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Chicago to see twelve — yes, twelve — new breweries. Can they all survive?

Josh — Fri, 04 May 2012 15:43:31 +0000

From flickr user urbanfeel

Opening a brewery has been a dream for many homebrewers for decades. With the drastically shifting marketplace away from macrobrewers and toward craft brewers, many have been able to open breweries and we’ve all benefited from greater variety in the marketplace.

But as we’ve argued before, the friendliness and openness of the craft beer world is coming under more pressure as more and more people decide to open breweries. As one Chicago media outlet writes up, there are at least twelve new breweries coming to the Windy City. How can they possibly all survive?

Of course, with every business boom, some will fail for things completely unrelated to their products — mismanagement, poor planning, cost pressures. Some still will fall away for bad beer, as they should. But with such a crowded market, some may just fall away because the market isn’t big enough. Chicago is one of the largest cities in the United States, but it already has its share of breweries. Are all twelve good ideas?

Will Budweiser be making your Hopslam? Bells Brewery could be sold.

Josh — Wed, 02 May 2012 16:34:52 +0000

Could Budweiser be making your Hopslam next year? Due to a business dispute, it’s possible. From Bell’s founder Larry Bell:

“Unfortunately with the growth and the size the company has gotten to, the alarms are going off to where we have to figure it out or do something else,” Bell said. “I don’t want to sell, but it’s a great time to sell if I had to. There are many willing buyers.”

“If it was just a family business, there would be legal maneuvers we could make that would facilitate that kind of transfer across generations. With its current structure, I’m not able to do those sorts of things. It would basically leave us in the position of selling the company upon my death.”

Bells wants to keep the brewery in the family, which is admirable. But he may have to sell, and it may have to happen as early as the fall. Could Bells end up like Goose Island, swallowed up by a big brewer? Maybe, or maybe they’ll find a way to work it out.

Oskar Blues expanding beyond beer into whiskey, other liquors

Site Admin — Fri, 02 Mar 2012 15:40:03 +0000

From flickr user ant217

Oskar Blues Brewery, famous beer cannery and brewer of such geniusly-named beers like “Momma’s Little Yellow Pils”, has decided to expand into other forms of alcohol. Coming soon: Oskar Blues craft liquor.

From the Times Call:

The stills have been ordered and the federal licensing agreements are in process for Lyons Soul Distilling LLC, the latest venture for Oskar Blues Brewery. Plans are for the distillery to be up and running by this summer, according to spokesman Chad Melis.

“We’re going to can some spirits,” he said Friday at the company’s Longmont brewery.

The barn, next to Oskar Blues Grill & Brew, is where owner Dale Katechis first started canning Dale’s Pale Ale, the brewery’s flagship beer, two cans at a time by hand, 10 years ago.

Macrobrewers to make cheap beer more expensive, push people to premium beer

Josh — Tue, 12 Apr 2011 12:45:16 +0000

From flickr user michaelallroy under a CC license

Beers like Natty Lite, Miller Lite, Bud Light, and PBR are getting a price increase to drive cheap-beer lovers toward more expensive brands. Macrobrewers expect this will mean a transition to beers like Budweiser or other brands they own, but I can’t help but think it will also drive them to craft brewers.

I’d expect breweries like Sam Adams and Sierra Nevada to be beneficiaries of the move, mostly because they’re on many of the same shelves. Also, in states where you can actually get it, Yuengling will probably also see a nice boost in sales.

From AdAge:

As brand manager for Keystone Light, Elina Vives would seem to be in a tough spot these days. The below-premium beer made big gains in the past few years as the economy tanked. But with trends improving, MillerCoors, along with Anheuser Busch, is raising prices on budget beers in a move to get drinkers to trade up to more-expensive brews such as Miller Lite and Bud Light, which struggled in the recession.

“What they’re really trying to do, both of them, is drive business to the premium brands where they make more money,” said Benj Steinman, president of Beer Marketer’s Insights. But for Keystone, which is owned by MillerCoors, that could mean losing momentum that made it one of the fastest share gainers in all of beer. So what’s a brand manager to do?

