19 Nov 2011 @ 2:05 PM 

I just wrote a small piece in my book about what defines a craft brewer, and I was faced at having to put down this ridiculous statistic, here, directly from the Brewers Association.

Microbrewery: A brewery that produces less than 15,000 barrels (17,600 hectoliters) of beer per year with 75% or more of its beer sold off site.

Regional Brewery: A brewery with an annual beer production of between 15,000 and 6,000,000 barrels.

As a small brewer who will, with any luck, make 500 – 1000 bbls of beer next year, I could not fathom writing down that last number. Just to put this in perspective, I downloaded the 2010 craft beer statistics to take a quick look at them. Bear in mind, now, that 60 or so breweries didn’t report data, so I may be off from reality by a few decimal points here or there. The 2010 data lists 1415 breweries with barrelage data, which is about 300 short of our current number, since so many have opened recently.

Of these, 1334 fell under 15,000 barrels. That’s mindboggling. Up from there, only the top 18 make over 100,000 barrels/year, and only the top 4 make over 500,000 barrels per year. If you take the average from the top 10 craft producers in the country (in 2010), the number is 487,528. If you average all 1415, the number is 6,961, and if you leave out the top 18 it drops to 2,919.

Why am I bringing this up? Well, for two reasons. One, I think we need more than two categorizations for breweries, because I fail to see what anybody that’s operating at 1,000 bbls/year has in common with someone who is producing 500,000 bbls/year aside from the actual end product. I don’t think you could find two more different companies, and I wonder if the majority of the breweries (ie – the small ones) are actually having their needs met from a professional organization standpoint.

The BA Board is primarily comprised of people from the largest breweries who don’t know what it’s like to be a small brewer in today’s market, only yesterday’s where they didn’t have to compete with.. well.. themselves. Kim Jordan has no idea what it’s like to have New Belgium expand aggressively into her state, Sam Calagione has no idea what it’s like to have to compete with his innovation. They’ve never had to do so. Their success has changed the market for small breweries in ways that they’ve never dealt with. Can they accurately consider and respond to issues and concerns of breweries significantly smaller than them? Maybe they can. I don’t know.

I would like to see a more tiered breakdown of breweries, and maybe see the BA address them as separate segments from an organizational standpoint:

Artisanal brewery: 0 – 10,000 bbls (1311 breweries in 2010)
Microbrewery: 10,000 – 50,000 bbls (71 breweries in 2010)
Regional brewery: 50,000 bbls – 100,000 bbls (15 breweries in 2010)
Super-regional brewery: 100,000 bbls – 1,000,000 bbls (17 breweries in 2010)
Premium craft brewery: 1,000,000 bbls – 6,000,000 bbls (1 brewery in 2010)

I’d also just like to pose the question: Would a brewery that makes 6,000,000 bbls/year really have the same interests as the 1300+ that make fewer than 10,000 bbls year? The size difference there is just staggering. In no way is that still a small business in any way shape or form. I’m not advocating culling the BA membership or anything, but given the large numbers of very small breweries, wouldn’t it make sense to treat each of these tiers differently from an organizational level, especially since the small breweries are less likely to have the resources to advocate for anything other than making their own sales goals to stay open?

Maybe the BA could feature different sized small brewer committees to deal with issues that come up within each successive tier. They’re going to be different, from supplier needs to distribution needs – what is relevant to a small brewery will be laughable to a large one and vice versa. Each tier could have advisory members from larger tiers to offer advice on problems that arise for these small guys that they’ve already conquered, or to act as a liaison to the larger tiers if there are intra-industry issues that pop up where small brewers are having a hard time getting their voice heard.

Just food for thought.

Posted By: erik
Last Edit: 19 Nov 2011 @ 02:05 PM



Responses to this post » (7 Total)

  1. This suggestion makes way too much sense to ever see the light of day.

  2. Greg says:

    I actually think they will break out more tiers of breweries, but the larger point is one that basically all special interest groups face. As one tries to gather more and more members to increase influence, the homogeneity of the group’s members decreases and diversity of agenda becomes an issue. Many groups deal with this by forming committees or caucuses (the BA has one for brewpubs, for example, and I wouldn’t be surprised to hear that they start one for small breweries), which can represent specific interests internally.

    Of course, in all things, as success leads to influence, smaller members tend to get shut out, and not just internally. This year, I asked for a 15 minute interview with an organizer of SAVOR, to talk about the ins and outs of running a massive event where demand outstrips ticket supply and the intimacy of the event is a major draw. I was told no one had time and sent a fact sheet, but the message was clearly that bloggers (outside of the top few) no longer rate attention from the BA.

    As the industry matures, we’ll start to see more of a Pareto distribution (the so-called “80/20 rule”), where 80 percent of the beer is made by 20 percent of the members. At that point, it will be up to the breweries in the long tail (guys like you) to organize internally and make sure that all interests are represented.

  3. Bill Night says:

    Another ridiculous thing about BA’s categories are that Widmer/Red Hook are excluded from the craft beer category because Anheuser-Busch owns a stake in them (perhaps other breweries are left out for a similar reason). Sure they are big, but to my mind they are still as craft as Sam Adams or other large breweries.

  4. erik says:

    Well – that one I can get behind. I would argue that their financial backing gives them significant financial and distribution advantages over small breweries.

    Other breweries are excluded for this reason, Goose Island being the most prominent. More will follow.

    I would also argue that Sam Adams isn’t really craft anymore. Good beer? Yes. Good friends to the craft community? Yes. But they no longer resemble any sort of small brewery, if they ever really did.

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