The number of Irish breweries producing their own product has more than quadrupled since 2012, from 15 to 72, according to a new report published by the Drinks Industry Group of Ireland (DIGI). This quadrupling has led to a total increase in microbrewery turnover from €8 million in 2012 to €52 million in 2016.
Brewers, distillers, cider producers, pubs, restaurants, hotels and off-licences are supporting and growing economic activity in Ireland, spread widely across the country.
14% of Ireland’s breweries are located in Cork, followed by 10% in Dublin, and 7% in each of the counties of Galway, Wicklow and Donegal. Every county in the Republic, bar Westmeath, has at least one brewery.
DIGI published its "Innovation and Entrepreneurship in the Drinks Industry" report, authored by DCU economist Anthony Foley, to mark the launch of its annual "Support Your Local" campaign, an initiative designed to demonstrate of the importance of drinks and hospitality industry businesses to the economic, cultural and social fabric of Ireland.
Growing fast
The Irish drinks industry is Ireland’s fastest-growing manufacturing industry in terms of number of enterprises. Whereas the number of enterprises in the overall manufacturing sector has increased by less than a percent since 2008, the number of drinks industry enterprises has grown by 105%. In comparison, the number of enterprises in the second fastest-growing manufacturing industry, food, grew by 28% in the same period.
The Irish drinks sector is experiencing growth across the beer, cider and spirit categories. In 2013, there were just four working whiskey distilleries in Ireland. By 2017 there were 18, and there are plans for another 16. Ireland’s gin sector, too, is attracting worldwide interest and plans to treble its exports to 400,000 9-litre cases by 2022. The number of licences granted for cider production increased from three in 2009 to 18 in 2017.
Donall O’Keeffe, Secretary of DIGI and CEO of the Licenced Vintners Association, commented, “Our drinks industry has proven itself extremely adaptable to ever-changing tastes in consumer behaviour. Manufacturers, large and small, have diversified their offerings, experimented with new ingredients and recipes, and developed lucrative commercial partnerships at home and abroad.”
In response to changing consumer tastes, pubs and off-licences are fostering their own culture of modernity and experimentation. Nearly three-quarters of pubs have refurbished their premises in the last three years.
Many breweries and distilleries are developing visitor centre facilities, increasing product awareness among local and international consumers, and opening up additional revenue streams. In a survey of 50 microbreweries, eight already have their own visitor centre facility in place. A further 36 have plans to develop one. The Irish whiskey industry, meanwhile, envisages Ireland becoming the global leader in whiskey tourism by 2030, overtaking Scotland.
Many off-licences host wine and spirit tasting events, encouraging customer loyalty and improving knowledge of, and appreciation for, Ireland’s diversified drinks market.
Challenges ahead
O’Keeffe believes that the industry’s rapid growth, especially the potential for scaling up the many new enterprises, will be challenged by current global trade considerations and our uncompetitive alcohol excise tax policies.
He stated, “The drinks and hospitality industry is one of Ireland’s bedrock industries. In rural Ireland in particular, where less developed infrastructure inhibits the creation of high-tech jobs, the drinks industry has provided a way for smaller communities to support economic activity, innovation and entrepreneurship.
“If the drinks industry is to flourish into the future, it needs as few barriers to trade as possible. Right now, our own excise tax is a barrier. Compared to other EU states, Ireland’s is the second highest overall: we have the highest excise tax on wine, the second highest on beer and the third highest on spirits.
“In a challenging international economic environment, with Brexit and growing American protectionism, export development must be supported by a strong market at home. This starts with ensuring that policy measures support growth and we must prioritise reducing the tax burden on Ireland’s fastest-growing manufacturing industry by lowering excise on alcohol.”
© 2018 Hospitality Ireland – your source for the latest industry news. Article by Dave Simpson. Click subscribe to sign up for the Hospitality Ireland print edition.
