Focus - Molson Coors Enjoying Life at Sharp's Brewery
By Chris Mercer | 7 September 2011
Molson Coors to keep Doom Bar at Sharp's Brewery in Cornwall
Big brewers are not known for buying businesses and leaving them to their own devices, but Molson Coors and Sharp's Brewery appear to have struck a reasonably happy medium. Chris Mercer reports on what has been happening since Molson Coors' acquisition.
What is Molson Coors going to do with Sharp's Brewery? That was the question at the forefront of my mind as I wound my way down to Rock in Cornwall, to the home of the Doom Bar ale brewer. On arrival, we were greeted not only by the obligatory Doom Bar banners, but also by cases of Blue Moon stacked up in the main presentation room. So, has the colonisation begun?
Since acquiring Sharp's for GBP20m (US$32m) in January this year, Molson Coors has studiously informed all-comers that it wants to invest behind Doom Bar but keep the brewing local. Emma Bebbington, who Molson Coors has installed as Sharp's general manager, reiterated the point this week: "Molson Coors is committed to a long-term future for Sharp's," she told just-drinks. "We said when we bought Sharp's that we're going to invest in the business as it stands now."
So far, this has been the case. Last month, the group said that it would spend GBP5m to expand capacity at Sharp's over the next two years. With Doom Bar the "fastest growing top-ten ale brand" by volume, albeit in a shrinking UK cask ale market, one gets the impression that those extra vats could not come too soon. "Currently, we're selling everything that we brew," said Bebbington.
Doom Bar is clearly a central strand in Molson Coors' interest in Sharp's. On the one hand, Molson Coors is keen to use it as "leverage" to help its Carling lager brand usurp the hegemony of Foster's in south-east England. But, Doom Bar is also talked about as a new generation of "gloriously mainstream" ale, pulling in a new generation of ale drinkers.
Bebbington thinks that Doom Bar "absolutely has the potential to be a national brand", but capacity constraints mean that the brand must pick its battles carefully. As things stand, Doom Bar makes up 90% of Sharp's annual production.
There is a quick fix to the capacity problem: brew it elsewhere. Yet, from what I can tell, Molson Coors appears genuinely trepidatious about uprooting Doom Bar from its local power base. Provenance, it seems, still matters to Doom Bar's core drinkers.
Another reason for maintaining the status quo is Stuart Howe, the flamboyant head brewer at Sharp's. Howe, unlike some of his peers, seems to thrive in the spotlight. He drives a white BMW with red sets, and has an engaging way of discussing beer, describing hops as the "guitar soloist" and malt as "the bass player at the back". If that is true, then Howe himself is surely a five-star frontman.
Howe is also a talented and experimental brewer, and Molson Coors seems keen to keep the talent happy. One day, it is hoped that Doom Bar mark 2.0, 3.0 or even 4.0 might emerge from Howe's workshop. Doom Bar 'mark two' may already be in our midst, with seasonal beer Atlantic IPA making a strong case for a full-time bar position this summer. At the same time, Molson Coors is interested in doing more with Howe's high-end, small-volume beers, also known as the connoisseur range.
"It's like Jim'll fix it came along," said Howe, when questioned about Molson Coors' involvement. "I've got all sorts of pieces of equipment that I could never afford before."
Surely, though, brewing Doom Bar must be something of a grind these days? He says not. Much as Howe plays the mad scientist, he is quick-witted, understands commercial pressures well and knows what is required. He's no stranger to big brewing, having worked at the "fizz factory" near Bristol, producing Foster's and Kronenbourg. I sense that there is a genuine tone in what he says about the skills required for consistency.
At the same time, part of Howe's attitude may also emanate from what came before.
Sharp's has never been owned by brewing enthusiasts. Bill Sharp may have devised the recipe for the first beers, and initially distributed them himself in a tiny van, but he is thought of in these parts as primarily a businessman - not a brewer. In 2003, Sharp sold control to two private investors, who - according to various Sharp's staff - made it clear that they sought to build a strong brand and sell the company on for a profit. It is they who approached Molson Coors, rather than the other way around. When you add it up, the 'for sale' sign has been dangling over Sharp's at varying heights for much of the past decade.
The upshot of this, according to Howe, is that he spent several years working with scraps. Everything went into Doom Bar, which resulted in Howe experimenting at unsociable hours of day. "I was doing everything without support and often in secret," he said. It might be too strong to say that Molson Coors has rescued Howe from a tight spot, but he's clearly coming at the deal from an unusual vantage point.
So, while Howe clearly sees merit in producing consistently-quaffable Doom Bar, he also gets to play around a lot more. Molson Coors has employed a second brewer at Sharp's and it should give Howe more free time to tinker. There is an insurance element to this, too, of course. Molson Coors knows how reliant the Sharp's operation is on Doom Bar, and on Howe. The group argues, as it must, that no one is irreplaceable, but Howe must be close and it makes sense to get someone in now to benefit from his knowledge, even if it is 'just in case'.
It remains to be seen whether, further down the line, Molson Coors' accountants will agitate for change and, if they do, whether the brewer will restrain them. Still, if Molson Coors is serious about using Sharp's to its full potential, then it needs to keep Howe doing what he does best.
This, to me, is the second strand that could support Molson Coors' acquisition. The beer industry needs a proactive solution to stop young people choosing wine, spirits and cider. In that fight, Howe's agility combined with Molson Coors' muscle could prove persuasive.
Sectors: Beer & cider
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