Bold Everards looks to next generation
Following the turbulence of the 1990s, when 44 British breweries closed, the remaining regional producers have battened down the hatches and forged new strategies for survival.
Some have opted for a national presence in the pub trade. Everards of Leicester, on the other hand, has developed a radical approach. It has a substantial estate of 140 pubs in the East Midlands and those pubs and the free trade in the region are the core of the brewery's "heartland strategy".
The strategy doesn't exclude selling beer further afield: national sales account for a substantial proportion of annual production. But the bulk of Everards' 40,000 annual barrelage goes to its tied pubs and free trade within a 70-mile radius of the brewery at Narborough on the outskirts of Leicester.
Chairman Richard Everard, who, with his sister, represents the fifth generation of the family to run the company, says a strategy was devised back in 1988-89 that was based firmly on the tied estate. "Property is our core business," he says. "We need pubs in the right places with the best licensees.
"We had total clarity about what we wanted to achieve. We spent £20m improving our estate, which is now 100% tenanted. It had a big impact on profits, but they came back from £1m in '88-'89 to £3m. Our latest profits were £6m."
Everards dates from 1849. For most of its history it operated two breweries, one in Leicester and a second in Burton-on-Trent.
But from the 1990s the company embarked on building a new modern brewery at Narborough, which led to the closure of the cramped, original Leicester site. Eventually the Burton brewery, which had produced Mild ale and Tiger bitter, was sold and all brands were gradually moved to Narborough.
Beacon Bitter was reintroduced, giving Everards a range of bitters from Beacon at 3.8% abv, through Tiger Best at 4.2% to the powerful Old Original at 5.2%. The company was given an enormous boost last year when Tiger and Original won silver and gold medals in the Brewing Industry International Awards.
Flushed with success, new branding and images, based around attractive new pump clips, have been introduced. Each clip proudly carries the line "Brewed in Leicestershire".
"Cask ale is fundamental to our business," outgoing managing director Nick Lloyd says. Richard Everard is equally passionate: "The family brewers are the driving force of cask beer. The nationals are uninterested we are the custodians."
Nick Lloyd has been with Everards since 1984. He joined to run the pub estate and soon took charge of the entire company in tandem with Richard. Nick has just stepped down and becomes a non-executive director. The MD's baton has passed to Stephen Gould who came to Everards after stints with Bass and Punch. In a ceremony in the brewery car park, Nick handed over the MD's car plate 1ALE to Stephen.
Stephen and David Bremner, the head of marketing and also ex-Punch, are masterminding the drive to build sales of beer in their heartland. They report encouraging figures, with sales of Original up by a remarkable 55%, Beacon by 6.7% and Tiger by 40%.
Sales of cask ale in Everards' pubs account for 37% of business and are growing. But Stephen points to the "ticking time bomb" beneath the statistics: 87% of ale drinkers are aged 35 and above, and 51% of that figure are aged 50-plus.
Most alarmingly, 96% of cask-beer drinkers are male. A lot of work has to be done by all cask-beer brewers to win the next generation of drinkers to the category, or sales will start to fall.
Everards believes the category's fortunes rest on quality. The company has two full-time members of staff who work exclusively on improving consistency. This is paying dividends, with returned beer scarcely registering at 0.3%. The key question remains: can the likes of Everards win the young generation to the delights of traditional beer? The omens are good in one family.
Richard Everard has a son and a daughter "who are interested in joining the brewery but are not being pushed". Which, of course, is the right way with a company dedicated to cask beer: drawn not pushed.
