Author Topic: OK one more thread on the Brewery bubble  (Read 2082 times)

Offline brewbaker

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Re: OK one more thread on the Brewery bubble
« Reply #30 on: December 10, 2013, 04:12:20 PM »
We are one of the nano or pico breweries being discussed here.  And I'll admit that not all of the beer we produce is terrific.

Why isnt it all terrific? Why would you knowingly produce and release less than terrific beer?

Offline micsager

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Re: OK one more thread on the Brewery bubble
« Reply #31 on: December 10, 2013, 04:20:27 PM »
We are one of the nano or pico breweries being discussed here.  And I'll admit that not all of the beer we produce is terrific.

Why isnt it all terrific? Why would you knowingly produce and release less than terrific beer?

I don't consider too many beers terrific.  To earn that title from me, it better be world class.  Some of the Russian River or New Glarus beers come to mind.  There are many beers out there.  Few deserve to be called terrific. 

Not considering it terrific, is not the same as saying it's not damn good. 

I think it's just semantics. 


Offline bluesman

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Re: OK one more thread on the Brewery bubble
« Reply #32 on: December 10, 2013, 08:15:27 PM »
Those are really vague questions, but I'd say yes. Certainly someone brewing at capacity would be selling it all, and usually someone selling it all would expand to at least their current capacity.

If you look at the BA stats, 1.8% of craft breweries closed in 2011, and again in 2012. That number has been dropping for as far back as I can find the data (2007: 5.2%).

Edit: Official Poobah of No Life?! I thought it was more of an ad hoc position.

Okay...why don't you like chico?  ;)
Ron Price

Offline bluesman

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Re: OK one more thread on the Brewery bubble
« Reply #33 on: December 10, 2013, 08:31:29 PM »
I think it is more of a boom than a bubble, and booms are followed by busts. Sometimes I think some craft brewers have a lot of capacity dedicated to 6 packs that set on the shelf. The quality brewers can not make enough, and are constantly expanding, or building new breweries.

There are many that are getting into the business now that are not making good beer on a homebrew scale. I wish them good luck.

I agree.  I have had beers from small start up breweries that really had no redeeming qualities at all.  Insipid would be an apt description.

+2

The buck stops at poor quality.
Ron Price

Offline bluesman

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Re: OK one more thread on the Brewery bubble
« Reply #34 on: December 10, 2013, 08:48:24 PM »
As was mentioned earlier, there is no way most of these nano and pico operations can last for long (no offense to anyone here that is running one of those). UNless you have a brew pub, I'm not sure how you can subsist on anything smaller than a 10 bbl system. I am filling 30 bbl tanks now and the amount of money I am making off a 30 bbl batch is not enough to make me or any of my partners rich by any means. I'm making about 1/3rd the salary I was when I left my job and working 2Xs as much. Granted, we are forced to go through a distributor which takes a nice, hefty cut and while we are permitted to have a tap room we can not sell growlers or other packages on premiss.

So in that case, I think there will be a bust eventually as many of the nanos and picos fail or simply get bored and quit. OTOH it's so easy to start a nano or pico now that I believe they will continue to pop up as other ones fail.

I'm sure there are exceptions across the nation but the picos and nanos operating locally are simply terrible. Most of these folks are people who got the idea to open a brewery before they learned how to brew or some of them obviously learned to brew and their friends and family told them how great their beer was and that they should open a brewery. What's amazing to me is, in some instances here in the south some of the latter are actually thriving because craft beer is so new here a lot of people think "that's just the way it is supposed to taste". But as people tastes evolve I think even these places will begin to fail.

FWIW I think there is money to be made in the brewery world and I think you can definitely support yourself and make a good living but it takes a lot of money and time and effort to get there and you have to be selling a lot of beer or have a very busy tap room or successful restaurant driven brew pub to get there.

Agreed Keith...I think one would be foolish to get into a pico or nano operation outside of a brewpub model, unless it was a very unique situation that supported another business like a distillery or tourist industry. It becomes real clear when you develop the cost model. Total expenses will drown out any potential for profitability unless the facility is owned by the business AND paid for, the utilities are dirt cheap, there's zero debt involved, and so on and so forth.

My advice to anyone seriously considering opening a nano or pico do some serious research and develop a comprehensive business model with complete financials. Kudos to those that are doing it, I commend you.
Ron Price