Northern Monk Brew Co: We can’t sustain our business making cask beer

By James Beeson contact

- Last updated on GMT

Unprofitable: Northern Monk director Russell Bisset said the margin cask beer commands is too low
Unprofitable: Northern Monk director Russell Bisset said the margin cask beer commands is too low
The price point of cask beer is too low and is driving breweries into other forms of packaging, according to the director of one of the UK’s leading craft breweries.

In an interview with The Morning Advertiser​, Russell Bisset, from Northern Monk Brew Co in Leeds, said his brewery was now only producing “a very, very small amount” of cask beer due to the lower margin the product commands in the UK marketplace.

“The cask market is difficult in the UK,” he said. “We put about 65% of our beer into cans, around 30% or more into keg and then a very, very small amount in cask.”

When asked why the brewery had pulled back from cask production, Bisset said: “There’s a number of reasons, including the ingredients we use, the heavy hopping rates and the raw material costs. It is quite difficult for us to achieve the price we need in order to sustain our business in the cask market.”

He went on: “We reach a wider audience through our canned products and find that we get better customer engagement and feedback on social media through them.

“We are constantly looking at how we can push the medium of beer forward, either through new ingredients and techniques or looking at how we present the packaging and make the drinking experience more interactive,” he added.

Supermarkets create exposure

In a wide-ranging interview, Bisset also defended the brewery’s decision to put its beers into supermarkets, stating his belief that extra exposure to craft beer would benefit the pub trade in the long run.

“The way we have approached it is thinking about the economies of scale and offering only multipacks,” he said. “If you go into the supermarket and buy a six-pack of beer you would expect to pay a decent amount less than you would buying one or two units at a time.

“The bigger picture is also people's exposure to craft beers and more interesting and smaller breweries. The more exposure those beers get, the better in the long term for the pub trade. I certainly wouldn't cite that as one of the reasons there is a decline in the number of pints consumed in pubs.

“People are drinking less across the board, but people are much more interested in taste, provenance and ingredients and the more exposure people have to those products, the more interest there will be in them. The more places that stock them, which are by and large still pubs, will do well.”

On the news that 35m fewer pints had been sold in UK pubs​ between July and September of this year, Bisset said: “I don't know what the market will look like in four or five years but it's just about doing what we do and trying not to look down.

“There will be many breweries that will struggle but if you have an excellent product and quality is the first and foremost thing you focus on, then I think you will still be able to do well in the UK market.”

“I wouldn't necessarily say we are concerned,” he continued. “I didn't know those exact figures [the 35m drop in sales] because it's not something I try to get involved in. We just keep our eyes on where we want to go and keep up the passion and enthusiasm to make some of the best beers in the world.”

Beer festivals small and large

Bisset also lauded the work done by small brewers relief (a duty discount paid to breweries that produce less than a certain amount of beer a year), stating that it had “levelled up the marketplace” and helped small breweries like Northern Monk get a foothold in the industry.

“I think it has been great.It gave us the opportunity when we started, and is something we have benefited from,” he said. “We considered whether or not we wanted to break through the initial threshold and go onto the escalator, but actually the cost savings through the economies of scale offset the additional duty costs. In that sense it has worked really well for us and in the way the Government would intend it to work.

Last weekend, Northern Monk hosted Dark City 2017, a two-day beer festival dedicated to strong, dark and winter-themed beers. Bisset described the festival as a great opportunity to meet and engage with the brewery’s customers, but stressed there remained a place for more traditional, pub-based beer festivals.

“For us, festivals are great opportunities to showcase the best of the best of what we do,” he said. “They are also a great opportunity for us to meet face to face the people who have bought into the brand and what we do.

“In terms of other festivals, there is always going to be a place for all kinds of beer festivals. I don't know the sales of more cask-driven beer festivals, but I would like to think they have remained fairly strong. I have attended cask festivals this year and really enjoyed them. It's just a bit of a different approach.

“Doing beer festivals on our own terms can be quite niche and interesting for us to see how far we can take that. The average ABV of the beers at the festival last weekend was 9%, very different to a 'normal' beer festival.”

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