“We have utilized this time of crisis…” – a VLB status report, October 2021

The past one and a half years have been very challenging for the entire brewing and beverage industry. Like so many other organizations, the VLB Berlin was unable to completely avoid getting caught up in the general developments of the pandemic. Nonetheless, VLB utilized the time to expand its range of products and services and optimize the internal processes. In this interview, the Managing Directors of VLB, Dr. Josef Fontaine and Gerhard Andreas Schreiber, provide some insights into the developments in Berlin.

The New VLB Building and Site Development

 The VLB moved into its new building in 2017. How are things looking after the first four years? Fontaine: The entirety of the new building project, including the relocation and commissioning in October 2017, was very challenging for all of us. But today, we are all very happy that this historical opportunity for the VLB presented itself to us, and that we were able to implement it successfully. Naturally, there were a few kinks we had to work out with the new building in the beginning, and it took a while until everything was actually running according to plan. There were also some employees who took a while to get used to the new work environment at first. But now, after almost four years, I can say that our whole team feels at home here, and we are all proud of the new VLB - and rightfully so. Schreiber: On the other hand, we’ve also had to learn that running and maintaining a new building like this, with all its complex laboratory and systems technology, demands a considerable amount of effort. And simply having a new building doesn’t automatically bring in all the new customers, contracts, and projects you need to make it worthwhile! This meant that we along with the support of our president Ulrich Rust and the whole Administrative Board, had to react quickly while pushing our strategic development further along at the same time.

 The Seestraße 13 site is still being used by the Charité University Hospital and the Technical University Dr. Josef Fontaine, VLB Managing Director (CEO) since 2003

Gerhard Andreas Schreiber, VLB Managing Director (CFO) since 2019

of Berlin (TUB). What’s happening there? Fontaine: A whole lot – despite the lockdown! The property that’s been home to the VLB for around 130 years covers a total of more than 30,000 m². Our new building occupies 6,000 m² of that. Together with the Hochschul Brauerei old brewhouse and the old malt house, we’re only using about a third of the entire property ourselves. The rest – which accounts for more than 20,000 m² – has been appropriated by the Senate of Berlin for use by the Charité and the TUB. Schreiber: There are currently two new research buildings being built right next us, one of which is “Der Simulierte Mensch” (The Simulated Human), a joint project between the Charité and the TUB’s Medical Biotechnology department that will research the modelling and simulation of human cellular and organ function. The second building is for a project run exclusively by the Charité, the “Berlin Center for Advanced Therapies, BeCAT,” which will be used to develop new cancer treatments. The two buildings are being constructed simultaneously, and should both be completed in 2023. Yet another building is also due to be built on the Charité’s portion of the property. This building is still in the preplanning phase.

 One of the faculties the TUB houses at Seestraße is its Chair of Brewing Science. How are the current developments there going? Fontaine: Our partner, the TUB, is currently having a rather difficult time with its site development. Along with numerous existing buildings on the site, the university was also allotted a considerable plot of land. Some of the buildings are more than 100 years old and in need of restoration. There are already several ideas and preliminary considerations

in play for how to deal with that, but at this point there are still no concrete plans. Earlier this year, the TUB closed its old building due to technical defects, and transitional measures have been implemented. Basically, quite a lot is still in flux. There will most definitely be various construction activities happening throughout the entire site in the coming years. When it’s finished, the end result will be a super-modern medical/biotechnology research center in the center of Berlin. And we at the VLB are a part of it!

 What’s happening with the VLB’s Brewing and Beverage Technology endowed professorship at the TUB? Fontaine: We were delighted when the TUB appointed Prof. Brian Gibson, an internationally renowned scientist, to our Brewing and Beverage Technology endowed professorship in October 2020. Such a new start is never easy, of course, and unfortunately, Brian started here in the middle of the Corona pandemic. Then came the sudden closing of the old buildings on top of that. Everything that happened has made his start that much harder. We’re helping him out in a lot of areas right now, as well as providing support for university teaching. The laboratory and brewing internships in particular can’t be held online, and require a suitable infrastructure – which we are happy to provide. All things considered, we are in regular communication with Prof. Gibson regarding mutual projects. It is our express goal to make the relationship between the VLB and the TUB’s Chair for Brewing and Beverage Technology even closer than it has been in the recent past.

