Craft beer bubble articles bubble

I'm seeing even further expansion, but Phoenix is behind about a decade or so when it comes to local breweries compared to other similarly populated metros.

I think we see frequent bubble articles because many of us are amazed at how places can still continue to open, and given the mediocrity of so many of them - we're amazed that they stay in business.

We had an actual bubble that popped in the late 90's, so that was the earliest I can recall seeing the bubble talk in the beer world. I think it came back in the late 00's. It was a curious phenomenon to me that so many still opened up right after the "Great Recession", especially given how slowly the economy recovered from the recession. Yet, breweries opened up left and right.

 

Many that opened here were started by people who had lost their job, and decided to make brewing their job.

 

There is continual expansion of new brewery/brewpub openings in my area (Southeastern PA). We previously had a lot and we now have even more.

I will comment that most of the recent openings are smaller breweries (15 barrels and less). It seems to me that serving very local markets appears to be their business plan.

As long as these breweries provide product that the locals want to drink I do not foresee a bubble bursting anytime soon. I do expect that some will close in a few (e.g., 5) years but that is true of any new startup business.

Cheers!

P.S. I have also noticed a significant number of new breweries/brewpubs opening in South Jersey as well.

 

Around 14 breweries have opened in/around the Charlotte, NC area over the last seven years and I've heard that there are 20 more are "on the way." Only one has gone under. Not sure what the beer future holds here.

 

People are becoming more and more aware of craft beer. I actually think what we're seeing with a huge number of breweries opening up will be normal for quite a while. As long as these new breweries can make good beer I don't think there could ever be too many.

 

Those involved in the bubble never see the crash coming.

During the height of the housing bubble many economists were still forecasting 10%+'growth in housing right up until it popped.

There is absolutely a craft bubble forming

 

Problem is the only sure way to identify a bubble is when it bursts. :-)

 

Seems also that there is a corresponding growth in the market demand for local brewery beers so I'm thinking we'll not see anything resembling a bubble on the horizon unless market demand stops growing and starts receding. That is something I'm not seeing signs of in SE PA.

 

Tom,

Have you had a chance to try any Sterling Pig beer yet? They are near you, right?

Cheers!

Jack

 

Not seen any yet. Still working creating enough space in the queue to work in a few things from Evil Genius.

Re the Sterling Pig, the other evening (probably opening night or close to it) while heading along Baltimore past the Pig they were simply too crowded to even consider stopping. But Media itself is becoming quite the beer centric place, what with them, Iron Hill, Quotations, Pinocchios, etc., etc. Got to do an evening walkabout there one of these days. Nice town for that.

 

When the Feds start forcing lenders to loan money to people who otherwise can't afford the journey to Dark Lord Day, I'll start comparing the two to each other.

Funny how no one talks about the increase in smartphone sales leading to a smartphone bubble.

 

You are correct in the fact that to my my knowledge brewery start ups aren't getting free money and therefore distorting market signals. In that respect I somewhat retract my earlier statement. One thing that technology has going for it that other sectors do not is the repaid increase in productivity and continually reduced cost associated with production. Phone prices drop and people buy more.

I still believe that many of the new breweries will fold in due time if only because of the competition for market share, a market that I don't think can support all the current breweries.

I think it would be great to see a drop in craft prices due to competition but I haven't seen it yet

I suppose I see it much like golf when Tiger Woods burst on the scene. Everyone started golfing and new courses opened up. Perhaps we could look at craft as being more "faddish" in this way?

 

Yup. downtown Media is a nice little town center. The head brewer at the Media Iron Hill is a very talented brewer. The co-owner/brewer of Sterling Pig used to be the head brewer of Rock Bottom in King of Prussia. His name is Brian McConnell and he is also a very talented brewer. Scott Morrison (a.k.a. The Dude) helped Brian setup and select equipment for Sterling Pig so it should be well equipped to produce tasty beer.

You have some excellent places to drink quality beer!

Cheers!

P.S. I kind of feel sorry for other BAs when they discuss their beer scene and the lack of beer quality. I suppose we are very lucky here in SEPA.

 

I reserve my prerogative to change my mind in the future but so far in my area (Southeastern PA) the “build it and they will come” concept has been working (so far).

I am under the impression that the craft beer drinking market is ‘expanding’ with the increase of breweries/brewpubs. My rationalization for these phenomena is that the ‘power’ of drinking local is very strong.

Cheers!

 

There talk of the raw materials being a limit on growth. Malt and hops are agricultural products, and a poor production year will put a stopper on growth. There is already talk of hops being tight due to a poor year in the U.S. and Germany. Those with contracts will be OK, those without will scramble.

 

I believe that there will always be a local market for a brewpub, especially if they have another "hook" like sports bar, musical venue or are in the 1A location in a downtown region, but the problem is getting onto the shelves in markets other than your home market. Distributors are getting flooded with newbies knocking on their door, and they must be prudent in the decision on who to take on.

There's lots of good beer on the shelf, hard to knock the tried & true off the pedestal with anything other than the occasional ticker beer.

 

Douglas, how lucrative are tasting room sales?

Cheers!

 

Any brewer will tell you $5-$8 pints are the best business (gross $600-800/keg). It's when you get to the food side of the equation that most have their problems.

 

We just had a cover story in our local food/music/event paper that featured the local craft beer 'explosion'.We are home to Revelry Brewing..3rd place in the Nationals!