Although the craft beer industry faces quite a few challenges time and again from various government bodies which changes based on the state, India has witnessed a significant rise in the consumption of craft beer. The rise in demand for craft beer is a simple fruit of the efforts, time and capital invested by micro-breweries such as ourselves who focus on brewing the perfect craft beer in the market. Looking at craft beer as a segment in the larger beverage industry, there is huge potential for growth which is fuelled by latent demand that exists in India. At this moment, the craft beer segment is at a very nascent stage, not only do craft beers have a long way to go, but also a bunch of challenges to overcome. This segment is like a new born baby. It needs nurturing, care and support to grow to its full potential and this can only happen with the support of the government and the various agencies that regulate our sector. Only with their support will our segment flourish and create employment, help in the development of new skill sets & most importantly to allow our segment to grow along with our contribution to grow to fuel our countries growing economy.
While all of it may look like a big task and a long journey away, the most encouraging aspect of this segment is the reception we receive from the consumers. At Brewbot, we often come across first time craft beer consumers, that can’t come to terms with how they have been compromising on their choices by consuming commercial beer. In our experience we can proudly say that a majority of our customers who experience craft beer for the first time at Brewbot, find it hard to go back to drinking commercial bottled beers that are full of artificial sugars, additive and adjuncts that are used to produce them at a low cost and strongly believe thatthe future of craft brewing is extremely bright and filled with opportunities. In terms of operating and growing a business it almost feels that our nation is divided by boundaries. Not only do the languages and cultures change but also the laws with reference to craft brewing, change in every state. For a country that is driving ‘Make in India’, right now doesn’t seem to be on the same story for craft beers.
In my opinion, there are two major challenges the industry is facing at the moment:
- Consumers who choose to compromise on quality by opting to consume commercial beer instead craft beers, because of the cheap price-range
- Regulations that restrict the promotion of craft beer in the state or the country
These two challenges are big problems for the craft beer industry and they are also co-related. Large commercial bottled beer brands brew on a large scale using average quality materials that helps them reduce costs and make margins and profits. This strategy allows an organization to invest in marketing in in-direct ways which promotes the brand name through, sports entertainment, etc. Whereas, micro-breweries brew on a smaller scale and focus on much better quality products to make a new product that is much better and different than commercial beers. This does not work in the favor of micro-breweries as they cannot spend the similar amount of capital to do such indirect promotions. The regulations on marketing and creating proper awareness about craft beer, works against the rise of the industry simply because the people are unaware of how different is craft beer as a product.
The two solutions that I personally feel that are required; Government bodies allowing the right kind of promotion of craft beer, which is not entirely product-driven but also informative for the people and breweries coming together to tackle both the above mentioned challenges, especially to create awareness among people and get more people to consume craft beers. These solutions are essential for the growth of the craft beer segment, which does not seem unreasonable and more so is required, just like how wine in India, which as a sector was provided tax breaks/reliefs and other benefits to support their growth at that moment, is why the Indian wine market stands where it is today.
Also, craft brewers need unite in each state to market craft beer and spread awareness in their immediate localities and neighborhood through on-ground activations and events planned to promote craft beer through a formal organization. The only way to do so is to form organizations in each state where craft brewing is permitted so that we can work to achieve relief from regulations that are currently slowing down the growth of existing players due to current regulations and also creating a barrier to entry for new entrants into our segment.