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Arran Brewery expansion plans thwarted

The Arran Brewery has had to put the brakes on its expansion plans after the Scottish Government Minister Fergus Ewing turned down a grant application to expand the brewery on Arran and build a new bottling facility on the mainland.
The Brewery was seeking to create ten new jobs on Arran and a further 67 on the mainland but the project was dependent on the government providing a grant to support the expansion on Arran.
MD Gerald Michaluk said: “I am obviously very disappointed.  We make only on average 6p profit on a bottle of Arran Beer and pay 24p duty. As we move above 500,000 litres of beer produced the duty rate rises to as much as 49p a bottle.  Clearly much higher than our 6p profit. As we refuse to compromise on quality of ingredients the only way to continue to make a profit is to have efficient brewing equipment that can save us 50p a bottle in production costs. This is why we applied for a grant from the Scottish Government so we could continue to expand our business. Without grant assistance a brewery of this size on island like Arran is simply not economic but with a grant we could have made the numbers work and created sustainable jobs both here on Arran and on the mainland in a new bottling facility that would have shaved a few more pence of costs.
“Our brands have won prestigious international awards like the best beer in Europe twice and only last year a best beer in the World category for our Arran Dark and were poised for international growth. While recent statistics place us as the number ten best selling ale in Scotland.  There is no other micro brewery in the top ten.
“This is clearly a set back and has wasted a lot of time while we awaited the decision but we will overcome, as they say, and move forward regardless.   It is just going to be a lot tougher, take a longer and involve a whole lot more effort”.

11 March 2013 - Felicity Murray