Despite the UK’s reputation as a brewing powerhouse, brewers say they are being hindered by customers who are failing to stick to agreed credit terms.
Cloudwater Brew Co founder Paul Jones said the industry-wide practice is damaging breweries, with some of the worst offenders paying bills three months late.
Jones told the Publican’s Morning Advertiser: “When we first started we faced the difficult decision of whether to take the hard ball approach of insisting on payment up front or offering credit where people sign an agreement to pay within 30 days. Because we didn't want to appear unattractive to customers and wanted to do business with some that insisted on credit terms, we decided to offer credit to many."
“There are those pubs, bar chains and distribution companies who essentially pay if and when they want to. It puts a huge pressure on breweries. We’re owed 27% of everything we’ve invoiced, which eats up all our profit margins and then some. I know we’re not the only brewery that has had sleepless nights because we don’t know when people will pay their bills and I wouldn’t be surprised if it ends up putting smaller breweries out of business.”
He added: “We understand that sometimes people don’t pay on time by accident, but when you hear that many breweries are facing the same issues week after week it’s time to question ethics."
Track Brewing's Sam Dyson added: "The majority of people are very good but it is frustrating when you want to expand and cash flow is slowing you down.If I had all the money that I was owed now, I would be able to employ another person and buy new tanks. I don't think publicans are bad people and I know pubs are very busy places with lots of invoices flying around. The whole point of this business is building relationships and its difficult when you don't want to sour them but you also need to get your money back."
On Twitter, Kent-based brewer Caveman Brewery said they couldn’t believe what they were owed.
Craft brewers have called for a brewery body to tackle the problem and asked fellow brewers to share as much information as possible about customers who fail to pay on time.