DCSIMG

The Bar Man - Plenty of micro scope

When I was young my father was keen on motorbikes. I vaguely remember him having an Ariel or Panther and he would sometimes go on about Matchless, Velocettes or BSAs.

Most of these are now long gone, and it is the same with other products. Who now remembers Atari, Acorn or Dragon computers? Breweries also fit into this pattern.

Once there were many thousands, a large number of them based in pubs, but a few grew huge whilst the majority closed.

By the early 1970s only four home brew-pubs survived, The Blue Anchor in Helston, Cornwall, Ma Pardoes in Netherton, West Midlands, the Three Tuns in Bishops Castle and the All Nations in Madeley, both in Shropshire.

Why does this happen? If you want a detailed answer track down a copy of EM Hoover’s 1948 book The Location of Economic Activity, which is, in my opinion the best book written in the 20th century. The simple answer is economies of scale. It is cheaper and more profitable to make things in bulk. Raw materials can be purchased more cheaply in large quantities, it is more efficient to heat one large mash tun instead of lots of small ones and one person can press a button to control a machine that performs a million tasks as easily as one that performs 10 tasks.

However, brewing is unusual in that the main raw material is water, which Hoover would describe as ubiquitous, meaning that it is available almost everywhere at the same cost. It makes no economic sense to transport beer great distances as most of the costs are for carrying water around which could be obtained locally.

The optimum location for a brewery therefore is a choice between a huge mega brewery near good transport links and a small brewery in a pub. For years the large breweries were in the ascendancy, but when Gordon Brown was Chancellor of the Exchequer, he introduced a progressive beer duty which levied less tax on the first 60,000 litres of production. This idea shifted the economic balance and prompted the establishment of hundreds of small breweries and has been so successful that it has since been adopted in the USA and elsewhere.

It makes one wonder why similar schemes cannot be introduced to help support small manufacturers or retailers in areas and encourage small enterprises which may grow into larger companies in the same way as Sharps brewery in Rock, Cornwall. This was established as a microbrewery in 1994 and sold to Molson Coors Brewing Company in 2011 for £20 million.

Still, let’s be grateful for what we have. The four home-brew pubs are still going and some of their beers are now in the free trade and I had a wonderful pint of Three Tuns XXX recently. More excitingly, the small-brewery revolution continues to grow and I hear that there is a chance that the brewery that has been constructed at the back of the Crown and Mitre in Lynn will be in production later this year. Let’s hope this happens and that it is the first step to Lynn becoming a major centre of brewing again.

 

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