Sunny weather puts a head on flat beer industry figures
The Local · 23 Apr 2011, 12:52
Published: 23 Apr 2011 12:52 GMT+02:00
Yet as the industry marks the anniversary of the German purity law which dictates the ingredients of beer, not all is as happy in the country's breweries as the crowded beer gardens might suggest.
The mid and long-term looks decidedly flat for many of Germany’s 1,325 breweries, according to Peter Hahn, manger of the German Brewers’ Association.
“The super weather shows us once again that the sun god is our best seller,” he said.
Although the start of this year was great for many brewers, he said the industry expected a further slight drop in turnover of between 1 and 1.5 percent for the year as a whole.
Only a particularly good year weather-wise would enable the industry to reach last year’s figures, bucking a continual, linear decline in sales.
“Less beer is needed all the time,” said Rudolf Böhlke, beer expert at consultancy Ernst & Young.
He said this was linked to the slight drop in Germany’s population, and its increasing average age. “The older we get, the less we drink,” he said.
The winners of the situation are the largest breweries, which can pay for advertising, innovation and takeovers – and the very small businesses which have a loyal customer-base, he said.
Alcohol-free beers and mixes are just two of the initiatives currently being seized upon as possible ways to stave off turnover droop.
Yet takeovers also seem to be on the cards. “They are overdue actually,” said Albert Christmann, head of the Radeberger Group, the German market leader.
The opposing pressures of increased competition and increased costs on the one side, and falling prices on the other, are making things very difficult for some breweries.
“Some participants are already hanging by a thread,” said Christmann.
Rumours abound of a possible large takeover, the whisper being that Radeberger Group, which has more than 40 brands including Radeberger, Jever and Schöfferhofer, could takeover the German business of Carlsberg, which owns Holsten and Lübzer.
The price war between breweries meanwhile continues unabated, with the customer happily slurping up the results – including more than half the premium beer in Germany being sold in special offers.
An unexpectedly negative consequence for the industry of the purity law is that no beer is really bad, said Böhlke, which leaves only the price for companies to fight with.