The Effects of the COVID-19 Pandemic and Events

 How has the VLB gotten through the COVID-19 pandemic thus far? Fontaine: Well in some ways, not so well in others. Generally speaking, the VLB is built on three pillars: research, analytics/consulting, and education/conferences. Our research and our contract analysis were only slightly affected by the lockdowns and, luckily, proved to be relatively stable. In contrast, our conferences and training programs suffered massively, as did our consulting business. Back in March 2020 we had cancel three large conferences that had already been fully organized, and our international consultancy business ground to almost a complete halt overnight due to the travel restrictions. This caused us to lose a considerable number of sales. Naturally, our members ran into problems too, and some of them cancelled their memberships – which is completely understandable, of course. But the vast majority of our members stuck with the VLB, and we’re incredibly grateful for that! Schreiber:All things considered, the pandemic turned out to be helpful, as since April 2019 there have been two us on the Board of Management at the VLB. My colleague, Dr. Fontaine, is primarily in charge of

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The new VLB building is in operation since October 2017. On the left: the former brew- house of the VLB HochschulBrauerei

Biering Jan Photo: member consultation, events, public relations, and site development, while my focus is on finances and administration. We established a pandemic crisis team, and carefully and promptly implemented the appropriate measures to ensure that we were able to continue our work at the VLB the entire time. Also our internal controlling system turned out to be a useful tool during the crisis as well. It gave us constant, up-to-date access to business figures, which were a great help to us when it came to evaluating and managing our business processes during the pandemic. Nevertheless, we still ended the 2020 financial year with a loss. In principle, that’s bad. But in light of how difficult the situation was overall, it’s really nothing more than a black eye. And we’re cautiously optimistic that our business growth for the current year is moving in the right direction again.

 The VLB moved most of its conferences and courses online during the pandemic. What has that been like? Fontaine: In March 2020, after it very quickly became clear to us that the future of in-person events was becoming a problem, we expanded our online activities extensively right away. This led to the birth of our “VLB Virtual Campus,” which is comprised of two core elements: a learning management system that forms the basis of our training courses and our virtual conference platform, which we have used to several large online conferences with great success. We also adapted

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our training program to online and hybrid models on short notice, so that we could resume and complete all our ongoing courses. We had to cancel seminars too, of course, but altogether we were able to use our online services to significantly limit our losses in the seminar and conference business. A special thanks goes out to our staff, many of whom dedicated a lot of time and effort to the implementation of these new concepts.

 Are these online formats just a temporary service, or is this the future? And will there ever be “normal” VLB conferences again, like there were before? Fontaine: We have discussed at length whether we are going to resume in-person conferences this year – and if so, when. Meanwhile we managed to safely and successfully host an in-person conference for the first time again in October this year – the IfGB Spirits and Distillery Forum. However, we did make a conscious decision not to use an in-person or hybrid concept for our Annual Conference in October, which is a significantly larger and more complex event. The economic risks and uncertainties involved are simply too great. As such, this event is going to be held online from October 25 to 28. We hope the general situation will settle down again in the year to come. Our Logistics Conference in Rosenheim, Germany, which is being held in March 2022, is being planned as our first in-person event, and more will follow. However, it’s become clear to us that the online formats offer their own advantages. They have enabled us to significantly increase our reach, especially in the international sector. Consequently, we will continue to offer additional virtual conferences in the future, though obviously we will make sure that they are coordinated well with our inperson events. We’re missing out on interacting with our colleagues in the local area.

