The Philippines: Philippines’ largest microbrewery continuing its success story

Rajesh Sadhwani is a beer connoisseur. Aside from loving this gentle alcoholic drink, he treasures the financial independence he derives out of the business his passion has led him to.

From importing premium beer for local distribution, Sadhwani now owns the Philippines’ largest microbrewery business as a natural complement to his growing distribution business of imported wines and beer spirit and an expanding chain of restaurants, the Manila Bulletin reported on July 12.

Sadhwani was studying at the Suffolk University in the US when the Asian financial crisis struck, doubling his tuition, forcing him to leave school and help the family’s Liquor and Tobacco Department for Duty Free Superstore, Inc. in Subic Freeport.

This experience gave him the idea to pursue a distribution business for imported spirits as he saw the growing demand for these products. And so, Booze On-Line, Inc. was born in 2000.

Booze has become one of the leading importers and distributors of premium wines and spirits and beers from other countries, mostly from Europe.

To have a steady outlet for his products, Sadhwani decided to venture into the restaurant business in 2008. It was named The Distillery, which showcased the widest selection of imported beers at that time. It was an instant hit. It opened up the previously staid beer market to a whole new beer experience, contributing greatly to the expansion and evolution of Philippine beer culture. The Distillery currently has two branches – one in Metro Manila and one in Cebu.

Sadhwani noted of the long lines of customers outside waiting to get in that he decided to build more Distillery outlets in Jupiter, Eastwood and in Cebu.

As the Distillery was doing good, Sadhwani decided to import draft beer in 2011 as there was no draft beer in the country, except San Miguel beer.

The Distillery was soon followed by Draft Gastropub, the first European gastropub to serve only imported draft beers. Draft was very well received and continued to be a favorite among the yuppie. Draft currently has four outlets spread throughout the metropolis. These establishments serve as a showcase for Booze Online’s imported beer brands. In 2010, Grand Cru was established as an affiliate of Booze, concentrating more on the importation of spirits and wines. Grand Cru was founded, together with Calvin Li, whose family is one of oldest liquor importers in the Philippines, thus, extending Booze’s distribution reach.

Most, if not all, of his restaurants performed very well. He recalled that in the first three months of Distillery, it was all completely full packed.

“At one point, we do not accommodate reservations anymore so we serve the walk ins,” says Sadhwani.

The same thing happened when the Draft outlet was opened in BGC at the Fort Strip.

People love their imported draft beers, premium ingredients and their food preparations that consist of the top-of-the line cheeses and high end beef.

“So all dishes are put together with very high quality ingredients and beers are all imported. We’re the first to do it. So it was almost exacting,” he says.

“Draft has a very good journey,” he says.

It was so successful that Sadhwani was able to recover his investments in a year. More outlets were opened in Rockwell, Greenbelt and Alabang. An outlet along Meralco is also under construction with opening date in September this year.

Throughout his career, Sadhwani’s love for beer has always been a deciding influence. Beer accounts for the biggest part of his growing business portfolio. He has scaled up his presence in the beer sector in his latest foray with the establishment of The Brewery at the Palace, which opened in June only this year.

A brewery is a venue that brews its own beer. In the case of Sadhwani’s, The Brewery At The Palace is not just a plain brewery, it is also a high-end restaurant.

“The Brewery At The Palace can produce six types of beer at one time making it the biggest on-site microbrewery in the Philippines. And we have a restaurant component with live entertainment and different DJs,” says Sadhwani.

This hip and happening place also prides itself in its unique dining experience that beer lovers would readily welcome. The microbrewery is a permanent fixture housed on mezzanine floor, and shares a two-level space with a stage for performing bands, a fully-stocked bar and a dining area. Both floors have a mix of homey and industrial feel to it with images of microbrewery scale models on the walls and the actual microbrewery where beers are legendarily brewed.

Aside from beers, The Brewery boasts a delectable menu and live band performances to keep the mood rocking.

“We wanted to showcase the artistry of the beer brewing process and simultaneously be a major force in changing the local dining landscape. It’s a different kind of gastro pub experience,” says Sadhwani.

Starting with four artisanal beers (Pilsner, IPA or Indian Pale Ale, Stout and Wheat) when it opened last year, The Brewery’s beer menu has expanded adding variety and excitement to one’s beer connoisseurs.

They now have other flavors using local ingredients (like tamarind and ginger) and others to spice up different seasons of the year. The list includes honey ale, ginger, Marzen (traditional Oktoberfest beer), Smokey Oakey, Santa’s Little Helper (Christmas Bock), Sampaloka, Jasmine Citra Lager, Brewmaster’s Gold, Uptown Ale and Fighting Irish.

“Filipinos love beer and I think in most countries, too, because beer is a very easy to drink and as people get older, beer is the stepping stone,” says Sadhwani, who cannot let a single day pass by without dunking a single bottle of beer.

According to Sadhwani, beer is normally the first alcoholic beverage for an adolescent.

“Beer has an average alcohol content of 5 percent so it is really a soft type of alcoholic drink, easy to consume and very low alcohol and can be consumed with food anytime of the day,” says Sadhwani.

