I’ve been immersed in the world of what we now call “craft brewing” since the early 1970s. From the beginning my gut always told me that people’s reaction to craft beer was positive, genuine and inspirational; grounded in fundamental human behavior.
First there were American homebrewers seeking quality, choice and flavor. Then there were pioneer microbrewers taking the leap from their homebrewing endeavors, offering their beers to a deprived public. Both struggled to get the message out to a public that couldn’t quite figure out what these extreme beers called pale ale, stout and porter were trying to be.
There were always doubters, but it has always been obvious to me that a renaissance in beer culture and interest in beer taste was going to happen in a big way. For decades no one ever asked me why, probably my gentle rants were so off kilter that few ever took the early day indicators as anything that would amount to or could amount to serious cultural shifts.
That has all changed recently.
The Question I frequently get asked these days, is “Why?” What’s up with the world’s craft brewing and craft beer craziness? Why is it happening in Latin America? Why in Asia? Why Europe, Africa, Australia? No one has asked me about Antarctica (but it should be noted that the American Homebrewers Association’s Zymurgy magazine published a story about brewing in Antarctica in the 1980s – seriously, there were homebrewers and a small brewhouse was considered as a possibility back in those days).
Back to Why? The question is asked because it goes against commonly prescribed business sense. While the large breweries continue to merge into their own immensity, there are craft brewing entrepreneurs sprouting up all over the globe. Even in Germany brewers and educators are rethinking where there beer culture will be in five years.
Why? The answer to “Why?” is neither singular nor simple. The model for craft brewing’s success is a new model most business people can’t grok. It isn’t taught in business school. There are no precedents. Traditional business values seem to be in conflict with the reality of craft’s success.
A long essay could be written about the dynamics of craft brewing’s success. Perhaps even a book outlining the intertwined dynamics and fundamentals that are changing the way and reasons why people go into business for both themselves and their customers.
In very brief fashion, here are a few of my thoughts and observations about why craft brewers are successful and a different breed of business here in the USA.
- Most craft brewers love beer and beer culture; they are passionate about what they do
- Most craft brewers are currently not interested in growing their business only to sell it for lots of money and profit
- Most well established craft brewers entrepreneurs have had other jobs before getting into the craft beer business.
- They wanted a change and sought job satisfaction
- If they were to sell their successful brewing business, sure they would have lots of money, but then what? Another job? Why do that? They love their job, control over their destiny, what they do and the communities they support. They have achieved their goal of job satisfaction. Why give that up? They have enough money. More money can’t buy the satisfaction they have worked for. Call it being content?
- Job satisfaction trumps most everything else. Do they teach that at business school? Are stock market trends based on job satisfaction? Doing the right thing? – are shareholders who await their return on investment going to tolerate leadership’s preferences?
- Dare I say it, that most American craft brewers have pursued a somewhat different approach to capitalism. People, business writers are still trying to figure this out. Even as they observe with amazement at what is happening, they are still asking “Why?”
- Why aren’t the same dynamics happening in the wine world or in the ice cream, coffee, potato chip, yogurt, baking, chocolate, toothpaste producing worlds? I’m thinking, that perhaps, it’s because there has been a collaborative community of brewers and beer fans that have made the beer business fun and enjoyable. Despite the competition with each other there is a genuine effort by most small and independent craft brewers to value, educate and nurture the entire community of brewers and beer drinkers.
- The continuing consolidation of the large brewing companies and the near monopolization of the beer network creates opportunities for small entrepreneurs to provide for fundamental human needs that go missing with the dynamics of consolidation. Large international companies find it difficult to compete in niche and specialty markets. It clashes with their business culture and their reason to exist. Theirs’ is a different business model. Profits are priority and profits are difficult to achieve with differentiating of beer types and resonating at a local level when you are a giant company. Their strategy of buying out small breweries and eventually shutting them down (as they have consistently done in the past) isn’t so successful – because most craft brewers have different business priorities.
These are some of the reasons I think about. I had these thoughts decades ago as well, but I suppose because my beard was a bit blacker and longer, these thoughts seemed too Utopian to be considered as legitimate business thoughts. But let’s face it, small and independent American craft brewers have really achieved something that no other industry has been able to achieve: Continued success at a small scale and lots of happy and appreciative customers.
Next: Why craft is emerging in the rest of the world?