Six months on from the Practice Excellence Conference, AccountingWEB caught up with Justin Hawke of the Moor Beer Company to find out more about planning and forecasting for growth.
In the run up to the PEP conference, we found out how business advice from their accountant had transformed the Bristol-based ‘Drink Moor Beer!’ business.
Here we look at their international ambitions and what they’re doing to handle that expected growth in the months ahead.
According to Hawke, effective planning and forecasting is a really difficult thing for a business going through rapid growth, especially one that is heavily dependent on raw ingredients that vary in availability and quality from year-to-year.
“We look at historical performance, order book, opportunities and try to temper it as best we can with what we think our customers will want in the future,” he said. “We’ve also got to plan space, personnel and equipment to sustain our growth. It is very difficult to get right, but we do our best!”
On whether the brewing industry demands effective forecasting, Hawke said at the small, artisanal level of brewing, forecasting was not quite as critical because most of their customers are small and flexible.
However, he also said: “If we are out of a specific brand of beer they are probably happy to take one of our other beers as a replacement. But as we are getting larger, more strategic customers rely on our beer for the success of their businesses, so it is becoming more important to hold accurate stock levels for them.”
The craft beer and modern real ale market has exploded across the UK in a relatively short space of time, and as with any fast-growing business vertical, multinationals are keen to grab a piece of the action.
Following AB InBev’s takeover of Camden Town Brewery at the end of last year and a spate of other similar deals, a lot of large brewers have expressed interest in the burgeoning small and micro-brewery market.
Hawke said the passionate artisan in him feels a bit betrayed when a company “sells out”, but admitted that is a short sighted, emotional response.
“I see both sides of the coin. Some of the companies (particularly in the US) that have been selling have been around a long time. The owners have either realised they are not best positioned (economically or strategically) to take their businesses to the next level, or they are nearing retirement and looking for an exit strategy. Both of these are honest and valid reasons to sell the business. If you let your ego get in the way you’ll damage your business which hits everyone - suppliers, employees, customers and consumers,” he said.
He added that having the knowledge and maturity to know when to step away was actually a good thing, not at all a sign of weakness.
“The key thing is for the business to maintain its heart and soul post-acquisition. That’s what consumers are emotionally attached to. If you lose that then you deserve to lose your customers as well. Of course there are always disingenuous people who only ever got into this because it was trendy. Seeing them go is no bad thing either.”
About Robert Lovell
Business and finance journalist