Are all the craft brewers going to be bought by the big guys? Garage Project’s Jos Ruffell tells Duncan Greive that, despite the sale of Panhead and Tuatara, they’re doubling down on the independent route.
A couple of weeks ago it was announced that Tuatara had been sold to the Heineken-owned DB Breweries, the latest in a trickle of acquisitions of the second wave of craft brewers by the major beer companies. Lion made the early running, with first Emerson’s and last year Panhead. The Tuatara move suggests that trend is likely to continue especially given the hefty rumoured price tag – north of $30m (the figure was not disclosed).
On the same day, in an announcement which seemed pointed in its timing, Garage Project was announced as the foundation brewer at bStudio, a new independent contract brewery in the Hawke’s Bay. When added to the wild yeast brewery they’ve opened on Marion St in Wellington, it suggested that Garage Project is planning on bucking the acquisition trend for the time being at least.
This will please its fans. The Aro Street brewery has acquired a cult following for its commitment to experimental brewing, something that seems unlikely to mesh well with a major brewer’s ambitions. Sometimes it goes wrong – I did not particularly enjoy the Umami Monster I bought a few years back, which listed fermented tuna among its ingredients. But mostly its a pure joy, shocking and awing with flavours riotous and subtle and ceaselessly creative.
I wanted to know what Garage Project’s Jos Ruffell thought about the Tuatara deal, and called him up – he was on the road at Sierra Nevada’s giant Mills River site when we spoke – to talk about the growth, potential and problems of the exploding New Zealand craft scene.
What’s your reaction to Tuatara sale?
It had been rumoured for quite a while – so it wasn’t a complete shock. I think also when you look at it, Tuatara had taken on private equity funding from Rangatira. And at some point there has to be a return on that investment. So a little bit of disappointment, but also, knowing Carl [Vasta, Tuatata’s head brewer] and the team there – he’s been in it a long time, so I’m happy for them. But on the other hand, a bit of a missed opportunity.
Missed opportunity? In what sense?
We’ve seen the industry develop and grow in strides, and breweries like Tuatara have definitely been at the vanguard of that. So by being acquired, it just adds that little bit of confusion back into the market again. People might think they’re drinking an independent brewery’s beer, not realising it’s owned by a multinational. Then there’s the smaller pieces – Tuatara have put a lot of taps into bars and venues, where the venue might not otherwise have had a tap. Some of those are independent taps – but now they’re tied to Heineken and DB. So it’s a step back in that direction, with more tied taps in New Zealand than there were previously.
When it’s already hard to get into certain types of bar, does this re-consolidation with the likes of Tuatara and Panhead make it more difficult for the independent scene?
Absolutely. We don’t bash big breweries. You look at what they do, and on one level it is remarkable – Pete [Gillespie, Garage Project co-owner and head brewer] used to brew at James Squire, which is a Kirin/Lion Nathan owned environment, and learnt a lot from them. But we’re big on choice for people. And for us, the best way to do that comes from independence – from transparency about what your beer is, and where it comes from. For us, with consolidation, it is a step back towards where things were previously. Which wasn’t great. There wasn’t a lot of consumer choice.
Have you been approached?
I think it’s fair to say that if you’re a brewery doing interesting things or have created a following – you’ll struggle to find one which hasn’t been approached. Not just in New Zealand and Australia, but around the world. The larger breweries are definitely seeing a dwindling market share, and a pretty significant growth in craft, and they’re looking to address that. It doesn’t take much for a larger brewery to “float an idea” to a smaller brewery. So I think you wouldn’t find many breweries which hadn’t been approached or probed.
What do you do when they come calling?
We have an open mind about where the brewery, where the Garage might go. But we started it to be nimble and light-footed and to move in different directions. But while we’re always interested in what ideas people might have, it’s nothing we’ve explored very deeply.
One of the sweet things about craft brewing is that the consumer feels like they have a stake in the business – in the case of Parrot Dog, that’s a literal stake. Is that a weight on you, or does it pull you along?
