The Craft Beer Middle Class
We often hear about the three-tier system in the beer business, usually castigated as a post-Prohibition relic, or as needless by consumers and some small brewers. But there is a new caste system developing in an increasingly stratified craft beer world. On the low end is the rise of the small brewery, including hundreds of new entrants. Often working with extraordinarily diminutive batch sizes and producing only an infinitesimal amount of beer, these small brewers inject some excitement, energy and even confusion into an otherwise maturing, stable and staid marketplace.
Capturing much of the media and blog attention, these small brewers and nanobreweries have upset the tenuous balance that’s allowed the craft segment to grow steadily, causing bottle prices to skew beyond existing price models, while many larger craft brewers scoff at their pluck and naiveté. However, their novelty aside, these minor players are largely inconsequential in the wider industry picture, where the true class-division drama is playing out.
At the other end of the pyramid is the all-too-familiar story of massive global conglomerates battling for control of markets in hundreds of countries around the world. Largely stuck in an increasingly outmoded business model, one focused on fighting volume with volume instead of flavor or style, these large breweries look with a measure of detached concern over the growing characterful beer sphere of influence. While some corporations, such as MillerCoors with its Tenth & Blake division, appear to have had a change of heart, these companies remain focused on their core product line, often blindly promoting the fading light-beer model.
Playing in the shallow end of the big kids’ pool are the top-tier craft brewers, including Boston Beer, Sierra Nevada, New Belgium and a growing class of long-standing crafts, including breweries such as Dogfish Head, Brooklyn Brewery, Harpoon and two-dozen others. These large regional or even national crafts often seem to have more in common, especially going into the future, with their macro counterparts than they do with the fledgling nanobreweries fighting for inclusion in the craft beer club.
What we do not hear much about is a middle class, those mainly regional brewers slogging it out in the trenches day after day, often with little to no distributor support. These mid-sized breweries, which make 15 to 20,000 barrels or more and distribute in only a small number of states, are the bishops and knights of the craft beer chess game, not gathering as much attention as other breweries, yet crucial to the industry’s performance. They are steady growers—not in the sense of flashy or explosive growth, but rather solid and dependable businesses. You won’t see press releases touting multimillion-dollar expansion projects or tweets about extravagant barrel-aged offerings from these guys. Instead, they make reliable beers for everyday drinking.
These middle-class brewers haven’t experienced the growth of their regional counterparts for a host of reasons; for one, they can become distracted by the routine business of running a brewery, often to the detriment of their creative spirit. Focused on day-to-day operations, passion often seems to have unexpectedly seeped out of these midsized breweries. Consumers then begin to associate predictability with unoriginality.
For craft beer to continue its strong evolution, this oft-neglected tier of breweries requires additional support from consumers and a rededication of effort on their own part. In need of a slight touchup—maybe even a makeover, a new image, a reboot—these workhorse breweries can move to the next level with some new thinking. For those interested in doing more than surviving, they must update old recipes, retool stagnant product lines and reconnect with consumers in new ways. As strong and stable operations, they needn’t abandon the characteristics that served them well to date. But taking a cue from the dynamism of the nano trend will help rejuvenate craft beer passion across the industry. ■