Does size really matter in the world of beer? And, be a taproom if you can
Read time < 4 min.
First up, another acquisition. Big whoop, right? They always seem to have some sort of interesting twist, though. Second, we discuss a bright spot in craft beer sales news. Yes, a bright spot. The lesson? Always be yourself, unless you can be a taproom, then always be a taproom.
Size Really Doesn’t Matter
At least not when you’re talking about brewery acquisitions. Hot off the merger-acquisition wire, River Horse Brewing (New Jersey) just acquired DuClaw Brewing (Maryland). No details were disclosed. No word yet on the number of employees impacted, but DuClaw Brewing will cease production at its brewery in Rosedale, Maryland. Production will move to River Horse’s location in Ewing Township, New Jersey.
This story is particularly reminiscent of a story we told back in November of 2022 when the smaller Roadhouse Brewing acquired the larger Melvin Brewing. In this case, DuClaw Brewing is much larger than River Horse Brewing in terms of production. DuClaw produced 30,000 barrels in 2021. River Horse has never produced more than 10,000 barrels per year. DuClaw distributes beer to 21 states, Canada, and France. River Horse distributes beer to just three states (NJ, NY, PA.) plus England.
DuClaw Brewing opened in 1996, as did River Horse Brewing, though the latter underwent an ownership change in 2006. The takeaway? Today’s merger/acquisition trend is not just about the big breweries or the young whippersnappers. Size and age do not matter.
Be a Taproom
Want to sell more beer? Be more like a taproom. And even if you are a taproom already, be more taproomish, whatever that means. Solid advice these days. The current issue of The New Brewer, which is published by the Brewers Association, reported that taproom sales were up 9 percent by volume last year. It’s a rare bright spot in craft beer sales these days.
A “taproom brewery” is defined as a brewery that sells more than 25 percent of its beer onsite and does not offer significant food service. Taproom breweries make up the largest portion of the nation's craft brewing industry, with nearly 4,000 of them operating in the U.S. On top of that, as we’ve all witnessed, many breweries that do not meet the strict definition of taproom brewery have very successful taprooms.
Surly Brewing might not fit the definition, but its expansive taproom in Minneapolis is wildly popular.
The question is, why? While overall beer sales (craft and non-craft) are struggling nationwide, what's up with taprooms?
The New Brewer points to the concept of community as a key driver of consumer interest, and rightly so. Taprooms are often deeply involved in the local community, partnering with non-profits and other community-focused groups. The taproom is the quintessential third place. Not work, not home, but other. It is a gathering space, often family-friendly, where co-workers and friends hook up, either by plan or by happenstance. But there's more to it than that.
Brick West Brewing - Spokane, WA.
Great Burn Brewing - Missoula, MT.
The modern taproom, or taproom brewery, offers a new kind of drinking experience for a new kind of drinker. Younger imbibers have little interest in wandering into the pub on a Friday night, unannounced, just to see what's happening. It's a kind of socializing that seems foreign or antiquated to younger folks. However, making plans to hit a brewery taproom on a Sunday afternoon is not foreign at all. The up-and-coming craft beer consumer has never known a world without the taproom. What was novel for one generation is normal for the next.
Burgeon Beer Co. - Carlsbad, CA.
Here’s the real key. There's something different about a taproom. It's not a sports bar, a dive bar, or a neighborhood pub. The taproom looks different and feels different. Sure, that stuff we mentioned earlier is part of it--community gathering space, all ages, and so on. But that's not all. The concept of drinking hyper-locally is part of it. So too is the act of consuming a product at its source.
Again, be more like a taproom. Whatever kind of beer-related business you operate, you should pay attention to, and try to better understand, what is driving the growing popularity of taprooms. In upcoming issues of The Taster Tray, with your help, we'll dive into this deeper.
So what do you think? What makes a taproom different than other types of drinking establishments? Why are they so appealing to the new generation of beer consumers? We’d love to hear from you. Use the feedback form or shoot us an email.
Here’s what a couple of you had to say about last week’s Taster Tray. We love your feedback, even if it isn’t as flattering as this.
Colin@... said: "Very interesting to see the Constellation acquisitions summarized. Truly they made a bad play at Craft and lost, if not their shirts, then at least a couple of sleeves."
Jeremy@... said: "Another great Tray - focused and concise with great insight into the larger industry."
So how did we do this week?
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This week's Taster Tray was composed by Kendall Jones.