If you like craft beer, there are probably many reasons why you would rationalize spending a little more for a quality brewed drink. Obviously, there are many ways to define that special quality in a beer. For some, the nomenclature “craft” is enough. Here’s some data to put ‘craft’ in context.

The general definition of a ‘craft beer’, as stated by the Brewers Association is: “An American craft brewer is from a small, independent brewer.” Small is defined as having an annual production of 6 million barrels of beer or less (about 3 percent of annual US sales). Independent is a brewing operation that is less than 25 percent owned or controlled (or equivalent economic interest) by a member of the alcoholic beverage industry that is not a craft brewer.

The TTB (Tax and Trade Bureau, TTB.gov) is responsible for regulating the craft beer industry. Anyone can go to the ttb.gov website and get more information than even the most informed consumer would like.

A generic definition of a craft brewing operation can be summarized as:

• Innovative approaches to historic styles with new ingredients and evolving techniques.

• Distinctive flavors, aromas and character from new ingredients such as yeast, hops and grains.

• Small independent brewers who are immersed in and with a region or community.

• Brewers with individual approaches to defined customers and markets/regions.

• Craft brewers have a market identity by being independently owned, developing distinctive product styles, and being creative in brand identity.

• Most Americans live within 10 miles of a craft brewery, so by definition they are local.

The craft beer industry can be segmented as: microbreweries, breweries, Taproom brewery, regional breweries, contract brewing, and alternate ownership.

microbrewery: 1,952 Total in 2019

It produces less than 15,000 barrels of beer per year and sells 75% or more of its beer off-site. Off-site is defined as take-out or on-site retail stores, bars/restaurants. Individual states regulate the distribution of craft beer through state laws. For example, some states allow brewers to self-distribute, while others require a system known as three-tier distribution only. (Average consumers call this a monopoly.)

brewery: 2,929 Total in 2019

A restaurant and brewery, contained in a single location, that sells 25 percent or more of its beer on-site and operates major food services. The beer produced is for sale in the restaurant and bar. Here again, local and state laws regulate Brewpubs and their ability to sell food to go and distribute to off-site accounts.

brewery tavern: 3,073 Total in 2019

A professional brewery that sells 25 percent or more of its beer on-site and does not operate significant food services.

Regional Brewery: 238 Total in 2019

Brewery with an annual beer production of between 15,000 and 6,000,000 barrels.

contract brewing company:

A business that contracts with another brewery to produce its beer. It can also be a brewery that contracts with another brewery to produce additional private label beer. The contract brewer handles the marketing, sales, and distribution of your beer, while typically leaving the brewing and packaging to your producing brewery (sometimes also referred to as a contract brewery).

alternate owner:

Recognized by TTB with specific regulations. “A licensed tenant brewery that physically takes possession of a shared brewery while brewing. Unlike contract brewers, alternate owners are the brewery of record for all obligations of a licensed brewery, including record keeping, payment of taxes and approval of labels or formulas, “Brewers Association/TTB.

All categories defined by the Brewers Association in the US total 8,500 breweries in 2019. The distribution by state generally follows population patterns. The annual increase, 2019 versus 2018, represented a variation of +8.9%.

2020 could be an extremely difficult year to assess the craft beer sector. In the space of 1 year from 2018 vs. 2019, openings in the Microbrewery category alone went from 700 openings to 100. Closings vs. openings went from 15% in 2017 to 80% in 2019. Basically, in 2019 closings nearly equaled the openings. In 2020, there will probably be a negative growth rate, especially in the Brewpub (brewery and food) category.

There’s no shortage of opinions on what the craft brewing market will look like post-Covid19, so I’m not afraid to join the crowd of self-proclaimed experts. If a person is committed to the brewing industry and is involved with the science and art of brewing, 2020 and 2021 could offer opportunities through turnkey operations. However, please note that Watches are fair and honest in all dealings. I know this because I lost a business during a recession.

What is the best way to plan/position to increase craft beer sales? In a blog post on July 2, I recently read (How Wine Can Stop Its Return to An Era of Snoot) where Dorothy Gaiter advised the wine industry to rebuke the image of wine as a snobby drink. One of the premises was that dismissing wine as something for the educated and privileged meant they were selling to a shrinking demographic. She precisely herself commented: “A diverse demographic included in the wine industry can only bring great benefit. It is my opinion that each industry that has embraced these ideals has grown exponentially and opened up markets that were previously untouched.”

Leggings reviews can be extrapolated to fit the craft beer industry as well; from grain to bottle beer is as complicated as making wine. The problem with craft beer, as an industry, is presenting the message that craft beer is worth the price and the respect due to quality, choice of styles, attractive packaging, new and innovative complex flavors and aromas, and feel in the mouth. Brewers must participate, invite and be interested in the consumer. An average bottle of wine is around $12-14 per 22 oz bottle; that’s not a bargain compared to craft beer. Remember, artisans, not everyone likes hops. Some people like a nice malty finish with a toasty aroma.

Beer is not always an inexpensive product. Boston Beer Company CEO Jim Koch marketed a beer that was in the category of a celebratory drink that Jim says rivals champagne. The most expensive premium beer produced in the United States was from the Boston Beer Company and has 27% ABV in a 700ml bottle and sells for $275.

As a beverage, beer has a universal market appeal that is evolving rather than changing. For example, there are more choices in styles and flavors, current offerings are innovative, more women drink beer, it’s a convenient/portable product, branding opportunities are diverse, and beer is affordable.

Let’s talk about beer. Enjoy to your heart’s content,

Health!