Friday, 9 March 2018

SIBA - The Voice of British Brewing?

I may well get my arse whooped for this. Yes, I'm going to discuss SIBA AGM again in this publicly accessible medium. My robust defence is that those in favour of the current direction of SIBA can, and do send their points of view out to all members. We, those who are constantly exasperated by the failure by the exec to listen to what we are saying, have no way to reach the very same people unless we broadcast it.

There seems to be two motions being presented to the AGM. I discussed one on my previous post. The other motion is against what I believe to be the right course for SIBA and I shall try and explain why.

I only have one trade body. There is also the BBPA and the IFBB, but neither of those organisations are suitable for me.

SIBA wishes to have a vision statement that reads;

To deliver the future of British beer AS THE voice of British INDEPENDANT brewing.

The capitalisation is as written in the motion document.

I'd like to vote against this on the basis that I do not want my trade organisation to have this vision. Unfortunately the previous vision statement read;

To deliver the future of British beer and become the voice of British brewing.

It is this very vision that is used by the organisation to argue for much of the detail that it does, which is against the interests of the majority of members.

The reasoning behind this is that it is argued that SIBA should lobby universally as one voice to Government for the whole of the UK beer industry.

Having sat on the SIBA policy committee I can absolutely give the reader full assurance that SIBA will not look after the interests of brewers under 5,000hl. Indeed, they are planning on weakening SBR1 and will be making representations to Government to that effect, if they haven't already done so.

If representation to Government is needed that is universally for the good of the whole beer industry then SIBA can join with the other trade organisations and deal with them on a case-by-case basis.

It is inconceivable to me that us little artisanal producers can be represented by the same organisation that represents some quite large Public Limited Companies who are listed on the stock market. They already have their own trade organisations.

I'm now kicking myself that I didn't get around to my own motion to counter this sort of nonsense. However, minded to vote against just to frustrate the process.


SBR = Small Brewers Relief = PBD = Progressive Beer Duty. Currently every brewer below 5,000hl gets 50% discount off beer duty. Above 5,000hl brewers are capped at a cash relief per hl% and above 30,000hl up to 60,000hl this relief is slowly, and quite painlessly removed.

There is an argument that states that brewers find it hard to climb above 5,000hl because the shape of the relief inhibits growth. Actually, I have evidence that proves very much that although there is an elbow in the profitability curve that shows improvement in profitability slows as breweries go through the 5,000hl level, actually profitability still increases, all be it at a slower rate.

See output from a certain bit of work I've been doing in the chart below.

What is crucial is to note that profitability is rare below about 2,500hl, although the model data does show significant error bars and profitability is evident in a small number of cases; exploring this may be interesting.

This however, is the subject of a future blog post.


Martyn Cornell said...

Fascinating figures, Dave. This may be something you will be mentioning in a later post, in which case ignore this question, but what difference does having one's own tied outlet(s) make to profitability?

Dave Bailey said...


An important question, and it is my belief that indeed having any sort of ownership of an outlet is extremely helpful in achieving some sort of profitability at any size.

I will probably be writing about this at some point in the future in more detail, but for now there is quite a lot going on, and I'm probably going to be making one massive announcement at SIBA AGM. After which point in time I will be even freer to comment on how awful it is in the brewing industry right now and how insidious the whole industry is.