OVERVIEW ON BEER MARKET IN FINLAND FLANDERS INVESTMENT & TRADE MARKET SURVEY
Overview on the Finnish beer market 2017
April 2017
Païvi Sievänen Flanders Investment & Trade c/o Embassy of Belgium in Helsinki Aleksanterinkatu 17 00100 Helsinki [email protected]
Beer Market in Finland | 2017 1 Content
Introduction ...... 3 Sales and consumption...... 3 The import of beers ...... 6 Beer taxation ...... 6 History of Finnish beer and brewery culture...... 7 Beer festivals ...... 8 Channels to do Business in Finland - Contact information ...... 9 Sources: ...... 11
Beer Market in Finland | 2017 2 Introduction
The Finnish beer market and culture has seen changes in both the far and recent past. The Belgian beers trended in the 1990s, but with the craft beer trend, which started five years ago, we hope to see an increase in the selection of rarer Belgian beers again. As most Belgian beers have an alcohol percentage of more than 4.7%, they cannot be sold at supermarkets but only at the state-owned Alko stores. However, Finland is preparing a reform in its Alcohol Act which would allow beers up to 5.5% to be sold in supermarkets. This would be an excellent news for the Belgian breweries.
Distinctive in Finland is the alcohol tax which is the highest in the EU and has a heavy effect on e.g. beer prices. That is why many Finns buy alcohol from Estonia, their southern neighbour, which is only a 2 hour ferry ride away.
Sales and consumption
The domestic sales of beer were 420.9 million litres in 2015, whereas 44.2 million litres were imported. Travelers imported approximately 35.6 million litres which indicates an increase of 10% compared to previous year – most of the imported beer is brought from Estonia or cruise ships sailing incessantly between Helsinki and Tallinn. The popularity of buying from Estonia owes to remarkably lower prices compared to the prices in Finnish mainland. However, Estonian government is planning to increase the tax rate for beer significantly in the next few years, which will most likely result in an increase in the domestic sales in Finland. Accordingly, cruising between Finland and Sweden is popular but the allowed amount of alcohol beverages travellers can import is restricted. In general, the cheaper price rate of alcohol beverages in cruise ships derives from the tax-free zone of the Baltic Sea.
Consumption of beer per person was 76.8 litres in 2015. There has been notable fluctuation in the consumption trend; a main explanation from the past ten years has been the tax policy on alcohol. The heavier the taxes, the less beer and alcohol in general is consumed.
Sales of alcoholic beverages decreased between 2008 and 2015 in all channels, including Alko monopoly, hotel & catering and retail. However, the consumption trend turned into an upward direction in 2016 and an ongoing reform of the Alcohol Act will be likely to boost sales even more once implemented.
Beer Market in Finland | 2017 3
Source: THL, National Institute of Health and Welfare
Sales of beer increased by 2.2% in 2016 compared to the previous year as seen on the table below.
Source: Panimoliitto.fi
The following table shows the figures for domestic sales of beer by alcohol content categories. Beverages with alcohol content lower than 4.7% are sold in retail channels such as grocery stores, but stronger beverages (alc. content above 4.7%) are only allowed to be sold in Alko stores and cruise ships – Viking Line has some Belgian beers in its selection. Most of the Belgian beers sold in Finland are only available in Alkos at the moment. However, according to the draft law by which the Alcohol Act is about to be reformed in 2017, the maximum alcohol content of beverages sold in the retail will be increased from 4.7% to 5.5%. This enables larger selection of Belgian beers to be available for the consumers in new channels, such as grocery stores and kiosks.
Beer Market in Finland | 2017 4
Source: Panimoliitto.fi
Most of the beer, 83.5%, is sold in the retail sector (2015). In the years after the millennium this sector has managed to grow heavily its share in the sales. In 2000, the percentage was 67. The restaurant sector has been losing share, in 2000 it sold 28% of all nationally sold beer, in 2015 only 14.7%. The prices in restaurants have gone up and as consumers are price sensitive in these challenging stages of the economic cycle, the amount of beer consumed at home has increased.
