I posted this link regarding the bankruptcy of Oma Panimo in the craft breweries thread as well, but I’ll link it here too:
The CEO’s message on the reasons for the problems:
- People are not visiting restaurants.
- The arrival of wines in grocery stores took shelf space away from beer.
- Banks are not financing craft breweries.
- The only ways to compete are to sell cheaper and cut costs.
In this environment, I think Nokian Panimo is quite well-positioned, and the company’s issue of low restaurant sales as a share of total sales eliminates one challenge. If a 4-euro (let alone more expensive) wheat beer is replaced by a 3-euro wheat beer, Nokian Panimo is a potential winner. If a 3-euro wheat beer is replaced by a bulk lager under 2 euros, Nokian Panimo is a loser.