Case analysis question about German Beer. list opportunities and threats.

Document 1 of 1 Berlin's rebel brewers Author: Hawkes, Will Publication info: Financial Times ; London (UKyf > / R Q G R Q 8 . \f]26 Mar 2016: 28.

ProQuest document link Links: Linking Service Full text:   Germany's "Reinheitsgebot" law has been controlling how beer is made for 500 years. But now innovative young brewers in the capital want to change all that. By Will Hawkes Deep in the bowels of Berlin's Markthalle Neun, a 19th-century market hall that is now a bustling street food market, Felix vom Endt passes on a particularly tasty rumour. "They say that the purity law is going to be changed soon," he says. The 29-year-old brewer is referring to the "Reinheitsgebot", a 500-year-old German law that dictates which ingredients can be used to make beer. "It'll mean that what we're doing [with some of our beers] is not against the law," he says. "Maybe there'll be a new designation, so that you can call it 'beer with natural ingredients'." Vom Endt works at Heidenpeters, a small craft brewery that launched in 2012 in Markthalle Neun's cellars. He and his boss, Johannes Heidenpeter, are part of a new breed of German brewers: keen to try out new flavours, ingredients and techniques, and inspired by the worldwide craft-beer movement, they regard the Reinheitsgebot (updated and renamed, in 1993, as the Provisional Beer Lawyf Z L W K X Q G L V J X L V H G V X V S L F L R Q "It really bothers me - I'm completely uninterested in the purity law," says Heidenpeter, 36, who taught himself to brew after studying art, an unusual path in a nation where brewers normally undertake years of study. He makes beers with a variety of non-compliant ingredients, including raspberries and vanilla. "I've stopped arguing with people about the law, because it's really bullshit." The Reinheitsgebot was adopted in Bavaria in 1516, to prevent brewers from using wheat, which was needed to make bread. The law decreed: "In all cities, markets and in the country, the only ingredients used for the brewing of beer must be Barley, Hops and Water. Whosoever knowingly disregards or transgresses upon this ordinance, shall be punished by the Court authorities' confiscating such barrels of beer." Yeast was not mentioned, perhaps because its role was not fully understood. Bavaria insisted upon the law being adopted nationwide as a condition of its entry into the German union of 1871, though it was not fully enforced until 1906. While it was substantially updated in 1993, the Reinheitsgebot still dictates what can be used to make beer:

