Black Days At Black Sheep....

News broke recently that the famous brewery based in the lovely Yorkshire Dales village of Masham has gone into administration. Whilst the pandemic and current economic problems have undoubtedly had a big impact, one could argue that some of the problems go back a lot further....

The Black Sheep Brewery started out in 1992, but the back story as to its opening is the rise of family tensions the likes of which these days grace many a Netflix drama. The founder of Black Sheep, Paul Theakston, was a former MD for the family brewers, T & R Theakston, having been in the role since 1968. His father Frank, who was dying from leukaemia at the untimely age of 46, was annoyed at a family member who had suggested they should get out of brewing as the price of a pint would have to go above 2 shillings a pint (or 10p in today's money), and with concerns about the impact on the staff that worked at the brewery he passed the business on to Paul who was then only 23 and had been working as a trainee at the former Mansfield Brewery. 

Back in those days, Theakstons, which had been founded in Masham in 1827, sold its beers mainly in the neighbouring areas of the Yorkshire Dales where it owned a number of pubs. But Paul saw that the business needed to grow to survive, and it is fair to say it was helped a few years later by the arrival of CAMRA and its focus on real ale, whose members  particularly took to the strong Old Peculier dark ale. And then in 1974 Theakstons bought the former Government-owned Carlisle State Brewery whose capacity of 2,000 barrels a week dwarfed that at Masham. A bottling line also enabled them to expand into new sales territories like supermarkets. Growth though had to be funded by selling off pubs and the arrival of new shareholders from outside the family. 

Theakstons Brewery, Masham

In 1984 Theakstons were acquired by Matthew Brown of Blackburn after a rift between some of the family members and shareholders with others including Paul over the sale of shares which spilled over into the High Court. However this was dismissed by the judge, and the business continued with Paul resuming as MD. Matthew Brown were subsequently though acquired by a predator in the shape of Scottish & Newcastle, at that time the smallest of the infamous 'Big Six' brewing giants that dominated the industry in those days, on their route from being a large regional player to a national outfit.

Paul was furious at this turn of events which had gradually cost the company their independence, and he left the brewery in 1988 after being offered a job by the new owners which would have taken him away from Masham. The following year, he acquired the former Lightfoot maltings neighbouring the Theakstons Brewery which was by now owned by a milling business who had been happy to sell it to Paul, but he then had to create a new entrance as the only access was over land which was now owned by S & N. Paul wanted to call the brewery Lightfoots, after the brewery that Theakstons had taken over in 1919, but the name had been trademarked and was now owned by S & N. Eventually the ironic name of Black Sheep was chosen, reflecting Paul's status in the eyes of some of the Theakston family!

Paul set out to brew proper Yorkshire beer, and not ape the styles of his former company. A yeast strain was obtained from Hardy & Hansons Brewery in Nottingham, which has outlived its former home as they were closed down by Greene King, and the brewery finally began brewing in 1992, using two-storey slate Yorkshire Squares also acquired from Hardy & Hansons, and other equipment from the recently-closed Hartleys Brewery in Ulverston. The first beers brewed were Black Sheep Best Bitter, a traditional bitter, and Black Sheep Special, a stronger premium ale, which have continued to be in the range, as has the strong 5.9% dark ale called Riggwelter, an old Yorkshire Dales term for a sheep that has become stuck on its back and is unable to get up without assistance!

Black Sheep's traditional brewery (Image: Black Sheep)

When it was launched, it is fair to say there was a lot of interest in Black Sheep. But, having no pubs of its own, it targeted the free trade, not just around its local area where there were plenty of free houses, but further afield too. The Theakston name helped of course, but the regular repeat orders were a sign that the beer had appeal for drinkers. I remember first drinking Black Sheep Bitter not long after it started out at the Dusty Miller at Longwood, near Huddersfield, which in those days was a free house, and soon it began to appear in other local free houses such as the Red Rooster in Brighouse, the Barge and Barrel in Elland, and the Pump Room in Halifax. 

The brewery's popularity continued to grow, and from early in its life Black Sheep embraced its customers by welcoming them to a visitor centre at the brewery, with the opportunity to go on a tour of the brewery as well as eating good food, drinking beer brewed on the premises, and then go home with bottles of Black Sheep beers, branded clothing, and other merchandise. If this all sounds fairly commonplace these days, back in the 1990's it was not the case, and Black Sheep deserve credit for their enterprise. 

