Innis & Gunn in expansive mood

Innis & Gunn in expansive mood

UK brewer Innis & Gunn is looking to build on strong sales momentum by expanding its presence in the buoyant market for craft beers in the US.

Innis & Gunn will this month ship its first 8,000 cases across the Atlantic to its importing subsidiary in New York.

The Scottish brewer has come a long way since its process of ageing beer in oak barrels was accidentally discovered seven years ago. This week, it announced record sales of GBP908,000 (US$1.32m) for the first three months of the year, up by 21% on the same period of 2009.

It's taken the company five months to set up its own import operation in the US, but Innis & Gunn managing director Dougal Sharp is confident that the physical and financial effort will prove worthwhile.

"At times, we've been tearing our hair out," said Sharp. "We've sold beer in the US for five years, but the actual volumes have been very small, representing around 5% of the business.

As well as an import business, the group has also now set up its own sales and marketing division in the US.

"Over 30% of our website traffic comes from the US, so we know there is big interest," said Sharp, who added that the firm will initially focus on the East Coast in a mix of on- and off-trade outlets.

While growth on the US beer market has largely been paralysed by the country's economic recession, craft beer sales rose by 7% in volume and by 10% in value, to US$7bn, for the 12 months of 2009, according to trade body The Brewers Association. 

Sharp said that Innis & Gunn is not targeting specific volume sales in the US this year, but said that there will be no difficulty in meeting demand "if the US takes off".

The brewer has annual volumes of 7m bottles, with brewing and bottling contracted out to Greene King's Belhaven business.

Exports have already proved to be something of a speciality for the firm, with demand from Sweden having driven growth in the first quarter of 2010.

Still, Sharp said that he is confident that the brewer can drive further into the UK market after achieving 400% sales growth in the country's on-trade in the first three months of this year.

"The trend for craft beers has already begun in the UK and I can only see it gathering pace," he said.

Alongside Innis & Gunn's strong sales growth, Sharp said that the privately held company "has been profitable since 2005". He added that the second quarter of the year is looking "just as strong" as the first.