The craft beer industry is a booming one that has seen a meteoric rise throughout the past decade all over the country. After seeing the Brewers Association data from the past year, the market seems like it is showing no signs of slowing down.
The Brewers Association has a lot of interesting data that breaks down total craft beer into many different segments. Those segments range from regional craft breweries to microbreweries to brew pubs, and finally to contract brewing companies. The two segments that have most of the craft market share are the regional craft breweries and microbreweries. According to the Brewers Association, a microbrewery is defined by having sold less than 15,000 barrels of beer per year, while a regional craft brewery can sell between 15,000 and 6,000,000 per year.
The latest report from the Brewers Association for 2014 shows that the microbreweries and regional craft segments of the market increased significantly in the past year. Microbreweries increased their production of barrels by just over 25%, going from 2,377,107 to 3,171,582 barrels. Regional craft breweries had an even larger increase in production at a rate of over 31% and going from 11,973,628 to 17,559,294 barrels. With all of this increase calls the question as to how much more can the craft beer market share increase.
Bart Watson of the Brewers Association wrote an interesting piece in April of this year using statistics to try to determine the capacity for craft brewing companies. Right now the total production of craft beer per year is 22.2 million barrels. Using an algorithm that includes a 16% compound growth rate over three years, Watson makes the case that the capacity is 34.6 million barrels per year. This indicates that production right now is at 64%, which should enhance more growth to the market.
The main point that Watson makes is that the craft beer industry should continue to be successful, and that there should be areas of entry for new firms to enter the market for at least the next few years.