malt, hops, yeast and water. There are loopholes that allow sugar for top-fermented beers, and some agents for clarifying and stability are acceptable. It's a unique and slightly odd law; a European Court ruling of 1987 means that foreign brewers that sell beer in Germany are not bound by it. It is possible to brew products that contravene the law - such as Heidenpeters' Red Flandern Winter, which is made with orange peel - but they can only be called beer if a special licence has been granted; otherwise they must be labelled "alcoholic malt drink". The problem, says Heidenpeter, is the widespread perception in Germany that beers brewed to the Reinheitsgebot are superior to those that flout it. It is the law's 500th anniversary this year and plenty of celebratory events have been planned, with the highlight being a beer festival over the weekend of April 22-24 in Ingolstadt, Bavaria. The German Brewers' Federation has been working hard to capitalise on the anniversary. "There is no incentive for German brewers to let the 500-year-old document fade into the past - quite the opposite," says Hans-Georg Eils, the association's president. "Anyone who believes that the Reinheitsgebot serves to limit creativity and gives rise to monotonous beers merely has to look to the immense diversity of the country's beer." Yet Berlin has become the epicentre of growing frustration with the law. For brewers such as vom Endt and Heidenpeter, the Reinheitsgebot represents an intolerable brake on experimentation with ingredients such as fruits and spices. They also believe its main role is as marketing for Germany's least quality-focused brewers, and that the idea of celebrating 500 years of the Reinheitsgebot is unhistorical nonsense, since its strictures have only applied in most of Germany since the beginning of the 20th century. Before then, north German brewers used a much wider palette of ingredients. It's the latest in a series of challenges for the German beer establishment. Although brewery numbers are rising - driven by the craft-beer movement - drinkers are slowly falling out of love with more mainstream beer, consuming 86 million hectolitres in 2014, about 10 million less than 10 years ago. And, though most consumers say they approve of the Reinheitsgebot, the implementation of the law is often problematic. Last year, a brewery called Camba Bavaria had to ditch a batch of Milk Stout, a traditional British-style beer made with lactose (a sugar derived from milkyf E H F D X V H % D Y D U L D Q I R R G D Q G G U L Q N R I I L F L D O V V D L G W K H Q D P H D Q G W K e label, which had a cow on it, were misleading, as there was no milk in the beer. Erdinger, the world's largest wheat beer producer, has recently been forced to stop putting "Brewed to the Reinheitsgebot of 1516" on its labels after a consumer group in Baden-Wurttemberg pointed out that the use of wheat was not permitted by the original Reinheitsgebot. Maisel, another Bavarian wheat-beer producer, has set up a working group intent on reforming the Reinheitsgebot. And a recent report by the Environmental Institute in Munich found tiny amounts of glyphosate, a weed-killing pesticide, in 14 major German beer brands, a blow to the broader idea of beer purity that is enshrined by the law. Anti-Reinheitsgebot events are being planned through an international Facebook group in countries including Germany, Brazil and New Zealand. The organiser is Sebastian Sauer, a 29-year-old brewer from Cologne who has built a reputation on reviving and updating forgotten northern German beer styles. "I'm interested in bringing new flavours to the market," says Sauer, who runs two brewing companies, Freigeist ("Free Thinker"yf D Q G 7 K e Monarchy. "I want the freedom for German brewers that brewers in other countries have. It's ridiculous that we don't have that." While most German brewers can seek special dispensation from local compliance officers to release beers brewed with non-compliant ingredients, that's not so in Bavaria and Baden-Wurttemberg, where brewers are prohibited from even making such beers. Authorities there can simply tell producers to throw the beer away (the German Brewers' Association says it is working to iron out this anomalyyf All of this is meant to keep standards up but many within the industry don't see it that way. "The really bad thing is that industrial brewers use [the law] as a sign of quality," says Nina Anika Klotz, the 33-year-old editor of beer magazine Hopfenhelden ("Hop heroes"yf , Q D Q \ * H U P D Q V X S H U P D U N H W \ R X O O I L Q G E H H U V W U X P S H W L Q J W K H L r adherence to the purity law, on sale for just 50 cents (40 penceyf R U O H V V S H U K D O I O L W U H E R W W O H ) R U W K D W S U L F H V D y the critics, something must be lacking in terms of quality. That's certainly what many of the new brewers in Berlin would say. The city, home to about 25 breweries, has welcomed Stone Brewing, a San Diego-based craft brewer that has invested some $25m to convert a former Mariendorf gasworks into a brewery, restaurant and beergarden, expected to open in July. Berlin Stalwarts such as Kreuzberg's Hopfenreich and Friedrichshain's Hops &Barley have recently been joined by the likes of Kaschk, an English-speaking coffee-shop-cum-late-night-bar in Mitte, and Salt N Bone, a laid-back, simply decorated bistro in Prenzlauer Berg that combines international comfort food - from ribs to Scotch eggs - with a smartly chosen list of draught beers. "The scene here is quite young," says Daniel Copeman, Salt N Bone's bar manager. "Things have really accelerated in the last 12 months. I think 10 or 12 breweries have popped up in that time, home brewing is starting to become a thing, and bars are opening everywhere. People are excited." The nascent state of Berlin's brewing scene can also be witnessed at Vagabund, a "brewpub" (the beer is brewed on-siteyf L Q W K H X Q J O D P R U R X V Q H L J K E R X U K R R G R I : H G G L Q J , W V D G R Z Q W R H D U W K V S D F H Z L W K Z K L W H Z D V K H d walls, mismatched furniture and chalkboards on the wall. Founded by three American friends - Tom Crozier, Matthew Walthall and David Spengler - in 2011, the brewery produces less than 200 litres (or about 350 pintsyf a batch. Nonetheless, they've built a strong reputation. The brewery's creation sprung out of a nostalgic yearning for US beer. "We started talking about home brewing," says Walthall. "In 2009, there was an article in Die Welt saying that craft beer will never work in Germany - so we thought, why don't we try? There's not much competition. We brewed a lot of beer in my apartment and got better and better."? Among Vagabund's most popular beers is a Double IPA, perhaps the flagship style of the worldwide craft-beer movement. At EU3.50 for 0.3 of a litre (roughly half a pintyf L W V Q R W F K H D S E X W L Q % H U O L Q W K H U H L V Q R V K R U W D J H R f buyers. This is a city full of younger drinkers, many from overseas, who are prepared to pay more for "boutique" products such as craft beer or organic fruit and veg. And although IPAs are generally Reinheitsgebot-compliant, the style's potent hop-led flavour (Vagabund's version, which is 7.5 per cent alcohol by volume, is full of pine and citrus-peel characteryf G L V W L Q J X L V K H V L W I U R P P X F K R I * H U P D Q E U H Z H G E H H U P R U H W K D Q S H U F H Q W R I Z K L F K L s decent but unremarkable pale lager. Many German drinkers are conservative in their tastes, apparently convinced that the beer made by their local brewery is the world's finest, and that the Reinheitsgebot is wonderful. "Most drinkers don't know anything," says Nina Anika Klotz. "They take beer for granted but they don't know anything about it." Greg Koch, the founder of Stone Berlin, concurs. "A lot of German people have forgotten their own beer culture," he says. "They've slowly, over decades, gravitated towards cheap industrial beer. But Germany's artisanal beer culture is wonderful and worth paying attention to." And the Reinheitsgebot? "It's an antiquated, oppressive restriction of freedom and creativity and it has zero to do with quality." Stone's head brewer in Berlin - Thomas Tyrell, a German who has worked in Oregon - has a different view.

