Brewing is one of the old and traditional occupations that provided people with stable income. At the same time, because of the character of this business and its relations with customers who buy certain products, it highly depends on the image of a brewery, its cooperation with clients and suppliers, taste, and other factors that are related to the sphere. At the same time, with the evolution of society and sophistication of trade, this craft acquired strategical importance because of the high level of income and increased attention of the governmental sector devoted to it. Under these conditions, many breweries that started their work as some family-owned firms had to reconsider their approaches and methods to remain effective and generate income. The complexity of this process, the long story of the evolution of the brand, and all challenges it had to overcome are reflected in the book “Brewed in the North: A History of Labatt’s” by Matthew Bellamy. The author offers a deep analysis of one of the most well-known breweries of Canada, along with the factors that were traditionally associated with this business and affected the firm.
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Rise of Labatt
The book starts with the very first stages of the company’s development and outlines the way it had to pass. In general, the author underlines the fact that for Canada, the brewery is an important craft, and its traditions have always been powerful here. Even the beginning of the Labatt company proves this idea, as it was founded by John Kinder Labatt as a small private business that functioned resting on the local peculiarities and demands of that period of time. It worked in the Upper Canadian Town of London and was firstly designed to satisfy the needs of local people and provide them with the beer they like. However, with the success of the first attempts, the need for further evolution became obvious, and the best possible ways were selected. The focus on the preservation of traditional tastes, along with the attempts to meet diverse requirements, created the basis for successful development.
Reading the book, one can also admit the fact that Bellamy uses the Canadian brewing industry as the background to trace the evolution of the state’s economy, technologies, and capitalism. Thus, outlining the critical periods in the rise of the brand, the author emphasizes the fact that the railway caused the “most transformative effect” on the whole industry. It provided Labatt with an opportunity to deliver products to different areas and disregard various seasonal difficulties such as muddy roads and ice-packed waterways. The new mode of transportation offered a perfect opportunity to provide products to far markets without the deterioration of their quality and in short terms. Labatt was among the first who recognized the power of logistics and its ability to generate a competitive advantage.
For Canada, it also meant that severe winter weather and awful conditions could be disregarded, and the trade could continue the whole year long. Using this very example, the book shows the critical importance of correct decision-making and strategic thinking. Focusing his efforts on the development and expansion of transportation networks, Labatt managed to penetrate other markets and become an active player in various regions that were previously uncovered because of the long distances and complexities of transportation. In other words, having become a railroader, the owner created the basis for the blistering evolution of the firm and the emergence of new opportunities as the number of clients grew and new products had to be manufactured to satisfy new demands.
Along with the chronological description of the basic events that contributed to the growing popularity of the brand and it’s becoming one of the most influential breweries in Canada, the book also offers facts that can help to understand the causes for the growing power of Labatt. For instance, to foster the spread of his products and ensure that broad populations will be covered, the owner was among the first to create an effective network of agencies working across the state. Labatt contracted small merchants and who were working in the same market and persuaded them to sell his products to their clients. However, as far as the given practice was not new, and no special treatment was given to products by sellers, the effectiveness of this decision was doubtful. Additionally, there was a low potential for advertising as only the quality of beverages and their discussion by customers promoted further popularization of the brewery. Trying to increase brand awareness, the owner hired special and knowledgeable agents who were responsible for the sales and promotion of Labatt’s products. They were paid salaries and commissions on deals to motivate them to work harder.
The given decision became fundamental for the growth of Labatt, and it’s becoming one of the most recognizable beers in Canada. Traveling to all regions of the big state, these specially hired agents offered products to people, answered their questions about the firm, and facilitated the evolution of the brewery. Being not revolutionary new, this strategic decision employed by Labatt contributed to the high speed of progression and created the basis for the penetration in almost all markets. The combination with the extensive use of railroads and educated agents increased the level of sales significantly. In such a way, from the book, one can realize the fact that the quality of offered beverages is not the only success factor; on the contrary, the ability to overcome rivals becomes another vital aspect. There were many small breweries almost in all regions of Canada, and they provided their beverages to local people. Under these conditions, there was a need for a competitive advantage and an effective advertising campaign. Labatt managed to reconsider patterns that had been traditionally popular in the state and create a new, national brand of beer that was consumed by the majority of the population in various regions. The domination in the regional beer market was a critical step towards the future successes of the company.
However, along with obvious achievements and successful periods in the life of the company, the book outlines some problematic times when Labatt had to overcome serious challenges to continue its existence. For instance, the adoption of the Canada Temperance Act, or Scott Act, was a serious threat to the brewery as it limited sales of alcohol and provided local governments with authority to ban the distribution of beverages. For the company, it was a critical strike as its further existence and evolution depended on sales. Trying to oppose the government in legal ways and support opposition, the owner, at the same time, accepted the decision to expand to regions that had traditionally been characterized by more favorable legislation and a less strict attitude to alcohol distribution. For this reason, Labatt opened its agencies in Montreal, which remained an attractive province and provided opportunities to generate income and survive in difficult times. In such a way, a reader can understand the fact that the evolution of this brewery is comprised of multiple decisions, both successful and poor ones, that contributed to the formation of its image and future rise.
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However, there were not only legal actions that helped the famous brewery to survive. In the age of prohibition, financial losses were too high, and the company had to become one of the biggest bootleggers. Beer and hard liquor were transported and sold to the United States, where the national prohibition was enacted. The adherence to this unpleasant scheme was not welcomed by all people working in Labatt; nevertheless, it turned out to be an effective way to save the company and ensure that it would be able to survive hard times and continue its evolution. At the end of prohibition, in Ontario, only 14 of 49 brewers existed and tried to function in complex conditions. It means that the decision to resist the pressure of the government by employing unfair schemes was critical for the further evolution of the brand and its remaining one of the leaders of the given industry in Canada. Moreover, this strategy helped to popularize products created by the company in other countries and broaden its target audience, and this factor can be taken as another serious achievement.
Unfortunately, the development of any brand is a history of rises and falls. In the 1980s, Labatt became one of the Big Three brewers that controlled 95% of the beer market of Canada and impacted its development. However, the senior management made some mistaken decisions in the second half of the 20th century as it tried to diversify its products and win domestic rivalry with other companies. Multimillion investment and poor results undermined the ability of the firm to compete in the international market and preconditioned its gradual decline. As a result, Belgian company Interbrew bought Labatt in 1995, and it lost its autonomy. At the moment, it is a dependent firm that still produces various beers and liquors and supplies them to different markets.
Altogether, the book provides an in-depth analysis of one of the most famous Canadian brewers. Labatt was taken as the embodiment of the unique culture and spirit and continued to evolve regardless of multiple obstacles that occurred on its way. In general, the main thesis of the book is that the evolution of the brewery was a long way full of successes, failures, and all decisions accepted by its heads contributed to the formation of a specific environment that helped it to survive. The history of the company can serve as a source demonstrating the evolution of the Canadian brewing industry and culture, along with governmental interference and complex conditions. Labatt lost its autonomy and does not function independently nowadays, but its contribution to the development of the sphere remains significant and cannot be overestimated.