Taiwan Beer
Taiwan Beer is a brand of mass market beer brewed by the Taiwan Tobacco and Liquor Corporation. The brand is an icon of Taiwanese culture and is applied to the best-selling beer in the country.
History
Japanese colonial period
The company known today as TTL has its origins in a government agency established by Taiwan's Japanese rulers in 1901. Initially, the Monopoly Bureau of the Taiwan Governor's Office was responsible for all opium, salt, and camphor sold in Taiwan. In 1905, tobacco was added to the list of monopolised commodities and products.In 1907, the Japanese colonial government began taxing liquor producers to create a new revenue stream. The government then remodelled the whole of Taiwan's liquor industry, and set up much needed infrastructure and training.
Subsequently, in 1919, the Takasago Malted Beer Company, developer and owner of Taiwan's first brewery, was established by Konosuke Abe and other investors, including figures from the Japanese wine industry, with a capital investment of two million Japanese yen. "Takasago" is the word that, since Japan's Edo period, had served as the customary Japanese name for Taiwan.
was erected in the then Kamihito District of Taipei. It was built using the same type of bricks as those of the nearby Governor-General's office ; most of its equipment had been acquired second hand from an old brewery in Hawaii. Upon completion, it was more than in area, and was one of only three beer breweries in Asia, the others being the Sapporo Brewery in Japan and the Tsingtao Brewery in China.
In its early years, the brewery was operated by Japanese brew masters. Its product, an ale first brewed in June 1920, was marketed as Takasago Beer, and was made in two styles, namely light malt and dark malt.
The investors' original plan was to export the company's product, but its initial quality was inferior to that of Japanese beers, and early export results were unsatisfactory. The company therefore decided to enjoy tax exemptions by selling Takasago Beer locally; beer was not yet then covered by any monopoly in Taiwan.
In 1922, under the influence of a post-World War I depression, the government attempted to nationalise the liquor industry by placing it under the exclusive control of the Monopoly Bureau. At that time, however, Taiwan had a highly competitive market for imported Japanese beers, and importers successfully lobbied members of the Imperial Diet to spare beer from the monopoly program.
Takasago Beer soon became very popular amongst Japanese drinkers in Taiwan, who preferred it to saké because it was a better thirst quencher during Taiwan's burdensome summers. With the support of a network of Takasago beer houses and advertising on billboards in Taiwan's major cities, Takasago Beer developed a big following in the 1920s. By 1925, it was Taiwan's leading brand of beer. Exports of the product to Tokyo began to rival Sapporo Beer, the leading Japanese brand.
Eventually, in 1933, the local market beer monopoly was reintroduced, with effect from July of that year. Over 200 liquor industry businesses were shut down, and private brewing was banned. The Monopoly Bureau began a practice of purchasing the local market products of Takasago Malted Beer Company in batches and then reselling them; the company also continued to export some of its products.
Although by then its competitiveness in terms of productivity and quality had improved from its early days, the company was still a long way short of profitability, and relied upon the monopoly to cover its losses.
Under the local market monopoly regime, beer was expensive. Most Taiwanese had trouble finding enough food, and could not afford to drink beer, bottles of which were so costly that the asking price is known to have exceeded the price of pork. The company's business of selling costly beer boomed, and even the Bank of Taiwan chose to invest in it. The company also secured the support of the major Japanese breweries in obtaining raw materials. Merchants vied for local market distributors and vendors licences issued by the Monopoly Bureau, and corruption was reported to be rife. The Monopoly Bureau could rely upon a variety of excuses to revoke such a licence.
During World War II, Allied airstrikes badly damaged Taiwan's liquor-producing facilities. Production was very substantially reduced. Meanwhile, in the early 1940s, matches, petroleum, and standard weights and measures also came under the Monopoly Bureau's authority.
Post-World War II period
After the war, the incoming Chinese Nationalists set up the Taiwan Provincial Administrative Office, which preserved the monopoly system by establishing the "Taiwan Provincial Monopoly Bureau", and also took over the assets of the hitherto privately owned brewery. Takasago Beer was renamed Taiwan Beer in 1946. The following year, the Administrative Office's successor, the Taiwan Provincial Government, reorganised the monopoly system, by forming the Taiwan Tobacco and Wine Monopoly Bureau. Simultaneously, the number of monopolised items was reduced; from then onwards, only tobacco and alcohol remained, together with camphor until 1968.The sudden departure of Taiwan's Japanese brewers in 1945 led to a lack of brewing expertise on the island. The government therefore promptly sent some of its employees to Germany to study beer brewing. That decision may have led to the replacement of the island's thick, malty pre-World War II ales with the light, bright, crisp and sweet German-style lagers that have been brewed as Taiwan Beer ever since the brand's name change.
