Is down-sizing or right-sizing an option for craft brewers?
Craft beer appears at the crossroads. There are more than 4600 breweries in the U.S., and new ones open at a rate of about one per day. Pundits worry that craft brewers already produce more brands and varieties than supermarket shelves and bars can reasonably accommodate. There are only three options for craft brewers right now. They either need to grow bigger, club together and form groups to look bigger, or go really small and hold down their tiny bit of turf.
This is what Denver’s Wyncoop brewpub intends to do. Its officials announced at the end of June 2016 that Wyncoop will stop supplying beer to retailers and bars which are not part of its chain of restaurants.
This decision will certainly raise a few eyebrows. Wyncoop is Colorado’s oldest brewpub and one of its most famous. It opened in 1988, when several people, including Colorado’s current Governor John Hickenlooper, decided to revitalise (or gentrify) Denver’s run-down city centre by buying up an old warehouse and putting a brewpub inside.
Today there are over 50 breweries within Denver’s city limits and 235 in the state of Colorado, including Coors’ megabrewery in Golden, outside Denver.
Last year, Wyncoop sold its stake in the Breckenridge Brewery, which was subsequently bought by AB-InBev. Apart from the Wyncoop brewpub, the group owns the Phantom Canyon Brewing Company in Colorado Springs and five restaurants.
Wyncoop justified the decision by pointing out that not having to satisfy demand for beers like Rail Yard Ale in shops and bars will allow them to spend more time to develop new recipes and offer a wider variety of changing and experimental beers at its own venues.
What they did not say was that it was probably not worth their time and money to cater to the demands of retailers. Or that protecting shelf space had become much harder.
Good for Wyncoop that they took such a bold and timely decision. Right-sizing may be a blow to one’s ambitions of growth but it may ultimately prove a means to survive: on one’s own terms and profits.
