Dive Brief:
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NPR reported the number of American breweries topped 5,000 for the first time in 2016. Craft beer makers accounted for 5,234 of 5,301 U.S. breweries, according to new figures from the Brewers Association.
- Just five years ago, there were only about 2,000 U.S. craft brewers. Last year alone, more than 800 opened.
- Even though craft brewers captured $23.5 billion of beer spending last year — a 10% gain over 2015 — their volume share remained essentially flat, at 12.3% of overall spending on beer in the U.S., according to the Brewers Association.
Dive Insight:
As more of these operations populate the country, craft breweries are finding that just because they make beer is no longer enough to guarantee their success. It is getting more difficult for independent craft brewers to remain independent – largely for the same reason other businesses seek hook-ups with larger partners — because as they look to grow and standout, they need greater production and distribution abilities, and the cash to achieve them. They also need to make sure they produce beers that can wow sophisticated drinkers with plenty of other options to choose from.
The big players also are struggling to find ways to combat the explosion of craft breweries. The rapid growth has attracted the attention of big players, including AB InBev which purchased Karbach Brewing and Devil’s Backbone in the past year.
As more craft breweries come online, something will have to give. While this segment of the beer industry is still growing and consumers are still demanding it, it's highly unlikely that this high level of growth is sustainable. Perhaps that will give small popular breweries the chance to sell their operations at their peak to a big company thirsty for growth, or a struggling establishment an opportunity to get out while it can. The story of the craft beer industry is still ongoing, and whether its future is as a standalone or part of bigger operation remains to be seen.