The Next Steps in Craft Brewing
This week we feature another guest blog from Jason Faulkner. Jason, from Malvern, Pennsylvania, is a faculty member of the English department at East Carolina University. He is also COED.com’s “Beer Professor” where every Thursday, he reviews and suggests a beer for the weekend in a column called “What’s On Tap.” Jason’s “Beer Writing” has also been featured in other beer-blogs and websites.
This past May I was hanging out at the Lonerider Taproom. My timing was perfect because it was early enough in the day where the Taproom had just opened, and I could spend time talking beer, travel, happenings in the craft beer industry, and whatever else with Jackie (Lonerider’s Taproom Manager), Derek (Lonerider’s Social Media Specialist), and whoever else stopped by for a pint or two. It is these conversations that I love the most, talking about craft beer and the craft beer industry with people who care about both just as much as myself.
Our conversations about the industry centered on brewery expansion, the tough decisions breweries have to make when it comes time to scale down production and not brew a customer favorite, and if the craft beer industry is sustainable. These are questions that Lonerider, and every other brewery, will constantly be asking in the years to come. Due to craft beer’s explosive growth in the past 3-5 years many have asked the question, is the current craft beer growth rate substantial and is the craft beer bubble going to burst? It was this question that Derek and I talked about the most.
Before giving my answer to the craft beer question a caveat: breweries are not in competition with each other, they are in competition with themselves to make the best beer they can. It does not matter what another brewery does, if the brewery produces a great beer, regardless of style, people will drink it! But, my opinion is the craft beer bubble will indeed burst, when I do not know, and the growth cannot be sustained. But the real question is, what is the fallout? For starters the number of breweries that are opening and in planning will decrease. Some breweries will merge (which is awesome if you think about it), some will contract, some breweries might join together but each brewery only being responsible for producing one or two styles of beer. Of course my predictions were met with some raised eye brows at the bar. However, I did offer a few ideas that were met with just as much enthusiasm as my predications and answers were met with trepidation.
Like any business, craft beer breweries constantly need to be thinking how can we enlarge our customer base? What can we do that sets us apart? Yes, a great beer is a game changer but many breweries brew great beer, and yes I know I just said, “if the brewery produces a great beer, regardless of style, people will drink it!” But even if every craft beer drinker drinks this hypothetical brewery’s great beer that translates to only 5-7% (roughly) of drinkers! What about the, again roughly, 40% of non-beer drinkers? How do breweries appeal to a larger alcohol demographic? The most obvious next step for breweries is distilling, the chemistry is similar to brewing, or similar enough and it would help appeal to another consumer base. Many breweries have already started and it will not be long until the ABC store has a “Craft Vodka” or a “Craft (insert your favorite booze here)” Section.
Another area that could help breweries is the restaurant industry if breweries begin to rethink the food that the craft beer bar offers they would cater to everyone, craft beer enthusiasts and restaurateurs and foodies. It seems obvious that breweries, instead of there just being great restaurants that serve great food and have an awesome craft beer selection, should become breweries that brew awesome beer and serve great food. Right now many tap houses offer the same menu items, lots of fried food, wings, salads, sandwiches, and burgers but, how great would it be if a brewery also served great tapas? Or any other food pairing than an IPA served with a soft pretzel and spicy mustard? Some breweries are already doing this; Tired Hands in Ardmore (a suburb of Philadelphia) has a great small menu that is “foodie friendly.” Their top selling dish? Candid bacon! That’s right, two sticks of about 4 thick cut pieces of Lancaster county double smoked bacon, local maple black walnut butter! So now not only is the craft beer crowd buzzing about the beers, this brewery has tapped (pun intended) into another revenue stream to help its sustainability. Need further proof that the food and beer pairing is the next step? Check out SAVOR!
SAVOR is a two night “craft beer and food experience” consists of trying different brews all paired with equally awesome small plates. A sampling of the menu includes roast duck, cured salmon, sticky toffee pudding, pork belly brioche, duck sausage, and quail legs! Held in the famed National Building museum in DC, tickets for a single night grand tasting went for $135! Both nights sold out and it was awesome! (I was at Saturday night’s tasting) SAVOR proves the marriage of food and beer is one that breweries should exploit and one that will help breweries generate other revenue streams and expose them to another clientele base.
Even with Macrobreweries buying shares of breweries, the unsustainable growth rate, and the over-flooding of the market with similar beers I am very confident the craft beer industry is going nowhere. However, it would be wise for breweries to not just expand their beer production but also their customer base. Do these two solutions, distilling and opening a restaurant, come without problems, a huge monetary cost, and business headaches, no; but given the amount of choices and still the limited, but growing, number of craft beer drinkers, breweries should move away from the traditional taphouse restaurant and look to do something that sets them apart from the rest! Hopefully by continuingly brewing great beer and offering great food the craft beer bubble won’t burst!