Coopers raises glass to better class of beer
It comes as the South Australian-based Coopers, the nation's largest locally owned brewer, bucked the trend that has seen beer drinkers abandon their schooners for wine and alcopops, to post record beer sales of 69.7 million litres in the 2013 financial year.
Tim Cooper, the managing director of Coopers, said SABMiller's revamp of Foster's flagship VB beer and a relaunch this month of Crown Lager would bring excitement back into the broader beer category to the benefit of all players.
"From the point of the view of the overall market it's good, because we are also competing against wine and RTDs [ready to drink]. Even though they could take some of our market ... it's good for the overall beer industry to grow the segment," he said.
SABMiller has quickly gone to work to resuscitate Foster's flagging sales since it purchased the Australian brewer in 2011 for $12.3 billion, lifting the alcohol content of VB back to its historic level after a reduction angered loyal fans and freshening up other brands in the portfolio.
"I tasted the new VB, which I think is certainly an improvement," Dr Cooper told BusinessDay. "SABMiller are very passionate about brewing and the wholesomeness of their brewed product globally, so I think they are taking a long-term view to try to increase the beer credentials of their flagship products," Dr Cooper said.
He said his brewery would benefit from a restoration of the beer segment in Australia as the market had seen volume declines as high as 4 per cent since 2009-10 as part as a prolonged slide.
"We are in our fourth year of market decline now. The decline is slowing but we are still seeing a decline of 2 per cent across Australia. We need to appeal to the younger drinker who might otherwise be drinking RTDs or be interested in wine."
The takeover of Foster's has also benefited Coopers' brewing business more directly. A number of global labels have left the Foster's camp since 2011 to seek new local partners, with the family-owned Coopers winning a distribution deal with the world's fourth-largest brewer, Carlsberg.
The Carlsberg deal, along with new licence arrangements with brands such as Sapporo and Kronenbourg 1664, helped drive the majority of Coopers' 8.3 per cent rise in beer volume sales for 2012-13.
Its partnership with Japanese brewer Sapporo generated a near-100 per cent lift in sales in Australia last financial year to 1.2 million litres.
Dr Cooper said despite tough trading conditions, the brewer had now averaged 9.8 per cent growth for the past 20 years, enabling the company to emerge from being a largely South Australian-based brewer to a national company.
Frequently Asked Questions about this Article…
Coopers Brewery posted record beer sales of 69.7 million litres in the 2013 financial year, helping cement its position as Australia’s largest locally owned brewer.
SABMiller’s work to restore VB’s historic alcohol level and refresh other brands, along with the relaunch of Crown Lager, brought renewed excitement to the beer category — a boost that industry players like Coopers say can help grow the overall beer segment.
Coopers says fresh ideas are needed after several years of shrinking volumes; revamps of major brands can revive interest in beer, make the category more competitive against wine and RTDs, and ultimately benefit all brewers by growing the market.
The article notes a prolonged slide in beer volumes: declines as high as 4% since 2009–10, with Coopers describing a fourth consecutive year of market decline and a current national decline of about 2%.
Coopers’ distribution deal with Carlsberg and licence arrangements with brands like Sapporo and Kronenbourg 1664 helped drive most of the brewer’s 8.3% rise in volume sales for 2012–13; the Sapporo partnership alone lifted sales in Australia to about 1.2 million litres.
After Foster’s was taken over, several global labels sought new local partners — an opportunity Coopers capitalised on by winning a distribution deal with Carlsberg and securing licence arrangements that expanded its national footprint.
Despite tough trading conditions, Coopers has averaged about 9.8% growth over the past 20 years, a performance that transitioned the company from a largely South Australian brewer into a national Australian business.
Coopers believes the sector needs to appeal more to younger drinkers who are choosing RTDs or wine, while larger brewers taking a long-term view to improve product credentials and refresh flagship brands can help revive the broader beer segment.
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