In 2018, Shanghai's craft beer experienced a dark and long night before the dawn.
In April, Kaiba, the first local craft beer house acquired by Budweiser, announced that it would shut down all six of its stores, retaining only its bottled beer business. Prior to that, Kaiba had a strong presence as a result of the acquisition. It started outdoor advertising on the Bund, doubled the number of stores, and created a "Starbucks of the beer industry" in the same way as FMCG, spending a lot of money on a makeover, but the results on the ground were unsatisfactory. The founder of the "open bar" Huang Wei bluntly said, "the new way of operation so that the 'open bar' lost the original spiritual core, less human flavor."
The human touch is the soul of any tavern. Play a cup of fresh beer, pour a mouthful of wine foam, with the lights and music, let the micro-brew surge, not for drunkenness, just for a moment of relaxation, is the tavern fascinating memories. But because of the demolition of Zhaozhou Road, in mid-December 2018, Shanghai's legendary bar "Jack's Dimple" announced the closure of 11 years of operation ended in the winter, which was once known as "the smallest but full of soul" of the bar. In fact, the omen early, the owner of Jack in an interview the year before the boredom of chatting, "once the store, people will be set to die here, can not go anywhere, has been ten years, do not want to set again."
One side of the market is the rapid sinking of high-end beer, a large number of craft beer imports, forcing local factories such as Tsingtao, Snow also joined the fray, have launched a high-end series; the other side of the influx of hot money, but the market volume growth is slow, China Craft Beer Competition (CCBA) data show that: China's craft beer industry annual growth rate of up to 40%, however, consumption of less than 1% of the overall beer market.
One of the most important things is that we have to be able to make the best use of our resources.
What happened to the once "fiery" craft beer?
"There is no industry standard for craft beer in China, and the influx of players is bound to result in a flooded market with a mixed bag of fish and dragons." Senior craft beer observer Yin Jie told the first financial, "For example, the wholesale price of ordinary beer 3 dollars, as long as the 'craft brewing' label, the retail price can be at least two or three times, but the quality is still the original, the average consumer can not identify, may feel that the craft brewing is just like this, that the market is doing bad! That will make the market bad."
At the end of the 19th century, the wine trade was quite prosperous, the market was once rampant counterfeiting, in order to protect the interests of the industry, to the formation of the first half of the 20th century, led by France's naming regulations of the geographic regions, and later became the international standard of the wine industry. Yin Jie believes that, similar to the process of establishing industry standards for wine, China's craft beer is now experiencing a turning point. "The self-elimination of craft beer has already begun, and just following the trend won't do it for long. Almost just this one or two years, there will be a big wave to leave some (brands), and then every year will come in some, and then benign elimination."
3 yuan to 30 yuan, breaking the curse of cheap
In China's beer market is China Resources Snow, Tsingtao, Budweiser, Yanjing and Carlsberg five oligopoly before the division, there has been a "blossoming" years.
Yin Jie was born in 1980, and in the 1980s and 1990s, Shanghai people's dinner tables were dominated by local beer brands - Shanghai, Donghai, Lippo, Bright ...... - and now only Suntory remains. In his father's generation, you can still drink Jardine Matheson Beer, founded in 1933 by British businessman Jardine Matheson, with a wide range of product lines from yellow, dark and red beers to wort drinks fitness dew.
"There used to be a lot of specialty beers, like Yangzhou Jasmine, Shanghai Dianshanhu, and Wuxi Taihu Water, which have now been bought out. That's why some people say that foreign beers have various flavors and Chinese beers have one flavor." Yin Jie is a bit sorry. The rapid development of China's beer industry began in the 1970s and 1980s, with the help of a series of national preferential policies, mainly led by the local government, the introduction of technology and equipment. In its heyday, there were more than 1,000 beer brands in China. However, around the turn of the millennium, the beer industry entered a period of consolidation and expansion, and the gradual formation of light-colored lager (Palelager) based on the industrial style of beer, manifested in the taste, is light and slightly bitter.
Relying on this single type of characteristics, from 2002, China's beer production surpassed the United States, jumped to the world's first. In contrast, pricing has hovered at three or four dollars per liter for years.
"In China's traditional alcohol culture, beer has always been non-mainstream, originally imported, and unlike wine there is hype, so many people feel that it is synonymous with cheap, can not be on the stage." Yin Jie believes.
China's accession to the World Trade Organization (WTO) in 2001, the positive entry of imported beer, began to break the spell of this consumption. 2010 Shanghai World Expo, Yin Jie in the Australian Pavilion was a "Victoria Bitter Beer" attracted the price of up to 40 yuan, did not expect a mouthful of unprecedented rich taste. He was attracted to a "Victoria Bitter Beer" at the Australian pavilion during the 2010 Shanghai World Expo, which cost as much as 40 yuan, and was surprised to find that one sip had an unprecedentedly rich flavor. He has drunk more than 3,000 kinds of beer, collecting more than 5,000 bottles and more than 3,000 caps, and people in the circle call him "beer hunter".
