Session #67: How many breweries in 2017?

The session this month is hosted by Derrick Peterman from Ramblings of a Beer Runner.   The question he poses this month is “How many breweries will we have in the year 2017?” 

Why 5 years from now?  Is this just an arbtrary round figure?  You see 5 years ago we had roughly 1400 breweries in the US.  Now we have a little over 2200 with another 1200 or so slated to open within the next year.  We have reached a nexus where we have surpassed the highest recorded number of breweries in the US since before Prohibition and the outlook seems to point to this number sky rocketing to even greater heights.   Or is it possible that the bubble will burst and send many packing back to the dead end careers they held before they bit the hop bug?

Can I play doomsayer?  I predict there will be one megabrewer who controls the world. 

That sounds crazy right?  When you look at the pattern of how business has been done over the last 100 years and more, that has a high probability of happening.  And within 5 years, it could absolutely happen because business is moving at lightening speeds in the information age. 

I know you are probably thinking that I couldn’t be further from the truth.  So I ask you to look around, look at the mergers that have already happened.  Aside from the big brewers buying out each other they have made inroads into craft as well.  Wasn’t it just yesterday that Goose Island bit the huge pay check cookie?  Even now there is talk of Magic Hat being sold yet again.  But no, that couldn’t happen here…

Career paths tend to follow a certain pattern.  For some it is a path to wealth and better toys.  When they see that others are succeeding at something that looks like it could be enjoyable and easy they get a bit of metoo-itus.  This is all well and good until they realize that work is involved.  People tend to begin leaving that career path when they realize that everyone else had the same thoughts they did and now it is too crowded.
    
We also run across those who decide to open a brewery based on the wrong assumptions.  Its a bit of the restaurant syndrome.  Friends rave about how great your (random French sounding food here) is the best they have ever had so you should open a restaurant.  More often than not this leads to people who have no business setting foot even in their home kitchen trying their hand at something that is easily a 10 headed hydra.  And they get burned…

We do actually have two scenarios that could happen before us.  The first is of course the one mega brewery that rules us all.  This can come about because when money is talking we may just be listening.  The other option being that we could in the future reach a point where we have breweries about as common as restaurants.  Either way it will be the passion of those who are opening the breweries that will determine where we end up. 

Time for a pint…

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5 thoughts on “Session #67: How many breweries in 2017?

  1. I can see it going either way but the question might end being how many beer brands will we have in 2017? There will be some consolidation. As craft beer keeps eating into big beer's bottom line, and what appears to be big beer's inability to stave it off, big beer will change strategies and ramp up their purchase of craft breweries. Some will take the money and run, others may just say no. It will come down to the money. A craft brewery making a decent profit might hold out. A newer craft brewery with good product that is still scraping buy might see the big dollar signs and cash out.

  2. I think reminding ourselves of this possibility is an important thing to do to avoid running into this scenario. Smaller independent buinesses may not have the high dollar value of mega conglomerates, but in the end they have a higher quality of life.

  3. Stuart – There are too many beers only if every (OK, not every, but more than several) brewery expects to put beer on shelves everywhere.In 1879, St. Louis had 20 breweries that produced more than 7,000 barrels. Today there are two (although several new ones are on their way past that). Craft consumption is going to continue to grow. Does that mean Green Flash (just an arbitrary pick) will sell a bunch more beer here, Schlafly or several small (some of them not even open yet) breweries? I don't know.

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