Craft brewer BrewDog agrees new joint venture deal with Budweiser to produce beers in China
- BrewDog said China currently accounts for less than 1% of its total sales
- Beers like Punk IPA are made at Budweiser’s Craft Brewery in Putian
- The joint venture is expected to be fully operational by the end of March
Craft beer maker BrewDog is set to expand its operations in China after forging a partnership with Budweiser to brew some of its best-selling drinks and open more bars in the country.
The Scottish company said the joint venture would allow it to capture more of a fast-growing market that is already the world’s largest consumer and producer of beer, but accounts for less than 1 per cent of its current sales.
Under the terms of the agreement, BrewDog beers, including Punk IPA, Elvis Juice and Hazy Jane, will be brewed at Budweiser’s craft brewery in Putian, east China’s Fujian Province.
Hosting production in China will also allow the company to “significantly reduce” carbon emissions and logistics costs as the beer will not be imported from Europe, the company added.
It is BrewDog’s second joint venture in Asia, with the first launching in Japan in September 2021 as part of a partnership with multinational beverage giant Asahi, owner of Grolsch and Fuller’s brewing business.
Growth: BrewDog is expanding its activities in China through a collaboration with Budweiser
Since announcing the latter deal, the privately held company said its sales in Japan have more than doubled.
BrewDog CEO and co-founder James Watt welcomed the “transformational partnership” that would help deliver the group’s beers “to every corner of the world’s largest beer market”.
He added: “Chinese drinkers love craft beer, but the sector is still very new. In Budweiser China we have found a partner that shares our growth vision for BrewDog in China and is perfectly positioned to support our rapid growth in the region.
‘We have always wanted to significantly increase our share in China and this new joint venture will enable us to do just that as we look to further expand our business globally.’
The joint venture is expected to be fully operational by the end of March.
Alongside this, BrewDog announced that it has signed a deal with a Budweiser China subsidiary to expand into South Korea and will open multiple new hospitality locations across China by 2026 to expand its only bar in Shanghai.
In early September, the company blamed massive cost hikes, including rising energy prices, for its decision to close six pubs in London and Scotland.
In a social media post revealing the closures, Watt blamed the “zombie.” [UK] Government of “mere paralysis of the rabbit in the headlights” as he warned Britain’s hospitality industry risks losing half its pubs and bars to rising costs.
Ambitious: BrewDog boss James Watt hailed the “transformational partnership” that would help deliver the group’s beers “to every corner of the world’s largest beer market”.
Watt himself has come under fire over the past few years over several scandals surrounding his personal behavior and BrewDog’s business practices.
Two years ago, a letter signed by a group called “Punks with Purpose” claimed that he was presiding over a culture of fear that had left some employees “burned out, scared and miserable” and suffering from mental illness.
Watt apologized to those who signed the letter and launched an independent review of company culture and practices that included a company-wide salary review, employee mental health support and an ethics hotline.
But a few months later, a BBC Scotland documentary interviewed former employees in the US who claimed he had behaved inappropriately with women at work, Watt claims, denied.
Soon after, the Guardian newspaper wrote that he had hired private investigators to investigate people he suspected were involved in a smear campaign against him.
In response to the reports, Watt said it was necessary to hire the private investigators as he had been the victim of a two-year conspiracy by “malicious individuals” to harm him and BrewDog.
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