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Good Beer Hunting

Mar 31, 2018

This week’s guest is Mike Benner, Chief Executive of the Society of Independent Brewers, or SIBA for short. SIBA is the largest UK trade body representing the independent arm of the British brewing industry. Founded in 1980 as the Small Independent Brewers Association, SIBA currently represents around 830 brewer members as well as around 300 or so non-brewing supplier associates. Its equivalent in the US would be the Brewers Association, and Benner’s equivalent at the BA would be its CEO and President, Bob Pease.  I recently attended the SIBA annual conference and trade show, BeerX, which also serves as its members Annual General Meeting. The meeting itself was full of fired up statements from some of the association’s smallest members. Folks who are feeling somewhat disenfranchised from an organization they feel should be helping them claw out some market share in an ever more competitive field but not delivering.  At BeerX a motion was proposed by SIBA to raise its threshold for membership from 200,000hl a year (just over 170,000 US barrels) to a figure that reflects 1% of current total UK beer production—just short of 440,000hl (or 375,000bbl). The motion was rejected by a slim majority, mostly due to the ire presented by the smaller members in attendance at the meeting. Had it passed it would have allowed two of the UK’s largest independent breweries, Fullers and St. Austell, to rejoin, after loosing their associate status, when this was scrapped in a similar vote in 2017.  This is one of many challenges Benner and his team at SIBA has to grapple with as it tries to meet the needs of its various members. Perhaps its greatest challenge is how these needs differ between its smallest and larger members. There just isn’t a one size fits all solution—and as SIBA attempts to evolve in a beer market that shows no signs of slowing down—trying to meet these varying needs becomes seemingly ever more difficult.  But if it wasn’t for SIBA, some of these very small brewers might not have had the opportunity to break into the industry in the first place. The actions of the association were key in the introduction of progressive beer duty or PBD—sometimes referred to as small brewers duty relief—in 2002. PBD meant that brewers producing less than 5000hl a year were eligible for a 50% tax discount on the beer they were producing. Once production is over 5000hl, the amount of relief is tapered until it hits 60,000hl, when a brewer will pay the full rate of tax on the beer they produce. As well as its trade association, SIBA also operates a commercial arm with. It launched a direct delivery service, now called BeerFlex, in 2002. This scheme allowed small breweries to sell to larger pub companies through SIBA. Recently, this scheme has been surrounded by controversy, as the pub companies continue push their prices ever lower, despite market conditions ensuring that the cost of beer production is rising. To compound these difficulties, SIBA recently acquired a distributor, Flying Firkin, to bolster its commercial wing, much to the ire of some SIBA members.  Finding a balance between its trade association and commercial arms is a challenge that’s been made all the greater by the emergence of hundreds of new brewers within the last decade—many of which feel that the association doesn’t represent them, and choosing not to become members. However, despite all of this relative uncertainty, Benner himself still seems positively upbeat. In fact he almost appeared to relish these new challenges as we sat down for this chat on the trade floor at BeerX a couple of weeks ago.