Brewdog feels cost crisis bite hardest in UK

BREWDOG founder and chief executive James Watt says Britain was hit hardest by the cost-of-living crisis out of all the countries it operates in.

Speaking at the launch of his Dragons’ Den-style competition for entrepreneurs, Watt said Brewdog’s home market appears to have been “way more affected” by the inflationary squeeze on consumers and businesses than other countries.

Brewdog’s beers are available in more than 50 countries and it has 118 bars in the UK, the US, Australia, China, Japan and India, as well as France, Germany, and other European countries.

The craft beer pioneer said the operating environment for consumer-facing businesses is tougher than it has been in years. The cost of producing its signature Punk IPA beer has risen by more than a third, and it has had to take cost-cutting measures across the business. “All our costs have gone up – energy, staff, water, carbon dioxide, aluminium. It now costs 34 per cent more to make Punk IPA,” Watt said. “Rising costs mean we’ve had to do things like take sweet potato fries off our menus because the price has risen six-fold.we couldn’t charge £20 for a bowl of fries.”

Brewdog has been looking at staging a £1billion-plus stock market flotation for a number of years but the company had to put it back first due to Covid and then the cost-of-living crisis. “It would have happened by now but for those factors,”watt said.

Despite economic uncertainty, he said Brewdog is pressing ahead with its expansion plans. Aside from opening new bars in Hong Kong, the US, and Australia, it is looking at building two new breweries in Asia and the West Coast of the United

States to serve those markets. Brewdog currently has four, its primary brewery in Elon, as well as Berlin, Brisbane and Columbus, Ohio.

Last week, Watt teamed up with crowdfunding website Crowdcube to launch a Europewide competition, The Next Unicorn, where entrepreneurs can win a share of £5million.

The web series is looking to unearth potential unicorns, startups that grow to be worth at least $1billion (£808.8million). While it will largely follow Dragons’ Den’s format, viewers can back the companies featured on it through Crowdcube.

The three winning companies will split £5million and be mentored bywatt, and have access to his business contacts. He was inspired to launch the competition after being rejected as a potential judge on the BBC show, as well as when Brewdog was turned away from the show in 2009.