"Beer consumers in Germany have never been as desperate as they were in the US," Tyrell says. He means that German beer has never been as bad as the industrial pale lager that once constituted the only option for US beer drinkers. "The real problem is that brewers here are not that creative. Partly that comes from the Reinheitsgebot but also they are not even being creative within the Reinheitsgebot." The Reinheitsgebot has always been more cherished in the south of Germany than the north. But even in Franconia, Bavaria - the law's heartland - questions are being asked. Gerhard Schoolman, co-owner of Cafe Abseits, in Franconia's beer capital Bamberg, says he favours a change to the law. "You could have a new category for more creative beers," he says. "I think it will change." He sells a variety of beers that do not abide by the law, including Belgian fruit beers and some experimental brews made by Weyermann, a Bamberg malt producer. There's plenty of respect for the Reinheitsgebot here but also a thirst for change. Ganstaller Brau is based in the tiny village of Schnaid, a 20-minute drive to the south of Bamberg. It is not a typical Franconian brewery; 95 per cent of its beers are sold overseas and owner Andreas Ganstaller regularly travels abroad to brew "non- pure" beers. He has brewed one such beer in Schnaid just once, using myrrh as an ingredient, and it was exported entirely to Sweden. Ganstaller says his local compliance officer turned a blind eye after discovering it would not be sold in Germany, which shows that however monolithic the purity law might seem, it is humans who enforce it - and their views vary. Change is happening everywhere but nowhere faster than Berlin. Back at Heidenpeters, vom Endt recalls a customer who questioned how they achieved the bright citrus character in their IPA, a flavour that is produced by the use of new world hops. "He said, 'This is delicious but you must have put something in it. It must be made with fruit juice!"" he says, smiling. The next few years could be quite a journey of discovery for German beer drinkers. Will Hawkes is the author of "Craft Beer London" Credit: By Will Hawkes Publication title: Financial Times; London (UKyf First page: 28 Publication year: 2016 Publication date: Mar 26, 2016 Section: FT MAGAZINE Publisher: The Financial Times Limited Place of publication: London (UKyf Country of publication: United Kingdom Publication subject: Business And Economics--Banking And Finance, Political Science ISSN: 03071766 Source type: Newspapers Language of publication: English Document type: News ProQuest document ID: 1784011803 Document URL:

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