At first, Yin Jie could only go to the imported supermarkets to try his luck, a small amount of German beer, a smaller amount of Belgian beer, as well as other sporadic models, almost all that could be found at that time. Until he was in Zhaozhou Road, "Jack's Dimples", "unlocking" the culture of craft brewing. This unassuming small bar, in addition to not say the name of the various colors of beer, the wall is decorated with posters of beer from various countries, the top light is a bottle transformation, warm light lined with this husband and wife store cozy and special.
"I was taken to the store for a drink by a friend in 2008, when it was still next door to the next door, only half as big as it is now, with one table, two freezers, six chairs, and a long thin passage of about 20 meters." Linlin, president of the Shanghai Craft Beer Association, is another drinker at Jack's Dimples, "I'll never forget the first bottle of Blue Zimmer I drank. I was shocked at the time, how is this a beer?"
Obvious malt flavor, prominent floral and fruity aroma, soft and sweet in the mouth, fading out in turn to a light bitter taste, this classic Belgian abbey beer from the Chi Mei brewery was founded in 1863, but also Europe and the United States of America in the best-selling models of craft beer. 2007, with the help of the background of the import trading company, "Jack's Nest" in more than 20 square meters, the company has been the first time in the world. In 2007, with the background of an import trading company, "Jack's Nest" introduced more than 60 different kinds of craft beer in a space of more than 20 square meters. In order to allow customers to drink fresh flavors, a draft beer system was developed, with taller freezers and additional taps.
Whenever a craft beer bar opened, the owner would come here to learn from the experience, and there was a long line of "pilgrimage" drinkers at the door. In the following ten years, such a bustling scene has been recurring in major cities across the country, from Beijing's Ox Beer Hall, Beijing A, and Panda Brewing, to Nanjing's Gao Masters, Wuhan's No. 18 Tavern, and Chengdu's Harvest. Shanghai's Fahuazhen Road, a sale of imported beer to start Hai Fu convenience store, known as "Beer Auntie" boss Zhang Yindi, quickly stood on the wind, the business from more than 20 square meters of cigarette and paper store to expand to have five stores "Beer Auntie", the largest of which is the Baoshan branch of the 8,000 square meters. The biggest one is in Baoshan, where there are more than 8,000 kinds of beer, which can be used by tourists.
Yin Jie and Linlin were among the earliest customers of "Beer Auntie", and had a good personal relationship. According to Yin Jie observed, "'Beer Auntie' of several stores are very good business, 35 to 55 yuan price point of the best selling, mainly wheat beer." In the industrial beer generally struggling with the low price of 4 yuan a liter, imported craft beer can charge about 10 times the range, which has become a huge temptation to stir the market.
Strife in the craft beer market
2012 is generally considered by insiders to be the first year of craft brewing. One important sign is that craft beer has finally been standardized as craft beer after going through direct translations such as homebrewed beer and craft beer. Relative to the bland style of industrial beer, craft brewing is like reopening the door to the world of beer, with the smoothness and fluidity of IPA (India Pale Ale), the thickness and sweetness of Saito, and the intensity and intoxication of Abbey.......
During this period, in addition to a handful of pubs that have the ability to brew their own beer, craft beer was mostly imported, and began to Boutique supermarkets and bars to meet the potential demand of some high-end and emerging consumers, while making up for the lack of diversification and personalization of domestic beer. Data from the Beer Branch of the China Alcoholic Beverage Industry Association shows that from 2012 to 2014, imported beer grew explosively for three consecutive years, with a cumulative growth of 426.81%. This trend has attracted public attention.
Beer poured too fast, a surge of foam quickly overflowing, difficult to control.
In Yin Jie impression, some imported beer under the banner of craft brewing, in fact, just change the name to pretend; there are also some small workshops, directly rushing to the money, in fact, is to hang sheep's head to sell dog meat. "There are too many craft beers on the market, and some wine merchants don't care about it, so it becomes a clinical wine."
Craft beer is ill-defined in China, and the lack of industry standards largely contributes to the confusion. In the United States, the birthplace of modern craft beer, the American Craft Brewers Association (The Brewers Association) has strict limits on craft brewing: annual production of no more than 6 million barrels (about 700,000 tons); the brewery is not or less than 25% of the shares are controlled by non-craft breweries; and no adjuncts are used to brew in more than 50% of sales. And in the unofficial criteria of the China Craft Brewers Association (CBAC), which was founded in 2017, annual production is limited to less than 20,000 tons and no shareholders in non-craft breweries.
"Ninety-nine percent of the craft breweries in the United States don't produce more than 10,000 tons a year, so the 20,000-ton figure is not going to be exceeded by anyone for quite a long time to come for Chinese craft brewing. The big breweries in China are producing hundreds of thousands of tons or more, and setting the threshold here is kicking out the big breweries and protecting the small ones." Linlin explained.
