I quickly wrote this over at the beer blog’s Facebook page* and thought it was clever enough to repeat:
With respect, the main point is being missed. The disassembling of the US craft beer market is itself the bursting of the bubble. The “big macro v. tiny craft” paradigm failed a long time as the BA’s failed “crafty” campaign illustrated. Continuing to suggest that the path of craft is being validated ignores the greater underlying realities. Big craft bought into scale a long time ago. Craft as brand regardless of what’s in the bottle is market reality. The brewery isn’t being bought. A battle with craft is not being waged. Macro is buying brands and markets to use for other purposes. The rump BA will appear to be quaint soon. Then pointless.
Some interesting comments ensued. I suppose it is related to the posts about how craft will kill itself from a few years back but this is really another thing. Craft being killed off by macro simply eating it after paying billions for the opportunity. We are likely not at mid-meal yet but that’s what’s going on. What we haven’t heard about yet, when you think of it, is how those brewers wanting to be bought but not getting offers are doing. You know, just because they are not worth buying doesn’t make them any less the traitors to the cause… if you are into that whole “cause” thing. What I expect we do know, however, is the guys at Goose Island must be really pissed off unless they took a deferred part of their $39 million chump change payment in the form of percentage share of future brand growth as part of their deal. That stuff is brewed everywhere and sold everywhere now and someone is making buckets of cash.
*…which reminds me of a pet cat having a pet hampster.
[Original comments…]
Jon K (Out of Stringers) – November 18, 2015 5:42 AM
http://www.stringersbeer.co.uk
Is there any sign that the supply of new entrants to the “craft” “bubble” is drying up? (I’m thinking of producers here) Surely, that’s the sign that a bubble is ending, not that large sums are now being invested in what were early entrants?
Thomas Cizauskas – November 18, 2015 9:20 AM
http://www.yoursforgoodfermentables.com/
I would agree that the Brewers Association, as it it stands now, is quaint, as it defends a 3-decades old romantic view of microbreweries and ‘craft’ beer. However, if it could ‘re-brand’ itself as the United States Brewers Association, —reviving that venerable institution, stipulating at least, say, 50% American ownership— it might find new purpose, reflecting current realities. A Small Brewery Guild, that should eschew ‘craft’ contortions —size and American production, if not ownership, being the only determinants— could co-exist in the USBA’s wake.
Maureen Ogle – November 18, 2015 10:50 AM
Tom: That’s the point I’ve been pondering for many months now. How does the BA plan to respond? What will the BA be in five years? I suggested to one neck-deep observer/participant that the BA might have to merger with BI. Or that another organization might emerge to contest the BA’s clout in craft. He scoffed. I don’t think I’m that far off the mark. (And FWIW, this is why I’m not that interested in who is buying who, etc. I’m WAY more interested in how the existing infrastructure adapts to what amounts to a future that isn’t the one it’s planned.)
Alan – November 18, 2015 12:04 PM
http://beerblog.genx40.com
Jon K: I agree with your observation but see the bubble as the “big craft” dream of being national or international, getting significant market share and somehow being immune to big beer buyouts, sector schisms or any other normal market forces. What is being burst is that illusion that somehow “craft” is special, coherent and cohesive. Small brewing will continue as it always has except for maybe 1945-85, the time of much homogenization in a number of industrialized food and drink sectors.
Alan – November 18, 2015 12:10 PM
Maureen: I see that a schism should arise between big craft and actual macros but the myth of the BA is still too unifying even if the underlying principles were chucked out the door by the BA leadership a long time ago. There is no leadership for the actual small in state brewers as of yet. Larry Bell I understand took a strong position against the big craft movement for a while at, for example, the BA closed door sessions. But now I can buy his six packs for $8.99 or less in upstate NY. Money is compelling for brewery owners – as it naturally has been for centuries.