Mar
18
'10In the U.S. craft beer keeps growing, but someone is not happy…
Last week the Brewers Association has published economic data relating to the craft beer sector in the United States. Once again, in spite of the international economic situation, the segment shows an enviable health, testified by impressive numbers. One data above all: compared to 2008, the craft beer market grew by 7.2% in volume and 10.3% in dollars, surprising even the most optimistic analysts.
Other statistics give an idea of the scale of growth. The total number of microbreweries rose from 1485 to 1542 (a record since the Prohibition days), the market value has increased from 6,32 at 6,86 million dollars, the beer market share is 4.3% in volume and 6.9% in dollars. Many craft brewers have experienced steep growth, such as Founders (growth of 72%), Oskar Blues (71%), Great Divide (34%), Dogfish Head (30%).
This is the comment made by Paul Gatza, president of the Brewers Association:
Beer lovers continue to find great value and enjoyment in fuller flavored craft beers. Americans have an increasing appreciation of craft beers, and the growing number of brewers behind them. They’re eager to try the latest seasonal release and to sample a variety of beers from different breweries.
It’s important to note that craft beer division is in countertendency with industrial one which is facing a heavy downturn phase.
At a time when the international economy is still struggling to recover from the recent crisis, statistics like those mentioned can only be appreciated by beer lovers around the world. Yet, in these days, appeared a controversial post on the blog World Class Beverages, which has proposed an interesting question: are there too many brewers in America? Here’s the gist of the speech:
There are too many breweries in the U.S.? “Are there too many brewers in the US? Are there too many beers? It sounds a little bit like crazy talk, but there are a fair number of brewers who seem to feel that this may be the case.
The issue has raised several debates on blogs and forums. Interesting is the point of view of Erik of Top Fermented web site, which suggests a parallel with the world of wine, highlighting differences and similarities. Beyond the personal opinions, it is interesting to note that such an argument come out when a market is particularly healthy. It’s a problem of abundance, to make it brief, and it’s usually a problem of prolific contexts.
The question could easily be applied to the Italian movement too, which in recent years has shown an impressive growth regime. The data that is most often mentioned to illustrate this boom is the number of microbreweries, which grew enormously in a relatively short period of time. Even if this is the most interesting statistic, is also normal for someone to ask where is the point of market saturation.
I say plainly, in my opinion is a false problem. In my view, the abundance rarely produces uncertainties. In a new market like the Italian one a multitude of actors can only do good to the movement, forcing brewers to constantly improve to stand out. A faultless discourse, I guess. But maybe there’s some less obvious factor that can make this vision at least partially. What do you think about it?
1 March 19, 2010 at 12:35 AM Bob MackI’m the author of the blog posting you referred to at http://www.worldclassbeverages.com and I want to thank you for your opinion and perspective. I agree with most everything you say and as far as I’m concerned, I don’t personally want to see any beers go away. I love most all of them, certainly the American craft beers.
My article was really inspired by talks with several brewers who see that there may be some “clutter” in the beer marketplace and I think their concern stems from the craft beer downturn in the mid-nineties when a whole bunch of craft brewers lost their businesses. Most of the problem back then was blamed on the proliferation of brewers, not all of them good ones.
Of course, we don’t really know where the market saturation point is until we get there, as you allude to.
The marketplace will eventually sort this out, of course, but there are always losers in the marketplace. Are great brewers going to be among the losers? It’s easy to say that the market will choose to keep the good ones, but quality of product is not the only factor in play here. Financial standing, including indebtedness and smart business decisions will play a role, perhaps a larger role than product quality and product demand. Most all craft brewers are relatively small businesses by any standard and even the great ones can be susceptible to a small backlash or downturn in the marketplace.
Cheers to you and thanks for your great website!
Bob Mack
http://www.worldclassbeverages.com, bmack@worldclassbeverages.com
2 March 19, 2010 at 10:45 AM Andrea TurcoHi Bob, thank you for your comment and your interesting post.
As Italian beer lover, I tend to apply your perspective to the Italian market, that is very different from the U.S. one. So my opinion is influenced by this aspect. In an emerging market like Italy, maybe the most important issue is to raise quality and consistency by the presence of several brewers. After the initial success, now the market need to find a “normal state” and maybe the competitivity is the best way to reach it.
By my experience, I can say that so far most brewers that reached success are the ones with better skills. I hope this trend may continue…