However, at least until the state introduced the industry standard for craft beer, the chaotic market will continue, local brands need to adjust to adapt as soon as possible. Shanghai's Boxing Cat has been participating in international events since 2011, and in 2016 won a silver medal at the prestigious World Beer Cup with an amber-colored lager called "Red Ring," so far the best result in China. best result so far in the country. "It has a toffee sweetness and a stronger malt flavor, it's a refreshing and smooth lager without a lot of layers not a complex model." "Boxing cat" one of the founders of Zeng Jianping to the first financial introduction.
"In the early years of the Chinese market is relatively chaotic, some people like to use marketing to promote, but the medals can give consumers trust, improve the sense of identity; through the competition, but also allows the international community to recognize China's craft brewing." Tseng Chien-ping was born in Taiwan, China, and grew up in Canada. He said that when he first started to figure out how to run a craft brewery bar, he hated to hear that "there is no good beer in China".
Compared to industrial beer, craft beer is a marvelous collision of water, malt, yeast, and hops. Modern beers are much more liquid, but for craft beers like IPAs, which seek fresh flavors, the use of hops is about aroma and bitterness. "To make craft beer in China, the core ingredients are dependent on imports, especially hops for different styles, and there is no good choice. At present, the country is only willing to grow a few varieties that big breweries want, and is not willing to invest for the sake of a niche market." Zeng Jianping said.
Shortly after the acquisition of "Kaiba", "Boxing Cat" was also Budweiser Group in the bag, backed by 60 million yuan of new Wuhan craft brewery plant, "Boxing Cat" The bottled beer and draft beer of "Boxing Cat" are constantly being sent to big cities. "Craft brewing styles on the market start at more than $8 for a small 350ml bottle or even smaller. The cost of ingredients is transparent, so if the pricing is lower, then something must have been sacrificed." Zeng Jianping said, "The price of craft brewing is not that expensive in the first place, the best craft brews in the world are a few hundred dollars a bottle, so it's not a wine that you need to worry about the price."
Sinking into the second and third tier, towards the local
In January this year, Dingxi Road, "open bar" in the empty shutdown for half a year, in the name of "boxing cat first game tavern" redecorated open!
"Currently, small bars are run by soulful people, we now want to try, let the wine as a product, without soulful people, to see if the guests are interested in contact with craft beer in such a place." In Zeng Jianping's vision, the relatively asset-light business model of "Boxing Cat's First Game Tavern" can accelerate the pace of sinking into second-tier cities. Linlin also has a similar view, he believes that in the past two years, the growth of China's craft beer in the second and third-tier cities, "if you do not go to seize the second and third-tier cities, it is impossible to develop.
Linlin's other identity is the chief product officer of Laibao Craft Brewing, but before he came to Laibao in 2014, the company had already gained a foothold in the craft brewing scene in Jiangsu, Zhejiang, and Shanghai with its self-produced stainless steel bottled fresh beer. The backstory is actually slightly bitter, because they could not afford to buy expensive glass bottles of beer filling line, the cost of ten dollars a stainless steel bottles became the team's desperate choice, but the good thing is that the end is satisfactory. With the help of a hit brand image, Lai Bao has received two rounds of investment in 2014 and 2015, updated the brewing equipment, paving the way for food and beverage and super channels.
Supermarkets, e-commerce, bars, these important scenes of beer culture dissemination, experience and consumption, have always been the place where craft beer must fight and the main battlefield. For Lite-On, which specializes in marketing and promotion, designing different brews for different scenarios is the first opportunity to seize the market. For example, in order to take care of the sweet taste of young people, in 2015, it launched the "black rabbit" series, wheat beer as the base, adding fruit juice mixed fermentation, "drink like a fruit-flavored beer", compared with the stainless steel classic series that can easily be 30 or 40, the price of 13 yuan is also easier to channel. The $13 pricing also makes it easier to channel down.
"One direction that Chinese can go now is to do flavor-enhanced beers and special grain beers." Linlin argued.
From its inception, one of the main reasons why craft beer is so sought after is that it can add almost anything to the base of water, malt, yeast and hops, "there is no flavor you can't think of, no flavor you can't make". "Lai Bao" has tried to use magnolia, peony flower flavor, "boxing cat" with ginger to add sweetness, pepper to remove greasy, "cow beer hall" oyster Shitao is sweet and salty.
Linlin used IPA as an example, in the craft brewing world, IPA is a basic style, currently the United States has been derived from the black IPA, white IPA, red IPA, cloudy IPA, champagne IPA, made a lot of subdivisions on the basis of the foundation, it is because of the potential market. "In China, you just have to make a certain market volume for a relatively new style, and you should be able to count it as a success, both in terms of reputation and profit."
Although China's beer production has continued to decline since reaching a high of 50,615,000 kiloliters in 2013, in terms of per capita beer consumption, China is only slightly above the world average, and below its Asian neighbors, South Korea and Japan. According to Linlin's projections, with reference to the US craft brew sales contribute 12.7% of the overall beer market sales. This figure in China is expected to climb from 1% to 10%.
One piece of good news is that, according to a report last year by the American Craft Brewers Association, the U.S. craft brewing market is trending smaller and more local, meaning that consumers may prefer smaller, local craft beers. Drinking local beer has become an increasingly important thing.