Craft Beer Isn’t Dying. It’s Changing Shape

If you only looked at brewery-closing headlines, it would be easy to think craft beer is simply falling apart.

There are definitely real problems out there. Breweries are closing. Costs are high. Consumers are drinking differently. People are going out less often in some places, and breweries that once could rely on steady taproom traffic or distribution are finding that model harder to maintain.

But after talking through the latest beer news with Dave from Beer In Front on the October 3 Midwest Beer Show, I kept coming back to one thought:

Craft beer may not be disappearing as much as it is changing shape.

The Closures Are Real

We talked about Black & Gray Brewing in Illinois, which announced it was closing after nearly eight years and described the decision as financially unavoidable.

That is not an isolated kind of story anymore.

There have been enough brewery closures over the past couple of years that we have to stop treating every one of them as a random failure. There is clearly a larger adjustment happening.

The market is tighter.

People have more beverage choices.

Disposable income matters.

And breweries are competing not only with other breweries, but with cocktails, THC drinks, nonalcoholic beer, spirits, and everything else fighting for the same consumer dollar.

So yes, contraction is happening.

But that is not the entire story.

One Brewery Closes, Another Moves In

Right after talking about Black & Gray, Dave and I got into Pollyanna Brewing acquiring Alarmist and moving into its Chicago location.

That is where this gets more interesting.

A brewery closing does not always mean the brewing space, beer brands, or customer base disappear.

Sometimes another operator comes in and sees an opportunity.

Pollyanna is not just moving into a location. It is also bringing back some Alarmist beers that already have recognition with Chicago-area drinkers.

That may become a much more common strategy.

Instead of building everything from scratch, stronger operators can acquire existing brands, take over useful brewery infrastructure, and keep products alive that already have an audience.

We also talked about Phase Three expanding into Metropolitan Brewing’s former riverfront space.

Again, the brewery landscape is changing, but the assets are still valuable.

That looks less like the complete collapse of craft beer and more like consolidation.

Growth Is Becoming More Selective

For a long time, the craft beer success story usually involved getting bigger.

More tanks.

More distribution.

More taprooms.

More beer styles.

More markets.

Today, that approach carries a lot more risk.

The breweries that appear better positioned may be the ones that know exactly where they fit.

They understand their strongest products.

They know how far they can realistically distribute.

They know whether another taproom is actually needed.

And they are becoming much more disciplined about where they put their money.

Brooklyn Brewery was another example we discussed. While plenty of breweries are pulling back, Brooklyn has continued investing and leaning heavily on partnerships and international business.

There is still room to grow.

The difference is that growth has to make sense.

The Beer Still Matters

One thing I do not want to lose in all the business discussion is the beer itself.

This show had a lot of new releases to talk about.

Great Lakes has another strong winter lineup coming, including Christmas Ale, barrel-aged releases, and a new Caramel Pecan Barrel Aged Blackout Stout.

Revolution Brewing rolled out another Deep Wood release with beers like Deth’s Tar, Café Deth, and Coconut Deth.

Lua in Iowa released two massive anniversary beers, including a 16%-plus barrel-aged stout and barleywine.

Epic Brewing announced another Big Bad Baptist lineup.

Surly had Darkness Day.

And we talked about a long list of releases happening right here around Cincinnati.

That tells me breweries still believe special beers can create excitement.

The question is whether consumers respond the same way they did ten or fifteen years ago.

That part is less certain.

Are Release Days Still Events?

Dave and I spent a fair amount of time talking about that question.

There was a period when certain releases became destinations.

People traveled.

They stood in line.

They planned weekends around beer.

They traded bottles afterward.

Beer festivals and big release events were a major part of craft culture.

Some of that still exists.

But the level of excitement feels different.

Surly Darkness Day still happens.

Revolution still draws interest around Deep Wood.

Goose Island still has Bourbon County.

Great American Beer Festival is still a major industry event.

But are those moments culturally as big as they used to be?

That is harder to say.

Part of it may simply be that there are so many choices now.

Part of it may be generational.

And part of it is probably financial. Traveling, buying tickets, and purchasing expensive specialty bottles is harder to justify when everything else costs more too.

That does not mean special releases no longer matter.

It may mean breweries have to work harder to make them feel special.

Nonalcoholic Beer Is Part of the Same Change

We also talked about Molson Coors continuing to invest in nonalcoholic products and Athletic Brewing collaborating with Graza on an unusual NA pilsner that uses olive oil during the brewing process.

Whether that particular beer sounds good to you or not, the bigger point matters.

Breweries are experimenting outside the old definition of what beer drinkers are supposed to want.

That is another sign of adaptation.

The industry is following consumers instead of assuming consumers will keep behaving the same way forever.

Fewer Breweries Does Not Mean No Opportunity

I do not think the next era of craft beer will look like the boom years.

There may be fewer breweries.

There may be fewer giant portfolios.

There may be less expansion just for the sake of expansion.

But there will still be breweries making great beer, building strong communities, and finding ways to grow.

The winners may simply look different.

They may be more focused.

More regional.

More disciplined.

More willing to collaborate.

More willing to diversify.

And more careful about which beers, taprooms, and markets deserve investment.

That is why I would not describe what we are seeing as the death of craft beer.

It looks more like a reset.

And the breweries that understand that shift may be the ones we are still talking about years from now.

If you caught the latest Midwest Beer Show, let me know what you think. And if you missed it, catch the replay here: https://youtube.com/live/gck-ankS7jo?feature=share.

Is craft beer shrinking, restructuring, or both?

Get your beer on. Cheers! 🍻