So you want to open a brewery

What shape will breweries take in a post-COVID world?

A Finkel & Garf taproom employee fulfills online orders.

It happens all the time: You’ve made the umpteenth batch of homebrew, and it tastes pretty good. Your friends are encouraging, and your spouse wants your hobby out of the house. You’ve pored through Zymurgy and The New Brewer, gleaning tips from the legends about what to do and what to avoid. You’ve dialed in the recipes and worked up a business plan. The time has finally come, you’re going to go pro — and then a global pandemic hits and commerce as we know comes to a grinding halt.

Still want to open a brewery?

Breweries that have yet to open still have flexibility. Breweries that opened in the past year (six in Boulder County) do not. Their business models were most likely based on trends in the marketplace à la 2015-2019, a unique moment in brewing history punctuated by prolific growth.

Brewers Association chief economist Bart Watson calls this period the “at the brewery era,” a nationwide explosion of taproom-focused breweries.

2019 was the first year the BA added the taproom segment and collected data (see sidebar). We’ll have to wait for the May/June issue of The New Brewer to see which breweries are classified Micro and which are classified Taproom, but you’ve probably spent the majority of 2019 drinking in taprooms. The segment saw growth of 26% in 2019, as opposed to a 6% growth in Micros, 7% growth for Brewpubs and 1% growth for Regionals. Simply put, craft drinkers in 2019 imbibed on-site. For 2020, they’ll be doing it at home. Not to belabor a point, but the brewery era is dead.

Though the coronavirus pandemic may be novel, shifts in beer consumption are not. When Boulder Brewing sold the state’s first case of craft beer to the Gold Hill Inn on July 4, 1980, it did so in bottles. Taprooms weren’t around, brewpubs weren’t a thing, and distribution in stores was still to come. Jump ahead to the 1990s, and brewpubs were all the rage: Oasis, Oskar Blues and Walnut — all sold food and brew side by side. Jump forward another decade, and the brewpub is still around, but production breweries in industrial spaces were cranking: Avery, Left Hand and Twisted Pine. When Upslope opened in 2008, it did so with two beers, in cans, out the back door. Less than 10 years later, attention turned to the front door, and taproom breweries attracted promiscuous drinkers with extensive tap offerings and a rotating schedule of food trucks.

The shape and look of a brewery reflect the era in which it was conceived. You’ve probably noticed similarities between many taprooms around the county. And not just in décor, but also in the styles available and the breadth of options. And if you were thinking of opening a brewery three months ago, 26% growth looked pretty promising. Not to mention visions of a small room packed with people clamoring for the beer you made. From today’s vantage, those taprooms are going to be awful empty while 12-packs of Dale’s Pale Ale and Left Hand Nitro Milk Stout fly off the grocery store shelves.

What will the breweries of tomorrow look like? Impossible to predict, though, it seems fair to expect most will have some sort of brewery-to-home delivery component. As well as a kitchen of some kind in place of food trucks — you can only promise your customers health, safety and proper sterilization if you can control every aspect of their experience. The only thing we can know is the same thing Lagunitas Brewery founder Tony Magee knew five years ago: “The future will not be like the past.”   

What’s in a name?

The Brewers Association divides its memberships into four segments: Regionals, which produce more than 15,000 barrels of beer a year (Left Hand, Oskar Blues, Upslope); Brewpubs, which offer a full-service kitchen along with on-site brewing (12Degree, Mountain Sun, Pumphouse); Micros, which produce fewer than 15,000 barrels a year and sell 75% or more of it off-site; and Taprooms, which sell 25% or more of its beer on-site and does not operate substantial food service. Anecdotally, taprooms’ and brewpubs’ annual production ranges anywhere between 200 to 2,000 barrels a year.

Taproom data from the BA’s 2020 State of the Industry presentation.
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