Scottish craft beer giant BrewDog has faced a costly setback, pouring away millions of pounds worth of beer after detecting a quality issue with one of its brews. BrewDog's chief supply-chain officer attributed the incident to “poor hygiene standards” at their Ellon facility in north-east Scotland. The company made the decision to discard the affected batches of their Punk IPA to protect its reputation and ensure customers only receive top-tier products, BrewDog said in a statement.
BrewDog’s CEO, James Watt, who quit his job as chief executive after 17 years in May 2024 (inside.beer, 8.5.2024), confirmed that the issue stemmed from inconsistencies in the brewing process. While the exact cause is still under investigation, Watt emphasized the company’s commitment to transparency and high standards. "We have taken immediate action to ensure this issue does not happen again and will continue to prioritize quality over everything else," he stated.
The craft brewing industry is watching closely this incident, as it highlights the risks associated with large-scale brewing and the need for robust quality control systems as breweries grow in scale, especially in the competitive craft beer market. BrewDog, however, remains confident that its loyal customer base will continue to support the brand as it resolves this issue.
This isn't the first time BrewDog has negatively hit the headlines.
In 2021, BrewDog faced internal turmoil when former staff accused the company of creating a toxic work environment, claiming they experienced fear and burnout (inside.beer, 17.6.2021).
In January 2022, James Watt was accused of attempting to intimidate whistleblowers to prevent the British Broadcasting Corporation (BBC) from airing the documentary disclosure: The Truth About BrewDog. The documentary reportedly focused on internal issues within the company, and these alleged actions raised further concerns about BrewDog's management and transparency practices (inside.beer, 21.1.2022).
Later in 2022, the brand was found guilty of violating U.S. federal law by shipping at least five batches of beer in 2016 and 2017 that contained ingredients not legally approved. An employee noted that this was done "despite everyone knowing" the beers had not been authorized.
In another incident, 2023 saw BrewDog's CEO, James Watt, paying nearly GBP 500,000 (USD 650,000) to winners of the company's 2021 "solid gold" beer can promotion, which was deemed misleading by the Advertising Standards Authority (ASA). Winners discovered the cans were gold-plated, not solid gold as advertised. Watt later admitted to mistakenly believing the cans were made from solid gold.
The new incident adds further strain to the company, which has been navigating significant financial challenges and has not reported a profit since before the pandemic. The company’s last reported pre-tax profit was GBP 1.1 million (USD 1.43m), achieved back in 2019. In 2023, BrewDog reported a pre-tax loss of GBP 25.7 million (USD 33.4m), marking another difficult year.
Despite these setbacks, founder James Wattremains optimistic, asserting that the company is nearing a return to profitability, focusing on streamlining operations and optimizing its production processes.
“We are pleased to report our trading losses reduced significantly in 2023, reflecting the significant changes we have made to address inefficiencies in the way we operate, and this will continue to be a priority as our business continues to evolve and return to sustainable, profitable growth in 2024,” he said
“Our global bar expansion plan is also continuing as planned, increasing our footprint across Europe, US and Australia, entering new markets such as Thailand for the first time and growing our presence at major transport hubs,” Watson added.