Edinburgh’s sour beer specialist defies industry headwinds with robust international expansion and strategic diversification, as broader market faces significant closures and rising costs.
Edinburgh-based Vault City Brewing, a prominent producer of sour beers, is charting a course for its most prosperous year to date, projecting a substantial turnover of £10 million by the close of 2027. This ambitious growth trajectory stands in stark contrast to the wider struggles plaguing the UK’s craft brewing sector, where numerous independent businesses have succumbed to intensifying economic pressures.
The independent brewer reported an impressive 38% year-on-year sales increase between April and December, fuelled by strong performance in major supermarkets and burgeoning international demand. Should this momentum persist, Vault City is poised to achieve the £10 million turnover milestone for the first time by the end of 2027.
Vault City’s market footprint now spans 26 countries globally, with export sales climbing an notable 62% year-on-year, primarily driven by robust demand from Nordic nations and France. Domestically, the company’s distinct product range is available in over 5,000 UK supermarkets, including prominent retailers such as Tesco, Sainsbury’s, Morrisons, and Waitrose. The brewer also secured a 50% year-on-year distribution expansion, further solidifying its retail presence. Underscoring its commitment to quality, beer review platform Untappd recognised Vault City as the highest-rated brewery in UK retail, with its beers securing the top two national ratings. The brewery was also the sole non-US entry among the top five global breweries for five-star reviews.
A Challenging Climate for UK Craft Brewers
This success story unfolds against a backdrop of significant hardship within the UK’s independent brewing industry. The Society of Independent Brewers and Associates (SIBA) revealed a “dramatic” 37% surge in brewery closure rates in 2025 compared to the preceding year. As of 1 January 2026, the UK counted just 1,578 operational breweries, a reduction from 1,715 at the start of 2025, indicating a net closure rate averaging nearly three breweries per week throughout 2025. SIBA attributes these widespread closures to a confluence of factors, including the escalating tax burden on small breweries, increased merger and acquisition activity, restricted access to the lucrative pub market, lingering COVID-era debt, and persistently tight profit margins. Furthermore, market data from late 2025 showed a 7% year-on-year decline in craft beer retail sales during the 12 weeks leading up to 27 December.
Brewers are also grappling with impending economic shifts and regulatory changes. From 1 February 2026, alcohol duty rates across all categories—including beer, spirits, wine, and cider—were uprated by 3.66% in line with the Retail Price Index (RPI). This increase is forecast to add 1-2p to the cost of a pint of beer, with industry bodies warning of a “trickle-down” effect that will inevitably lead to higher consumer prices. Concurrently, substantial increases to the National Minimum Wage (NMW) and National Living Wage (NLW) are taking effect from 1 April 2026, with the NLW for those aged 21 and over rising to £12.71 per hour, representing a 4.1% increase. Rates for younger workers are also experiencing significant uplifts.
Commenting on the challenging environment, Steven Smith-Hay, co-founder of Vault City, acknowledged the broader difficulties. “It is undoubtedly a challenging time for the craft brewing sector, with closures ramping up last year across the industry. With the changes to duty and the minimum wage coming in from April, trading is likely going to remain tough – and we’re seeing these trends take place in other markets too, not just the UK.”
Despite these considerable headwinds, Smith-Hay remains optimistic about evolving consumer preferences. “But people are still drinking beers – and consuming a wider variety than they were 10 or 15 years ago. Against that backdrop, we’ve aimed to stay true to our roots and focus on the quality of our products. Our signature sour style has broadly been overlooked and that has allowed us to grow to the size we are today, while maintaining our independence,” he stated. Established in 2018, Vault City has cultivated a dedicated following through its experimental approach, offering bold and playful sour beers, stouts, and dessert-inspired creations. Popular releases such as Jungle Juice and Raspberry Cream Soda exemplify this innovation, with the latter having secured two stars at the Great Taste Awards.
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Strategic Expansion and Future Diversification
To support its ambitious expansion, Vault City successfully completed two crowdfunding campaigns in 2024 and 2025, collectively raising over £330,000, exceeding its £250,000 target by 32%. This capital injection facilitated the relocation to a new 36,000 sq ft, state-of-the-art production facility at BioCampus, located within the Midlothian Science Zone, a burgeoning hub for life sciences and research. The significantly larger premises, seven times the size of its previous home, provides Vault City with the capacity to produce more than 10 million litres of beer annually, with further scope for growth. In 2025 alone, the brewery produced 14,384 hectolitres and sold 3.3 million cans of beer.
Smith-Hay underscored the company’s measured growth strategy. “We’ve created a niche set of products and built a dedicated community around them in a very considered way. We’ve been fortunate that the two have grown together organically, and we hope that will remain the case with the wide variety of new beers we have recently launched and have in our plans for 2026.” He added, “Wherever we can, we have reinvested straight back into the brewery to strengthen how we operate and set ourselves up for the long term. But there’s a lot to be said for reflecting on where you are in uncertain times and, after a period of sustained growth, it feels like a good time to consider our next steps.”
Looking ahead, Vault City intends to broaden its flavour portfolio beyond its signature sour beers. Internal experimentation is currently focused on barrel-aged projects, alcohol-free options, and potentially lagers and IPAs. This strategic diversification is designed to position Vault City to adapt to evolving market demands and sustain its impressive growth trajectory amidst a turbulent industry landscape.