Alko stores sold 1.8% of all beer sold in the domestic market in 2015. As mentioned before, in the retail sector Alko sells all of the beer with alcohol content higher than 4.7%, but the situation will change if the new legislation will come into force. Alko is state owned and has a monopoly on the retail sales of strong alcoholic beverages, while other retailers willing to sell milder beverages need a license. Alko has a total of 354 stores and 61 pre-order pickup points. A new Alko webshop was introduced recently.
Beers in a Finnish retail store: 6- and 12-packs of Finnish beer are popular.
The beer trend is currently changing, especially in the cities from the basic Finnish lager to special small brewery beers, this is also shown in the statistics - see below in the history chapter for more detailed information.
The biggest Finnish breweries are Hartwall www.hartwall.fi/en, Sinebrychoff (part of the Carlsberg Group) www.sinebrychoff.fi/, and Olvi www.olvi.fi/web/en. The list of the smaller breweries can be found at the website of the Finnish Microbreweries’ Association www.en.pienpanimoliitto.fi/3
Beer Market in Finland | 2017 5 The import of beers
The imports have seen a boom in the years after the millennium. In 2000, the imported amount of beer was 6,581,000 litres and 53,027,000 litres in 2013. The total amount seems to be increasing year by year.
More detailed figures:
Source: panimoliitto.fi, (figures of its member companies)
Some examples of Belgian beers sold in Alko (of a total 48): • Grimbergen Blance 0.33l 3.11 euro • Rochefort 10 0.33l 7.00 euro • Leffe Blonde 0.33l 3.77 euro • Hoegaarden Witbier 0.33l 3.53 euro • Stella Artois 0.33l 3.09 euro • Duvel 0.33l 3.98 euro • Lindemans Kriek 0.25l 2.97 euro
As the consumption of organic food is increasing in Finland, Alko has taken more organic beers into its selection. In 2009, there were only 5 organic beers available in Alko, whereas the current number of organic beers is 22. Three of these products are from Belgium: Brunehaut Ambrée Bio Gluten free (0.33l) 3.28€, Mongozo Premium Pilsener (0.33l) 3.50 €, and Saison Dupont Biologique (0.25l) 3.51€.
In bars beers cost approximately 6 to 9 €.
Beer taxation
Finnish beer tax is the highest in the European Union and almost five times as high as in Estonia, Finland’s southern neighbour, where people often travel for cheaper alcohol, as mentioned before.
Taxes in Finland account for about 60% of the price of a bottle of beer which is one of the highest in Europe. The Finnish Association of Breweries says that the amount of taxes is even higher. On the discount beer, tax could be more than 80% of the price. Tax differences between Finland and Estonia are huge. When prices in Finland rise, the outcome is a rush to buy cheap beer in Estonia. This activity has increased considerably for several years.
Beer Market in Finland | 2017 6
Source: Panimoliitto.fi
History of Finnish beer and brewery culture
Photo: Brewing beer in 1911 at Ylälaukaa
The history of Finnish beer culture has experienced different phases.
In the beginning of the 1900s Finland had a rather lively brewery culture and different types of beers were brewed such as porters, stout, and bock, in almost every city and village.
In 1919 the prohibition law came into force, the breweries had to stop with the business. The prohibition lasted until 1932. The prohibition started a ‘dark age’ in the Finnish beer culture and it lasted for decades. After the prohibition the monopoly of alcoholic beverages above 2% was given to Alko, the state owned alcohol retailer. Alko tendered the breweries and chose 4 biggest and cheapest which all produced watery lager because it was cheapest to make. The Koff brewery also produced porter.
