Lion closes Swan Brewery

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Business is business and, no doubt, it may well be a good business decision for Kirin to close the Canning Vale Brewery in Western Australia, but the move highlights exactly what a beer ‘brand’ is to a multinational company. While a beer label can be a signature of state identity to the drinker, a brand is a pawn to be moved across the board for a brewery.

Although small on national scale, the Emu and Swan brands are no doubt important to Western Australians as their ‘local’ drop. Not so much to Kirin, which owns Lion. “Sure Swan & Emu are WA’s state brands, but let’s move their production to the other side of the country,” seems to be the thinking in Lion HQ.

Now it is undoubtedly true that any beer can be made just about anywhere these days, but the big brewers know that the emotional attachment the drinker has to a beer is a big part of why they drink it and even how it tastes to them. This is a key factor in the millions of dollars a year spent advertising the brands and also in linking them to local sports teams. They want to build that emotional attachment. But ultimately that emotional attachment is hollow. Remember this next time you see an ad telling you how Tasmania’s pure waters are the secret to James Boag’s, or that XXXX is Queensland’s beer.

While a great shame for WA’s beer drinkers that they don’t have a local mainstream brand, and for the workers now out of a job (sorry, for the 80 ‘roles’ that are now redundant), it really doesn’t matter where Emu and Swan are made, at least to the beer. Or James Boags, or XXXX or Tooheys for that matter. So hopefully Lion could stop spending the millions insulting our intelligence and telling us that it does.

Perhaps the most interesting thing about this decision is that it perhaps signals that Lion believes these are dead brands and not worth investing in. Lion is on a roll with it’s biggest brands, kicking goals in craft and powering ahead with their imports and faux imports. And yet, these brands are amongst the only ones that don’t even have a web site linking from the Lion site. Coming so soon after VB’s monumental backflip, and with history showing that you don’t mess with something like this for a mainstream brand which really only has local loyalty going for it, you really have to wonder what it shows about Kirin’s thinking.

“They’re declining, we’ll keep brewing ’em, but it doesn’t matter where,” seems to be the thinking. “They’re dead anyway.”

But that couldn’t be the case could it? They are “committed” to the brands. It says so right there in the media release. [MK]

Media Release

Lion announces changes to its Australian brewery operations

17 October 2012: Lion today announced its intention to close The Swan Brewery located at Canning Vale in Western Australia (WA).

James Brindley, Managing Director Lion Beer, Spirits and Wine Australia said: “Lion undertakes regular reviews of its operations and unfortunately The Swan Brewery has been operating substantially below full capacity for some time and will require significant ongoing capital investment to maintain its current operations, which is no longer sustainable.

“This is not something we have taken lightly and is no reflection on the dedication and capability of our people at The Swan Brewery or the importance of the WA market to our business. We will be consulting with our people to support them through this significant change.”

The intended changes to Lion’s operations will result in 80 roles being made redundant, and will also impact contract labour requirements. An additional 55 roles in sales and support functions will not be impacted, and will be relocated to a new office site within WA.

Lion intends to transfer its WA keg production and the brewing of Swan and Emu to its West End Brewery in South Australia (SA) and its WA pack production to its James Boag & Son Brewery in Tasmania (TAS). Swan and Emu will be brewed to the same recipe and Lion’s expert brewers will shortly begin the process of brew emulation testing to ensure absolute flavour consistency.

Lion will invest $70 million into West End Brewery to increase cider and international brand capability and to accommodate the brewing of WA keg production. At James Boag & Son Lion will invest $12m to increase the Brewery’s capability to brew national brands and to accommodate WA pack production. New roles created in both SA and TAS will be made available to people at The Swan Brewery as a first priority.

“Lion remains committed to the Swan and Emu brands and to the Western Australian market,” continued James. “Our ongoing sales presence in WA and our recent acquisition of Little World Beverages demonstrate that we continue to see WA as an important part of our future.”

The closure is expected to be completed by the end of March 2013; however the exact timing and process will be confirmed following further consultation with Lion’s people at The Swan Brewery.

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