The FINANCIAL — The EBRD and the EU have helped a traditional brewery in Batumi, Georgia, upgrade its production and enhance quality to meet European standards.
A beautiful seaside town with blue sky, a stony shore and surrounding mountains – over the past decade, the city of Batumi on Georgia’s Black Sea coast has become a hotspot for travellers not only from neighbouring countries, but across the world. Batumi is truly a city of contrasts – maintaining signs of its European heritage from the early 20th century when it was a major port city on the crossroads of Eurasia.
Lately, some world-renowned hotel chains have entered the local market and major infrastructure projects have transformed the skyline of the town beyond recognition. And while the Black Sea resort offers its visitors newer and more fascinating attractions every year, there are still some unique landmarks that go back in time. Batumi Brewery is one of them, according to EBRD.
Founded back in 1949, during the Soviet era, the company is the sole brewery in the region with a long history and a locally well-known brand: no wonder that the district it is situated in is commonly referred to by the name of the beer factory.
“Imagine a local who instead of heading to the beach goes to the outskirts of the city and joins dozens of like-minded people to enjoy a jug or two of fresh draught beer. That’s who we call our patriot client – it’s the highest form of loyalty when people walk up to 6 kilometres in 30ºC heat to enjoy our product,” says Roin Khalvashi, director of the Batumi Brewery.
From the outset, the company has been producing different types of beers and non-alcoholic beverages, supplying most of the western part of Georgia. However, lately, due to outdated machinery, the brewery switched to producing only one brand of unpasteurised draught beer targeting the low-priced segment of the market. Up to 75 per cent of products are sold in Batumi, in the local cafés and restaurants, and also in the nearby regions.
“The interest and demand for Batumi beer is growing every year. For local residents, it is a longstanding tradition, while for foreign visitors a chance to experience local produce – live draught beer,” says Nana Janelidze, the brewery’s owner. ‘’But the outdated equipment not only hindered our production, it also affected the morale of our staff. And this pushed us to seek options for development.’’
A new path to explore for SMEs
In 2016 the EBRD and the European Union (EU) joined forces to offer small and medium-sized enterprises (SMEs) in Georgia, Moldova and Ukraine assistance to fully exploit opportunities deriving from the free trade area with the world’s largest trading bloc – the European Union.
The Deep and Comprehensive Free Trade Area – an integral part of the Association Agreement between the EU and Georgia – was signed back in 2014. It is considered to be the one agreement that will not only enhance trade ties and release the full benefits that come from economic integration, but also foster SME competitiveness by upholding the highest food safety and phytosanitary standards, substituting import produce and meeting expectations of local consumers, and increasing the number of visitors from abroad.
In Georgia, through the EU4Business-EBRD Credit Line local companies can access financing to modernise their equipment, foster workplace safety practices and upgrade sanitary conditions. Within the EU4Business initiative, the financing offered by the EBRD is complemented with an EU grant of up to 15 per cent and technical assistance engaging local and international expertise.
The Batumi Brewery was one of the recipients of the financing. A loan helped the company acquire a new semi-automated Slovak beer production line that on the one hand improves the quality and safety of the product and on the other minimises the risk of injury at the workplace. The shift from old, outdated machinery to new modern technology reduced the required size of the production facility – now it occupies one quarter of the space, cutting down on energy and related costs.
The brewery has benefited from know-how and knowledge transfer from the EBRD’s Advice for Small Businesses team as well, which with EU funding helped the company introduce new quality management systems.
‘’For us, quality standards go beyond a simple mark on our logo. They’re a guidebook that directs every single step of our operations; and we are happy to receive such guidance. Our goal is the highest standard for our product and success barometer – the size and satisfaction rate of our clientele,” says Mr Khalvashi.
“We are proud of our heritage – and what we are even more proud of is the fresh draught beer of the highest European quality we offer to our clients. Batumi Brewery goes beyond ordinary production, it is something that people remember, the soul of our city,” says Nana Janelidze.