"The bubble is bursting!"

if any aspect of a craft beer "bubble" is going to burst it might be a small category ie. the IPA style might see a slow decline in sales as almost everyone with a mash tun is making one.

 

Here's my .02 worth - over the past 5 years or so - in general there has been a huge upsell expressed interest by the consumer market for all things "local". Make that fruits and veggies, breads, meats, dairy products, etc and of course all things alcohol related. That'd be wineries, distilleries and of course breweries. That's a very good thing but like any "trend" it can get tired and eventually will "run its course". Its a good thing for one to support the local guy but only to a point. The best product at a fair price will almost always prevail in our market driven economic scenario. Trends will come and go, tastes and interests will fluctuate, its a given. This current "craft" beer trend will evolve, adapt and mutate. Some things will survive, others won't. Its a really fun ride just to see where it'll go so let's all try and keep things in perspective and enjoy it.

 

I am with the thinking that it is well below the ceiling. I am in Paris france right now, and the craft beer scene is ,to me, just booming. last time I was here , when you went into a wine shop(of which there are many) there was NO beer, now, there is a few to choose from, next time who knows. the craft beer stores are much like ours with beers from all over the world, exciting I know! drink on!

 

I hope someone sees this as an opportunity to experiment with new packaging. My vote goes for this stuff made from melted sand they are calling "glass". I envision creating a "glass" package that is taller and thinner than a can, with a hole at the top for filling and pouring, and with some sort of sealable cap placed over the hole to keep the beer from infection and to seal in the carbonation.

 

If one unnamed large customer has cornered the market on canning supplies, DOJ might be interested.

 

Yes that's why I said as craft beer becomes more popular. Have worked retail before, I am well aware of how macros move vs craft.

 

You would have an interesting point, if there wasn't a shortage of glass bottles as well. Pabst couldn't get enough bottles to distribute Nyfrb as fast as they wanted to. Granted, it could be that those were a special order of bottles, but they there is/was a shortage of those as well. Also, there's a minor issue that you may not realize, in these breweries' situation, their canning lines cannot also fill bottles. So, they have to go buy another very expensive piece of equipment and find space in their already full brewhouse to put this new piece of expensive equipment....

 

Small brewers also use mobile canning lines. Not sure there are mobile bottling lines.

 

Working for a distributor, I can tell you that a frequent concern is the struggle to place a new package when the options available are to either persuade the retailer to remove a competitors product, or to remove one of your own slower-moving packages. Not sure where you're perspective is coming from. Perhaps things are different in your market.

 

What I meant is that it would be easy for many store owners to expand or alter existing space. Also, depending on how craft beer products move there is room to do exactly what you say, remove slower moving products. For example, at a store I worked at we were carrying up to 15 flavors of each brand of cheap vodka. There are places where things can be cut in order to make me money off faster moving products, it is just up to the store owner to do some actual data analysis and see what makes more money.

 

Let me see if I can explain this another way, it is actually incredibly difficult for store owners to expand or alter existing space. If you want to look at a real life example, google the articles on "distributors" in Pennsylvania bitching every time the state allows them to sell a different package size. They have to buy new racks, decide how much of the store they're changing over and generally get their undies in a bunch about it.

Beyond that, let's say you have 15 flavors of Smirnoff and the store owner takes your suggestion and does some data analysis of his sales data and realize "gee, chocolate pomegranate Smirnoff isn't selling well and Bacardi Feta Watermelon is selling worse, I should drop those!" So, he takes those out...and then he has two choices, reset his entire store (confusing his regular customers and taking a ton of time) or fills those holes with a new vodka and a new rum. It wouldn't really work to throw in more craft beer in those spots.

Third, the belief that customers don't buy warm beer runs deep in the beverage industry, so if even if you did want to reset your entire store to add more craft beer, that means (in theory) you then have to buy new beer coolers as well. If you are to have 6 coolers and you start adding warm space, you'll find it moves very slowly unless it's a hot craft beer. Why? Where do you go when you buy beer? Straight to the coolers and you might only even look around the store to notice the warm shelf space if you're looking for something specific.

Lastly, if store owners started doing a ton of analysis on the sales of craft packages, they would probably remove more craft then they would add. The flagships from many breweries move pretty well and would keep their space, but the stuff we go in for, the variety, moves much slower since it doesn't have the marketing support and such that the flagships do.

Yes, in a world where a new brewery opens and their entire lineup sells like it cures cancer (or it's a fucking root beer) and magically doesn't cannibalize other craft sales, sure adding more cooler space for that might be a workable solution, but that's a fantasy. Pretty much every store owner has a lot of optimization with their current beer space before they start resetting their entire store.

 

And lets not forget that wine and liquor is more profitable for stores so few would be willing to give up space for those for beer. Also at least around here the major distributors all have one of the BMC's in their portfolio as their main beer so you really can't cut too much of their products for craft offerings

 

You guys have to to be copy/pasting your arguments at this point because this comes up AT LEAST once a month

 

I decided to turn my Y2K shelter into my beer cellar. I'll let you know whent the party goes down.

 

I think an economic downturn would be far more likely to cause folks to go out of business than any "bubble "as luxury items are the first to go and people will retreat to either less of an expensive thing or a less expensive option to begin with. Some consider beer to be a recession proof-.but when times get tough, things at the top of any price point will suffer.

 

Is Total Wine a small player in most markets?

 

The lesser products will fade and that is simple market share economics----Jack Daniels beer line comes to mind....also the tech bubble pop of the 90's is an annoying reminder as bitter as it was.
That said, I would say we are safe for many moons.