SIBA / DDS / BeerFlex and the tied pub.
SIBA, the ‘Society of Independent Brewers’ run a scheme whereby they have agreements in place with Tied Pub Companies which allow Brewers to sell beer into some Tied pubs, each Pubco has its own pricing structure and SIBA get something out of it too. Click Here for more.
As a company we are in two minds about selling via SIBA DDS/Beerflex, it seems restrictive to small brewers to get started due to the setup costs, especially in the first 12 months. I’ll list some costs below to try and explain things, thanks to Steve from Beer Nouveau for the figures as I seem to have misplaced the ones I was keeping in my emails from SIBA.
- SIBA Membership £149.27
- SIBA Joining Fee £30.00
- SIBA FSQ Annual Fee £300.00 (Not added are the yearly BFBI Feed Assurance Scheme and Contract Pest Control which I believe are required for FSQ)
- Cyclops Annual Fee £30
- First 5 Beers tested by Cyclops £300 + Additional beers over the course of 12 months @ £30 each £210
- BeerFlex Enrolment £200.00
- First Sales Fee £200.00
SIBA Beerflex & Cyclops Fees: £1,419.27 So that is the amount of money you need to make from sales to Tied pubs through SIBA to break even on your first year ‘investment’. The second year figures would work out a little better. Cyclops is a SIBA company that taste tests brewers beers. FSQ is the SIBA Quality Audit, basically an audit to check you are keeping complete and appropriate records which all brewers should be anyway.
Basing things on a 3.6% beer, like our Blonde which retails at its very reasonable £65+vat, SIBA/Pubcos will pay the brewer between £37 to £57 per Firkin (72 Pints).
Very roughly speaking, if we could do higher end sales to the better paying Pubcos, it would take us to sell around 12 casks per month each month for a year just to break even from all the SIBA/Beerflex/Cyclops costs. And profit per cask sold to a tied pub would be between £0 to £12 per cask, our regular profit per cask to free houses is approx £25… it keep the lights on and food on the table. *If you happen to brew really hoppy beer with expensive ingredients then the amount of profit you get will decrease to pathetic amounts for the beers priced on ABV*
There is a spreadsheet available from SIBA which lists a lot of the tied pubs that can buy your beer via SIBA but the brewer has to put in the leg/phone/email/social/postal work to encourage sales to said pubs, I suppose you could factor in this time and effort which would probably blow the figures above out of the water.
You could consider BeerFlex deliveries as ‘Van filler’ so they go out on deliveries while you are out delivering your higher value sales which will offset the delivery costs a little… I’ll have to keep telling myself this 😉
We occasionally deal with Beer Wholesalers though we decided NOT to deal with Wetherspoons as JDW don’t pay the brewer anything near what you would consider a fair price using their Price Formula, the formula would make you laugh if you saw it compared to the costs to make a cask of beer and you can see why a lot of the beers in McSpoons are *brewed-to-price or selling to them is seen as an advertising or marketing tool. (*That is not to say that some beers are beautiful creations at already reasonable prices)
So considering all of the above and an eye on the amount of work you need to do to earn enough money to live:
- Current Higher Value sales = Steady amount of work
- SIBA/Cyclops/Beerflex sales at low value = Increasing workload for little money
This seems a funny place to leave the blog at the stereotypical “Work, Life Balance” statement above, though if you are flogging yourself to death and not enjoying what you do there is no point doing it.
As I say we are on the fence on this one and would love to hear other brewers feedback info@wishbonebrewery.co.uk
The bits we did so far; we joined SIBA, we got 5 of our beers tested for cyclops, then we became somewhat disillusioned with the series of monetary hurdles SIBA require to gain “Access to Market”. “Access to Market” is an interesting term, SIBA seem to have evolved it a bit after getting feedback from members with a hint that they might try to fight for “Access to market at a fair price for brewers”.
Though ‘Pubcos’, Pubcos are mostly driven by their shareholders so the changes they make are to furnish their shareholders pockets rather than benefit the Landlord or Brewer so the fear is that “Access to market at a fair price for brewers” is a tough bargain to make with the devil.
Shit, I used to Blog about #Homebrew, now this is one of the things that drives me to blog!
Again, cheers to Steve from Beer Nouveau for the figures.
Here is a response from Buster Grant
Just to quickly correct one major misapprehension – Cyclops (An organisation in its own right, with many members, only one of which is SIBA, and to which SIBA makes no financial contribution, unlike many of the other members) is no longer a pre-requisite of BeerFlex membership. This came about after an AGM motion in 2016, which effectively called for a review of SIBA’s participation in Cyclops. As a Board Member, I was tasked with chairing the group, which thoroughly investigated the situation and the conclusions were presented at this year’s AGM (and can be found on the ToolBox). The conclusion was that Cyclops should not be used, and a free to use system for brief (and longer) beer descriptions should be held by BeerFlex for use by those customers that require them.
Just to clarify, although it would cost £300 to have had your beers assessed under the old scheme, as a brewer you would only have paid £100 of this, with SIBA subsidising the rest of this cost.
I’m not sure if the other costs you quote are accurate either – please feel free to contact Rachel in the Commercial team to get up-to-date costs for your brewery via rachel.harriott @siba.co.uk . She should be able to answer any other questions you have. For example, the joining fee (you’ve listed an enrollment fee and a first sales fee totaling £400) is actually £300, of which £100 is paid up front, with the remaining £200 deducted from sales, to aid your cashflow.