Also, as a side note, I had no idea Bud Light was so much more popular than Miller Lite. It’s all bad, but when I’m somewhere and don’t have much of a choice, I always grab Miller Lite first.

Brooklyn Brewery opens massive expansion, Bloomberg puts ice in his beer

Josh — Tue, 15 Feb 2011 17:01:38 +0000

From flickr user iandavid

Yesterday, brewery president Steve Hindy and New York City Mayor Michael Bloomberg opened a long-planned expansion of Brooklyn Brewery. The expansion is absolutely huge, going from 12,000 barrels of beer per year to 120,000.

Less newsworthy was something Bloomberg said while he cutting the ribbon — he puts ice in his beer.

Standing inside the just-expanded Brooklyn Brewery yesterday, the mayor revealed that his unorthodox approach to drinking beer requires ice.

“I actually put ice in my beer,” the mayor said. “Most people don’t.”

Hearing a gasp from the crowd, he explained: “I know. I’ve always done it. I don’t think it comes from Boston.”

Brewery President Steve Hindy was too polite to set the mayor straight on the correct way to savor his popular suds.

Craft brewers facing another hop shortage in 2011

Josh — Tue, 18 Jan 2011 15:16:28 +0000

From flickr user Raymond Barlow

Word is that your favorite hoppy beers could be in for some recipe changes if their brewers didn’t plan ahead and contract for the right amount of hops this year. Rogue points to some news from Beer Business Daily warning that a 30% drop in the American hop harvest could have a negative impact.

The explosive popularity of hoppy beer has become bittersweet as the total American harvest was off 30% for the year, according to December’s USDA hop harvest report. Especially screwed now are those brewers relying on smaller-yield, aroma-centric American hops to make mainstream-barreling IPAs, since Simcoe, Citra and Amarillo are largely (if not totally) sold for the year.

IT SHOULDN’T BE A SURPRISE. Unlike 2007’s sneak-attack, this scarcity was established back in June, according to the BA’s Chris Swersey. That’s when members learned that both acreage and years were significantly down. It’s just now coming to a head, however, as brewers wonder if they’ll have enough of specific varieties.

They point out that Sierra Nevada is already looking toward whole-leaf hops to help fill the gap from a potential pellet shortage. I’m also curious as to what this means for the average homebrewer looking for something like Simcoe hops at their local hombrew shop — probably nothing too terrible, but it’s possible we could see small price increases for the average 5-gallon batch of Joe Homebrewer’s IPA.

Brewers Association redefines “small,” letting big craft brewers stay on the team

Josh — Tue, 11 Jan 2011 15:26:30 +0000

From flickr user Thomas Hawk

It’s obvious that the folks at the Brewers Association have an enviable job when one of the organization’s biggest “problems” is that craft breweries are outgrowing the definition of what it means to be a craft brewer.

Last week the Association announced that it was tripling the size of breweries that were considered “small” by craft brewery standards. The previous limit, 2 million barrels per year, was sure to be eclipsed by the makers of Sam Adams and because of its ongoing success.

The industry’s largest craft brewer, The Boston Beer Company, is poised to become the first craft brewer to surpass 2 million barrels of traditional beer within the next few years. Loss of The Boston Beer Company’s production in craft brewing industry statistics would inaccurately reflect on the craft brewing industry’s market share.

In addition to Boston Beer, the current growth trajectory of other sizable BA member breweries places them on a course approaching the 2 million barrel threshold in the coming years.

Nick Matt, chair of the Brewers Association board of directors correctly summarized: “Rather than removing members due to their success, the craft brewing industry should be celebrating our growth.”

Great news, and a wonderful problem to have to solve.

Does the United States really make the world’s worst beer? According to a new survey it does.

Josh — Thu, 16 Dec 2010 15:30:41 +0000

From flickr user jon starbuck

Travel writer Doug Lansky highlights a survey of 3,400 beer drinkers from around the world, asking them which country makes the world’s worst beer. The winner? The United States, by a lot.

According to Lansky, 36.2% of beer drinkers from 99 countries ranked the U.S. as the worst beer producing country, which dwarfed the 6.9% who said China. The American rating was actually 7% worse than last year.

