The Craft Beer Industry: Full Guide on the Craft Beer Market

For the past 15 years, the number of breweries in the US has increased from around 1,500 to nearly 10,000. The main reason for that is the craft beer industry. The dramatic increase in consumption of craft beers is called by many a craft beer revolution. Beer enthusiasts have the opportunity to try thousands of different tastes and brews either at one of the local pubs or by ordering online. Let’s examine the main aspects of the craft beer industry, how big the market is, the main types of craft beer, and the future of this business niche.

How to Start a Brewery or Another Beer Business

Different Types of Beer Businesses

Breweries. They are the foundation of the craft beer industry. Recently, a lot of nano breweries have started operating.
Brewpubs. These are pubs that also brew and sell their own beer. This combines the production and service parts of the craft beer industry.
Taprooms. These bars sell beer on tap. Like pubs, they often have a large selection of craft beers and often change their beer menu in order to improve customer experience and increase guest retention.
Wholesale beer distributors. They act as middlemen between breweries and other businesses.
Beer websites. These can either be eCommerce websites that sell different types of craft beer or just blogs that talk about the beverage.
Event companies. There are a lot of reasons why you might want to start an event company that focuses on beers. Some of the events your business might organize are pub crawls, beer-tasting events, beer brewing trainings, and brewery visits.

Steps for Starting a Brewery

Prepare a brewery business plan. Starting with an elaborate business plan and SWOT analysis for your future brewery business is very important.
Financial projections and funding. Make sure to create realistic financial projections for the next 5 years. This will help you when applying for funding with banks or investors.
Regulations. Research the needed documentation to brew and ship beer. All licenses and permits need to be handled before starting operations.
Location and tools. The location should be selected based on nearby infrastructure, proximity to customers, and potential for growth opportunities. Besides the location, you’ll need brewing equipment such as fermentation tanks, cooling systems, brewing kettles, and other tools.
Software and technology are an important part of the brewery business as well. Consider buying beer inventory software, invoice software for small businesses, warehouse inventory management software, and other wholesale business software.
Plan your beer menu and find distributors. Make sure your brewery offers interesting and eye-catching beer options. This will give you a competitive advantage when you negotiate with beer distributors.

Wholesale Beer: Where to Buy and Sell Beer

Where to Buy and Sell Wholesale Beer

Find beer distributors. If you’re a restaurant manager looking for regular deliveries of beer and other beverages, one of the easiest ways to find beer distributors is to search online. Alternatively, you can ask for recommendations from other businesses or contact associations like the Brewers Association.
Work directly with breweries. If you wish to skip the middleman, contact breweries directly. Most of them have logistics solutions and can deliver beer on their own.‍
Wholesale marketplaces. Solutions like BlueCart help businesses in search of wholesale beer and beverages suppliers. The benefit of BlueCart’s platform is you can check all products of different wholesalers and supply other items for your restaurant’s inventory.

Craft Beer Distributors

Generally, restaurants, pubs, and other businesses that stock beer have two options - to work directly with breweries or to use the services of intermediaries.

Working with Beer Distributors

Great selection of breweries. If you wish to develop a large craft beer menu, working with distributors will be easier as they partner with many breweries.
Efficiency. One of the benefits of working with distributors is the fact that they can take care of the administrative parts of the process. Distributors are much more likely to have processes regarding invoicing, automation, ordering, and payment.
Marketing and regulatory support. Distributors might provide you with information about promotional events and marketing events. Additionally, distributors are more aware of all regulations and can assist you with that as well.

Working Directly with Breweries

Access to fresh and unique beers. You can partner with breweries and negotiate special types of beers for your restaurant. This will give you a unique selling point compared to other venues.
Better quality control. Breweries have a much higher incentive to apply better quality control when they work with direct customers.
Pricing. By eliminating the middleman, you will get a better price.
Support a local business. Many clients wish to help the local community and businesses. Thus, if you offer craft beers produced by local breweries, you will improve the customer experience and can increase the profits of your venue.

Operations Included in a Beer Distribution Business

Purchasing. Distributors negotiate with breweries and purchase their beer products. Volume and quality are among the main price-affecting factors. Additionally, supply and demand for specific types of beer can play a role as well.
Inventory. Beer distributors stock a large variety of craft beers and need professional warehouse inventory management software.
Delivery. Naturally, transporting and shipping beers is a major part of a beer distributor’s business.
Sales and marketing. In order to grow their business, beer distribution companies need to help with the whole craft beer marketing. That’s why they often use the services of designers and other professionals to help create marketing materials.

Craft Beer Menu Trends

What Should a Restaurant’s Beer Menu Include

The growth of the craft beer industry means a lot of customers are looking for beers they haven’t tried before. Thus, venues that are looking for ways to increase restaurants’ profit margins should develop a craft beer menu. Here’s what it should include:

Pale ale. One of the most consumed types of beer. Their balance makes them a great addition to any dish.
Indian pale ale (IPA). Beingly slightly more bitter than regular pale ales, IPA beers are a great addition to summer seasonal menus. The increased bitterness also equals a strong character.
Stout and porter. These dark beers are popular in the winter months. However, some beer enthusiasts enjoy dark beer all year round.
Lager. Lagers are refreshing and smooth. They are a casual beverage that is widely consumed.
Sour beers and ciders. These fruity and citrusy beers are also a refreshing option for beer enthusiasts. They pair well with fruit-based desserts.
Seasonal beers. Near the holiday season, most breweries offer special beers. These can be with notes of hazelnuts or ginger near Christmas or pumpkin-flavored near Halloween.
Local beers. Offering options from local breweries is a great way to help the community and stimulate customers to try products from local breweries.
Beer and food pairings. Traditionally, beer menus include pairings as well. These can be appetizers, main dishes, and even desserts that go well with different styles of beer.

