Back in January this year- it does seem like an age ago now - I wrote about the growth that “Craft” Breweries were likely to see going forward and the problems of either following that dramatic growth or of deciding to take a much slower and considered approach to growth.
In discussions with a large range of breweries that we have spoken to over the year so far, we do not see any lessening of the ambition of Craft Breweries nor the growth potential in the market place, but there appears to be a growing awareness that the “significant“ growth is going to be harder won in the period ahead.
There is no doubt that consumer appetite and awareness for good quality craft beer is continuing to increase. Drinkers are increasingly seeking more variety and higher quality in their drinks. Consumers continue to demand a variety of beers with innovative flavours and variations of traditional beers.
This is recognised by the big international drinks companies in creating or buying UK craft beer brands or even using US Craft beer brands in order to keep control of the market. They do not invest where there is NO market!
Whether the UK Craft Beer market rises to the same levels as the US, a claim parroted by most crowd funding prospectuses these days, but unlikely to happen, there is still good growth available in the UK market place for years to come.
The issue is – Who will get that increase in volume of sales – the bigger companies or the smaller independents?
Essentially the craft beer market place as opposed to the “Brown Beer” market place is now being targeted by a range of companies who all have bigger, stronger and more organised operations.
Group 1 – The big players – The drinks brands
All developing “Craft style” drinks, or importing them, good example is Guinness with “The Brewers Project” Hop House 13 lager, Rye Pale ale, Golden Ale
Group 2 The bought out – Camden, Meantime, London Fields etc.
Money, people, brand and marketing expertise
Group 3 - The regional, larger players
Slower to react but are gearing up to increase sales either through launching a more dedicated craft beer brand eg. West Berkshire – Renegade, Shepherd Neame – Whitstable Bay or by increasing investment into their own production facilities and producing a “Craft” type ale.
As an independent “Craft Brewery” this all comes down to pressure on access to the market place. Routes to market are becoming harder and achieving sales becomes ever more difficult. We have consistently heard stories over the last 9 months about how sales are difficult and breweries are not achieving their forecast figures.
There is only one answer to this problem and that is to professionalise your own marketing and sales efforts;
Where markets become more competitive and essentially products are in many cases “Me to” the deciding factor on who wins is down to marketing and sales.
You need to ensure that you have your marketing strategy and implementation sorted.
- You must have a clear brand proposition - which if you want to expand outside your area is well beyond saying "We are your local brewery!"
- Make sure your product labels are clear, informative & stand out
- Your brand is critical – why were Camden & Meantime bought – because of “Brand”
- Brand is critical in the current market place. Whilst craft beer sales are growing, effectively you need to displace a competitor to achieve sales. What is it about your brand, your offering, your service that is going to get the buyer to give you a trial and then to keep ordering?
The Sales Numbers
- Analyse your sales history and build a detailed forecast of what you need to sell going forward.
- Have a clear plan of how many new outlets you need to achieve your forecast and how you will fill your sales prospect funnel to achieve those numbers. It is a numbers game
- Review your monthly sales at the start of the month and also after the first week, it’s too late in the middle of the month to realise you are not going to make target.
- Expand your sales into all the non-traditional areas – do not limit yourselves. Over 50% is now sold off-trade.
- Use distributors to get you to reach the parts your sales cannot reach. Whether the newer distributors such as eebria, Honest Brew (see Susanne Currid’s recent blog) or any of the large number of older more established distributors.
- Develop a clear strategy for distributors, if you use them as “sell & forget” you are unlikely to get the best from that channel.
- Challenge your sales people, don’t accept the excuse – having been a salesman in the past, there are just too many excuses you can make!
o Cellar is full, will order next month!
o We don’t quite have the beer he wants!
o The competition did a deal!
o Etc. etc.
- Your team have the advantage of being passionate about selling what you are making. Your sales people are directly connected to the brewery - they can talk with passion about the beer.
- You have to use this emotion & passion, as what you are selling is a “Quality, handmade experience in a glass/can” which needs to be communicated.
- A passionate salesman who believes in their product will always outsell someone who is selling from a catalogue or embedded in a large, bureaucratic company.
If you want to get more clarity on how to structure or improve your sales activity, then why not speak to one of our advisors at The Business of Drinks. We can help you assess your opportunities, match them to your ambitions and help you create a business roadmap that will guide you to your desired position.
If you would like a copy of our white paper on “Sales Planning” or “The Sales Process” please just drop us a line.
The Business of Drinks works with breweries and other drinks companies across the UK. Business owners who use our services find they are more focussed, have a clearer vision of where they want to get to and achieve more.