Marketing

Our fastest-growing manufacturing industry

Turnover at Irish microbreweries has risen by 650% from €8 million in 2012 to €52 million in 2016 as the number of Irish breweries producing their own product has nearly quintupled from 15 to 72 according to a new report published today by the Drinks Industry Group of Ireland.

This quadrupling has led to a total increase in microbrewery turnover from €8 million in 2012 to €52 million in 2016.

Some 14% of Ireland’s breweries are located in Cork, 10% in Dublin and 7% in each of counties of Galway, Wicklow and Donegal. Every county in the Republic, bar Westmeath, has at least one brewery.

The figures are contained in the new report by DCU economist Tony Foley which shows how high levels of innovation and entrepreneurship in all sectors of the Irish drinks industry are supporting and creating jobs – generating balanced regional development

DIGI published its Innovation and Entrepreneurship in the Drinks Industry report 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, has grown by 28% in the same period.

And this growth is being experienced 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 points out the report. Ireland’s gin sector, too, is attracting worldwide interest with plans to treble its exports to 400,000 nine-litre cases by 2022. The number of licences granted for cider production increased from three in 2009 to 18 in 2017.

“Our drinks industry has proven itself extremely adaptable to ever-changing tastes in consumer behaviour,” said DIGI Secretary and LVA Chief Executive Donall O’Keeffe, “Manufacturers, large and small, have diversified their offerings, experimented with new ingredients and recipes and developed lucrative commercial partnerships at home and abroad.”

Nearly three-quarters of pubs have refurbished their premises in the last three years.

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.

 

Challenges ahead

Donall 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.

“The drinks and hospitality industry is one of Ireland’s bedrock industries,” he stated, “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,” he concluded.

 

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