Breweries in Lower Saxony face a gloomy outlook due to elevated expenses and a slump in consumer spending. Two notable breweries, Friesisches Brauhaus zu Jever and Einbecker, have reported mixed feelings about the past few months. While the easing of coronavirus restrictions and the long early summer saw an influx of festivals and events, consumers have been tightening their purse strings and opting for cheaper alternatives.
Friesisches Brauhaus, part of the Radeberger Group, has seen sales surpass industry averages, despite challenging weather. However, the company prefers to keep exact sales and turnover figures under wraps. Einbecker Brauhaus, on the other hand, is operating at industry level. Though the beer garden season was slightly lower compared to the previous year, revenue growth has been encouraging.
Consumers are cutting back on spending on food and drinks, turning towards discount stores and their own brand items. Lifestyles remain far from pre-pandemic norms, with socializing outside still a rarity. "The market trend has left its mark on us," admitted Reitze, while Meiser, Einbecker spokesperson, referred to the mix of unfavorable weather and consumer restraint due to inflation as the culprit.
Breweries grapple with upsurging expenses in production, transportation, distribution, and marketing. Price hikes, driven by wage settlements and forthcoming increases in truck tolls, are expected. Einbecker also struggles with skyrocketing raw material and energy costs and complex supply chains. One of Einbecker's solutions to cut energy costs involves a 20% reduction.
Germany's beer sales continue to plunge, reaching a 2.9% decrease in the first half of the year compared to 2023. Industry watchdogs like Friesisches Brauhaus predict this trend of decline to persist in the medium and long term. Though the mixed nature of the past few months, with beer gardens as well as major festivals and events, offers some relief, both Friesisches Brauhaus and Einbecker are operating at or slightly below industry benchmarks.
While sales hover near the average, reveal uncertain revenue figures for both breweries. With these persistent challenges in view, production and sales are experiencing decreases, echoing broader industry trends. Breweries are reinventing themselves by focusing on sustainability, innovative products, and collaboration with startups to navigate this evolving market.
