Is it time the BrewDog beer empire went flat?

Independent

4 days ago

When it launched in 2007, craft beer BrewDog was a 'punk' brand. It's a word that featured on many of the cans of its IPA sold at the Fontaines DC show at Finsbury Park earlier this month, and at summer festivals across the land. It's a sign of something young, cool, edgy.
What's not so cool is abruptly closing 10 bars, including BrewDog's flagship outlet in Aberdeen, some within a matter of days. 'Morally repugnant,' said the union Unite, which represents some of the workers whose livelihoods have been affected by the closures.
True, companies sometimes have to close outlets when they're losing money, especially if the wider group is in the red and really can't afford to be subsidising places that aren't washing their faces financially. That's the harsh reality.
But while that sort of decision is always going to hurt the workers on the receiving end, there are ways and means of handling these things.
Unite has raised questions about the firm's tactics, telling the BBC that this is: 'Yet another example of a company that doesn't have the slightest regard for basic employment law, let alone the welfare of their workers.' It says it is working with the affected workers to challenge the decision, legally if necessary.
BrewDog was an entertaining and innovative start-up that became a big success, planting its flag overseas and tweaking the nose of the establishment along the way.
It had an original way of garnering finance by creating 'equity punks' through crowdfunding. These supporters turned up at sometimes raucous AGMs. The group also had a keen eye for PR stunts. Its critics obligingly went into meltdown when the company launched nuclear-strength beers.
In recent years, however, the brand has acquired a coat of tarnish.
In 2021, former workers wrote an open letter highlighting what they claimed was a "culture of fear" within the business while alleging "toxic attitudes" towards junior employees.
The following year, a BBC investigation aired allegations of inappropriate behaviour on the part of co-founder and now-former CEO James Watt. These were denied. But Ofcom rejected a complaint made by Watt and the company against BBC Scotland on the grounds of 'fairness and privacy'.
It said: 'Ofcom's decision is that material facts were not presented, disregarded or omitted in a way that was unfair to the complainants, that they had an appropriate and timely opportunity to respond to the allegations made in the programme, and that their response was fairly reflected in the programme.'
Then last April, Watt – who publicly opposed Brexit – was pictured at Nigel Farage's 60th birthday party. Now, I want to be clear here: I really couldn't care less who his friends are, or whose parties he chooses to go to. Business leaders need to engage with all sides for the health of their companies. That's lobbying. It's silly to huff and puff when they do that.
But partying with a polarising figure that a large chunk of your customer base reviles is different. The optics are not good. It's a poor business decision. And it was only a few weeks after Farage's party that Watt stepped down from the top job at BrewDog, 17 years after he co-founded the Scottish brewer.
The company also decided to cease paying the real living wage, based on the cost of living, in favour of the lower rate mandated by the government, citing the need to return to profitability in a tough climate for the hospitality industry. For his own part, Watt has previously decried those who seek a "work-life balance", rather than what he called "work-life integration", suggesting that if you love you work, you don't need to separate it from your personal life.
Much of the hospitality sector has been swimming upstream, it is true. Its businesses have been grappling with higher taxes and costs while consumer confidence is at a low ebb. The country's economic challenges have also hit young people particularly hard. If your rent is gobbling up half your take-home pay, you're going to have to limit what you spend on going out. It's a lot cheaper to buy beer from Tesco and invite friends round than it is to meet up at BrewDog.
But one also wonders whether at least some of the company's problems are down to the damage the brand has taken. Brands matter. Companies pour vast sums into building them up. History also teaches us how easy it is to blow them up. If customers stop buying into yours because you've been shooting yourself in the foot and causing them to question your authenticity, then you have a problem.
No one would bat an eyelid if, say, Brexit-backing Wetherspoon's boss Tim Martin was spotted out on the town with Farage. Martin is who he is, and doesn't much care who knows it. He's authentically Tim. Is that true of Watt and, by extension, BrewDog, which he is still closely involved with even if he's no longer the CEO?
How much are you willing to pay for 'punk' beer that isn't really so punk? A beer that is, in reality, part of the establishment but expects you to pay a premium price that the local Wetherspoon's doesn't demand (far from it).
I suspect the answer isn't to BrewDog's taste.