The Craft Beer Business: Creation of a diverse beer culture and regional development through Our Steady Focus on Quality

In 2014, Kirin Brewery entered the craft beer business and opened SPRING VALLEY BREWERY TOKYO, and YOKOHAMA, the restaurants with brewery.

Since then, the company has put out a number of amazing craft beers. In March 2020, Kirin Brewery began selling the canned product SPRING VALLEY HOJYUN 496. Kirin Brewery’s craft beer business embodies the Kirin Group's contribution to local communities and one of our CSV Purpose, “Community Engagement”.

Kirin Brewery has a history of over 100 years that is based on the philosophy of a Steady Focus on Quality.
Craft beer is now gaining popularity both in Japan and abroad. In craft beer, what kind of value will Kirin Beer, which has a history of more than 100 years with the philosophy of a Steady Focus on Quality, create for local communities? And what the future of beer we are trying to open up like?

" A Steady Focus on Quality " philosophy passed down through the pride of our engineers

Kirin Brewery’s philosophy when it comes to doing business is to maintain a Steady Focus on Quality along with a Consumer-first Approach. Our philosophy of maintaining a Steady Focus on Quality was born even before Kirin Brewery itself was founded. The roots of that philosophy go back to Japan Brewery, a brewery founded in Yokohama during the Meiji period that was later taken over by Kirin Brewery.

Japan Brewery was established by foreigners living in Yokohama’s Yamate area, which was a foreign settlement at the time. The company originates in Yokohama and was established on the site of Spring Valley Brewery, which was first founded by William Copeland, the father of the Japanese beer industry. Beer was still not popular in Japan at the time, but armed with leading-edge equipment, brewers did their best with attempts to make authentic German beer in Japan. Since our founding, we have been committed to brewing high-quality beer. We made no compromises when it came to quality and brought in qualified brewing technicians from Germany and imported what we needed from the country when it came to raw materials such as malt, hops, machinery, and equipment and so on.

In 1907, Kirin Brewery Company, Limited took over Japan Brewery. At the time, quality levels were maintained by foreign technicians. While World War One left them with no choice but to return to their homelands, their skills and spirit were passed on to their Japanese engineers.
Time passed and the Great Kanto Earthquake of 1923 devastated the site of the former Japan Brewery in Yamate. We overcame that unprecedented crisis and decided to build a new brewery in Yokohama. Opting to view the crisis as an opportunity, we dispatched engineers to Europe and the United States so that we could incorporate the latest brewing techniques and built additional technical lab to improve the quality provided by our brewery. Those efforts yielded success. Thanks to the combined efforts of our technicians, we succeeded in producing clear, light-colored beers (also known as “Greenish Yellow”). Until then, our beer had contained high levels of extracts, which meant that they were prone to cloudiness.
Our philosophy of maintaining a Steady Focus on Quality has been passed down through the ages thanks to the pride of technicians doing their best to maintain and improve upon their skills

Never-ending Pursuit of the Best Hops with a Focused Persistence on Quality

Kirin Brewery’s pursuit of a Steady Focus on Quality extends beyond brewing techniques and includes everything from the quality of raw materials to the development of containers (which is currently undertaken by the company’s Institute for Packaging Innovation).
We are especially persistent about the hops that go into our beer, as they are the ingredient which give beer its unique aroma and bitterness. Around 1980, when the beer market in Japan was growing, Kirin Brewery became one of the world's largest buyers of high-end, fine aroma hops produced in the Czech Republic. We continued to focus on high quality and set up a local office so that we could inspect the hops before purchasing them. This was at a time when there were many brewers increasing the amounts of bitter hops (which made it easier and cheaper to generate a bitter flavor) used in their beers as well as brewers which were decreasing the amounts of hops they used.

Hops, an ingredient so important that they are referred to as the “soul of a beer,” are also produced in Japan.
However, in regions producing hops, there are major challenges being faced, including the aging of farmers and a shortage of successors. This means that production volumes have dropped significantly compared to the period when they were at their peak.

