Holt's

humdinger

days

Winning the annual Tesco Beer Challenge has been just one of many achievements for this family brewer. Tony Halstead reports

Its been a great year for Manchester brewer Joseph Holt. Last autumn the 156-year-old family-owned company became the toast of the brewing world when it triumphed in the prestigious annual Tesco Beer Challenge.

The award saw Holt's new honey beer, Hum-dinger, win high-profile shelf space in hundreds of the supermarket company's outlets nationwide.

Sales of the new beer have grown steadily since the award last September, in line with other beers currently rolling out of the brewery gates.

Humdinger is a 3.5% abv ale that uses Mexican honey and citrus-flavoured whole hops ­ a decidedly new-wave beer for a company steeped in generations of brewing tradition.

Holt's may still be best known for the giant 54-gallon hogsheads used to deliver cask beers to its 127-strong tied-pub estate, but it is not afraid to take on new challenges.

"Winning the Tesco Challenge was a tremendous achievement for the brewery and made 2004 a big year for us," says chief executive Richard Kershaw, a fifth generation member of the founding family.

"But sales of Humdinger are continuing to grow, as it is stocked in more Tesco branches, and we could not be more delighted. It's an exciting product, which has become a real talking point and a real feather in the cap for our brewing team."

Rivals are green with envy

Beer is big business in nearly all Holt's pubs and hogsheads are a feature in almost half of them. Cask beer is served in every outlet, with average barrelage returns making rival operators green with envy.

But with a pint of bitter priced at £1.40 it's not difficult see why drinkers make a beeline for Holt's pubs. Honest value-for-money beer and pubs has been Holt's watchword for years and it's a game plan that still works. A careful cost structure and tightly-defined retail estate, with no pub more than 40 miles away from the brewery, are two of the reasons why Joseph Holt still holds on to a defined sector of the beer market.

The company's biggest-volume pub, the Melville at Stretford, turns over an astonishing 30 barrels each week. But this is by no means a one off, with many other houses across the estate regularly hitting the 20-barrel mark. Despite the healthy beer returns, though, the company is working hard to maximise sales of food and wine.

"We are in the business of running decent pubs with a value-for-money offering," Kershaw maintains. But the great great grandson of brewery founder Joseph Holt, insists that while the company remains mindful of its traditions it is also looking towards the future.

"We are developing high-quality managed houses where food is an important part of the business," the chief executive explains. "Holt's is opening new pubs with customer comfort very much in mind and outlets such as Wyldes in Bury and the Bluebell at Whitefield underline this new direction. Food and wines sales represent a key part of the business here, we are by no means a solely beer-driven pub estate."

The brewing side has also advanced, with a new impetus on bottling as well as new brands like Humdinger. "Beer is our great strength and we will never take our eye of that particular ball," Kershaw promises. Underlining that promise has been major investment in the brewery over recent years, including the installation of a small-brew plant that has enabled Holts to develop exciting seasonal beers.

The Derby Brewery produces 80,000 barrels each year, made up exclusively of its house-brand draught ales, lagers and bottled products. Ale accounts for 70% of total production, the bulk of it cask-conditioned beer.

The brewery's pubs sell mild at just £1.33 per pint with house lager Crystal at £1.53 and the stronger Diamond weighing in at £1.66 a pint. It's a pricing formula that other retailers find hard to match and few even try to follow.

Holt's has been running pubs since the day the company was founded in 1849 and has grown its estate steadily over the years. But all its houses have been acquired on an individual basis.

Never bought blocks of pubs

"We have never taken on blocks of pubs through bulk acquisitions; we have hand-picked our houses," Kershaw explains. "But that is not to say that if a good block of 10 or so came along we would not be interested in them."

The bulk of the Holt's estate are in urban locations, in the thick of the chimneypot districts of Manchester and its surburbs. It is these parts that still harbour what remains of the north west's volume-drinking population, which the brewery is still proud to service.

But its three flagship pubs in Manchester city centre ­ the Ape & Apple, the Old Monkey and the Crown & Anchor ­ remain highly-popular venues, with a broader range of customer. The three outlets add a welcome element of price competition for ale drinkers, and rival operators of outlets in close proximity keep a careful watch on their own prices.