Beer Market in Finland | 2017 7 The import of foreign beer was allowed only in 1964, but as late as in 1986 Alko only had 2 foreign beers in the selection – both of them Danish. The beer culture that we know currently started only when Finland joined the European Union in 1995. After that, the imports rose heavily and Finns found the tasty foreign beers, also Belgian ones which were a trend in the 1990’s. Also, the amount of Finnish breweries increased. However, the recovery of the beer culture lasted only a few years and ceased sadly again when the millennium was approaching.
About five years ago the current beer boom started. Instead of ordering just ‘beer’ as equivalent to Finnish lager, the thirsty customers want individually chosen special beers. In this new boom the price is not a terminating factor as it was earlier. Now taste matters. Beer houses have also changed – the current style is trendy and Scandinavian, nothing dark and shabby like before.
The Finnish retailers also sell a vast variety of special beers; those have now become main stream and consumers go to beer houses to find even more rare beers. The experts believe the boom will continue and even grow. This boom is visible in big cities in Finland, in the countryside the normal Finnish lager still keeps up. It remains to be seen whether a larger group of the whole population will change its liking with beers.
The big breweries like Koff and Hartwall have also started co-operating with foreign breweries. They are understandably afraid of losing too much market share. They believe that the smaller players have managed better with the marketing and branding their products. Also, the etiquettes are well-thought, and the beer names are funnier which supports the brand-building.
There is a growing number of small breweries and brands in Finland – some of their special beers are brewed in Belgium as private label products.
A Scottish brewery Brewdog opened a bar in Helsinki in 2014. Other new trendy beer houses have opened their doors as well for example with Scandinavian and North American emphasis. The traditional Belgian style cafes remain to have their own loyal customer base.
Beer festivals
There are several smaller and bigger beer festivals annually in Finland.
Helsinki Beer Festival - www.helsinkibeerfestival.fi/main ,Flanders Investment & Trade Helsinki visits this festival. There are about 60 Belgian beers present, mostly through the festival director who brings special beers from Belgium. The festival director can be contacted for cooperation/inquiries: Mr. Markku Korhonen Email: [email protected] T +358 40 707 7771
Great Beers – Small Breweries - www.suuretoluet.fi/in-english/
Beer Expo Finland - olutexpo.fi/?lang=EN
Craft Beer Helsinki - www.craftbeerhelsinki.fi/in-english/
Beer Market in Finland | 2017 8 OtaOlut - otaolut.fi/ohjeistus-information/
Kymijoki Beer Festival - www.beerfestival.fi/2016/briefly-in-english/
Channels to do Business in Finland - Contact information
If you want to do business directly with Alko, please read their instructions and requirements www.alko.fi/en/alko-inc/for-suppliers/ carefully. Contact information can be found on the website as well. Alko publishes its purchase plan twice per year, in November and in May, besides these they might have extra searches e.g. Easter beers or Sparkling Wine from Germany. However as the sales of beer in Alko are limited we recommend you to rather do your best to find your product a good importer in Finland who will visit and keep up contacts with Alko. Unlike in Sweden and Norway, the Finnish importers are still allowed to do this. Working with a good importer will mean that you can also enter the Finnish HoReCa channels and your beer will be found in Finnish restaurants, hotels and bars.
Please find below a list of importers, for detailed contacts of the emails of the purchasers please contact the FIT Helsinki office.
1. Servaali (www.servaali.fi) “Servaali is among the largest private and impartial beverage importers on the Finnish and Baltic markets. Servaali's product portfolio consists of international premium lager, specialty beers, cider, wines, liqueurs, spirits and soft drinks. The product range includes global renowned beverage brands as well as local specialties from around the world.”
Servaali has a good selection of Belgian beers including Duvel, Maredsous and Vlaamsche Zotten. Also ABInbev is their supplying partner. They also have an own brand Vlaamsche Bandiet, which is brewed by Brouwerij Cornelissen (www.brouwerijcornelissen.be/).
Servaali has connections not only to Alko but they also serve the supermarkets and horeca as well as travel retail (Tallink Silja and Viking Line, the two main ferries). They also supply to crossborder stores with Finland and Russia.
