Describe one environmental uncertianty for Greene King (Brewer and pub owner)in the UK or international market

Answer 1

The effect of climate change on the type of hops used to brew Greene King's bitters (Abbott Ale and IPA) has to be an environmental uncertainty. The company should be concerned enough to investigate likely effects. If warmer temperatures encourage hops harvests in areas like Kent, then the wholesale price of a key brewing ingredient (and cost of production) ought to fall, and thus Greene King has the potential for an increased profit margin. If hops crops diminish, Greene King may be forced to put up prices as the cost of obtaining the ingredient rises. Encouraging hops farming in new areas may resolve the supply, but transport costs could be greater than at present. Similar comments could be made about barley (used to make malt, another essential ingredient of beer). As a further comment, warmer temperatures are likely to encourage a decrease in the demand for real ales in preference for chilled lagers.

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