We get to do what we do because of our fans. We get real excitement and joy from working hard, coming up with an idea which we think is a bit ludicrous, busting our guts to pull it together, being quite nimble with how we put it out there. And just seeing that response. And that is a partnership, so to speak. We want a relationship with people who drink our beer. We want them to know who we are. People want to have a relationship with their food, their drink, their music, their media. We think that transparency is really important. Just being up front and honest about things. So if we ever got to the point where we thought we’d work better as part of a big brewery we’d want to be very transparent. That’s something we feel is often lacking in their announcements.
It seems telling that on the same day Tuatara announced their sale, you guys were announced as the first brewery going into bStudio.
It’s a good moment – not trying to steal the thunder of the announcement, just trying to reassure our audience, our fans, of what we’re about. bStudio came out of this vision, about 18 months ago, that we wouldn’t build our own production brewery in the foreseeable future. We never set out to be collectors of the most stainless steel.
Do you study the wine industry? If so, what kind of cautionary tales come out of it, or how instructive is looking back at its growth through the ‘80s and ‘90s?
Absolutely. And I think there are really strong parallels. There are also probably some pretty key differences as well. One being that our unique kiwi difference – our hops – can be palletised, vacuum-sealed, put on a boat and sent to other breweries all around the world. You can’t really say the same for Marlborough sauvignon blanc. I think we need to look at them for inspiration, for the way they’ve banded together, gone overseas and developed markets. And there’s some great examples of that – the family of eight independent family-owned wineries who share resources. But we’re just at the beginning stages of developing the beer market in New Zealand. I think you’re starting to see a bit more export, but there’s a lot more growth still to happen, and market growth and maturity to come within New Zealand.
The New Zealand craft beer scene has had a ‘hundred flowers bloom’ moment – but it feels like there’s been a creeping homogeneity amongst a lot of the breweries that have come up. The endless grunty IPAs, for example. What frustrates you, and conversely what excites you about the plurality of it?
The issues that the industry needs to work on and overcome are ones of quality and consistency. And that’s about training all the way through. Not just at brewery level, but at frontline bar and consumer level. There are breweries making bad beer in New Zealand. There are faulty beers that are sold. That the bars and consumers selling and drinking those beers don’t necessarily realise are not tasting as they should. We think that’s an area that needs a lot of work.
Having said that, we do have fantastic beer. That’s a great starting point. I think for the breweries starting out, it’s important to have your own voice, and have something to say. I think if you’ve got that and stay true to it you will be successful, you will get a following, you will carve out a niche for yourself in the market. There are a lot of breweries chasing one particular type of beer, two particular types of beer. One packaging format. And I think that type of competition is ultimately quite disruptive and destructive. I think it’s better for people to focus on what they want to do and not so much on what other breweries are doing.
What are the New Zealand breweries which do impress and inspire you?
I love Craftwork down in Oamaru. They’ve been brewing tiny batches, two types of beer – wonderful saison. Very unique beers. And they’re utterly passionate about it. Every time you drink one of their beers it’s an absolute joy. I had some beers a couple of weeks ago at the Queenstown beer festival from a brewery called Ground Up Brewing. They’re brewing 100 litres at a time, several times a day to try and make it happen. Really passionate and great quality, really enthusiastic. Great to see. All the way through to the likes of 8 Wired and Liberty, making a huge variety of beers – sour beers, hoppy beers, building out their own breweries. Both of them started either contract or small but ended up building out and building a team, with a real integrity about what they’re doing.
What do you see up in the US, and how does that inform your vision of what a mature craft beer scene might look like?
We’re really fortunate in that we do get to travel and get to meet brewers overseas, see what they’re doing, see how they’re pushing the envelope and be inspired by them. I think that’s healthy, and it’s great to see so much more overseas beer coming in, so that we get to try things – in the same way that people up here are excited to try New Zealand beer.
Disclosure: Garage Project supplies The Spinoff with beer for their Friday drinks. Duncan Greive’s uncle Howard is a shareholder.
The Society section is sponsored by AUT. As a contemporary university we’re focused on providing exceptional learning experiences, developing impactful research and forging strong industry partnerships. Start your university journey with us today.
Join The Spinoff Members for as little as $1 to help us hire more journalists and do more investigations. Or get a free Toby Morris-designed tea towel when you contribute $80 or more over a year.
The Spinoff Daily gets you all the days' best reading in one handy package, fresh to your inbox Monday-Friday at 5pm.