Black Sheep continued to be a significant regional brewery over the years, but with no pubs of its own and no outlets dedicated to solely selling their beers, other than the Visitor Centre, they continued to rely on the whims of the free trade and supermarkets, although the brewery had secured business with virtually all of the major players. They had toyed with the idea of buying a few pubs and building a small estate over the years but had never followed it through. Belatedly though, they did acquire some pubs when they took over the beleaguered York Brewery in 2018, which gave them a handful of outlets in both York and Leeds.  

However, this traditional over-reliance on the free trade has seemingly fed into the current difficulties Black Sheep find themselves in. The growth of microbreweries, many in Yorkshire, increased significantly the choice available to landlords and pub companies, and in this post-pandemic world, many free houses have cut back on the number of beers on the bar, with Black Sheep having much more competition for a reduced number of slots. The number of pubs in the country has fallen significantly since 1992 too, so it becomes easy to see the difficulties a free trade focussed brewery faces compared with back then. And as I said earlier Black Sheep has continued to brew several of the beers from those earlier days. Now there is nothing wrong with that if you are also brewing beers that reflect current tastes. But the market of 2023 is significantly different to what it was back then, with a swing over towards paler, more hoppy ales and away from traditional bitters, and whilst different beers have been brewed over the years, with some such as Golden Sheep and Velo continuing in bottle, and they have introduced keg and canned beers through a pilot brewery called 5-Barrel Project, the outward appearance is of a brewery focussing on a range that was fine when it started out, but is in serious need of beefing up with some more contemporary styles.  Add to that the impact of the pandemic and the rising costs of key ingredients, utilities, labour, and distribution and it is easy to understand the problems Black Sheep now face.

The brewery, which is now run by Paul's sons, Rob and Jo, along with Charlene Lyons as chief executive (Paul now acting as a brand ambassador), to their credit realised they needed to take some action as they had been loss-making since the pandemic, and appointed consultants Teneo Financial Advisory Ltd earlier in the year to undertake a strategic view of the business. They have now been appointed as administrators with the aim of selling the business on, and it is to be hoped that they are successful in saving the company, although whether there is any chance of their near neighbours, who were bought back out of Scottish and Newcastle by the family in 2003, stepping in to help the Black Sheep of the family who knows....

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And briefly, by way of contrast to the troubles faced by Black Sheep, another Yorkshire brewery which was born in the 1990's is celebrating 25 years in fine fettle. Ossett Brewery started out in 1998 when Bob Lawson, a former brewer at Tetleys decided to set up on his own, with beers first appearing next door at the Brewer's Pride in Ossett and other local free houses around Wakefield and Dewsbury. Unlike Black Sheep, the focus was on the pale, hoppy beers which were starting to become popular, and they brewed beers with names like Silver King, Silver Fox, and Silver Shadow. In 2003, Bob was joined by his son Jamie who owned a number of pubs, and from then on the newly-enlarged company set about building up an estate, which now stretches to about 35 within West and North Yorkshire. Along the way a number of existing brewpubs were bought; The Rat & Ratchet in Huddersfield, the Riverhead in Marsden, and Fernandes in Wakefield. They continued to brew their beers whilst having access to the growing distribution network Ossett were enjoying, with White Rat, one of the original Rat beers, eventually becoming the group's best seller. 

The Riverhead brewpub, Marsden, part of the Ossett Brewery group

The capacity at Ossett was increased to cope with the growing demand for White Rat and other top sellers, and with an eye on the growing craft beer market, a few years ago they opened a brand new brewery in Saltaire, called Salt. As with the main business, it was recognised that they needed their own outlets, so several modern, craft-focussed bars are now operated in and around Leeds, Sheffield, plus two in London, and the taproom at Saltaire. This has opened up the company to a whole new sector of the market.

It may be too simplistic to say that Black Sheep have been trapped by their past whilst Ossett have been forward-thinking and innovative, but it does help to partly explain why these two breweries from the 1990's find themselves in two completely different positions in 2023....

POSTSCRIPT

Meanwhile, following on from this it emerged a week or two later that the company had been acquired by lending and advisory group Breal, and a new company, the Black Sheep Brewing Company Limited had been formed. This maintained brewing at the company's site in Masham, although with it having been a pre-pack administration, the chance of shareholders and creditors in the old company being able to get any of their money back appeared to be remote. However the fact that around 150 jobs were saved was some good news, although we will of course have to see how it all pans out in the future....

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