In the cellar underneath the Frederik VI bar in Copenhagen, owner Jimmy Streit showed off the innovation that’s enabled him to boost his earnings by 5 percent in a declining business — a line of plastic kegs racked side-by-side like bowling balls against a concrete wall.
Streit switched from traditional steel storage more than a year ago at the behest of his supplier, Carlsberg A/S. Because the new vats keep beer fresher longer, the change enabled him to increase the number of taps running at the bar to 22, adding more expensive brews like Jacobsen Yakima India pale ale and Somersby apple cider.
Bad news for steelmakers is good news for the alcohol industry, which is getting squeezed by the decline of traditional pubs and a shift in consumer tastes away from beer toward wine and mixed drinks. One way for brewers and bar owners to boost profits is to sell a greater variety of premium and craft beers such as those that Streit now offers alongside Carlsberg’s namesake lager.
Photo: Bloomberg
The company is marketing the plastic kegs as the most significant innovation in draft beer in 50 years — or since the switch from wooden barrels to steel cylinders. Other brewers, including Anheuser-Busch InBev NV and Heineken NV, have developed similar technology, but Carlsberg has rolled it out most aggressively, signing up 2,500 pubs in its domestic market. Other territories include Italy, Sweden, Norway, France and some of China’s largest cities.
In some of those markets, all sales of beer on tap will be from the plastic DraughtMaster system by 2020, the company says.
“Draft is a seriously tough environment, but this is a win-win for bars and for us,” said Kaare Jessen, who leads Carlsberg’s DraughtMaster team.
Plastic kegs might seem anachronistic at a time when consumer-goods companies’ use of the material for packaging is under fire from environmental groups. Carlsberg’s focus on sustainability includes initiatives such as doing away with the plastic ring holders that bind together six-packs of beer cans and replacing them with little bits of glue. But the new canisters are recyclable and lighter to transport, cutting fuel consumption, the company says.
FRESHER BEER
They also keep beer fresh for about 30 days, compared with about a week for their older steel cousins. Metal kegs expose the contents to external gases as soon as they’re tapped, while the plastic ones seal the brew inside a separate internal container that’s compressed to release beer to the tap.
Carlsberg isn’t alone in revamping the engine room of the global beer trade. With demand for mainstream draft beer declining, brewers are taking their battle for market share into more obscure but valuable back-end segments of the business.
“It’s clearly important to make these kinds of systems,” Danske Bank analyst Jonas Guldborg Hansen said. “You’re pushing the high-end part of your portfolio, and you’re effectively locking in your customer,” since adopting the new kegs makes it harder for pubs to sell beers from more than one supplier.
Budweiser maker AB InBev and Dutch brewer Heineken are locked in a legal dispute over patents tied to their own new storage methods. Earlier this year, AB InBev filed complaints with the International Trade Commission to try to block imports of Heineken’s BrewLock into the US, contending that the Dutch brewer infringed on AB InBev’s patents. Heineken fired back in August that AB InBev’s Nova countertop cooler infringed on a patent of its own.
“We are confident in our position as the owner of the patented technology,” AB InBev said. Heineken declined to comment.
While Carlsberg estimates that the industry is shrinking at a rate of about 3 percent a year, the new kegs are helping the company and the bars it supplies maintain profitability, Carlsberg Chief Executive Officer Cees ’t Hart said.
“For us and for the customer, it’s margin-enhancing, and we see a significant decline in churn,” the CEO said in an interview, referring to beers that are added on tap only to be removed a week later based on insufficient demand.
Carlsberg declined to detail its investment in DraughtMaster. The company cut off funding to develop the technology a few years ago after suffering losses tied to a weakening economy in Russia, one of its most important markets. The Carlsberg country manager in Italy was a believer, and used his own market’s purse to fine-tune the product.
About 95 percent of bars that sell Carlsberg beers in Italy have switched to DraughtMaster and now the brewer is pushing the system elsewhere. Italy chief Alberto Frausin’s services to one of Denmark’s biggest companies were deemed so valuable that he’s set to receive a medal of honor from Crown Prince Frederik.
May 11 to May 18 The original Taichung Railway Station was long thought to have been completely razed. Opening on May 15, 1905, the one-story wooden structure soon outgrew its purpose and was replaced in 1917 by a grandiose, Western-style station. During construction on the third-generation station in 2017, workers discovered the service pit for the original station’s locomotive depot. A year later, a small wooden building on site was determined by historians to be the first stationmaster’s office, built around 1908. With these findings, the Taichung Railway Station Cultural Park now boasts that it has
The latest Formosa poll released at the end of last month shows confidence in President William Lai (賴清德) plunged 8.1 percent, while satisfaction with the Lai administration fared worse with a drop of 8.5 percent. Those lacking confidence in Lai jumped by 6 percent and dissatisfaction in his administration spiked up 6.7 percent. Confidence in Lai is still strong at 48.6 percent, compared to 43 percent lacking confidence — but this is his worst result overall since he took office. For the first time, dissatisfaction with his administration surpassed satisfaction, 47.3 to 47.1 percent. Though statistically a tie, for most
Wooden houses wedged between concrete, crumbling brick facades with roofs gaping to the sky, and tiled art deco buildings down narrow alleyways: Taichung Central District’s (中區) aging architecture reveals both the allure and reality of the old downtown. From Indigenous settlement to capital under Qing Dynasty rule through to Japanese colonization, Taichung’s Central District holds a long and layered history. The bygone beauty of its streets once earned it the nickname “Little Kyoto.” Since the late eighties, however, the shifting of economic and government centers westward signaled a gradual decline in the area’s evolving fortunes. With the regeneration of the once
In February of this year the Taipei Times reported on the visit of Lienchiang County Commissioner Wang Chung-ming (王忠銘) of the Chinese Nationalist Party (KMT) and a delegation to a lantern festival in Fuzhou’s Mawei District in Fujian Province. “Today, Mawei and Matsu jointly marked the lantern festival,” Wang was quoted as saying, adding that both sides “being of one people,” is a cause for joy. Wang was passing around a common claim of officials of the People’s Republic of China (PRC) and the PRC’s allies and supporters in Taiwan — KMT and the Taiwan People’s Party — and elsewhere: Taiwan and
RSS