With the same owner as Servaali, Brewseeker www.brewseeker.fi is specialized in the import of craft beer (also from Belgium) – see more below.
2. Brewseeker Oy (www.brewseeker.fi/node/5) “Brew Seeker Oy is a privately owned, small and agile company concentrating in alcoholic speciality beverages from all over the world. We import, market and distribute quality products and our focus customers are the specialist on-trade outlets all over Finland as well as our national monopoly for alcohols above 4.7% abv and retail. Our motto “Quality Brews for Connoisseurs” explains our business idea perfectly. We are constantly looking for new potential partners in order to fulfil the demand from our clients.”
Brewseeker is part of 25-year-old family business Captol Invest like above mentioned company Servaali. While Servaali is focused on traditional beers, Brewseeker is looking for experimental and special beers of smaller quantities to their selection.
Beer Market in Finland | 2017 9 Tol Brands (http://tolbrands.fi/brands) is also part of Captol Invest and its purpose is to develop new products for Captol Invest’s own brands and source alcohol beverages.
3. Diamond Beer (www.diamondbeer.com) “Diamond Beverages is a privately owned company founded in 1998. We are importers of beer, cider, ready-to-drinks, whiskies and other alcoholic beverages from several countries all over the world. Our main line of business is beer and cider, generating approximately 90% of sales divided equally between on- and off-trade.
We cooperate with all Finnish wholesalers, which guarantees that you can find our products all over Finland. Our customers are bars, restaurants, night clubs, hotels, supermarkets and Alko (the Finnish alcohol monopoly system).
We are always interested to try something new. If you have a product that could be suitable for us, please contact: [email protected]. “
4. Malty Oy (www.malty.fi) An importer of beer and cider, their current selection of Belgian beer scan be seen here: malty.fi/belgia/
5. Uniq Drinks, former Heino Juomat (udf.fi/meista/, 7 Belgian beers in selection) [email protected]
6. Novovin (www.novovin.com) [email protected]
7. Pikkulintu (www.pikkulintu.fi) [email protected]
8. Ultimator (www.ultimator.fi/ importer in Helsinki, Mr. Olli Sarmaja) Phone number +358 50 5994529 [email protected]
9. PM-Juomatukku Oy “PM-Juomatukku is a family business with its roots in a beer wholesales company founded by Pekka Markula in 1980. PM-Juomatukku's clientele mainly consists of restaurants, retail traders and catering companies. Our product range covers over 4,000 items.”
PM-Juomatukku has increased the amount of smaller breweries’ beers in their selection, latest from Belgium was the addition of Paljas beer to their selection in 2015.
10. Red Bev Oy (www.redbev.fi/index.html)
11. Viinitie (viinitie.fi/yhteystiedot/)
12. Restile Oy (www.mallaskukko.fi/restile)
13. Lasso Drinks (www.lasso.fi/english/) Their private label Lasso beers are brewed in Belgium
Beer Market in Finland | 2017 10 [email protected] T +358 10 400 64 80
Sources:
Helsingin Sanomat 30.01.2014
Panimoliitto - www.panimoliitto.fi/en/
Pienpanimoliitto - www.en.pienpanimoliitto.fi/
Alko - www.alko.fi/en/
Ministry of Social Affairs and Health - stm.fi/en/comprehensive-reform-of-alcohol-act
THL, National Institute of Health and Welfare - www.thl.fi/en/web/thlfi-en
Meetings with Finnish importers in 2015 and 2016
Disclaimer
The information in this publication is provided for background information that should enable you to get a picture of the subject treated in this document. It is collected with the greatest care on the bases of all data and documentation available at the moment of publication. Thus this publication was never intended to be the perfect and correct answer to your specific situation. Consequently it can never be considered a legal, financial or other specialized advice. Flanders Investment and Trade (FIT) accepts no liability for any errors, omissions or incompleteness’s, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organization mentioned.
Date of publication: June/2017
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