Can the small brewery phenomenon sustain itself?

The big question is how much market share can "craft beer" obtain? On a local level, it's a little more complicated. Some communities can support multiple breweries, but others can't. I do believe Ms Howat's comparison to restaurants is applicable.

“The idea of market saturation had crossed our mind,” Howat said, speaking by phone from the Former Future Brewing Company that she and James opened on South Broadway in Denver in January. “But you never hear someone say, ‘this neighborhood is oversaturated with restaurants,’ even though if I go from one restaurant to the next a lot of them serve the same products, the same liquor, the same beer. With craft beer, you can’t get my beer anywhere else.”

 

It's managed very well on this side of the pond for quite a bit longer than the US "craft" explosion.Breweries have come and gone of course but many are well able to stay in business and are expanding.We now have around 1300 breweries to serve 60 million people.Many of these breweries are tiny, many are in the 10 bbl category.
The market share of so called craft beer in the UK is rather higher than in the US which suggests that your sales in that end of the market can at least double

 

Some time ago there was a discussion on this and somebody made the point that a brewery for every 30K in population was doable. Back then we only had two breweries operating in town and now we have 3 breweries in town, 2 more outside of town that opened pubs, and a craft bar that just got approved to make their own beer.

Bloomington has 80,000 residents and 40,000 IU students. So far every place (haven't been to one of them) seems to be doing well. In fact Upland has really upped their game in the quality of beer they are putting out so a little competitive kick in the rear is a good thing.

 

Wow, using the 30k residents/1 brewery rule, then Los Angeles County with its 9.9 million residents and its 30 or so breweries is a wide-open market!

In theory, it could support 300 more!

 

I think Former Future actually ran out of beer in their second or third week of being open, and had too close early and then stay closed the next week, until more was finished, back in March or April. They had to buy more fermenters IIRC; not sure if they upgraded the size of their brewhouse.

It's crazy here right now. Seems hard to believe it's sustainable. One thing's for sure, half-assed attempts are going to face stiff market resistance from here on out. Got to bring your A game, from the jump, or risk being written off by an increasingly sophisticated market.

I do think craft beer constitutes way more than 7% of the local market, isolating the Colorado Front Range counties as the "local market." Wish the Denver Business Journal had numbers on that.

 

I thought the market was saturated ten years ago - shows what the hell I know.

The worry now is brand loyalty - with everyone chasing the next great brewery and their limited whales, it's inevitable that other breweries eventually fall by the wayside.

 

I hope that aspect of the movement is squashed. I want bars, specialty retailers, and major grocery stores to have the best of those who have expanded and deserve to thrive - Bell's, Founder's, etc. If "mom and pop" local brewery wants to thrive, they need an IPA that will rival Two-Hearted or Centennial, and same for other styles from top brewers, because (hopefully) the best breweries' beers will be everywhere in a few years. So if they're going to be new, they better be good. I'm tired of the over-romantization of small, local places because for every Hill Farmstead there's probably dozens of mediocre ones opening up.

Drink what you think tastes best. (regardless of where it was brewed or how small the brewery is)

 

It will be interesting to see what happens in a couple years when all these new spots are no longer new and people have familiarized themselves with the beer. Right now, I think a lot of the new guys are simply succeeding because the scene is in its growth and development stage and people are interested in drinking good beer just as much as they are in trying new beer. What happens a couple years down the road, though, when the scene has familiarized themselves with the beer? I imagine with all the local competition, especially here on the Front Range in Colorado, if a brewery isn't putting out quality product once the curiosity factor dies out, so will business.

 

Coast buster was really good.

 

I think the bigger question is, how long will the Biggies continue to see sales suffer from the likes of the small, craft brewery types.

 

I know the debate about market saturation crops up often around here and everyone and their mother has a different opinion of where that ceiling is, but I think as far as the thread title goes, the small brewery phenomenon can definitely sustain itself. In fact, I'd bet it will continue to grow. There's plenty of room in the market for craft in the US, so long as not every one expects to be a national brand.

In countries with longer brewing histories, eg England or southern Germany, small breweries are a part of the patchwork of the land. Localized production is usually better suited to respond to localized demand, and more responsive. We're seeing a shift in that direction in the US and it's great, but craft still needs time to gain recognition. BMC has been able to culturally define "beer" for a while and isn't about to disappear overnight.

 

Sometimes it is about more than pure taste; sometimes it is about ambiance and romance.

I'm not saying that crappy breweries should flourish simply because they are are small, but my best experiences drinking beer have not come while drinking my highest rated beers.

To put it another way, place matters. And if the wave of small breweries provides me more good places to drink beer, I'm all for it even if the beers the new small places produce don't rival the best of the best.

 

I can fully agree with you in many respects, especially that place matters - ambiance, romance, and all. But I can have that at a great beer bar that is locally owned, small, with the owner behind the bar who remembers your name. In this case, ideally most of the beers if not all are fantastic. I don't have to settle for something "because it is local", which in all too many states and cities often means mediocre. If someone's local is Bell's, or Founder's, etc. then this conversation isn't for them. I'm not surprised by differences in taste, perhaps someone thinks their local is good while others don't, but what I am surprised by sometimes is how often it is acknowledged that the local beer isn't as good as alternatives yet it is supported anyway.

 

My mistake, and apologies to the author, who I see shares your last name. Nice piece! nice site!

 

Look at all the people that don't drink craft beer (yet), and you'll see how much room there is to grow.

 

Washington already has a much higher ratio of breweries to population at approx 250 breweries and 6.9 million residents, just under 30k per brewery.. the UK figure quoted is over 46,000 to 1. Craft sales as a percentage of overall beer consumption is also way higher here (and in Oregon) than the national average. Craft/specialty beer is closing in on 40% market share in the Seattle metro area. My point is, there is a ton of room left for growth, especially in OTHER areas in the US that still are struggling to understand what local beer is.

 

Definitely...it not uncommon that when a small brewery doesn't make it...a new small brewery pop up in its place.

 

If you brew it they will come...if its world class they will come back.