As a beer maker which purchases more than 70% of the hops produced in Japan, Kirin Brewery has been committed to stable supply and quality improvements.
For example, in 2018, Kirin established an agricultural corporation called BEER Experience CO., LTD. in Tono City (Iwate Prefecture), which is one of Japan's top regions when it comes to the production of hops. This was done to establish a sustainable production system in cooperation with Tono City, the local hop producer’s society, and so on. This demonstrates the effort being put forth to maintain hop production through partnerships between the public and private sectors. Tono City has been involved not only in efforts related to production; it has also been involved in initiatives such as Tono Beer Tourism, which serves to communicate the city’s charm and the slogan of which is “from a hop town to a beer town”. As a result, Tono City has seen a rise in people moving in as hop producers and has become a tourist destination for fans of beer.

Kirin Brewery has also been engaged in the development of technology related to hops and the development of breeding techniques for the plant.
With a focus on a fresh, aromatic hops produced in Japan, we have been shipping Kirin Ichiban Toretate Hop every fall since the product’s release in 2004. After harvesting hops, they are generally dried quickly to maintain quality. But Kirin Brewery has developed a technique, a “frozen milling” that is used to rapidly freeze hops which have just been harvested. Frozen hops with plenty of plant-like and fruit-like flavoring give this beer a gorgeous aroma and deep taste. Other unique techniques include our patented “dip hopping” and “after--ripening hop” techniques.

When it comes to the development conducted in relation to hop breeding, we have come out with new hop varieties such as IBUKI and MURAKAMI SEVEN. The former is characterized by a pure, floral aroma and offers an elegant, well-balanced flavor. The latter was bred by Atsushi Murakami, a former Kirin Brewery hop engineer of world-class stature. Not only does this variety offer a refreshing citrus flavor, but it is also easy to cultivate.
In our pursuit of a Steady Focus on Quality, we are discovered the potential of hops and are contributing to the diversity of beer made in Japan.

From The Pursuit of Hops to the Challenges of Craft Beer

Our stance is to pursue techniques, delicious tastes, and enjoyment based on our philosophy of maintaining a Steady Focus on Quality that is passed down from generation to generation. That stance will flourish in a new way: This is the craft beer business that Kirin Brewery has been focusing on in recent years.

Since 1994, the size of the Japanese beer market was on a downward trend, especially among young people, who have become less interested in beer. In order to mass-produce high-quality beer at affordable prices, all brewers sought to create easy-to-drink tastes and which would appeal to everyone. As a result, the beer culture has been deprived of the "fun of choice".
The opposite of the uniformity symbolized by "beer for now" is diversity.
Together with the assured quality pursued by Kirin Brewery, the company also wants to provide customers with the enjoyment that comes with having choices available. The beer that makes possible this very diversity comes in the form of craft beers offering charming, unique tastes. And one of the elements that makes craft beer unique is comprised of newly developed hops and hop infusion methods. Thus based on a philosophy of a Steady Focus on Quality, Kirin Brewery entered the craft beer business by leveraging the techniques cultivated by the company up to that point.

Entry into the craft beer business is a significant challenge for major brewers as it requires efficient mass production. What made that possible for Kirin Brewery were two things, one being the existence of pilot breweries, which are small-scale breweries that brew up to 1,500 kinds of beer a year. The other, is the pioneering spirit of William Copeland, the man who gave light to the beer industry in Japan during the Meiji period and who was succeeded by brewers who refined their craftsmanship there at the brewery. This is how the company has put into practice its philosophy of maintaining a Steady Focus on Quality when it comes to craft beer.

After studying the brewing of beer in Norway, William Copeland came to Japan and established Spring Valley Brewery in Yokohama’s Yamate area in 1870. He was the first person in Japan to succeed in the continuous production of beer as an industry during the eve of Japan’s movement toward Westernization taking place during the Meiji era.

