Good Beer Hunting

BrewDog Acquires Macro-Friendly Draft House Pub Chain

Brewdog Bar.jpg

BrewDog has announced it will purchase UK pub chain Draft House for an undisclosed sum. The multinational brewery is set to acquire all 14 of Draft House’s existing sites, which includes 13 in London and one in the town of Milton Keynes, about 56 miles northwest of the city. They’ll be added to BrewDog’s collection of 33 BrewDog bars nationwide. Draft House bars will continue to operate under their own name, with BrewDog currently stating no intent to rebrand them in its own image, stating in a blog post this morning that Draft House does things “outstandingly well.”

The Draft House chain was originally established in Battersea, South London by Charlie McVeigh in 2009. The initial venture—which was set up in 2006 with £75,000 of McVeigh’s own money—was seen as something of a failure, then built up into the successful and saleable venture after its 2009 rebrand. Following the sale, McVeigh will stand down as Managing Director of Draft House, with that responsibility taken on by David McDowall, Managing Director of BrewDog’s bar division.

Both BrewDog and Draft House entered the world of bar retail within a few months of each other in late 2009 and early 2010, respectively, BrewDog opening its flagship Aberdeen site not long after Draft House opened on Battersea’s Northcote Road. It would be another twelve months before BrewDog would enter the London Market, opening the first of its 11 London sites in Camden in December 2011. The rate at which both BrewDog and Draft House have expanded within the capital city are examples of how established the specialist beer retail market has become in London. Other expanding chains, such as Mother Kelly’s and Barworks, are further examples.

“[Draft House] has been a truly remarkable journey of discovery. We’ve built an awesome business, and more importantly, a team right at the heart of the UK’s beer revolution,” McVeigh said in a press statement. “I am immensely proud of what we’ve achieved together and delighted to hand the business over to BrewDog for its next stage of growth. Draft House couldn’t be in better hands.”

The acquisition of Draft House further boosts BrewDog’s already determined plans for its retail arm in London. It recently acquired former Polpo site Ape & Bird on Cambridge Circus, which is now open as BrewDog Seven Dials. It’s also just weeks away from opening its ambitious brewpub project in Tower Hill, which will see BrewDog brewing in London for the first time. Not all of BrewDog’s plans in the capital have been successful, however. Its Essex Road-based restaurant concept Dog Eat Dog stalled after less than six months, as did its Homerton bar in East London, which closed after only three months reportedly due to lack of patronage.

Bringing Draft House under its wing also means that BrewDog now has multiple London sites only a short distance away from each other under direct competition. For example, Draft House Hammersmith is only 700 metres (less than half a mile or an eight-minute walk) away from the nearby BrewDog Shepherd’s Bush. BrewDog also stated in a press release that it will open up its access to training facilities, such as those provided by Cicerone, to all Draft House staff. It did not, however, state whether or not it would be passing on other existing staff benefits such as the London Living Wage or its Unicorn Fund bonus scheme to Draft House employees. In their announcement, BrewDog noted it would keep all 213 Draft House employees.

This acquisition also pushes BrewDog’s “punk” rhetoric to its limit. As well as being longstanding champions of cask ale, which BrewDog does not produce or sell, Draft House pubs also stock many brands associated with macro breweries. The Scotland and Ohio-based brewery has often aggressively railed against larger producers such as Anheuser Bush-InBev in the past. In one instance, on the day of Camden Town’s sale to ABI, staff at BrewDog’s Camden Bar filmed themselves pulling the London brewery’s beer from its tap wall. As its empire expands, BrewDog consistently finds its ethos under challenge. The acquisition of Draft House and the macro-tied lines in some sites, does little to reinforce the brewery’s self-styled rebellious image.

Brands such as Camden Town, Duvel, Pilsner Urquell, and Lagunitas are all familiar sights in Draft House pubs. Some of its sites, such as those Draft House acquired from Grand Union in June 2017, also contain dispense equipment owned by Heineken along with lines that are contractually tied to pouring its brands, such as Lagunitas. BrewDog came under fire recently, when it had its beer disconnected from a York-based pub after a reported refusal to pay the lease for the use of dispense equipment owned by Heineken and Carlsberg.

Although it’s currently unclear if the brewery will take the same stance with regards to its new acquisitions, it’s a conundrum that BrewDog’s Bar Division MD David McDowall will have to solve eventually. For the time being, it seems his focus will be on his people.

“Our main priority just now is ensuring that the entire Draft House crew feels welcomed into the BrewDog family,” McDowall tells GBH. “There’ll be things we need to settle and agree on within the next four weeks, but for now, our focus is on getting to know the awesome team at Draft House, and allowing them the time to get to know us."

—Matthew Curtis