The ransomware attack on Asahi Group disabled its internal system that handled all orders and shipments online. — Bloomberg
TOKYO: While Japan gears up for its busiest beer-drinking season, the country’s largest brewer is struggling to stay on tap, with its systems still crippled more than a month after a cyberattack disrupted its supply chain.
The ransomware attack on Asahi Group Holdings Ltd disabled its internal system that handled all orders and shipments online.
As an emergency measure, the company reverted to processing them manually, in person, over the phone, and even by fax, a technology largely considered obsolete in modern business.
The shift has severely slowed operations, with shipments currently at just 10% of normal levels, according to an Asahi spokesperson.
The timing couldn’t be worse: December is typically its strongest month with Super Dry alone accounting for 12% of its annual sales volume.
The attack on Asahi is part of a broader wave of cyber incidents hitting Japanese companies.
Askul Corp recently suffered a breach that disrupted its eCommerce platform, and Nikkei Inc reported a virus infection via Slack chat platform that may have exposed employee and business partner information.
Japanese brewers are set to release their beer shipment data for October tomorrow, which would offer clue on how Asahi might have ceded market shares to rivals following the cyber attack.
In Tokyo’s salaryman hub of Shimbashi, Kohei Matsuo runs Bier Reise ’98, a bar that used to rely on Asahi’s Maruefu beer for 80% of its sales.
Within a week of the attack, he was out of stock and had no choice but to pivot to other domestic and imported brands.
“If supply doesn’t recover and I have to suspend the all-you-can-drink plan, it’s likely to hurt year-end party attendance,” Matsuo said.
Over in Ueno, manager Hiroyuki Iida of Izakaya Ueno Ichiba Honten said his restaurant briefly switched to beers from Sapporo Holdings Ltd and Suntory Holdings Ltd before Super Dry shipments resumed.
But other Asahi products, like non-alcoholic beer and Maruefu are still missing.
“Wholesalers may be prioritising larger volume accounts,” he said, adding that the impact has been milder than feared.
Competitors are seizing the opportunity. Kirin Holdings Co, Suntory and Sapporo have been replacing Asahi’s dispensing units and branded glassware through wholesalers, making it harder for bars to switch back once supply normalises.
Sanford C Bernstein Japan’s analyst Euan Mcleish expects Sapporo to benefit most, thanks to its full-malt lineup.
Asahi lost its No. 1 spot in Japan’s retail beer market to rival Kirin, which surged ahead after Oct 6, led by strong sales of its Ichiban Shibori brand, according to point-of-sale data from the Nikkei newspaper.
Kirin said is adjusting shipments of certain commercial products to ensure a stable supply of its main offerings as demand surges.
Meanwhile Suntory said it has been receiving numerous inquiries from distributors and is adjusting shipments while responding to stronger-than-expected demand.
Sapporo said it increased production to meet the surging demand and started to ramp up shipment.
Interestingly, retail stores paint a more forgiving picture.
Some outlets of discount chain OK Corp in central Tokyo still have Super Dry and Maruefu in stock, even as shelves of other Asahi products are beginning to sit bare.
Major convenience stores, Seven & i Holdings Co Ltd, FamilyMart Co and Lawson Inc, also show healthy supplies of Super Dry, though shortages are emerging for soft drinks and private-label beverages and Monster Beverage Corp’s energy drinks supplied by Asahi. — Bloomberg