In 2011, Kirin Brewery began formulating a plan for its craft beer business. In honor of the pioneering spirit of William Copeland, the “founder of the Japanese beer industry,” we decided on SPRING VALLEY as the brand name. The brand launched in 2014 with prototypes being sold only at an online shop run by Kirin, called DRINX. SPRING VALLEY BREWERY, the restaurants with brewery opened in Daikanyama and Yokohama in 2015. And in 2017, a location in Kyoto was opened as a place to directly communicate the fun and diversity of beer, and released its signature beer "496" .In March 2021, ten years after planning of the business began, SPRING VALLEY HOJYUN 496, which combines four types of hops and incorporates the dip hopping technique, was released at mass retailers nationwide and is today being enjoyed by many. Since 2022, the beer has been made using” IBUKI “a Japanese hops to further enhance the balance between the beer’s flavor and aroma, with the aim being to have this beer become a craft beer that is unique to Japan.

To further improve upon the taste and quality of our products, Kirin Brewery actively has the SPRING VALLEY brand participate in beer competitions, with several beers being highly acclaimed internationally.
While it is obviously important to continue refining the quality of our products based on these kinds of objective assessments that alone will not serve to help broaden a diverse beer culture.

Tap Marché to Broaden a Diverse Beer Culture

Many consumers casually enjoying a variety of unique beers: Tap Marché is a dispenser for craft beer developed by Kirin Brewery that is installed at restaurants to help that kind of craft beer culture take root in Japan.

The greatest feature of Tap Marché is that it can provide customers with four kinds of craft beer and thereby solve issues faced at on-Premise when it comes to being able to provide a wide variety of beers with a saving place. Customers can also choose from a variety of craft beers outside the realm of Kirin Beer products that best suits the store concept..

As of January 2022, there were 14 craft breweries participating in the Tap Marché program. From Tohoku in the north to Kyushu in the south, craft beers with rich flavors and local tastes are available, offering customers the enjoyment of choice and delicious tastes. “It is unusual thing in this world for a major brewer to sell a product made by seemingly competing independent craft breweries,” says Steve Hindy, founder of Brooklyn Brewery Corporation in the United States. Kirin Brewery believes that the coexistence of a wide variety of craft breweries is essential when it comes to the realm of craft beer, the charm of which is its diversity.

Since the easing of regulations resulting from the amendment of the Liquor Tax Act took effect in 1994, locally brewed beer had become something of a major movement in Japan. There were still many brands, however, which were unable to offer stable quality levels. This meant that the movement of locally brewed beer had once ended as a fad. To avoid a repeat of that failure, craft breweries as a whole must strive to improve upon their quality. Kirin Brewery's philosophy is to maintain a Steady Focus on Quality, so our belief is that we have a responsibility to contribute to that effort.

One of the activities being undertaken to that end is the participation of Kirin Brewery Sendai in “the Soul of Tohoku Brewers Project” involving a group of craft breweries in Tohoku. The brewery provides support when it comes to quality control in relation to beer and with respect to how hops are used.

Diverse Beer Culture Enriches People’s Dining Tables and the Local Community

What kind of value will the craft beer business create for society as it becomes a driving force and contributes to the creation of a diverse beer culture? Tomohiro Tayama, Master Brewer at Kirin Brewery explains:

“Mutual recognition of diverse values is a challenge faced across the globe. If the habit of uniformity cannot be abandoned, both Japan’s beer industry and its beer culture will die out someday. Working hand in hand with craft breweries around the country to foster a diverse beer culture is an essential initiative to undertake when it comes to having the country's beer industry and beer culture continue to survive into the future.
If craft beer becomes more familiar to consumers, experiencing the joy of choosing a beer will become par for the course. This will also serve to enrich those moments spent enjoying an alcoholic beverage. It’s not about simply choosing a beer. Consumers can also choose what they drink based on the origin of the ingredients used in the cuisine they are enjoying alongside that drink. In other words, I believe that the revitalization of local craft breweries doesn’t just lead to the survival and further development of beer culture, but also to the promotion of the food industry itself in the relevant regions and eventually to regional revitalization thereafter. ”

Craft beer, which allows consumers to enjoy a variety of tastes together with their food, serves as a catalyst for conversation sparked up between people who enjoy both beer and food, and serves to create connections between people.
This is the essential value that alcoholic beverages provide and is what brings to fruition of the fulfillment of Kirin's corporate slogan (“Joy brings us together”).

Kirin Beer brings joy to society by pursuing a Steady Focus on Quality and pursuing purpose of alcoholic beverages business.

*Stated information as at the date it is made