View Full Version : Northern Beer Blog - Pubpaper 684 – The muck spreader that is the WaverleyTBS collaps

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18-11-2012, 19:11
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In the chain of the distribution between the brewer and the pub, beers can get to their destination in one of three main ways. *The first is direct from brewery to pub as is the case with many smaller brewers who mainly supply local establishments. *This works well when there is a regular route or small number of routes which a van can easily service.
The second is via a small number of “beer shuttlers” who take northern beer to southern locations and fill the return journey with southern beers for northern consumption. *There are similar beer trading routes all over the country. *It is one such local business which has brought the quality beers from the likes of Bristol Beer Factory, Titanic and Dark Star to our local pubs while delivering our quality beers to pubs in the south west. *The craft beer / small brewery sector has used this to great effect to spread their name and reputation without incurring any significant infrastructure overhead.
The last is via a distributor, who takes stock from many breweries to be stored centrally and distributed in mixed deliveries to pubs. *This is used more by bigger breweries as well as those same smaller brewers when they want to distribute outside of their local area. *The advantages of using such a company as a brewer is that you don’t have to concern yourself with the final leg of the journey to the pub. One large regular delivery or collection to a depot is all that is involved.
There are different types of distributors in the beer sector ranging from the specialist beer companies like James Clay based in Elland to the giants of the sector WaverleyTBS which supply beer, spirits, soft drinks, cider and more from hundreds of companies to a far greater number of outlets.
The downside of using such agents however is that a larger quantity of stock is out of your direct control. *If a pub fails to pay up for the goods delivered then you typically are taking a loss of less than 5 barrels, if a distributor fails to pay up then you could down by hundreds of barrels / kegs and thousands of pounds, with the risk of zeros being added to that amount as you move up the scale of brewing operations. *This is what has happened to the suppliers of the aforementioned WaverleyTBS who were left with a combined £40.5 million of stock unpaid for when the company collapsed last month. *The 200 affected companies are expected to get pennies in the pound back once higher priority debts such as HMRC have been cleared.
The creditor list has only now been released, and some of the liabilities left behind are quite staggering. *Diageo (makers of Guinness) were owed £6,000,000 while Heineken and AB Inbev (makers of Stella) were both owed around £4,000,000 each. *Even for a company that size it is still a lot of money. *However it is when you move down the list past the likes of Cola Cola, Red Bull and Britvic (owed between £500,000 and £1,000,000 each) that you see the range of small / medium sized producers affected.
Looking at the cider presses, Aspalls and Westons cider were owed close to £250k each, which adds up a a lot of lost bottles for such a company although not company threatening. *The medium sized brewers were hit all over the country with Fullers, Adnams, Marstons and Sharps taking a hit of between £100k and 200k. *Even distributors have been hit with the aforementioned James Clay being owed £64,000 for stock supplied. **The medium sized brewers should be able to absorb the loss without any risk to the company’s future, given profits of between £3m and £80m last year, as will Clay.
It is important to remember that beer is different to containerised soft drinks, cider and spirits as in its cask / keg form it is a product with a limited life span. *Bottled products can survive months or years in storage enabling resale, however all except the very best beers which benefit from ageing will begin to go off from their prime after a relatively short period, making the cask / keg worth more than the contents.
Lets not forget the effect on the outlets the company supplied, suddenly scrambling around to get stock from alternative suppliers when informed deliveries were being suspended from WaverleyTBS. *Some major PubCo’s had to suspend the tied supply rules to enable pub trading to continue. **Hopefully no creditor should go under due to the collapse of the company, but there will be some small creditors who run a tight financial ship having a few restless nights rejigging their financial plans to cater for the loss.
All this from one company going under.

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