Saturday, 31 August 2019 13:01

Big Beer and Big Capital - What is to be done?

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Big Beer and Big Capital - What is to be done?

Keith Flett discusses the challenge of Big Beer and Big Capital in 2019/20. What is to be done to resist and oppose them?

Beer writer Roger Protz has noted the strategy of Big Beer:

First Big Beer buys up a swathe of independent breweries. Now it’s attempting to control the natural ingredients used to make beer. The power of these global behemoths is frightening and has to be vigorously resisted….

Big Beer is on the march, and we risk losing our wealth of choice to merely the illusion of it. Not only are consumers being misled, but these global brewers are changing the very character of the beers they buy and driving genuine independents out of business….

The question of what the strategy of Big Beer and Big Capital is for the 2020s has come into sharp focus in recent months. Firstly, by Japanese brewer Kirin’s takeover of the Huddersfield craft brewer Magic Rock. Secondly, by the sell out of Fuller’s brewery (and with it Dark Star) to Asahi and finally (so far) by Greene King’s sale of its brewery and pub to a Hong Kong-based property company.

I agree with Protz that one of the aims of Big Beer is to control the market, and produce mass market beers which will claim to be ‘craft’ but will be of lower quality and more bland than ‘genuine’ products. That process will usually take time. It is the outcome of a series of decisions that capitalist businesses make about cost savings and efficiencies in order to retain or boost profit levels.

It would be a mistake, however, simply to expect a re-run of the 1960s. In that period regional and smaller brewers, often those which had failed to invest or keep pace with changing markets for various reasons (but not always) were swallowed up and closed. Their beers, or at least their best-selling beers, were produced elsewhere in much larger breweries. At the same time the Big Six, Watneys, Whitbreads and the like sought to monopolise not just beer production but beer sales. They did that by growing pub estates and making sure only their products could be obtained in wide geographic areas – Watneys in East Anglia for example.

Richard Boston, who wrote on beer for the Guardian during this period, noted the case of a drinker who had left an East Anglian pub, fed up with the quality of Watneys beers, only to find that every other pub in the area also sold Watneys – and only Watneys.

I don’t think the 2020s will look quite like that. For a start Big Beer is now definitively global. It still has some interest in shutting down a brewery it buys and brewing the beer elsewhere. Where would that be? To an extent it can be contract-brewed and at the moment that can be in the rest of Europe as much as the UK – it’s unclear what impact Brexit will have on that.

It may not have a big interest in owning pubs, unless of course as with the Greene King sale the new owner is actually a property company. What it does have an interest in is making it financially attractive for pubs to carry its products, and not those of genuine independents.

Moreover, unlike the 1960s it’s not really about reducing beer ranges and promoting a few big brands. These already exist. The problem is that the profit to be made out of them by Big Beer is not as high as it was, while the profit out of the (much smaller) craft beer market is higher.

The Big Beer combination could therefore be to reduce the cost of making craft beers they acquire (and in doing so make an inferior product) and to seek to make them as widely available as they can.

That means of course not just pubs but supermarkets, restaurants, cafes. The shape of the beer market looks a bit different in that respect to the 1960s.

A preliminary summary might be that the broad trends that Big Beer pursued in the 1960s remain, but that the context of the 2020s is somewhat different.

What is missing in the above is the input of an independent campaigning voice for beer drinkers. CAMRA arose out of the impact of Big Beer in the 1960s. It is still around – but can it, or others grapple with Big Beer 2020s style?

Roger Protz has suggested on social media a summit of CAMRA, SIBA and others to determine proposals to be put to Government – once there is one that is actually concerned with day-to-day Government.

But what should be proposed? As ever it is much easier to oppose than argue for a positive and realistic way forward.

One idea might be to return to the model of the State-owned brewery in Carlisle that was started during World War One and lasted until the 1970s. Its aim was to set a benchmark for good beer, family-friendly pubs and of course moderate drinking habits amongst munitions workers and others.

I have no issue with reasserting that idea but in a world where global beer and capital operate it can’t be the entire answer.

Another is to strengthen legislation (which currently operates in England) to allow community bids a first crack at buying a pub under threat of closure. That would make property-focused takeovers like that for Greene King less attractive.

More is still required. Perhaps it’s time to designate a range of regional brewers as producing something unique to the UK and put strict regulations around anyone trying to interfere with it. Much for example as the EU has done (remember them) with Stilton cheese.

Finally, if not State or municipal ownership, perhaps local or national authorities could take a golden share in some leading breweries, meaning they could not be sold without a reviewing process.

Some possible ideas for the manifestos which are no doubt being hastily drafted at the moment? Because it all depends, of course, on who gains power in any forthcoming general election.

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Keith Flett

Keith Flett is convenor of the socialist history seminar at the Institute of Historical Research and has been a member of CAMRA since 1975.