Category: Beer Industry

my occasional rants and raves about what is going on in the industry.

Posted on

Let’s Do the Numbers

To recap 2015 in craft beer….
unnamed
The Brewers Association (BA), recently released their 2015 data on the state of craft brewing.

Here are what I consider the important take-aways:

12% market share of the overall beer industry but if you look at it as retail dollar value then the number goes up to 21% market share.

Throughout the year, there were 620 new brewery openings and only 68 closings.

One of the fastest growing regions was the South, where four states—Virginia, North Carolina, Florida and Texas—each saw a net increase of more than 20 breweries, establishing a strong base for future growth in the region.

None of these numbers shock me as much the sheer brewery total but what it does tell me is that there is still growth happening. Maybe not spikes upward but steady walking up the hill for sure. And I like to see that the South is starting to catch-up with the rest of the country, it speaks to me of the fact that either cities and states see the growth and are helping OR breweries are looking for open spots on the map to do business in. And from this year forward, I think it will be important to chart the opened-closed number and see how that trends.

Posted on

Tax Time

With the tax deadline next month, it is a good time to take a gander at this state-by-state comparison of beer taxes.
Beer_map
The Tax Foundation describes itself as a “non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937.”

And no matter what your political view on taxes and government, as craft beer fans we need to be in the loop on how this affects the cost of running a brewery and how it ends up costing us.

And just from a quick scan of the numbers, Oregon and Colorado are really at the low end at 8cents each and not surprisingly have big craft consumption and brewery numbers.

Posted on

Sku’d

National Beer Wholesalers Association’s 2015 Distributor Productivity Report
National Beer Wholesalers Association’s 2015 Distributor Productivity Report

Two statistical tidbits from a recent post from Jason Notte about the proliferation of SKU’s (aka stock keeping units)

“Meanwhile, it’s starting to tax the people who have to bring that beer to retailers. Independent beer distributors were carrying an average of just 262 SKUs in 2007, according to the National Beer Wholesalers Association’s 2015 Distributor Productivity Report. Just last year, those same distributors were dealing with an average of 981, with a reported range between 600 to more than 1,600. They’re also dealing with an average of 35 breweries, compared with just nine two decades ago.”

Imagine that you are selling beer, or delivering beer or hell, being the data entry specialist at a distributor now? You are juggling a lot of balls now. You now should really know 35 breweries and their offerings where before you had to only keep 9 straight. There are multiple variants of multiple beers. And if you are in Los Angeles, you need to know the day-to-day traffic patterns too just to physically get a beer on a shelf to be bought. Then (if you are on the ball), you have to police retailers and get old product off the shelves in a timely manner.) The spreadsheets and customized computer programs would be mind boggling to the average beer drinking person.

“The burden of that increased SKU count isn’t just on distributors and stores. While the beer industry’s SKU count has increased 244% since 2008, total U.S. beer output has actually dropped 3.3% during that same span — from 213.3 million barrels to 206.3 million. While it’s true that craft beer’s production has nearly tripled in that time — from 8.4 million barrels to 22.2 million in 2014 — and its brewery count has soared from 1,500 to more than 4,000, there’s a catch.”

This stat is fun. Couple layers to peel. Back before craft (BC), it was a large amount of beer and little SKU numbers. Now that beer amount is down but there are now more breweries in the US than ever before. But nesting in that number is that the growth category of craft is well dominated by the major players of the Top20 list. So bigbig has fallen backwards but littlebig has grown. The intimation being that littlebig may well be on the way to being bigbig and how will they behave towards the little?

Posted on

Where are IPA’s headed?

Where will hops go next? That is a question I have had swirling in my mind since I saw the Facebook invite for the Mohawk Bend IPA Festival this weekend. There have been Session IPA trends, single-hop IPA trends and this year fruit IPA beers are big.
Capture
Then I saw this Beervana piece (which itself was commenting on another piece from Willamette Week newspaper) and found myself wondering how these trends start and how they move around the country. Is it really from one area? Does a can of Heady Topper hopscotch from brewer to brewer until that beer becomes emulated from coast-to-coast or is it sales number that drive every last brewery to introduce a grapefruit IPA?

Adding another “Or” to the mix is the hop supply. I remember when there simply wasn’t enough Citra hops to meet the demand, and then to add another layer, Mosaic and other new and exotic hops showed up on the scene blunting a full-fledged Citra take-over.

How does a certain IPA sub-style grab the attention of both brewers and craft beer fans alike? Obviously it has to catch the zeitgeist of craft beer fans but my personal theory (without hard Nate Silver data to back it up) is that for a trend to take lasting hold it needs to have an unobtainable avatar of the style as well as well-regarded local and easily available options as well. Much like a hit movie, it needs to have lines for tickets but also be on enough screens for the curious who might walk away from the ticket window if the line is too long. But that rollout from whale to common needs to happen in a short window otherwise the momentum dies on the bine and the beer stays as Moby Dick and doesn’t enter the popular conversation which is on a different plane and only tenuously connected to blogs and industry chatter.