Trends in the Craft Beer Industry

Specialty flavors. Breweries are using various exotic fruits and spices in order to create one-of-a-kind beers. The craft beer industry is known for its experimentation and that’s one of the main trends currently.
Sustainable practices. As the market is drastically changing towards eco-friendliness and sustainability, breweries strive to meet the expectations. These practices include lower energy consumption, less waste, and using recycled materials in the packaging process.
Focus on local. A lot of breweries aim to use locally-produced hops, wheat, and malt.
More eCommerce sales. Beer enthusiasts are looking for websites where they can order different types of craft beers or home brewing kits and materials.
Increased on-premise consumption. As beer lovers often wish to try different types of beers, they are eager to order low-alcoholic beers. This often leads to increased consumption and order value.
Growth in key regions and new markets. The international craft beer industry is growing rapidly as well. Countries like China, Vietnam, Mexico, Brazil, and many others are potential markets for US breweries.

The Beer Market Size & Trends

Beer Market Size

US beer market. The US is one of the largest consumers and producers of beer. According to the Brewing Association, there are more than 10,000 breweries in the States. The consumption of beer is equal to 5.6 billion gallons yearly. 13.2% of these are craft beers. 22.2% are imported beers. And the rest are mass-produced beers.
Global beer market. As can be expected, China is the leading beer market. The estimated size of the Chinese beer market is $125 billion in 2023. Around 33% of the volume is out-of-home consumption.

Craft Beer Marketing

Modern marketing techniques are among the reasons for the popularity of the craft beer industry. Craft breweries often focus on creative design and branding. Social media and ads targeting the right audience are a must as well. Here are some additional marketing strategies for breweries:

Partnerships with influencers. Beer brands can partner with influencers, vloggers, and bloggers. This will increase their brand recognition and boost social media efforts.
Brewery events. Events such as brewery tours and tastings can educate people about the craft beer industry. Additionally, these events can be a lasting memory for visitors and turn them into loyal customers.
Storytelling. All brands need a story. But that’s especially true for craft beer breweries. The difference between ‘just a beer’ and ‘my favorite beer’ can be the story behind it.
Focus on eCommerce. Online presence is very important for every business. A craft beer brewery should have an informational website that showcases its products, the story behind the brand, and contact information. If you have the resources to develop an online store, go for it. That way, customers can buy their favorite beers directly. Consider adding gift vouchers, subscription boxes, and other interesting beer gift options.
Beer festivals and workshops. Breweries should consider organizing beer festivals near their location. This will bring a lot of beer lovers and their families to a wonderful event. Furthermore, this helps the craft beer industry and can result in additional revenue.

Types of Craft Beers

There are two main beer categories - lagers and ales. Let’s examine the main styles of both ales and lagers.

Main Types of Lagers

Pilsner. They were first brewed in the Czech Republic. The balance between malt and hop makes it a smooth and popular option.
Helles. A traditional German beer. It has a clean golden color and stronger malt notes.
Märzen. Also known as the Oktoberfest beer. It has some caramel notes and is slightly amber in color.
Bock. This dark beer ranges from amber to dark brown. It has a malty taste and sweet notes.

Main Types of Ales

Pale ale. One of the most recognized styles of craft beer. There are many pale ale variations. Their color is usually golden, but some pale ales are slightly amber. The balance between hop and malt is what makes this beer style so popular.
Indian pale ale (IPA). This style of craft beer is considered to be the most consumed. It differs from standard pale ale due to its bitterness and higher alcohol content. There are multiple flavors of IPA beers.
Stout. Guinness, one of the best-known beer brands worldwide, is a stout beer. The dark color and rich taste make stouts a preferred option for many beer enjoyers.
Porter. They are slightly lighter compared to stouts. Nevertheless, these dark beers have a wide range of flavors including coffee, caramel, and chocolate.

How to Ship Beer

There are additional regulations for breweries or other beer-related businesses that wish to ship beer to their customers. Let’s dive a little deeper and check out some of the steps needed to ship beer legally.

Get an EIN and all needed licenses. Before shipping, you need to make sure that all required licenses are taken care of. Those include both state and federal licenses. Shipping companies work only with alcohol producers that are licensed. Additionally, you should consider researching the beer wholesale distribution market. Find out how you can profit by becoming a middleman between breweries and other businesses.
Partner with a reputable shipping company. Companies like UPS or FedEx are widely known for their good services. That’s why many businesses prefer to outsource the logistics of their company to a shipping company. However, these companies might have additional rules regarding alcohol and beer transportation.
Get a shipping license. If you wish to integrate the logistics process into your business, you’ll need to apply for a shipping license. These certificates give companies permission to transport products across state lines. Keep in mind that different states might require a separate license. Additionally, check the regulations related to the transportation of alcohol products as they might differ as well.

Craft Beer Subscription Boxes

What Is a Craft Beer Subscription Box?

The subscription box business model is becoming increasingly popular. The main reason behind this is the increase in online sales. Craft beer subscription boxes are popular gifts for beer enjoyers. Additionally, fans of the bitter beverage want to discover new styles of craft beer. Thus, they’re eager to order subscription boxes to receive different brands regularly. Craft beer subscription boxes can be customized in the following ways:

Size. The smallest ones usually have 4-6 bottles. The largest consists of 20+ beers.
Beer styles. Discovery subscription boxes usually contain beers of different styles and countries of origin. There are also boxes that consist of only one beer type.
Frequency. Some beer lovers want beer delivered to their doorstep every two weeks. Others opt for a subscription box once every three months.
Combinations. Companies in the craft beer industry know that people enjoy their beer in good company and with food. Thus, some subscriptions include things like snacks or slices of cured meat.