Buyouts and 'craft' conflict: beer stories to watch in 2018 | HopCat

Buyouts and 'craft' conflict: beer stories to watch in 2018

Kyle Montgomery, HopCat Madison Beer Program Manager
Wednesday, January 10, 2018

One of the HopCat family’s resident experts, Madison Beer Program Manager Kyle Montgomery, gazes into his crystal ball (by which we mean “his own comprehensive knowledge of the beer-making business”) to offer some predictions about which stories and trends will affect what we drink in 2018.

Taprooms

As larger "craft" breweries continue to expand into new markets, they realize the importance of establishing a connection with local consumers. A great way to forge this connection is to tie the enjoyment of a brewery's offerings to an actual physical space. We can see this trend in action with Ballast Point's forthcoming Chicago brewpub, as well as Goose Island's handful of domestic and international brew houses, including locations in South Korea and Brazil.

Corporate Buyouts

2017 saw an unsettling number of independent craft breweries gobbled up by the usual international behemoths, as well as by larger craft breweries and craft collectives. As growth among the craft sector continues to slow and retail space becomes more and more limited, it's unlikely that we'll see this trend slow in the coming year. 

Brewers Association Independent Craft Brewer Seal

While attempting to determine who owns whom in today's craft beer scene can prove a dizzying endeavor, the Brewers Association's new Independent Craft Brewer Seal is designed to make this task at least somewhat easier. Breweries that are small, independent, and traditional qualify to display the seal on their packaging and promotional material. 

This designation is not a suitable replacement for thorough research, however, as "small," is defined as a brewery with an annual production of less than 6 million barrels, and "independent," is defined as less than 25% ownership by an alcohol industry member that is not itself a craft brewer. For example, if a larger craft brewer (by the Brewers Association definition) acquires 100% of a smaller craft brewery, that smaller craft brewery would still be considered an independent craft brewer. As such, they would be free to flaunt the Independent Craft Brewer Seal. 

Quality Matters

With craft beer sales growing at a slower rate (6% growth in 2016, down from 13% in 2015) and 2,739 new breweries in the planning stage adding to an increasingly crowded marketplace, breweries will begin to fail. 

While no one likes to see a small independent brewer fail, there is no arguing that there are plenty of breweries across the country that have managed to survive while putting out sub-par products. In my own hometown in suburban Philadelphia, there are a handful of breweries that seem to get by for the mere fact that they brew their own beer.

As soon as this year, simply having a taproom with some shiny fermenters behind the bar will no longer cut it. With competition continuing to increase, and growth beginning to slow, quality and consistency will become crucial to a brewery's survival.

While at first glance this may appear a bleak prospect, this emphasis on brewing consistent, high quality beer will be good for both the craft beer consumer and the craft beer industry as a whole. 

As an industry, we will see less bastardized renditions of our favorite styles crowding shelves and tap towers. As anyone who's had a poorly produced sour beer or IPA can attest, it only takes one bad example of a particular style to turn a drinker off to that style entirely. 

As consumers, we will be less inundated by poorly produced beers, and more comfortable taking a gamble on that $15.99 four pack, as the quality of beer at our favorite bars and retailers becomes concentrated, and our beer purchases become more likely to be worthwhile.