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Bira 91 crafts plan for every Indian beer to be emissions-free: founder Ankur Jain

By changing the ways in which it consumes energy and water and disposes of waste, the company wants to spark a revolution and ensure that every beer made in India has zero carbon emissions.

April 21, 2022 / 06:30 PM IST
Ankur Jain, founder and CEO of Bira 91, spoke to Moneycontrol about the company’s sustainability efforts and zero-emissions mission and about current sales trends and the impact of rising prices.

Ankur Jain, founder and CEO of Bira 91, spoke to Moneycontrol about the company’s sustainability efforts and zero-emissions mission and about current sales trends and the impact of rising prices.

Bira 91 is on a mission to be a net-zero carbon emissions company by 2025. It plans to achieve this goal by shifting entirely to clean energy, consuming 60 percent less energy, halving water consumption, and ensuring that no waste is sent to landfills.

Last year, Japanese beverage company Kirin Holdings invested in B9 Beverages, the parent company of Bira 91, for a minority stake. Subsequently, both companies formed the B9-Kirin Centre for Sustainable Growth, focused on environment sustainability and other business synergies. The sustainability move by B9 Beverages comes with the partnership.

Ankur Jain, founder, and CEO of Bira 91, spoke to Moneycontrol about the company’s sustainability efforts and zero-emissions mission and current sales trends, and the impact of rising prices. Edited excerpts:

What triggered the company’s sustainability move?

While sustainability has been on our mind for some time now, a book by venture capitalist John Doerr that I read last year was the trigger for the launch of this mission. I had also read a book by Bill Gates on climate change prior to that and both these books made me aware of the urgent need for companies and individuals to address climate change.

Consumers want to drink better beer, they want to drink more flavourful beer but at the same time they are very aware of the impact of their choices on the community and the planet. And they want to also be able to make better choices for the community and the planet. So we thought about what we can do as a beer company and as a manufacturing company that’s rooted in India.

We have a responsibility to minimise the negative impact on the environment that we would have as a manufacturing company. And that triggered this entire effort. Over the last 12 months, we have worked very hard to ensure that we have a credible path to zero carbon emissions by 2025. And this is a result of that.

What are some efforts that will be taken over the next few years to become a net-zero beer company?

We have crafted a simple action plan, which is we want to lower the amount of energy that we use to make our beer. Any energy that we use, we want to ensure that it is clean and has zero carbon emissions. We want to lower the amount of water that we use to make beer because water directly and indirectly does lead to carbon emissions. And we want to ensure that we send zero waste to landfills.

Across these four pillars, we have taken a tremendous number of actions. To give you an example, over the last 12 months, we have been able to lower our carbon emissions by nearly 40 percent through incremental improvements in the way we brew, the way we pack, and the kind of energy that we use. We reached a very important milestone, our first milestone of becoming zero coal, in January 2022. About three months ago, we stopped using coal in our breweries.

One thing that is very different about our mission to zero is that this is not just about supply chain and manufacturing for us. At the end of the day, this is about consumers as well because we feel that a lot of times companies announce initiatives which are in silos. That’s why climate for us is not just a manufacturing pillar or the way we make things. It’s also the way we talk to our consumers and what we talk to them about.

Does it make business sense to go sustainable at this point?

When we were researching this really important aspect of our business, we realised that in many circumstances, going green is actually cheaper than not going green, even in the short term. And in several other instances, while there is some capex, the payback for that capex is actually less than two years. So from a pure business perspective, it makes a tremendous amount of sense to go green.

To give you a very specific example: if you’re able to cut energy use by 20 percent because of an initiative, then you’re buying 20 percent less energy, right? And that’s what is so powerful about going green, that it’s actually not just green from an ecological standpoint, it’s also green from a profitability standpoint.

Beverage companies are experiencing a normal summer after two years. What’s the consumer response been so far?

After two successive summers that were impacted by Covid, we are finally entering, hopefully, a Covid-free summer. And the results of that are already encouraging in terms of both industry volumes and our sales. We have crossed pre-Covid levels for the first time. Also, with our revenue numbers, our volume numbers, etc, expanding tremendously recently, we are seeing a lot of positive response.

We have also come across a change in consumer behavior and realised that they are looking for a lot more flavourful products today than they were maybe in the pre-Covid period. And that is both in bars and restaurants and also at home. And I think that’s a direct result of them experimenting with different flavours during Covid.

The transition towards flavourful beers is happening very aggressively. And that’s resulting in our market share growing. We also feel that a lot of our peers are realising the importance of flavours. We launched four new products last week, but we also see a lot more launches by our competitors and our peers.

We feel that we are partly responsible for that change. Just like we sparked the craft beer revolution in India over the last few years and demonstrated or validated the category, we now have an opportunity to also spark a much more important revolution, that is to ensure that every beer that is made in the country has zero carbon emissions.

Besides product launches, what initiatives are being taken to tap the increase in consumer demand this time?

Over the last 12 months, we have been able to ramp up capacity tremendously. Now we can produce more than 2.2 million cases per month – or about 25 million-plus cases, 27 million cases per year – as opposed to 1.6 million cases per month last year.

The second initiative for us is to ensure that our products are available in more stores and hence we are expanding distribution. We are available in one out of three licensed outlets today in the country. Pre-Covid, that number was something like one out of every four. And the third one is about product innovation. So introducing new flavours that consumers want and in the preferred pack types.

Prices of raw materials have climbed considerably and the Russia-Ukraine war has led to a rise in wheat prices. How are you addressing this?

Almost every important commodity that we use in making beer, be it aluminum cans, wheat, barley, or wheat, has been impacted severely by inflation. And also, in some cases, shortages.

From our perspective, the first thing has been to ensure that we have secured adequate quantities and supplies.

Secondly, we are trying to mitigate the impact of price increases or cost increases. In many cases, we’ve been able to mitigate the impact on margins by improving our product mix to ensure that we are selling more of our premium products versus mass-market products.

We have also been able to address and mitigate the impact of inflation through very active cost management. We have rationalised and cut all ancillary costs. We do not really have an option but to pass on a price increase to consumers. The combination of all three we feel will help us at least maintain margins.
Devika Singh