State of Craft Brewing 2018, Out with the Old?

By July 7, 2018Featured

New attitude at the CBC in Nashville this year?

It’s been a few months since I attended the Craft Brewers Convention in beautiful Nashville this spring – but the mixed message conveyed by the speakers at the “summit of craft beer” still reverberate.

What is the state of craft beer in 2018, and who and what is steering the future direction? Well, if you listen to the Brewers Association, it’s now mostly about running the business. They told the convention that to be successful, the craft industry has to stay together and successfully face down the forces in the industry that threaten craft: Government rules and taxes, multinational competition (and it’s deceptive practices) and the new levels of internal competition.

Yes, there is still passion, quality and good people, but first and foremost the BA would like to remind you that it’s a business and we need to work as an industry to make it continue to be successful.

Discussions included talking about mobilizing to prove that excise tax reductions help the overall economy, and warnings about how the biggest multinational breweries are “eating our lunch and taking our kid’s lunch money” through restrictive and deceptive practices.

Moreover, the message was clear: “it not enough any more to have the passion and make good beer locally, now it’s also more about your business plan, establishing your brand, your customer experience and separating yourself from the ever growing competition.”

In a panel discussion at the CBC this year “Growing into the Headwinds” Eric Ottaway (Brooklyn Brewing) basically echoed the new bottom line attitude: “It’s reality – we were living in “Lala land” with all that growth – that’s not reality – it’s settling in. Efficiency concerns and HR…all the other industries deal with it. Forcing us to look at our business model. We had pegged everything on volume…now we have to change.”

Laura Bell, of Bells Brewery in Michigan added: “The reality is that if you don’t have a plan or work effectively with distributors – you get off course. What’s right for the business and the people, and their needs. Hold off the pride.”

Brewers Panel – “Headwinds”

All of this bottom line business first stuff seems to be at odds with the original basis of craft brewing: Passion, “collabor-atition”, alternative and a creative lifestyles – maybe even living a religion of non corporate beer.

In contrast to the newer business first message, also at the CBC this year was a long stream of consciousness keynote presentation by Deborah Carey. Deb is the co-founder and co-owner of the venerable New Glarus Brewing Company – brewing and selling their beers only in Wisconsin.

Deb started her presentation with: “I love the industry statistics, but I am not motivated by money – my goal is to change the trajectory of peoples lives. Money doesn’t make you happy – but its a great tool to take advantage of – as we make 320 thousand barrels of beer per year just in and for Wisconsin.”

As she recounted the origin of her brewery in 1993 with her husband Dan, she described the industry 25 years ago: “People didn’t know what craft beer was. The industry wasn’t taken seriously…What is raising money? If you had no friends with money, banks didn’t want to lend…Now people walk up to me and say ‘I am going to do what you did’ with a team of people and their fancy cars, shoes and nice bankroll – well, that’s not how we did it.”

She explained that the reason New Glarus never left Wisconsin is that she didn’t want to get caught up in the “tyranny of success” – to have constantly grow, buy more equipment, invest more, then sell more beer, the do it all over again.

“It was exhausting – so I said ‘you know what? screw it!’ – if I pull out of Illinois I can have more breathing room. Then I was threatened by wholesalers – ‘if you pull out you can’t come back – I will sue you!’. There was an industry wide ‘WTF Deb?’ But, I am not served by being in different states – I am taking care of my people.”

Deb Carey Addresses the CBC “from home maker to beer maker”

I believe that Beer Appreciators are in an interesting time indeed – with many of the original craft leaders selling out to others (Lagunitas, Anchor Steam, etc.) or simply stepping out of the limelight (Sam Calagione of Dogfish). New voices are stepping in to fill the void like Natalie Cilurzo (Russian River): “Take a look at your cash flow, your identity, look at strengthening your weaknesses. Consider investing in lab equipment for better quality. And invest in your people – turnover costs money – people are expensive.”

Or David Firestone (California’s Firestone Walker): “Focus on your business – it is important to have discipline. We are flexibly experimental – but you have to have principles. I recall being with (head brewer) Matt (Brynildson) discussing IPA, and fruit extracts – and he said ‘I am not put fucking lemonade in my pale ale’. Build on your guiding principles.”

Maybe it’s generational or maybe it’s the millennial times we are in, but I believe that the new view of craft as a business first is simply a natural part of the maturing of the craft beer industry. It’s not a charity, it’s about making money and taking care of yourself and your people. When asked about why he sold Lagunitas to Heineken, founder Tony McGee reportedly said, “…I wanted to thank all the people who helped make me and Lagunitas so successful over the years, so I held out and got the best deal I could – and passed a lot of that back to my people.”

This is all good and real, but then again cherished BA founder Charlie Papazian retired this year – coincidence? I don’t think so. Time for a new view?

But let’s not forget that there are still some brewers around like Deb Carey who say: “Brewing creates a confluence of politics and beer. Stake holders in water, sewage, education. Environmental changes are effecting farmers. Health care should resolved. BE courageous – beer is all about people – it’s made by people for people.”
Is there still room in the industry for this line of thinking, and for how much longer?

CBC Parties Not Like it’s 1999 Anymore