Video: CBC Attendees Discuss the Risks of Growing Via Taprooms

Earlier this month, Brewers Association CEO Bob Pease took the stage at the 2018 Craft Brewers Conference (CBC) in Nashville, Tennessee, and extolled the benefits of direct-to-consumer sales.

Calling breweries with the ability to sell beer across the bar or to-go “ground zero for bringing new drinkers into the category,” Pease made his case for the continued expansion of the beer category via own-premise sales.

“If we can stop the intra-industry bickering over food sales, to-go sales, and tasting rooms, we can continue to expand the base of beer drinkers and build upon the positive beer culture we have all built together,” he told attendees.

But as more beer company owners have worked to expand their businesses through taprooms and beer gardens, some industry stakeholders have begun voicing concerns about the long-term impact this approach could have on the category.

“Once taprooms become just duplicate licenses, and they become a way around state laws to open up bars without having to open up a brewery, I think it is a slippery slope and a dangerous path for our industry,” Karl Strauss co-founder Chris Cramer told Brewbound.

Cramer, who admitted that brewery taprooms helped stoke much of the growth that the craft category has seen in recent years, believes that wholesalers and retailers could “backlash” against the continued proliferation of satellite tasting centers.

According to BA chief economist Bart Watson, about 2.7 million barrels of beer were sold directly to consumers from a brewery taproom or retail shop in 2017.

That figure is likely to grow in 2018, especially when Massachusetts’ Tree House Brewing, which sells the vast majority of its beer directly to consumers, has grown from 270 barrels of beer per week to 1,000 barrels.

Many of the CBC attendees Brewbound interviewed also questioned how wholesalers and retailers would react as more taprooms opened.

“I think the biggest risk is potentially alienating your biggest customer, which is your wholesaler,” said Terry Hopper, vice president of sales at Vermont Cider Company. “Nobody else orders full trucks, so I think that by going direct sales through taprooms, potentially it could alienate that relationship.”

But in Georgia, where direct sales at breweries only became legal last August, the concerns are somewhat tempered.

“I think that the growth in Georgia will be based on taproom sales,” said Nancy Palmer, executive director of the Georgia Craft Brewers Guild. “I think that those are excellent ways for breweries to make money, and reinvest in their business, and a more natural progression than the forced distribution model that we had been dealing with previously.”

Hear what Palmer, Hopper, Cramer and other industry professionals had to say about the emergence of brewery taprooms in the video above.

Editor’s note: If you missed Brewbound’s previous video coverage of CBC, listen to what attendees had to say about the annual conference, hear what keeps them up at night, and discover what trends they are keeping an eye on in 2018.

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