In the late 1940s, after the Chinese Nationalists had lost the civil war in China, more than 800,000 of them retreated to Taiwan, where they came to account for around 10% of the population. That influx, combined with the departure of Japanese nationals, led to changes in consumer preferences, but initially demand for beer was not much affected.
The Korean War led to an intensification of the cooperation between the USA and the Chinese Nationalists. The USA funded several important aid programs in Taiwan between 1950 and 1965. Many American advisors and military personnel were stationed on the island during that period, especially after the signing of the Sino-American Mutual Defense Treaty in 1954, and their presence caused a beer sales boom.
During the 1960s, domestically produced was added to Taiwan Beer's fermentation process, resulting in the distinctive local flavour for which the beer is known today. The recipe was altered not only to make the brew sweeter and less bitter, but also to absorb a surplus of locally produced rice that was suppressing prices and thus limiting the incomes of farmers. Adding rice to the brew also lowered production costs.
In 1964, the Monopoly Bureau responded to an increase in demand for beer by cooperating with Dominion Breweries of New Zealand in learning, practising and adopting the patented brewing technique of continuous fermentation.
In November 1965, Taiwan became part of the Rest and Recuperation program, under which US military personnel could take a short vacation in a number of places in Asia. From then until the program ended in April 1972, almost 250,000 Americans had a vacation in Taiwan. A new industry of American-style bars emerged on the island, and thousands of women were employed to serve beer and other alcoholic beverages, and otherwise entertain bar guests. Soon after the American forces pulled out of Vietnam, the Taiwanese American-style bar industry vanished.
Meanwhile, the Monopoly Bureau constructed new breweries, in Wuri District, Taichung City, in 1966, and then in Shanhua District, Tainan, in 1973. To meet public demand, it introduced canned beer in 1975. Also in 1975, Taiwan Beer's brewery complex in Taipei was renamed as the Jianguo Brewery. It has since been renamed again, and is now known as the Taipei Brewery.
During the 1980s, an important new type of drinking establishment, the beerhouse, appeared in Taiwan. The first one opened in Taipei in 1983, and there were soon many more, in that city and others. Typically constructed in a log cabin-style, beerhouses appealed to the Taiwanese fascination for western culture. Patrons would hang out in beerhouses after work and late at night, drinking beer and eating local dishes, such as fried clams, fried crab legs and snails. However, beerhouses were also controversial, and by the end of the decade enthusiasm for them had waned.
Democratic era
In 1987 Taiwan lifted martial law and, under pressure from the US government, opened its beer market to foreign imports from America and Europe. Up to that point Taiwan Beer held 99% of the market. Not long after that year, imports from Japan and Southeast Asia were also permitted. However, the local brews were initially protected by high tariffs.In 1991–92, production of Taiwan Beer reached its absolute peak of 144 million bottles per annum, and in the latter year modern automated computer-controlled production and environmental protection equipment was installed at the Taipei Brewery. However, imported beers gradually increased their market share, and competition between them and Taiwan Beer became very intense.
Taiwan entered its modern period of pluralistic democracy in the 1990s. Free trade and open markets became priorities as Taiwan prepared for admission to the World Trade Organization in 2002, and the government found itself under outside pressure to liberalise markets. At the start of that year, laws fully opening Taiwan's liquor market to competing products went into force, and the already reduced tariffs were eliminated.
In July 2002, the Monopoly Bureau was corporatised and renamed Taiwan Tobacco and Liquor Corporation. That year, Chinese beers were permitted to be imported into Taiwan, and foreign beers reached a peak of 26% of the market. However, TTL's marketing strategies have since regained some of Taiwan Beer's market share.
In the two decades leading up to the start of the 2010s, advertising for Taiwan Beer focused on its freshness; towards the end of that period, TTL also introduced several new beer styles, and a new logo, bottle design and commercial campaign for "Gold Medal", the brand's most popular style.
During the 2000s, TTL also took steps to introduce Taiwan Beer to the Chinese market. Initially, its efforts to register the Taiwan Beer brand as a trademark were thwarted several times in reliance upon China's trademark law, which forbade the registration of a geographical name as part of a trademark. The necessary procedures for Taiwan Beer to be sold in China were finally completed in 2009, after several years of negotiations. Within two months, TTL started shipping Taiwan Beer to China; the following year, the corporation began brewing the product in Jiangsu Province.
Taiwan Beer remains the island's best-selling beer brand and is one of the most recognised brands in Taiwan's business world. However, according to figures released by Taiwan's Ministry of Finance, its market share has dropped dramatically in recent years, from nearly 85% in 2009 to only 70% in 2015 and just 60% in 2019, in each case by volume.