What is Craft Beer Anyway? Should Consumers and Brewers Care?

In the United States today, there are more than 7,000 craft breweries. Even so, those 7,000-plus breweries produce only a small percentage of beer sold. Accordingly to the Brewers Association – a nonprofit trade association that represents the interests of many small (production of 6 million barrels or less per year), independent (less than 25% non-craft owned) brewers, beer production in 2018 hit 194,278,588 barrels, 13% of which was attributed to craft breweries, 18% to imports, and a whopping 68% to other “big beer” domestics (Miller-Coors, Anheuser-Busch InBev (“ABI”), and the like).

Americans drink a lot of beer

194,278,588 barrels is a lot of beer (one barrel is 31 gallons!).  But that number is actually down from previous years.  In total, beer production has dropped eight-tenths of a percent in 2018, again according to the Brewers Association.  This drop is almost-certainly connected with the large domestic producers, as imports and craft brewers have increased production by 3.6% and 3.9%, respectively.

What does a cursory glance at these data tell us? First, despite an ever-more-crowded field, craft beer is still growing, while big beer is struggling to hang on. Second, despite the large and growing number of craft breweries, craft brewers still only account for a very small volume of the beer consumed in the United States. So what? What does mean for craft brewers? What does this mean for beer consumers?

And We Like Our Craft Beer ALOT!

This situation, where craft beer continues to grow in the face increased competition at the same moment that big beer has hit a wall, has created a behavior that Professor Howard of Michigan State University has dubbed “craftwashing.” Craftwashing is big brewers “taking advantage of the increasing sales of craft beer by emulating these products or by acquiring craft breweries, while also obscuring their ownership from consumers[1].” That tasty Lagunitas IPA you love? 50% owned by Heineken International[2]. That Kona lager you drank at the baseball game last week? 32% owned ABI[3]. The venerable Anchor Brewing? 100% Sapporo Holdings. Breckenridge Brewing? 100% ABI. Cigar City Brewing? 100% CANArchy/Fireman Capital Partners. Elysian? 100% ABI. Firestone Walker? 100% Duvel Moortgat. Funky Buddha? 100% Constellation Brands. Sweetwater? 50% TSG Consumer Partners[4]. Third Shift amber ale? 100% Miller-Coors[5]. The list goes on… and on… and on.

So, if you’re the kind of person who cares where his or her beer comes from, how can you tell if the purportedly “craft” beer you’re buying is actually craft? Well, you could sit at your desk and read articles like this one, or spend your time at the liquor store ferociously Googling brands on your phone. But wouldn’t it be nice if there was a quick way to know if your beer is actually craft? Like a label that brewers could place on their product to let consumers know that they belong to the craft-beer community and not some giant corporation?

Fortunately, the Brewers Association has created just such a label. The Independent Craft Brewers Seal[6] is a mark that qualifying brewers can place on their product, packaging, premises, websites, marketing, merchandise, and other items to let the public know that a brewery is part of a special club of over 4,000 real craft brewers. Supporters of craft brewing – including this law firm – can also qualify to use a label to let the public know that their organization supports the efforts of small, independent breweries.

In that vein, if your brewery needs legal assistance, please consider contacting counsel at Whitcomb, Selinsky, P.C. Our attorneys have been successful in helping a number of breweries successfully handle trademark, regulatory, corporate, and business-law related issues. Call our Denver office at (303) 534-1958 or complete our online form today.

[1] Howard, Philip, Craftwashing in the U.S. Beer Industry, WordPress (2018) https://philhoward.net/2017/12/26/craftwashing-in-the-u-s-beer-industry/amp/?__twitter_impression=true

[2] https://www.latimes.com/business/la-fi-heineken-lagunitas-20170504-story.html

[3] https://www.marketwatch.com/story/anheuser-buschs-latest-deal-means-youll-soon-be-drinking-more-hawaiian-beer-2016-08-25

[4] https://www.craftbeerjoe.com/brewery-who-owns-who-list/

[5] https://www.brewbound.com/news/millercoors-third-shift-touts-passion-further-blurs-craft-beer-definition

[6] https://www.brewersassociation.org/independent-craft-brewer-seal/

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