According to the Society of Independent Brewers, sales of locally-produced beers were up 8% in the first half of the year – a period when overall beer sales were plunging. SIBA’s Direct Delivery Scheme, which delivers local brews to pubs, shops and off-licences across the UK, said there had been a surge in demand for its products. Real ale enthusiasts have long argued that there’s no comparison between their tasty brews and the mass-produced lagers that dominate the market – could the credit crunch prove them right?

The success of SIBA’s 350-odd members – who include the likes of Adnams and Fullers – is in stark contrast to the state of the beer market overall, which appears to be in sharp decline. According to the most recent figures, beer sales in pubs and bars fell by more than 8% last quarter, as drinkers chose to preserve their pennies. And it’s not as if they’re choosing to drink at home instead – retail sales were also down 6%.

What’s more, the rising popularity of real ales is not just limited to the beer-and-sandals brigade in the comfort of their own homes. Ailing pub group Mitchells and Butlers, the owner of All Bar One, said recently that cask ale sales were up by 7.8%, with CEO Tim Clarke suggesting to the Times that it was seeing a ‘general consumer trend towards quality products with provenance’ – in other words, punters are choosing to drink beers that actually taste of something.

You’d expect real ale enthusiasts to be less willing to give up their favourite tipple than casual lager drinkers – but perhaps the difficult economic times are encouraging a ‘flight to quality’, with punters starting to see their beer consumption as an end in itself, rather than a means to an end…

On the other hand, it’s not all good news. One of the reasons for the rising popularity of real ale was the rotten weather of the last few months, which always puts a dent in the sales of ‘more refreshing’ drinks like lager and cider. So the resurgence of real ale has come at the expense of the great British summer…

Taken from: www.managementtoday.co.uk

2008 Cask Ale Report – The Intelligent Choice

We have pleasure in releasing the 2008 Cask Ale Report, ‘The Intelligent Choice’ and the executive summary written by Pete Brown, an independent award winning beer writer.

This report is backed by the entire cask ale industry, represented by:

• Brewers: the Why Handpull group (Adnams, Caledonian, Fuller’s, Greene King, Marston’s and Wells & Young’s), Independent Family Brewers of Britain (IFBB), and the Society of Independent Brewers (SIBA).
• The Consumer: The Campaign for Real Ale (CAMRA), which has 94,000 cask ale-drinking members.
• Quality assurance: The Cask Marque Trust – the organisation that accredits pubs that can keep cask ale in perfect condition.

Hard copies can be obtained by contacting Cask Marque on 01206 752212 and the report can also be viewed online at www.caskalereport.com.

We would welcome any comments on the report and hopefully you will distribute it to anyone who may be interested in its findings.

For further information on Cask Ale Week which is mentioned in the report and planned for Easter 2009 please ring us at Cask Marque on 01206 752212.

Thank you for your continued support.

Paul Nunny

It is now clear this was just the tip of the iceberg and no commentator was able to foresee the full blown banking crisis that has exploded in the last fortnight with the collapse of Lehman Brothers, other US bank emergency sales/mergers, the $700 billion rescue package for Wall Street, and in the UK the Bradford & Bingley nationalisation. Other banks are also in crisis, Halifax Bank of Scotland, and the huge “banking to Insurance” group Fortis.

Northern Rock is like a pebble on a beach compared to these events and, as derivative contracts unwind in the coming weeks/months, no one can be certain of the effect this will all have on other institutions and the financial markets.

What next?

There is now a crossover of banks lending less combined with the onset of recession. Banks are very badly placed to cope with the economic downturn, significantly worse than in the recession of the early 1990′s.

Capital markets, the normal source of bank funding, are now virtually closed for business so Banks have to protect capital however they can. De leveraging – the process of reducing debt – has already begun taking place with the withdrawal of mortgage funding products and is extending through the corporate market place. There have been a number of shelved projects where bank support has been withdrawn and even the 2012 Olympic games has seen PFI support withdrawn in recent days.

The implications remain familiar

* Less lending – banks just do not have the borrowing capacity to support expanding loan books;

* More stringent lending criteria – there is a flight to quality in these situations;

* Prices higher – banks are paying a high price to protect their balance sheets, this is being passed on.

Businesses must be cautious. It is obvious but cash flow availability is critical to survival in these times, profitable businesses have failed in the past because they ran out of cash – that is exactly what has just happened to the banks.

Sensible actions for any business to take are:

• Check terms and conditions relating to bank facilities;
• If renewal dates are imminent bring forward discussions and secure required funding;
• Match expenditure to income generation wherever possible;
• Maximise the use of existing assets in terms of security value or cash release;
• Establish access to a reserve or contingency fund;
• Cost justify capital expenditure, only invest in areas of the business that have a realistic expectation of producing an acceptable return.

It is highly probable that trading and economic conditions are going to get a lot worse over the next year or two. Take action now to ensure your business is equipped to survive and prosper, maintain liquidity at all costs!

Peter Godwin
Managing Director
Close Brewery Rentals Ltd