Bedford brewer Charles Wells has been feeling the squeeze as a result of the influx of cheap imports. Lorna Harrison discovers how the company is changing its sales strategy.
Cross-Channel imports have been directly blamed for a major shift in business direction for Bedford brewer Charles Wells.
The 120-year-old company claims that the influx of cheap foreign booze is squeezing it out of the take-home market and has forced it to look towards contract packaging to maintain its business.
Managing director Paul Wells explained that the company's own-brand labels could no longer compete with cheap French bottled beers in supermarkets.
"We will now be approaching the supermarkets to try and persuade them to increase their pricing structure. If this fails, we have Board approval to withdraw our products from the shelves," he said.
Wells anticipated that around 50 per cent of supermarket trade will be lost almost immediately. But he said: "I do have high hopes of hanging onto a lot of them."
Vice chairman Tom Wells said whatever happened there would be an immediate effect on the brewer.
He said brewing would drop and, depending on the feedback from the supermarkets, could be halved to 300 barrels. The reduction will inevitably result in job losses but these will be kept in the "10s rather than the 100s".
Tom Wells said: "Our own-label products have been selling at too low a price, making this side of our business unviable.
"Any change in company strategy is a tough decision to make and this one has not been taken lightly. We have been reviewing the situation since 1993.
"The French brands are coming over in such large quantities that British brewers are competing unfairly.
"The fact that we turnover £80million a year but pay £30million in duty cheques gives a significant idea of the burden we are carrying.
"Generally the cask ale market has a battle on its hands. I will take great delight in telling my MP what has happened. We along with others know it is time for something to be done."
Charles Wells' shift in company policy and sales strategy will be the responsibility of the Board, which has recently undergone a number of changes itself.
In a break from tradition Alec Monk, who has been with the company for seven years, takes over as the first ever non-family non-executive chairman, following the early retirement of John Wells, 59.
Tom Wells, whose great-grandfather founded the company, takes over as vice chairman, while Paul Wells has become managing director. Nigel McNally becomes commercial director, with the responsibility of take-home and exports, and Anthony Wallis has been promoted to free trade sales director, looking after local and national sales, plus customer service.
Among its initial decisions, the new board has recently agreed to pull out of exporting to Russia - another area which has proved to be unviable.
This decision too was not taken lightly, but export is still a high priority for the company which last year won the Queen's Award for Exports.
Paul Wells said: "We will be looking to turn a third of our business into exports. It is 20 per cent at the moment, so this is not unrealistic. We are extremely strong in Europe and Canada's number one English brewer."
So despite the knock-back - which arose through no fault of its own - Charles Wells is looking forward to the future.
The company will focus its attentions to exports and contract packaging and is keen to point out that its portfolio will not drop as a result.
On the retail side, there are a number of developments on the go.
Its estate of 300 pubs is steadily increasing and the company is embarking on a number of one-off, innovative themed outlets.
For instance, Cox's Yard at Stratford will open in the autumn featuring life size sets, audio visual displays, a micro-brewery and historical artefacts giving locals a heritage point.
Money is also being invested in redeveloping existing pubs. Bar Citrus in Bedford town centre is a classic example of how a dingy boozer has been refurbished to provide a light, airy, female-friendly bar.
Last year also saw the opening of a Charles Wells pub in Paris and more European openings are planned.
"The influx of cross-Channel beer may well have taken its toll but we do have a lot to be positive about and look forward to the future," said Tom Wells.