Saturday, August 12, 2017

On Great Taste Day, craft brewing still going well in 2017

On this beautiful Saturday, Madison is hosting the 31st annual Great Taste of the Midwest. I'm sitting this one out after going last year - $60 is getting a bit rich for my blood to go through the effort I need to get tickets - but I did take plenty of part in Great Taste Eve at numerous Madison establishments last night, so it is all good.

I sometimes worry that the craft beer boom of the last 10-15 years is starting to level off, and that there will be an inevitable cutback/correction. But new ones still keep popping up, and the Brewers Association said last week that the industry is still in a growth mode.
Small and independent craft brewers demonstrated continued, but slowed, growth, according to new mid-year metrics released by the Brewers Association (BA)—the not-for-profit trade association dedicated to small and independent American brewers. American craft beer production volume increased five percent during the first half of 2017.

“The growth pace for small and independent brewers has stabilized at a rate that still reflects progress but in a more mature market. Although more difficult to realize, growth still exists,” said Bart Watson, chief economist, Brewers Association. “The beer world is highly competitive and there is certainly a mixed bag in terms of performance. Some breweries are continuing to grow, whereas others are having to evolve their position and nurture new opportunities to ensure they keep pace. Many brewers are benefiting from on-premises and taproom sales, and recent state-based reforms have the potential to help brewers in new regions capitalize on this growth.”

As of June 30, there were 5,562 operating breweries in the U.S., an increase of 906 from the same time period the previous year. Additionally, there were approximately 2,739 breweries in planning. Craft brewers currently employ an estimated 128,768 full-time and part-time workers in a variety of roles including numerous manufacturing jobs, all of which contribute significantly to the U.S. economy.
You may have also seen a few stories in the news relating to beer distribution, and the possibility of new limits and restrictions on who you can sell and distrubte beer and other alcoholic beverages in Wisconsin. The Brewers Guild of Wisconsin chimed in on that issue a couple of months ago, and warned against the State Legislature messing up something that the Brewers Guild says the makers of the beer need to be listened to.
I am writing on behalf of The Wisconsin Brewers Guild in opposition to a proposed bill currently being circulated by Tavern League of Wisconsin, Wisconsin Beer Distributors Association, and Wisconsin Wine and Spirits Institute. These organizations are using this proposed bill in an attempt to limit the growth of Wisconsin’s beverage industry by tightening the definition of the current three-tier system. In addition, the aforementioned parties seek to create additional restrictions and barriers to market through the creation of an Office of Alcohol Beverages Enforcement. This additional level of bureaucracy is, simply put, a solution in search of a problem. Furthermore, as proposed, there is no method of paying for its creation, nor its maintenance, and is thus an example of wasteful government spending.

This proposed bill is yet another example of a dysfunctional three-tier system wherein two of the tiers attempt to speak on behalf of the third. In this instance we, the manufacturing tier, have been intentionally left out of any discussion regarding the construction, management, and enforcement of our industry’s three-tier system. This proposal, and the notion that changes should be made to Wisconsin Chapter 125 without the input of all the affected parties is unacceptable.

We, as Wisconsin’s independent craft brewers, are not three-tier abolitionists; rather we are simply looking for an equitable relationship and an even playing field within our industry. The vast majority of Wisconsin’s independent craft breweries rely on the relationships we have with our wholesale partners to move product to market efficiently. Additionally, without the retail tier’s participation, we would not be witnessing the craft beer renaissance taking place today in all corners of our great state. Meanwhile, not a day passes where there isn’t a new example of one of our small businesses trying to grow, or even get off the ground, being stifled by prohibition era laws. In Wisconsin our production breweries have the ability to cross the three-tier system by self-distribution of up to 300,000 barrels of beer (Ch. 125.29(3M)(6)) and to operate two retail locations within the state (Ch. 125.29(3)(f)). Despite our ability to cross the tiers and effectively operate as manufacturer, wholesaler, and retailer, our commitment to the responsible trade practices and adherence to Chapter 125 has never wavered. Along with Wisconsin’s wholesalers and retailers we stand firm in our commitment to the responsible sale of alcohol within the State of Wisconsin.

That being said, Wisconsin has unfortunately fallen behind the curve when it comes to the opening of new breweries, the growth of existing breweries, and the subsequent addition of well-paid manufacturing jobs that come with that growth. Brewpubs, for example, are held back from growth due to arbitrary caps on their production levels and the number of brewery restaurants they can legally operate. We believe there needs to be action taken to modernize Chapter 125, but we firmly believe that this process should take place in an open discussion that includes all three tiers within our industry. The Wisconsin Brewers Guild strongly opposes any and all changes to Chapter 125 without all parties having a seat at the table.
Of course, back in June the thought was that these changes would be slipped into the budget bill at the last minute, but now with the budget being held up and 6 weeks overdue, it's hard to tell if it's still in play.

But in the meantime, things continue to do well for the craft beer industry in Wisconsin and around much of the country. Plus, it's one of those industries that's difficult to outsource to another country, no matter how much technology improves, and many of these brewers are the type of small-business entrepreneurs that are worth getting behind, as opposed to corporates who lobby to take more and more from the rest of us.

And it couldn't be a better weather week for the big events this weekend in Madison (I've suffered through quite a few humid and/or rainy Great Taste weeks). So get back to the fun, wherever you are.


  1. Why do Republicans hate small businesses?

    1. Simple answer- they don't donate enough. Once you see GOP policy as a giant kickback scheme to campaign contributors, lots of this otherwise stupid legislation makes sense.