Hi all, I am new to this forum and hope you can help me. I am a student. My current project is undertaking an Industry Analysis of the Brewing Industry particularly in the USA concentrating on Craft beers but not exclusive too.
I have found most of the info I am looking for but am struggling in one area. That being what are the "critical current and emerging strategic issues facing the industry". Particularly the emerging issues.
Can anyone help PLEASE, maybe point me to an article or website where I may get some answers. I have searched over 100 sites now and my time is running out.
I really appreciate your help
Last edited by Brewing Student; 08-31-2004 at 08:59 PM.
OK, I'll take a stab at a couple emerging issues (current, really). Neo-prohibitionism is a re-awaking monster. Look at the on-going drive to reduce drinking to a criminal act itself by dropping legal BAC levels to absurd lows. See ABIonline.org. The current national concern over carbs could impact beer sales, so search around on that issue, too. Distribution has always been, and always will be, a major challenge for new breweries. Consider taking a look at the constitutional issues surrounding interstate sales of craft beer and wine. Also, state and municipal distribution networks may see a constitutional challenge, which could potentially open up markets. Not unique to brewing, but a business opportunity nonetheless is the potential for forays into China. Food for thought.
Another angle on the market is some of the outdated laws on the books in states like my own, PA. Beer sales have been on a steady decline in recent years here, tho I don't know exactly where craft beer sales are in relation to that. It's believed by some to be due in part to the relaxing of liquor control laws for wine and spirits... you can't buy a case/keg of beer in PA on a sunday, and only less than 2 six packs worth of beer from a place that also serves legitimate food... assuming they do carry-out. You can now buy wine on Sundays, and some non-state run outlets for wine have sprung up somehow.
Beer seems to be taking a back seat in the move to update these laws to modern, non-puritanical standards.
Just my $.02...
I agree with the two previous posts. One of the issues with competition from wine and spirits is the emergence of "malternatives" which are taking market share from the bigger brewers. Because in actuality only a small part of the alcohol is derived from malt ( ie non-distilled alcohol) and the rest from "distilled spirits flavourings" (basically spirits used under the guise of being part of a flavouring preparation) spirits producers are able to compete with brewers at a similiar (if not the same) taxation rate as beer. This is a relatively new source of competiotn for beer. It may however be difficult to sort through all the state laws regarding restrictions, it may be better to start on a national level. The TTB website would be a good place to start and can be a goldmine of information. Also industry associations like the NBWA and DISCUS can give you a good overview of the issues.
Thank you both very much for your responses, there are some great points for me to investigate. I had picked up particularly on the distribution point. Difficult at a distance to study these things sometimes and I appreciate your inside knowledge.
Thank you for taking the time to respond.
For what it's worth, because you are probably aware of these local issues, the Federal Government Excise Tax on beer sale volumes less than 48L is disadvantageous to the craft brewer in Australia, who sell most if not all of their product in volumes less than 48L. There is a push within the industry to obtain some relief similar to the recent changes in Wine Equilisation Tax, but we'll see.
Individual State's Liquor Licencing Laws can also be tricky and unhandy. For example in WA, a Producer of beer must not sell beer in quantities less than a case (I think) in a single sale, yet a Producer of wine (operating under the same licence) may sell a single bottle if they wish. So, again there are some differences between what the wine industry can do and what the craft brewing industry can do.