Tuesday, 31 March 2015

Which Morrisons

It seems quite a few people are pleased we've got our beer coming to Morrisons shelves. I've been asked a few times which stores are stocking. I emailed a couple of people, both of whom replied with a list of stores.

I did have to do a bit of digging to double check the stores and their exact locations. Due to differences in data between stores stocking Hardknott and the fill list of Morrisons, along with inevitable new openings and a few closures, I might have made the odd mistake. Still, should be 99% accurate.

Click here to get full list of stores stocking

Tuesday, 24 March 2015

The down side of duty reduction

There are many costs that affect a brewery. We've found this year, for instance, that some of the major hop varieties we rely on have been scarce. This inevitably means increasing costs, or alternatively a compromise on recipes. As the economy improves we see, quite rightly, wage rises. This ripples through to increased costs of labour. Fuel may well be low at this present time, but that won't last long, you can bet on that and it's already showing signs of increases again.

RPI falls to zero - but for how long?
(Image curtesy ONS)
Out of all the costs we have to manage, beer duty is the one that is published widely. When it goes down, and the government promise a penny off a pint1, it leaves us brewers wondering what we should do about all the other costs that are rising.

Traditionally a duty increase signalled the time when we could all look at our costings, across the board, and make appropriate price increases. Yes, a penny or two on a pint, by the time it got to your glass, often looked more like 10-15p. The reason for this is that the brewery, and the pubs and shops that stock the beer, rolled their annual price review together into one event, and that was all shrouded by the duty increase.

Now, considering with the recession and all, beer prices at the brewery gate haven't seen much of an increase over the past few years. However, costs, as I've said, are going up. Overall, this is having a detrimental effect on the ability to earn an honest living out of beer.

The reader could be excused for questioning my arguments, based on today's announcement by the ONS of zero inflation. This is making interesting news, but one thing is certain, economic growth is not possible without inflation. As we move from deep and difficult economic times we will see increased economic activity, increased wages and fuller employment and increased inflationary pressures. Many would argue this is essential for economic recovery, but either way, we will see prices increasing for everything, and that includes beer.

In the past I've had pubs we supply ask me how they are going to explain to their customers that they probably can't pass on the duty reduction through to their pint prices. Indeed, some have even said that they should really be looking to put up prices, despite duty reductions.2

Some customers this time around have been asking us if we are going to reduce our prices in response to the budget. I'm quite clear on this. No.

As we are still below the duty threshold, and enjoy a 50% discount, the reduction in duty is only a half of the published amount. This results in the reduction in duty on a bottle of Azimuth to be only a shade over 0.3p. Meanwhile, a cost of living increase for our staff, hop price increases, transport cost increases and heating and power cost increases will put that, plus more, back on the cost of manufacture.

The duty cut will help us keep a level keel, help us to continue to develop our business, to invest in the future and to build a solid and competent team. It will not help us to reduce our prices, overall efficiency elsewhere might, but not a relatively minor duty reduction.


1Actually, the real shocker is that even at full duty rate it is not even a penny off a pint until you get to 5% beer. Yes, Stella might enjoy that duty cut, but not your pint of 4% session ale, that works out at only 0.85p per pint. Micro-brewed beer will enjoy only be 0.4p on a pint of 4%. A bottle of Azimuth will only see 0.34p off its beer duty. It isn't very much really, is it?

Now, before my friend Keith Bott, or any of any of the other great people who have worked tirelessly to stop the beer duty escalator, and at least reverse the trend a little shout at me, I do appreciate it. We are in a much better situation now than we might have been had the escalator still been in place - except, if I remember correctly, it was linked to inflation.......

{Edit} It has been pointed out in the comments that in fact the duty escalator was 2% above the rate of inflation. So, even with zero inflation, we'd have seen an increase.

2I've known pubs put out a jar with 1p pieces in it with a sign saying "Here's you beer duty reduction, if you can be bothered to take it" - really, a penny? Why are those little copper plated steel things still circulating? they are more bother than they are worth banking, which is why many pubs are happy to give them away.

Tuesday, 17 March 2015

I'm not dead

The first shipment ready to go
I am certainly not dead at all. One could be forgiven for thinking some great tragedy had befallen me, after all it is 6 weeks since I posted on this blog. It is true that Dry January did push us close to the edge, and then, just as we thought it might be getting better, it turned out the great craft hop shortage might threaten to limit our ability to brew stunning beer. I might have been tempted on several occasions to drink myself to oblivion, after all, I probably have enough alcohol in the warehouse to wipe out a small army, should I be able to persuade them to consume it all.

But then, around the middle of January, an email popped up in my inbox that I felt sure would change things forever. It happens every-so-often. Sometimes it might be greetings with an unusual enquiry, which turns out to propagate long and fruitful acquaintanceship. Sometimes it is the offer of a trip to some interesting place all in the name of beer. Sometimes it is just an invite to take part in something fun.

On this occasion the email started with "Promised I'd be back, and here I am" and proceeded to state that "In theory, we can look to do something with you from April" It was the beer buyer from Morrisons. Ann and I had been to see him at the nice head office way back last Autumn. We thought the meeting went quite well, but knew that these things can take time to happen.

The theory turned fairly quickly into a certainty. We had ramped down all operations due to the evil that is Dry January and stupidity of detox, And fairly quickly I realised we had a lot of work to do. Indeed, so much work that we really were not sure how we would do it.

Today we packed up three pallets and loaded them onto a wagon. This is just a pre-order to check that systems are all working, that we get the paperwork via Morrisons systems1, we send it to the right warehouse, and all the barcodes work the way they should. If all is good, next week we ship double figure amounts of pallets. Apparently it should be on the shelves around the beginning of April.

Good job the warehouse is full then.

And so, if the information I'm given is true, we'll have Code Black, Azimuth and Infra Red on the shelves, 4 bottles for £62, alongside some other stunning craft beers. How good are we to you?


1It didn't work first time. We should have got the order last week, apparently, but there was a field missing in the database, or some such thing.

2The deal started yesterday. It seems many of the supermarkets are turning to great craft beer to try to bolster their trading performance. After all, when it's time to go do that weekly shop for potatoes, pasta, frozen pizza for when you get home from work late, and can't be arsed to cook something proper, at least the drudgery will be eased with the knowledge there is craft beer to be bought. At great prices too.