Czech Independents

Under communism, Czech breweries operated within a system of territorial market segmentation determined by the central planners, with each brewery allocated a relatively small area to supply with beer. This arrangement strengthened a historically powerful connection: strong regional identification with the local brewery. At the same time, though, it provided for little to no competition within a given region, and capital investment into the modernization of production facilities was virtually nonexistent. In such an environment, one might expect the quality of any product to go the way of communist-era toilet paper, which was tough to find and even tougher to use.

While some breweries did suffer, it is notable that under such conditions the overall quality of beer did not plummet to the depths that it did in other socialist paradises like Russia. Instead, in the Czech lands, the quality of a given brewery’s output was maintained by the professional honor of the brewer, who in most cases fulfilled this important responsibility to the community. And the authorities in Prague, no doubt, preferred that qualified brewers did so, rather than party appointees. After all, had the sturdy proletariat (not to mention the wavering intellectuals) been denied the premium beer to which centuries of tradition had accustomed them, widespread revolt against the regime might have been the outcome.

With the collapse of the communist government in Czechoslovakia in 1989, the entire country began to reorient itself toward a private, market-driven economy. This was especially true of the Czech Republic, which split peacefully from Slovakia in 1993. In this reorientation, Czech breweries found themselves on a new playing field entirely. With government purse strings severed, breweries were forced to privatize. Profitability became an issue, as did its bedfellows investment, competition and marketing. Suddenly, a regional brewery’s lock on its local customers was open to threats from other domestic producers.

Yet the Czech Republic has no shortage of local customers. It would be wrong to call Czechs "beer enthusiasts"; one might just as well call inhabitants of Egypt "sand enthusiasts.” Beer plays such a basic role in the culture that the common citizen is unlikely to see anything exceptional about its pervasive presence. Their modesty notwithstanding, in this category they rule the world. At a per capita volume of over 160 liters annually, the average Czech drinks more beer than his national counterpart anywhere else. As long as Bavaria remains part of Germany, the Czechs will be safe with this distinction.

With beer imports virtually nonexistent outside a handful of Irish pubs in Prague, it is the domestic breweries that supply this thirsty market. Given the persistent demand side of this "beer economy," one would assume that Czech brewers are in a pretty safe business. While this may have been the case throughout the communist era, during the ensuing free-market period, an all-out battle for consumer allegiance has developed among the large, state-wide breweries as well as the smaller, regional ones.