Crafting their own way to a great success

Although beer sales generally are falling, Carlow Brewing Company has found that demand for O’Hara’s craft beers and stouts are going up, both here in recession-beaten Ireland and abroad.

Now Ireland’s largest independent craft brewery, it sells to 20 countries worldwide, employs a staff of 15 and saw sales shoot up by an impressive 50% during 2012. Company managing director Seamus O’Hara says turnover has been rising steadily since the company expanded by building a new premises at Bagenalstown in 2009 which allowed it to quadruple production capacity.

A growing thirst for craft and speciality beer has been a global phenomenon for the last 20 years but according to Mr O’Hara Irish drinkers were slower to change their habits than elsewhere.

“For the first 10 years 75% of what we produced went for export but now 50% is sold here in Ireland.”

Offering 10 different varieties of stout, ale and beer in both draught and bottle, the company estimates that it is now producing close to two million litres of beer per year. Stout, red ale and pale ale are the bestsellers but the company releases new seasonal or limited edition products every few months.

“This month we have launched a limited edition whiskey barrel aged edition of our Leann Folláin extra stout in bottles and last month we started selling O’Hara’s Helles craft lager on draft, our first venture into the larger market.’’

The company is now working on producing a Winter Beer for launch later in the year. The aim is to provide off-licences and pubs with a range of new and interesting drinks to offer their customers.

“The recession in Ireland has had a positive impact on our business. Beer sales generally are falling and there has been a downturn in the pub business. Pubs are looking at their offering trying to differentiate themselves from other pubs. Offering craft and speciality beers is one way of doing this and has proved to be very successful for those that have gone that direction,’’ reveals Mr O’Hara.

Noticing a strong increase in demand from pubs over the last three years, Carlow Brewing has now, at a time when many pubs are closing, taken the brave step of opening a new one. Brewery Corner in Kilkenny city is one of a small number of pubs which sells only craft beers and according to Mr O’Hara is the only with draught which is 100% Irish craft.

Carlow Brewing sells its bottled drinks nationwide in Ireland in off licences and supermarkets while its draught products are found in over a hundred pubs, principally in the Dublin, Kilkenny, Carlow and Kildare area.

The company was one of the first microbreweries to be set up in the country in 1996. A biotechnologist who had worked in the pharmaceutical industry, Mr O’Hara started it with his brother Eamon as a part time venture.

“I had seen what was happening in the craft brewing scene in the US and also in the UK. A lot of new breweries were doing interesting thing and having been an active home brewer I eventually decided to give it a go on a commercial scale,” he said.

Registering the company in 1996, they spent two years researching the market and products and received some grant aid from Carlow Enterprise Board. In September 1998 three new drinks were launched on the market, O’Hara’s Irish Red Ale, Curim wheat beer and O’Hara’s Irish Stout.

Operating from a 3,000 sq ft premises in Carlow with a staff of three, Carlow Brewing found the Irish market very difficult to break in to because of the domination of the big breweries and because Irish drinkers were unfamiliar with craft and speciality beers. “We found the export market more open to trying new varieties of beer both in the off licence and the pub trade,’’ explains Mr O’Hara

For the first 10 or 12 years he grew the business gradually, increasing by an average of 20% a year selling to 12 countries and employing seven staff by 2008 when the company found that demand was outstripping its brewing capacity.

“We sold in the UK in the early years but this stopped when our distributor went out of business, but we have re-entered that market in the past year. The US is our biggest market but we also have good sales in countries such as Sweden, Norway, Italy, France, Russia and Croatia.”

By 2008 the craft beer business was growing globally, so Mr O’Hara with some support from Enterprise Ireland invested in building a new 14,500sq ft facility at Bagenalstown which opened a year later. “This gave us the capacity to produce 65,000 litres a week and as a result we have increased our staff to 15.”

Since then the company has added eight new markets including Lithuania and the Ukraine in the last year. Attending international trade fairs has been a key means of winning new business and the company has been supported by Bord Bia since inception.

Mr O’Hara says he is hopeful that O’Hara’s beer sales will continue to grow both here and abroad. The focus now is to develop existing markets.

“Sales of craft and speciality beers are typically between 5% and 10% of the market in the counties we export to. In Ireland the figure for Irish craft beer is around 0.5% — so there is significant scope for further growth.”