The full list is below, but don’t panic. Even considering Germany or Belgium, the reality is that American beer drinkers enjoy what is probably the best beer selection anywhere in the world, and those beers are produced by other Americans. What this survey seems to show is that American craft brewers aren’t distributing — and more than that, it means is that they’re not marketing — overseas.

For now, that’s just fine. The American craft beer market still has plenty of room to grow (even though the overall beer market has been drug down by the dead weight of the major macrobreweries), and when that market has been satisfied, I think you’ll see plenty of craft brewers distributing much more widely. Most craft breweries don’t even distribute nationally yet — a frustration that keeps someone like me from enjoying a New Belgium’s Fat Tire on a regular basis.

The real problem with this is that the rest of the world sees American macrobreweries the same way American beer lovers do — not positively. With their marketing budgets, distribution networks, and business deals, they have absolutely decimated the reputation of American beer across the world. In 10 or 20 years, should Sam Adams or Sierra Nevada want to seriously market and distribute in China, India, or across Europe, what kind of negative preconceptions will they be up against? How badly will it hurt their ability to sell and expand?

Clearly, American craft breweries have shown an admirable tenacity while battling the macros on their own turf. And by all accounts, they’re winning. Can they do that across the globe when the time comes, if it comes?

As promised, the list of nine is below. It’s actually not a terrible list, with the exception of the US and UK.

The Worst Beer Producing Countries in the World (from Dough Lansky)

United States, 36.2%
China, 6.9%
Italy, 6.9%
France, 3.5%
Mexico, 3.5%
United Kingdom, 2.8%
Australia, 2.4%
India, 2.4%

Still fighting, Cigar City wins a battle for beer jobs in Florida

Josh — Fri, 03 Dec 2010 15:38:24 +0000

From flickr user Travlr

When we last checked in with Tampa, Florida’s Cigar City Brewing, they were fighting the good fight against distributor monopolization.

They’re back in the news again, and after fighting the good fight for the permanence of their own tasting room, they have a victory to show for it. From the St. Petersburg Times…

The Tampa City Council Thursday gave initial approval to a controversial wet-zoning that pitted an award-winning local brewery against neighbors who opposed the business’ beer-tasting room.

Council members voted 4-3 in favor of Cigar City Brewing’s request to make the temporary approval for its tasting room on W Spruce Street permanent.

What swayed the city council weren’t threats from prudish constituents or dollars from big-brewer lobbyists, but jobs.

Thursday’s vote came after more than two dozen people, most of them supporting the brewery, said the council should allow the tasting room to stay. They said the tasting room was an integral part of how the brewery markets its beers. Taking the tasting room away, they said, would hurt the business.

“I’m asking the City Council to let me keep my job,” Cigar City production manager Doug Dozark said.

The line of supporters also included patrons, other business owners and even competitors who said Cigar City’s ability to thrive in the recession, going from two to 23 employees, is something the city should support.

Craft beer is good for the economy, plain and simple. The more we can argue that, the more we can change draconian and outdated policies across the country, leading to more beer and more jobs.

Strange world of caffinated “beer” meets the FDA

Josh — Thu, 18 Nov 2010 15:24:56 +0000

From flickr user smohundro

Sorry, Four Loko, your ride is over. The FDA has decided to ban seven types of caffeinated alcohol — some of which bear a distant resemblance to beer — effectively forcing manufacturers to significantly alter their recipes or pull the products completely.

From CNN…

The move follows a year-long review by the FDA, which gave the companies 15 days to either reformulate their products or face possible seizure under federal law, said Dr. Joshua Sharfstein, the agency’s principal deputy commissioner. Experts have said the caffeine used in the beverages can mask the effects of alcohol, leaving drinkers unaware of how intoxicated they are.

“FDA does not find support for the claim that the addition of caffeine to these alcoholic beverages is ‘generally recognized as safe,’ which is the legal standard,” Sharfstein told reporters. “To the contrary, there is evidence that the combinations of caffeine and alcohol in these products pose a public health concern.”

One familiar name was impacted by the decision: Rhonda Kallman, brewer of now-banned Moonshot, played a very significant role at Sam Adams and was an early force in the craft beer world.