OnTap Magazine

A survey recently conducted by the Craft Brewers Association of South Africa (CBASA) shows that some craft brewers around the country have been gearing up for consumer demand, but the significant challenges facing the industry are a concern for small and independent brewers.   CBASA, an organisation consisting of small and independent breweries across South Africa, conducted the survey at the end of last year. The results are based on breweries’ experiences throughout the previous year. CBASA said that the survey provided a comprehensive snapshot of the South African craft brewing landscape in 2023.   Half of the brewers surveyed reported an increase in production year on year, and a further 18% of brewers said their production levels remained the same. About a third of the surveyed brewers expanded their production facilities in 2023, and 16% were already planning to expand production in 2024.   “The fact that most breweries havemaintained or increased sales during a period of high inflation with consumer spending under huge pressure is a clear sign that demand for craft beer by the South African consumer is increasing. That consumers are increasingly choosing to support craft beer is especially profound under the circumstances of beer as a category experiencing stalled growth,” says Rob Cass, the Gauteng Representative for CBASA.  Half of all sales made by small and independent breweries occurred with breweries selling directly to the end- consumer, whilst restaurant sales accounted for 34% of total sales. A further 14% of sales occurred at events and festivals. This underscores how important small and independent breweries are for the health of local tourism and the hospitality industry. Only 4% of sales occurred through large retailers.   “With the maturation of the South African craft beer industry, quality has become a prerequisite for survival - before considering success,” says Cass. This means that craft brewers often prioritise selling directly to consumers or through local restaurants, ensuring that their beer is enjoyed at its optimal quality.  Just under half of the brewers also reported an increase in income year on year, whilst a further 10% said income remained the same as in 2022.    But despite positive outlooks and notable growth, serious challenges persist. The brewers highlighted that regulations (22%), supply chain issues (21%), competition in the market (20%), and distribution challenges, exacerbated by high fuel and transportation costs in 2023 (20%), were among their primary concerns. Additionally, 13% cited various other challenges, including load shedding, economic constraints for consumers, and exchange rate fluctuations impacting raw material pricing.  “South African businesses have shown themselves to be resilient in the face of massive domestic and global challenges, and South African craft breweries are no exception. With massive pressure on discretionary spend for consumers, and the pressures of being reliant on global supply chains for key product inputs, for South African craft brewers to have maintained or increased sales is nothing short of miraculous,” says Cass.    The insights gained in the survey will aid CBASA in tailoring strategies and advocacy efforts to support and nurture this dynamic industry. The Association remains committed to addressing the identified pain points and fostering an environment conducive to the continued success of craft brewers across the nation. CRAFT BREWERS PREPARE FOR UPTICK BUT CLOUDS ARE ON THE HORIZON Photos Credits: Pexels 8 | Autumn 2024 | ontapmag.co.za