The Craft Beer Market Bubble

Great stuff. Thanks for sharing.

 

"Cans of Heady Topper fresh off the production line" uh huh, the image shows fresh cans for heady topper, unfilled and topless in the image. People that do not know about beer should not write about it IMO

 

Great story and I said this is something I think will happen 5 years ago. Its like the stock market though NO ONE can time it. we know history repeats. the question always not IF but when and how much.

Most everyone is always in denial about a bubble before it happens, and after it passes everyone then wakes up and says yea it happened. My locals were none to 6 now (in 3 to 4 years) and more planned. It will never last. In fact folks like me are already nearly priced out of many beers and differently priced out at bars/pubs/micro tasting rooms.

Big boys will survive, the market WILL shake out. You can quote me, lol.

 

This will shake the tree and only the strongest fruit will survive.

 

Oh good, another "bubble" thread.

I'll leave it to someone else with more time to explain why there is no bubble à la tulipomania.

 

Good read, lot's of interesting points. Took me a while to get through it all, but was worth it.

This is so true.....

 

Bring it on. Lived through the "microbrewery" bubble burst & as most have already said the average to mediocre brewers will fall leaving the cream of the crop. Don't let the door hit ya on the way out.

 

Not bubble but a boom and boom are followed by busts. I don't see a collapse like one does with a bubble. I do see a lot of small systems for sale in the near future, after the dreamy eyed owners/brewers realize the ratio of earnings to work is low. Large established breweries with good product will continue to grow, even if the craft growth is stagnant - happened last time.

 

Gonna be a LOT of 1-5 BBL systems available for cheap in the next few years!

 

Yes a lot tucked into this very long article, but I also agree with NHcraftbeer above that the author does not seem to have been that well schooled in craft beer himself before doing the interviews for this article. If it was a typo for Widmer when a "Wiemer Brothers" craft brewery was mentioned, any knowledgeable writer or editor would have caught it before posting or publication. And mentioning New Belgium right after Boston Beer and Sierra Nevada as one of the "few big players" who "dominate" the craft beer market - well maybe in Colorado, possibly even on the West Coast they do, but Fat Tire & Co. are not very common in my area, and in fact totally absent in all but the most well-stocked stores. Meanwhile ubiquitous Founders and Dogfish Head are nowhere to be found in the article.

Also, the lead in about bumper to bumper traffic in downtown Waterbury Vermont on a recent Monday morning seems rather bogus, since the retail store closed a couple of months ago, was about a mile north of the town, and out of staters would likely exit I-89 north on 100 to the cannery, rather than south into town. Anyone who has been up there when there was any such rush is welcome to correct me.

My biggest quibble is the overblown alarmist headline, suggesting a coming "collapse," when the article mainly has a few brewers predicting a natural competitive shakeout of lesser players. The big news in the article for me at least were the further details about the Heady Topper retail store closing and problems finding a new location which I had not seen mentioned in other interviews or on the Alchemist website.

 

In general, new businesses have a high failure rate.

 

Speculation, and nothing more. Meanwhile, why aren't I hearing about the increased sales of smartphones bringing us into the middle of a smartphone bubble?

 

because smartphones are a completely different product and a completely different market outlook. there are over 2000 breweries in the USA, and probably less than 50 smartphone makers. the barrier to starting up a brewery is extremely low for an individual compared to starting up a smartphone manufacturing business, meaning brewing is more likely to produce opportunists looking to cash in on a perceived trend.

 

New Belgium is not common here because they don't distribute (yet) to MA, even to the biggest liquor stores. There is no lack of credibility by the author for him to state they are one of the "few big players" who dominate the craft beer market.

 

Is this serious?

Smartphones are a transformative and new industry. That would be equivalent to asking why increased sales of toilets occurred after modern plumbing and water infrastructure access became more prevalent.

 

To expand on this...Here is a great interactive map that shows the size, location, etc...of the nations 50 largest craft breweries. New Belgium, at well over 700k barrels brews around 3.5 times the amount of Founders and DFH combined. And New Belgium is about to open a 2nd east coast brewery.

http://www.newyorker.com/sandbox/business/beer.html?mobify=0

 

LOL at people making fun of the author for not being knowledgeable about craft beer while not realizing the New Belgium is the third biggest craft brewery in the country.

 

I agree that there was no bumper to bumper traffic when I went to Alchemist to buy a case of HT on a Monday morning about a month back - this was the day before HT announced it would be doing Growler fills, and a short time before HT announced it was closing its retail shop.

I wonder if the bumper to bumper traffic is a reference to the Monday after Alchemist announced it would be closing its retail shop.

 

OK thanks for the beer distribution lesson. Clearly I live in an unusual part of the USA where New Belgium is absent (and I can't receive beer in the mail). I have only had Fat Tire and Trippel myself, and on reviewing my records, I bought both in Maryland. I'll go wash the egg off my face now...