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Wicklow brewery welcomes some, not all Budget measures

Wicklow Wolf brews its beer in Newtownmountkennedy
Wicklow Wolf brews its beer in Newtownmountkennedy

As you walk in the door of the Wicklow Wolf's brewery in Newtownmountkennedy, two things hit you.

One is the strong smell of fermenting hops, malt and other ingredients that go into making their craft beers.

The other is the noise of the canning machines, rattling out dozens of filled and labelled cans every few minutes.

It is the site, sound and smell of a successful business in rapid growth.

Over the past year, Wicklow Wolf, which was only founded nine years ago, has grown by 25%.

"We started in Bray and we outgrew our facility in Bray fairly quickly and we moved here to Newtownmountkennedy to a purpose built facility five years ago," said Quincey Fennelly, who co-founded the company with Simon Lynch.

"Today we produce a range of different beer styles, from lagers to stouts to IPAs in both keg format and canned format. We distribute to all 32 counties and we have fairly significant exports now to France, Italy, Finland, Sweden. And hopefully soon into Germany and Spain."

The brewery also runs tours, hosts events and sells merchandise, offering other income streams.

Quincey Fennelly and Simon Lynch, co-founders of Wicklow Wolf

Growing any business from a startup is never easy. But Quincey Fennelly said that despite the growth of the last 12 months, it has been a particularly "tough" environment.

Predominantly this has been due to rapidly rising costs in raw materials and ingredients, as well as labour.

"It's been really tough, particularly from a cost point of view," he said.

"The cost of raw materials into the business have rocketed. In particular malt and because of the conflict in Ukraine, malt has tripled in price over the past year."

"And it's been difficult to pass on those price increases, so our margin has been severely squeezed across the entire business because of inputs."

Aluminium and glass has also gone up exponentially he added and energy, although the business has offset 40% of that by installing an array of solar panels on its roof.

"But you know, we're coming into the winter months now when the solar panels are not as efficient," Mr Fennelly said.

"And you know the cost of energy is going to kick back in for the winter months. So you know it's tough across the board from a cost point of view and also from a competitive point of view it's a very, very competitive market."

As a result, the company was keen to see if the Government would do something in the Budget to support it and other businesses with extra costs, some of which are being driven by the Government itself.

The measure came in the form of a €250m fund, which will provide as many as 130,000 SMEs with up to 50% of their commercial rates from this year back in payments early next year.

"Enterprise Ireland in particular have been very good to us and and have been very helpful to help us to get to where we are today," Mr Fennelly said.

"But any assistance we can get in the budget would would be brilliant, really."

Also welcome was that there was no increase in excise duty on alcohol announced, although Mr Fennelly had hoped for a cut in it.

"We've one of the highest rates of excise in Europe and...it just makes it very expensive in market, compared to other markets," he explained.

Other positive developments for the Wicklow based business were the announcements around startups, including a lower rate of capital gains for angel investors.

"I think with the amount of work that entrepreneurs put into a business it would be great to see them being rewarded for all the risk and hard work that they put in," the Wicklow Wolf boss said.

Less helfpul though, according to Mr Fennelly, is the increase in the minimum wage to €12.70.

He said staff at Wicklow Wolf get paid more than the minimum wage anyway, but any increase in it would drive labour costs generally higher.

"It is going to put pressure on inflation," he said.

"And if wages go up, costs go up and if costs go up, prices go up. So my my fear around that is inflation and that that will have another upward spiral in terms of costs all around."

"I'm not saying people don't deserve an increase, but it it has an economic repercussion."