to advance your presence in supermarkets/general stores this year?
Gavin – We look forward to growing the availability of our beers through all our distributors and retailers who are passionate about our beers and understand the difference between our fresh products and the commodity brewed and heat treated (pasteurised) alternatives on the shelf.
Annika – In 2016 we were successful in getting select products listed in several of the large multiple chains across Scotland (Aldi, Sainsbury’s, M&S, Co-op Stores, Morrison’s and Waitrose). We will continue to work with multiples in order to get our core range beers to as many people as possible. However, will always restrict the range that is available to the multiples. We have listed a select range of our core products in the multiples, but we intend to keep our limited edition beers, and new 660ml range of beers available to independent retails.
Our main focus will be increasing our presence in the on trade (pubs/restaurants), and export markets.
Are you looking to open any tap pubs in Edinburgh or Glasgow?
Obviously, we’d love to have a brewery tap however we have no plans to open one in the foreseeable future. But you know, never say never….
Any collabs in the pipeline?
Gavin – Yes, every beer we make is an in-house collaborative effort J.
We’ve got an idea for an interesting project around collaboration with a few other Scottish breweries, so we’ll be working on that and if all goes to plan you should hear about that fairly soon.
Annika – We’d like to do some international collab brews in 2017 but it comes down to time and space in the production schedule.
Will you be doing Oktoberfest festival again this year?
Annika – Yes, we’ve actually got two coming up. “Springfest” – name pending, ideas welcome – on Saturday 29th April, and Oktoberfest will be making a return on Saturday 16th September.
(And before anyone points out that it’s not in October again, Oktoberfest in Germany starts on the 16th of September and ends on the 3rd of October this year!)