2023-05-29 08:02:43
The microbrewing industry here has been experiencing rapid expansion for twenty years, but the trend is starting to run out of steam. As raw material prices rise and the market becomes more competitive, Quebecers are abandoning beer in favor of other products, discouraged by record prices. Some businesses even had to close.
“The current situation is not easy, admits Marie-Ève Myrand, general manager of the Association des microbrasseries du Québec (AMBQ). The aging of the population is reducing consumption. Rising production costs and rising interest rates also have a major impact on prices. »
Karl Magnone, president and founder of specialty store chain Tite Frette, says the past few years have been particularly difficult for retailers. He observes that the average bill for his customers has dropped by $3 compared to last year. “Unlike grocery stores, we feel the repercussions of inflation, because 95% of our sales come from beer. »
One of its franchisees on rue Sainte-Catherine, in the Village, recently closed up shop. If Mr. Magnone specifies that the district represented a particularly difficult market, he adds that the current economic context has not helped.
Unlike grocery stores, we feel the repercussions of inflation, because 95% of our sales come from beer.
Popular microbreweries suffered the same fate. In January, the Cap Gaspé brewery closed due to rising production costs. The Vrooden company stopped brewing beer in the fall of 2022 to focus exclusively on the production of rice alcohols, citing a saturated market.
Fierce competition
Both brewers and retailers face increasingly fierce competition. The AMBQ website lists 324 brewing companies in the province, compared to 33 in 2002. “Sixty others are waiting for permits, as we speak,” says the director of the association. .
Mme Myrand maintains, however, that this additional pressure on brewers should not affect their turnover unduly. She also claims not to have accounted for the overall turnover of the industry. However, Patrice Comtois, the sales manager at Lagabière, a microbrewery in Saint-Jean-sur-Richelieu, assures us that the AMBQ told him that the revenues of microbreweries here were down 15% compared to the last year, what Mme Myrand denies.
Anyway, Statistics Canada published a report last February that the sale of beer in the country had reached “an all-time low”. “Total beer sales by liquor boards, their agencies and other retail outlets decreased 0.7% to $9.1 billion in fiscal year 2021-22. This is the third annual decline in a row,” the document said.
What’s more, the floor price of beer has doubled in 2023 compared to the previous year, when we had already recorded a record increase.
“Difficult” consumers
Kamar Boudemlij, general manager of the Benelux brewery pub in Verdun, regrets that rising beer prices are discouraging potential customers: “Some brewers are using more and more expensive ingredients. They normalize paying seven or even eight dollars for cans of IPA (India Pale Ale). »
In order to take the pulse of the brewing community, The duty went to the Mondial de la biere in Montreal, which was held in May. The president and CEO and co-founder of the festival, Jeannine Marois, said she was “confident” for the future, but lamented that consumers were becoming “more and more difficult”.
“People want the best on the market, but they buy less,” she said. At the same time, the industry has grown so much in recent years that it’s normal for the market to slow down a bit today. »
“With rising prices and market saturation for certain styles of IPA […], I try fewer and fewer beers,” laments Mathieu Alary-Fortin, a microbrewery beer lover who works in the restaurant industry. Miranda Nisenson, an arts student, agrees: “These days, I just buy mic beers for special occasions. »
A diversified offer
Karl Magnone explains that, to survive, companies must now “diversify” their offer. “Since our foundation, in 2018, we have started selling wines, ciders and other local products. We also offer more non-alcoholic beers. And to differentiate from [grandes surfaces], we sell certain beers exclusively. For example, Lagabière beers are popular everywhere, but we sell one made to measure for our stores. »
Patrice Comtois, the sales director of Lagabière, met at the Mondial, is also betting on a more varied offer. “We are now producing seltzersfour non-alcoholic beers and more beer styles. […] Unlike other brewers, we were able to keep growing. »
It is such strategies that ensure that, according to the most recent data from the AMBQ, “75% of microbrewers remain optimistic” for the future, maintains Mme Myrand. So, microbrewery beers may not be as popular as they used to be, but microbreweries and retailers should still do well.
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