Research Field Development

 Research is another important pillar of the VLB. How has this area developed during the pandemic, and what are the projections for the near future? Schreiber: Research at VLB is defined as applied, project-based research. Luckily, the effects of the pandemic in this area turned out not to be too serious. In fact, it even provided us with a minor benefit, in that our scientific personnel were able to use the time they would have otherwise spent on preparing events to draw up proposals for new research projects. These proposals have since been submitted to the responsible authorities, and some of them have been approved. In addition to this, we were able to use the pandemic period to optimize our research infrastructure in terms of equipment: Thanks to the infrastructure funding we received from the German Federal Ministry for Economic Affairs and Energy (BMWi) Innovative Expertise Program (INNO-KOM Programm), we were able to buy a gas chromatograph equipped with a sulfur chemiluminescence detector (GCSCD) for the analysis of volatile and aroma-active sulfur compounds in beer and fermented beverages, a modular multi-detection reader for cell imaging, and several other useful items. This new state-ofthe-art equipment has played no small role in enabling the VLB to develop suitable new procedures for demanding scientific problems. This is all the more important now that special analysis topics – as opposed to the standard beer analysis – are steadily becoming a much greater focus for us, as they represent a strong USP for the VLB. The research colloquium’s online format was created on the VLB Vir-

tual Campus for the VLB’s annual conference in order to facilitate the vital transfer of our research project results. The VLB’s scientists use this to present individual projects from various fields of research and then open up the floor to the audience for discussion. In order to safeguard the future development of the field of research as a whole, it is important for us to keep an eye on the political aspects. Up to now, research and innovation have generally received increased support from the German government, particularly in periods of crisis. Thus far, this same approach has also been applied during the Corona pandemic: Funding rates have occasionally been raised, and the available funds increased. Because the overall economy’s capacity for innovation has been sinking for several years, a political countermeasure that includes increased funding and provides for at least stable growth of third-party funds it is to be expected. As such, we can be optimistic for the future in this area as well.

The Development of the Analytics and Beverage Packaging Division

 What developments are there in the VLB’s other divisions – in beer and beverage analysis, for instance? Fontaine: We are realizing more and more that the standard beer analysis that was so important to us in the past is slowly becoming less relevant. There a number of devices on the market nowadays that deliver quick and reliable analysis results on-site, and are both affordable and good at what they do. This has become particularly clear from looking at our incoming orders in this sector. In contrast, the demand for special analysis of grains, hops, beer, spirits, and other beverages has been growing continually for years. This often requires very specific and expensive devices, as well as analytical expertise. Designing test series and interpreting results also demands a lot of experience and specialized knowledge. Our numerous research projects in the field of beer and beverage analysis have enabled us to acquire a lot of knowledge and hardware over the years. This is really paying off now and is something that is increasingly in demand within the industry – both nationally and internationally. The new trend toward experimentation with beer and beverages is also invigorating for our business. Whether it’s craft beer, kombucha, hard seltzer, water kefir, or something else, we have plenty to offer in all these areas.

 The VLB is currently reorganizing its beverage packaging division. What led to this? What’s the plan? Fontaine: Packaging is a strategic success factor when it comes to beer and beverages. Along with product protection and marketing aspects, the logistical challenges during the development and handling of beverage packaging need to be considered more closely. We have now taken these developments into account and integrated our Testing Laboratory for Packaging into our Research Institute for Management and Beverage Logistics (FIM). Since its founding in 2001, two of the areas the FIM has spent a lot of time on are the question of how to handle empty containers, single-use and multiple-use container systems, and the traceability of shipping units. The integration of the Testing Laboratory for Packaging should lead to closer consideration of the overall importance of packaging in logistics. Schreiber: This reorganization is another milestone in the VLB’s internal optimization process. We want to restructure and expand our operations in the beverage packaging sector, and use them to breathe new life into research in our in-house Packaging division. What’s more, an online conference on the topic of beverage packaging was being organized along with the International VLB Packaging Conference, which ran successfully at in October 2021. Fontaine: In summary, we can say that the VLB is on a relatively stable course despite the difficult and challenging environment of the past one and a half years. Together with our fantastic team we have utilized this crisis to develop new products and services and optimize our internal processes and structures, but we still can’t avoid getting caught up in the general developments of the pandemic, of course. That said, we’re looking to the future with cautious optimism and working together to restore our industry to its former strength.

Questions by Olaf Hendel

Atrium in the VLB building. On the right: the Wilfried-Rinke Pilot Brewery