MyShout

As international beer brewing changes, Tony Jennings wonders how this will effect the market

I completely understand if some of the current reportage on the goings-on on the international brewing scene leaves retailers cold. Wrestling with many-tentacled town-hall monsters, spawned by smoking bans and new licensing laws, they may well be somewhere between bemused and totally indifferent.

Whether the big man from Brazil does a deal with the big man in the United States, or who gets the ailing Japanese beer giant or becomes number one in the emergent Indian beer market, or indeed who does a distribution deal with the most unlikely partner, may all make fine questions for the pub quiz night, but as a way of moving forward the particular outlet's business plan they must seem irrelevant.

In fact, the seismic shake-ups that are going on in the international brewing business at the moment could, in my opinion, be the start of a whole new deal for retailers operating in the world's mature beer markets, and that of course means the UK.

The traditional landscape of international brewing is changing so fast because the sales of the traditional big beer brands in mature markets are in terminal decline. This has stimulated a rush for replacement markets in the world's emergent economies - reminiscent of the late 19th-century European rush for Africa.

The mature markets are still worth playing for, however, but here the drinkers are going for less and better. In other words, they want speciality, craft beers; products with provenance that are beginning to enjoy the respect that up until now was traditionally reserved for wine. This doesn't mean that the future belongs to the packaged product in the fridge. Technical advances, that when implemented do not in any way infringe on the integrity of a great brew, have improved the quality of draught immeasurably in recent years, and it will be quite easy to fill the vacancies in the cellar created by the inevitable demise of the standard brands in their draught form.

And, most importantly, thousands more retailers than now will be able to stock these speciality beers because they will be sold to them through the distribution chain that they are currently in, or at least one very much like it. It's logical when you think about it.

In their heyday, the brewers of the big brands created vast distribution systems for their product to flow through. The product is ceasing to flow, but the system, created at enormous cost over decades, is still there, so why not push through it those speciality beers that the new generation of beer drinkers crave? For the most part, the brewers of these beers have not been big enough or wealthy enough to evolve their own routes to the big market places, but one thing they can do, usually better than the big boys, is brew.

What we are seeing develop is a very exciting new division of labour. The big boys will do what they are really good at, the marketing and distribution, and the craft operations will do what they are good at, brewing, and the retailers will start to get what they have been dying to sell - what their customers want.

Budweiser Budvar has just done a deal with Anheuser-Busch, for the latter to distribute beer brewed by the Czech brewery throughout the US. There's a rational use of resources if ever there was one, and one that is going to leave everybody, but most importantly the retailer and the consumer, happy.