Brewery Aldaris feels negative impact of Latvia’s economic situation

The Baltic Course
Nina Kolyako

Latvia’s largest brewery Aldaris feels the negative impact of Latvia’s economic situation on its business activity, the company’s Chairwoman of the Board Inara Sure admits in an interview to the newspaper Diena.

“The good news from analyzing the data of the first seven months of this year is that our business activity has not shrunk, but the bad news is that we have not developed either,” the entrepreneur points out, admitting that the industry is currently in a stagnation period.

“Of course, the industry was affected by weather conditions, as I would say, there was no winter and no summer either. But it is just one factor. Of course, the economic situation had the strongest impact on our business. People have less money, they focus on credit payments, their children’s needs and paying the bills, those are the priorities.”

Aldaris expects even worse results in the next months of this year as the economic situation is troubling.

“There has been talk of the recession and the economy crisis for a while already. In my opinion, it is still ahead of us. However, we do not wish to be very negative in our prognosis, I am confident that the recession will be followed by development. We survived the impact of the crisis in Russia, we survived the beginning of the 90’s, when we had to look and think far ahead. Now we have a stable outlook for the future,” Sure said.

She categorically denied the option that the number of Aldaris’ employees could be reduced, “each year we make investments to improve the efficiency of the company and to reach European level of productivity.”

“The efficiency is revealed by the data, how many hectoliters of beer we produce per hour per one employee, how much energy and water we spend. We have been working efficiently all the previous years and we will continue to do so. [..] In Latvia one resident consumes 70 liters of beer per year on average. In Lithuania and Estonia the number is already above 90 liters and people drink even more in other countries. I prognosticate that the consumption of light alcoholic beverages, including beer, will increase,” Sure prognosticates.

One of the development options that the company plans to explore, is the export. Aldaris already exports non-alcoholic beer and mineral water “Vichy” to Lithuania and Estonia. “Now we are ready to try out exporting our beer to the west. We already have experience with Ireland, United Kingdom, Canada, U.S. and Israel. We plan to expand the export sector, talks have already started, but we will be able to give precise conclusions after we see the results,” the entrepreneur says.

The entrepreneur also admits that the beer prices next year could increase. “We do not plan to raise the prices until the end of this year, we hope to cope with the production costs, although the gas and electricity tariffs will be augmented. We will have to increase the prices at one point, but no sooner than at the end of the next year. I cannot give exact number yet, but our goal is to increase the beer prices as little as possible,” Sure emphasized.