The brewer – which will gain access to Budweiser’s sales and distribution network for its best-selling brands such as Punk IPA, Hazy Jane and Elvis Juice – says the partnership will allow it to grow in China ‘from a position of strength, while remaining fiercely independent’.
The joint venture is expected to be fully operational by the end of Q1.
Shanghai and beyond
Around a fifth of the world’s beer is consumed in China. Meanwhile, the popularity of craft beer has surged over the past decade with production rising 10-fold to 6.5m hectolitres by 2020 as drinkers move beyond familiar lagers to seek out premium brands and superior taste.
BrewDog opened a bar in Shanghai in 2015: but acknowledges that ‘to say we’ve barely scratched the surface of this dynamic and fast-growing market would be a massive understatement’.
Budweiser China has a strong position in the premium and super-premium beer segments in China: and its local expertise is invaluable, says BrewDog.
“China is one of those markets where you really need to work with an established partner who has a sales and distribution infrastructure in place and local market knowledge," says the company.
"That’s why we’re really pleased to have signed a partnership agreement with Bud China to enable us to fast track our Chinese business.”
BrewDog’s beers will be produced by local brewers in collaboration with BrewDog’s Global Brew Master and Head of Quality at Budweiser China’s Putian Craft Brewery in Fujian province.
The company highlights that local production will allow it to ‘reduce significantly’ the CO2 output and logistics costs associated with importing beer from Europe: adding that the Putain brewery – which opened in July 2022 – was designed and built according to sustainability principles that align with BrewDog’s own corporate ethos.
Brewing beer locally – as it already does in the US, Germany and Australia – also gives consumers a fresher product, it adds.
Additionally, BrewDog China also plans to open several new hospitality venues in China by 2026, building on BrewDog’s sole Chinese bar in Shanghai and adding to its existing international network of more than 110 bars.
China currently accounts for less than 1% of BrewDog’s overall sales. Under the new partnership, BrewDog aims to achieve significant multiples of its existing Chinese volumes, using Budweiser's distribution network to turn the country into a key market for its international business.
BrewDog defends global partnership strategy
The deal marks BrewDog’s second joint venture in Asia following the announcement of its partnership in Japan with Asahi in September 2021. Sales in Japan have doubled since the deal was announced, reports BrewDog.
It also has partnerships around the globe with Molson Coors, Heineken, Estrella Galicia, Warsteiner and Swinkels.
“Going global as an independent business, in an industry dominated by giants, is incredibly tough yet we have managed to do this and retain our independence which is massively important to us," says BrewDog.
“One of our strategies which enables us to do just that is to work with larger beer companies as partners in key geographies.
“Not everyone will agree with our strategy here but it’s helped us to become the world’s leading independent beer brand - no mean feat for a business started in a derelict shed by 2 humans and a dog just 15 years ago.”