How long can the boom last?

Carlsberg has unfortunately removed their historical archive from their website but I think these translated excerpts are interesting, being letters from 1869 between Carl Jacobsen (the son) and JC Jacobsen (the father).

Quite modest amounts of dry hopping when one consider the amounts used nowadays for regular IPAs, and especially most NEIPAs, which really emphasise massive dry hopping amounts (several pounds per barrel, short contact times and consumed as fresh as possible). Ron @patto1ro chimed in with some actual brewing logbook numbers that were similarly modest. So around a pound of hops per (UK) barrel. and then the aging on top of that. I could see Orval approaching those numbers today as it pertains the dry hopping rate, even as they dry hop for a shorter amount of time, a few weeks, and much of the aging takes place in the bottles without the hops.

 

I think in the next few years we will be seeing a lot of small local brewery owners calling it quits. Not all will be poor beer makers either. I just have a hunch that a lot of brewers had more grandiose aspirations when they quit their day jobs and jumped into the brewing business than just to cap out as a local hangout spot, which is pretty much the ceiling for most. Running a brewery is a lot of hard work and long hours and without seeing further growth opportunities after a while, a lot may close shop and try something else, retire or go back to the past career.

 

Let me add here too, that some of these smaller breweries are well off the radar screen, especially the ones that are brewery only. I can only judge from what a see here locally, but the craft beer looks to be back tracking big time.

 

That's an interesting perspective I have never really considered. I wonder how many brewery owners out there are nursing huge dreams and how long those with ambitions of reknown or major production will keep working without achieving those things?

 

The "local hangout spot" is what the majority of new places will be of course with exceptions. In NC, the few towns that don't have much "local beer" are that way because there is little market for it. Charlotte has probably more than we need now with still some places trickling open (Devil's Logic) and some closings (Bold Missy--wasn't too good) but the energy for it has noticeably slowed. Spring/summer will provide for a bump.

In addition to competition for patrons, competition on the shelves, it seems like there is more demand for people's time outside of beer as well.

 

I know! I get nervous about spending $10 for a six pack of OMB anything.
Because it is an outstanding brewery.
I think $10 per 6 pack is the edge of reasonable.

BTW Bells 2 Hearted is also $10 a sixer.

Edit: Technically $9.99
Edit Off.

 

OMB is never a risk as far as freshness and quality goes. Their footprint is massive, over 4 acres in a fairly large city, you really have to see it to believe any place that’s not rural could be so large. But for every OMB that’s doing well, I’m sure the majority of the smaller brewers are scraping by, I could see many of these closing, it has to be a mental drain to work so hard but to be stuck in the mud.

 

I think this is a good reason to support our local breweries. We all have at least one local place, I'd bet.

For me, I'm fortunate to have 6 really good breweries, from 5 minutes to 30 minutes away. Because of this, I haven't bought beer in a package store in a looooong time now. Freshness is never an issue when buying 4-packs from my local guys.

I know that I'm not getting a wide variety of beers from all over the world, but I am getting really great beer and supporting my local brewers. It's a win/win for me and them.

 

Born yesterday, but early October!

 

I agree that this is an interesting take, and I suspect @bubseymour is right that some brewery owners entered the industry with grandiose dreams that they have since discovered are unrealizable.

There are some complications, however: Many of these breweries are debt-financed, in which case this isn't really a viable option until the loans come to term (could be as little as 3 years or as much as 25 years). Obviously the statuses of their leases, if they don't own their real estate, matter too. Breweries, unlike most restaurants, have a lot of very expensive equipment that they're not going to just abandon to the owner of the building or let lie fallow if they own the building (and that a non-brewer isn't going to want if they try to sell the building). Rather, they're going to have to go through a major sale process, if only of the equipment, and, given that fact, and that we're positing that operations are profitable, there seems little reason not to try to sell the whole operation rather than just shut it down and sell it for parts, likely at a haircut. Contrast that to restaurants that often own few and low-value hard assets (often those things are owned by whoever owns the building and, if they're not, they tend to be much less valuable than brewing equipment), so it's easier for restaurant owners simply to wipe their hands and say "I'm done." There are still tons of people who want to buy breweries, and the breweries that sit for sale on the market for a long time typically either have bad locations or unfavorable lease terms that the buyer would inherit (i.e., things that tend to make them unprofitable and thus not the sort of brewery we're talking about here).

I pay very close attention to Minnesota breweries, and I can't think of any that claimed to be profitable that simply shut down. All of the ones that shut down were losing money. That said, most probably still do have outstanding balances on their loans. But I do think the phenomenon that @bubseymour has identified, while quite possibly legitimate, would tend to lead to brewery sales (which are already not uncommon) rather than closures (the sort of thing that threatens "the boom").

 

I would like to see these guys around locally more, especially during Oktoberfest. A six-pack of Pounders for 10 bucks? Yes please

 

You make a very good point, with a bit more thought the phenomenon @bubseymour mentioned might come into play in a decade or so (after most newish breweries have/have almost cleared their debt) IF there is some actual collapse of the market for local beer.
The only semi local example I've seen was a founder whose drinking became problematic a few years into the life of the brewery and, because it was clearly succeeding financially, a group of employees found a way to buy him out of the business and they continue to chug along today 5 or 6 years later.

 

Really good insights, thanks.

 

It’s a toddler.

 

Ballantine IPA was aged in wood for 1 year when it was brewed in Newark NJ way back in the dark ages of beer.