Location And Innovation Crucial To Brewery Survival

A new study in the UK has found that craft brewers who were best able to weather the COVID pandemic will continue to benefit from their location as well as from a willingness to stay resilient going forward.

According to new research from Northumbria University, the COVID-19 pandemic has had a lasting effect on how craft breweries in the United Kingdom are approaching their businesses. And that “going forward, location and innovation have become key factors that will shape strategies for future growth in the craft beer sector.

The University study found that, during the pandemic, urban breweries were “more effective in capturing support provided by the Government and in adapting to changes required by lockdowns and restriction to movements”.

The craft breweries that survived proved to be nimble, they were able to shift production quickly from kegs to bottles and adjust their distribution practices to suit the constantly changing retail environment.

According to New Food researchers also found that, rural breweries felt the impact of the pandemic lockdowns “much more” than breweries located in towns and cities.

“Being located in an urban or rural area made a difference for breweries during the height of the pandemic,” said Professor Ignazio Cabras, Research Lead from Northumbria University’s Newcastle Business School. And governmental economic support kept some breweries afloat during the crisis “support by local people and other local businesses were equally significant factors in how craft brewers, in the absence of pubs being open to supply products to, survived the crisis.”

“The pandemic had a big impact on not only breweries, but supply chains both big and small. We are still feeling these impacts today, with one third of the hospitality industry predicted to be under threat of failure at the beginning of this year,”  according Dr Gary Bosworth, Professor of Rural Entrepreneurship at Northumbria.

“What surprised us most was just how many strategies these brewers discovered to strengthen their resilience in the face of unprecedented challenges,” Bosworth emphasized…”It wasn’t changing business strategy that put businesses on the right foot to move forward in the initial stages of the crisis,” rather the “individual attitudes to the pandemic such as those who felt the crisis would pass were less likely to make investments during the period, and slower to innovate.”

COVID-19 changed perspectives for craft breweries,” said Dr Ekaterina Shakina, Assistant Professor at Newcastle Business School. “Before the crisis craft breweries tended to brew a much wider range of beers, however now many refocused their efforts on core and flagship beers, cutting seasonal beers to achieve economies of scales.”

“Compared to pre-COVID-19 times, much investment has been also re-directed from capital infrastructure to marketing and social media, to maintain and keep up with the customers’ base acquired during the pandemic.”

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