Also, beer is so accessible and are mostly sold in “sari-sari” stores and convenience stores.

In beer-producing countries a draft beer comes from a keg not from a bottle. Normally, fresh beer has a shorter shelf life because it has less preservative and less chemicals than a bottled beer.

Beers are pasteurized in different ways in different storage situations. Draft is more technical in storage, shorter life span but fresher with standard expiration of 6 months as against bottled beer of 12 months.

As such, this beer lover admitted it has been his passion to really produce even fresher beer than what customers drink.

So they imported the machineries from Vienna and hired a brew master from Vienna also. Now, The Brewery has a new German brew master, who is working full time “so we have been able to produce great beers.”

Now, The Brewery produces new variations of local craft beers.

“For instance, we now have chocolate chili beer and we’re using the malt from Belgium and our ‘labuyo’ (native chili),” says Sadhwani. The malt is roasted to give a chocolate type of flavor. “It is very similar to roasted coffee with chili taste at the end,” he adds.

Freshly brewed beer, great food, live entertainment plus a sprawling two-storey restaurant – these are reasons enough for guests to hold their private and corporate functions at The Brewery.

The restaurant was also built in such a way that “customers can see an actual beer manufacturing process on days when people are brewing, milling the malt and loading the brew house. It is so open for all to see and how and we are not using any sort of chemicals so it is completely fresh.”

With the brewery component, The Brewery is its biggest restaurant with 860 square meters area.

“The beer at The Brewery is the freshest beer in the Philippines because it comes from the source so there is no chemical, no transporting of the product as it gets straight to your glass, just like in other heavy beer-drinking countries like Germany,” says Sadhwani.

The ultimate goal is to come up with a bottling operation to be able to produce its own beer bottles or growlers that it can use to deliver to his other restaurants and distribute to other markets.

Growler is a resealable bottle traditionally used to transport and deliver beer. Since beers are supposed to be taken fresh, people refill their growlers at the brewery. Thus, each village in Germany and other countries in Europe have their own breweries. Beer is served chilled not with ice.

“Our beer is already chilled because the brewery is temperature-controlled where all tanks are insulated and no oxygen can get, no oxidizing. So it is completely fresh like an incubator, nothing changes inside the container,” explains Sadhwani.

“Our beers are doing very well and customers are trying out our new beers,” he says.

The Brewery has 6 fermentation tanks and 6 dispensing tanks with a production capacity of 500 litters for every run or 12,000 liters per day. Once they have set up the growler facility, The Brewery can increase its production to serve new markets and select retail spaces.

Its fulltime German master brewer is doing well and making decisions on when and what flavor to brew depending on his inventory and sales demand.

“His job is to make the beer and make sure that it is perfect,” says Sadhwani. The brewery equipment was its biggest investment and Sadhwani has to recover that yet.

“I was thinking that even if takes us a long time to recoup, our money is safer as they are invested in good equipment that will not rot or break or lose. So, it holds its value,” he adds.

“We continue to grow and one of the reasons is our people,” adds Sadhwani

The restaurant chain employs 300 people but the distribution business, which has 50 employees is still bigger. The distribution business is 90 percent Metro Manila and the rest in Cebu and Davao.

“We have not opened our own offices outside of these areas because there is still plenty of room for growth in Metro Manila,” he adds. There are plans though to open restaurants in Cebu and Boracay.

Filipinos are traditionally beer drinkers and they prefer the San Miguel Beer Pale Pilsen.

“That is the very standard of beer that we were drinking growing up,” says Sadhwani. Given the affordability of local beer, the beer market demographic cuts across all segments in the Philippines.

For Sadhwani’s restaurants, their customers are from the AB segment from 25 years old and above. But as the economy gets stronger, people also tend to upgrade their taste and preference for beer.

He drew a parallelism with Starbucks wherein before it opened locally, nobody wants to spend R100 for a cup of coffee as Filipinos are content with the 3-in-one coffee but now everybody has a cup of Starbucks.

“Just like beer, people are slowly upgrading to our products because they are really quality products,” says Sadhwani.

The price of its beer maybe a little bit expensive than the others but Sadhwani caters to a more affluent market being located in BGC which hosts a lot of other high-end products.

“It is expensive because it is very premium but we are also in an expensive area so we are not sticking out like a sore thumb,” he adds.

There are several craft breweries in the country also, but they are basically home brewing and more of a hobby, “But ours is business and we have lots of capacities.”

While Sadhwani is promoting alcoholic drinks, he always emphasizes moderation in drinking. He does not sugar-coat the impact of alcoholic drinks.

“One glass of red wine is good for you, but the moment you drink more, then it is not really good for you anymore,” warns Sadhwani.

He also accepted that beer is fattening. “There is no way to say it, it is fattening, but the thing is if you’re going to drink it you might as well drink this one because this is the best,” he adds.

But beer is actually healthy, he said, it only loses this healthy content after the fermentation which produces alcohol.

He, however, took note that its beer is healthier than bottled beer because the protein is alive when the beer is fresh, but because it has alcohol content, “I don’t want to call it healthy because that’s misleading.”

“If you are drunk you would not be in the right frame of mind because you are intoxicated,” he adds.

11 July, 2016