This is why Sour IPA’s haven’t taken flight nor have coffee IPA’s. Yet. They have been oddities or taproom specials but have not gone nationwide. They may have caught the fancy of the early and adventurous beer consumers but have not reached a critical mass of breweries and beers to push into mindsets and store shelves.

Which leaves me back at the start. Is there a new hop lurking and about to create a national stir? That is a wait and see game.

Posted on

How the Fruit Gets in the Beer

The Oregonian may be shrinking and then blinking out of existence but it does still have some people on staff and can get out information that is helpful to know.

Case in point, this article on the Oregon Fruit Co.  I knew them only from the cans on a shelf in the baking section and no more.

This, to me, is an oft overlooked part of the craft beer industry. How tangential businesses get a boost from it.  Now grapefruit IPAs won’t last forever but this company has seen a market to sell to
Capture

Posted on

Another brewery on Sunset?

A few posts back, I talked about Sunset Strip Brewing in the planning process, now there is a brewpub in the planning phase for Sunset Blvd. in Echo Park.

Screen Shot 2016-02-13 at 10.24.48 AM

Sage operates a mini-chain of restaurants in the Los Angeles area and is looking to expand their Echo Park corner into a brewpub.

Let’s see if this comes to fruition.

Posted on

Shelf Room

When it comes to beer shopping away from the friendly confines of a good, local bottle shop or brewery taproom there is a dark distribution underbelly to getting a craft beer onto a shelf so that you and I can see it and buy it.

This MSN article points out a new plan that looks like a new way to squeeze money from the makers of beer, wine and spirits. And it has all the major players (who generally don’t see eye to eye) aligned against the Kroger chain.

Right now, the less than ideal situation is that the stores ask for “captains” to analyze sales and shelf allocations. Those captains are usually Bud or Miller and the allocation is usually to the detriment of craft beer. Don’t believe. Check out a Ralphs or Vons. Not a lot of choice. Sunset Beer Co. has more variety in one cooler. The new even worse plan is to have a distributor do the analysis and charge those who want to be on shelves for the privilege of being part of that analysis. Effectively cutting out the small players who don’t have budgeted money to “buy their way” onto a shelf.

The fees are called “voluntary” but us consumers know that voluntary means temporarily voluntary until people stop grousing about it and they install it permanently.

The sad thing is that maybe if the chain grocery stores took a little responsibility for their own actions they could be nimble competitors who focus on local beers. They could hire their own damn analyst to cover 10-20-30 stores in a region and be able to buy new releases and rotate their stock. That ain’t happening right now. I don’t buy craft beer from a grocery store because it is usually old and dusty. And the only local nod about the stores are some haphazard art work with my town name near the door out.

The other sad thing is that it can be done. Whole Foods has selection and it is literally a block away from the local Ralphs Visit Portland and head to a New Seasons grocery store and they have growler fill stations. The beer is there, you just need an industrious person to stock it.
Screen Shot 2016-01-31 at 2.49.00 PM

Posted on

Shop with BrewPublik

Capture
Another beer service has entered the interwebs, Brewpublik (not to be confused with the excellent Brewpublic blog) has developed what they call a beergorithm to help you discover new beer.

Here is their spiel: “You tell us what you like, and then based on your personal preferences, we pick out beers that you are sure to love. Then those beers arrive at your door every month. It’s like a monthly beer Christmas. You never know what you are going to get, but each crate is delivered with your personal preferences in mind.”

You create a taste profile with five beers that you love and then choose the size of package you desire and then you have it delivered to your door.

They liken it to Pandora and not Amazon or Netflix. The interface was a snap to use. It didn’t take more than 5 minutes to create a profile and jump to the ordering stage. I didn’t place an order since it is for Raleigh and Durham for now (though they plan expansion) but maybe franchisees will pick it up and run with it.

Posted on

Victory Southern

Check your Craft Beer Acquisition bingo cards. If you have Southern Tier and Victory teaming up, you might be a winner.
Capture
The first big business transaction of 2016 is thankfully straightforward and shouldn’t cause too much waves amongst the craft beer fans. Basically Artisanal Brewing Ventures (ABV) is now the parent company to the two East Coast breweries both with extensive brewing behind them. Southern Tier with 14+ and Victory with 20+.

The brewing operations will remain independent but where the combined strength will come is “in collaborative sales and marketing efforts to strengthen, support and expand its distributor and retail partnerships. Victory and Southern Tier brands will become increasingly available to loyal and new consumers across their combined markets as a direct result of this union.”

Both companies have pretty large distribution footprints but we in SoCal may be the beneficiaries because we get only Victory now but some Southern Tier may end up hitching rides to our favorite beer shoppes. The other benefit is that these two are off the table for the big sword swallowers and ABV is now an option for those who have been approached.

Posted on

Experiments in Whiskey

Craft beer isn’t the only alcoholic beverage that is breaking rules left and right. This quick slide show showcases some real cool whiskey experiments. Who is influencing who can be debated but the fact that Buffalo Trace has a Single Oak Project that looks to understand how the wood of each barrel imparts different flavors is really exciting to see.

Because, you know brewers will be getting their hands on the barrels eventually.
Capture