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The decline of homebrewing


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#21 Bklmt2000

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Posted 31 January 2019 - 10:44 AM

My ill-informed and random thoughts on this topic:

 

At least around here, I don't see homebrewing in much (if any) of a decline; the crowds at my now-former LHBS are anecdotal testimony to that.

 

In the past, a few people I know wanted to see how beer was made at home, so I'd have them over for a brewday, so they could see my process and decide for themselves.

 

Same outcome every.  damned.  time:  They enjoyed standing around, drinking my beer, playing on their phones, and not really paying any attention to the brewing process, or if they did see what I was doing, they'd later decide it was too much work vs. just buying it at the store.

 

I see that as just another temporary ebb in the hobby, not too unlike the craft beer industry as a whole:  those in it for the long-term, who know what they're doing, making good beer, and in the case of a brewery, making sound business decisions, will stand the test of time. 

 

The rest will fall by the wayside. 


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#22 SchwanzBrewer

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Posted 01 February 2019 - 11:09 PM

Lots of homebrewers went pro. Probably a pretty large chunk of the hard core homebrewers I'd say.


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#23 Zsasz

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Posted 02 February 2019 - 05:27 AM

Lots of homebrewers went pro. Probably a pretty large chunk of the hard core homebrewers I'd say.

 

there must be a lot less of us than I thought then because while there are a lot of new small breweries there aren't that many.  Not counting myself I've known 7 homebrewers outside of this forum.  none of them have gone pro but most of them either don't brew often or at all.  they just don't have time or interest anymore.  look around here - how many of us have gone pro?  2 or 3?


Edited by Zsasz, 02 February 2019 - 05:28 AM.

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#24 SchwanzBrewer

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Posted 02 February 2019 - 03:48 PM

there must be a lot less of us than I thought then because while there are a lot of new small breweries there aren't that many. Not counting myself I've known 7 homebrewers outside of this forum. none of them have gone pro but most of them either don't brew often or at all. they just don't have time or interest anymore. look around here - how many of us have gone pro? 2 or 3?


Around here there are about 4 or 5 serious clubs with roughly 250 active hardcore brewers. Id say 20 to 30 have gone pro in the last 5 years. Almost all of the breweries here were started by homebrewers. From my dinky club alone we've had 7 go pro and i tried to but that isnt happening.
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#25 Zsasz

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Posted 02 February 2019 - 05:25 PM

Around here there are about 4 or 5 serious clubs with roughly 250 active hardcore brewers. Id say 20 to 30 have gone pro in the last 5 years. Almost all of the breweries here were started by homebrewers. From my dinky club alone we've had 7 go pro and i tried to but that isnt happening.

 

that doesn't really sound like a huge number overall.  most homebrewers aren't "hardcore".  out of the half dozen or so I know in person (not from here so I can't count drez - he likely has me beat!) I'm the "most hardcore" and I doubt I'd even register on the hardcore brewer list.


Edited by Zsasz, 02 February 2019 - 05:30 PM.

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#26 SchwanzBrewer

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Posted 02 February 2019 - 05:40 PM

that doesn't really sound like a huge number overall.

 

Over 6300 breweries now. I'd bet that the vast majority are homebrewers that are either running them or own them. That probably cuts the number of hard core homebrewers nation wide by double to triple that. Those brewers probably brew 20 times a year, so lets say 2 homebrewers go pro for every brewery @ 6000 breweries, that's 120,000+ less sales per year. If they spent $35 each sale then that's $4.2 million less in the pot. When a homebrew shop probably does $150k in revenue, that's 28 shops that are now making $0. Now, it doesn't really work that way, but that's a big decline in revenue when that $4.2 M is spread around. When your margins are so small in retail you can't afford to take a big hit before the shop closes. Thus the decline.


Well that's my conjecture anyway.


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#27 djinkc

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Posted 03 February 2019 - 07:06 AM

Over 6300 breweries now. I'd bet that the vast majority are homebrewers that are either running them or own them. That probably cuts the number of hard core homebrewers nation wide by double to triple that. Those brewers probably brew 20 times a year, so lets say 2 homebrewers go pro for every brewery @ 6000 breweries, that's 120,000+ less sales per year. If they spent $35 each sale then that's $4.2 million less in the pot. When a homebrew shop probably does $150k in revenue, that's 28 shops that are now making $0. Now, it doesn't really work that way, but that's a big decline in revenue when that $4.2 M is spread around. When your margins are so small in retail you can't afford to take a big hit before the shop closes. Thus the decline.


Well that's my conjecture anyway.

 

I thought we all agreed - no math on weekends


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#28 ER Pemberton

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Posted 03 February 2019 - 09:36 AM

My angle on this is that homebrewing absolutely exploded in the past 5-10 years and maybe a good chunk of those people ended up making marginal beer and decided that it wasn't worth the work especially with all the new commercial breweries around.  I'm a fan of beer, brewing and beerdom in general.  I was just on vacation where the beers available were all in the pale and fizzy variety and I still like to drink that style of beer especially in the setting.  I also like to make that type of beer.  I would think it's more likely that many people got into it and then jumped back out of it as opposed to getting into it and going pro.  



#29 SchwanzBrewer

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Posted 03 February 2019 - 09:42 AM

My angle on this is that homebrewing absolutely exploded in the past 5-10 years and maybe a good chunk of those people ended up making marginal beer and decided that it wasn't worth the work especially with all the new commercial breweries around. I'm a fan of beer, brewing and beerdom in general. I was just on vacation where the beers available were all in the pale and fizzy variety and I still like to drink that style of beer especially in the setting. I also like to make that type of beer. I would think it's more likely that many people got into it and then jumped back out of it as opposed to getting into it and going pro.


Im certainly not saying its one thing. What you said definitely makes sense and the combo of the two would certainly put a dent in the overall bottom line.
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#30 ER Pemberton

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Posted 03 February 2019 - 11:41 AM

Im certainly not saying its one thing. What you said definitely makes sense and the combo of the two would certainly put a dent in the overall bottom line.

Agreed.  I'm also in agreement on the state of the beer from small local breweries.  It got to the point where the majority of the offerings I tasted were not as good as my own beers.  I hope I'm saying that fairly... when I drink my own beers I'm very critical and I know when I've made a marginal beer.  I don't assume that all beers I make are good.  But some of these commercial craft beers I've had were truly dreadful.  



#31 SchwanzBrewer

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Posted 03 February 2019 - 11:57 AM

Agreed.  I'm also in agreement on the state of the beer from small local breweries.  It got to the point where the majority of the offerings I tasted were not as good as my own beers.  I hope I'm saying that fairly... when I drink my own beers I'm very critical and I know when I've made a marginal beer.  I don't assume that all beers I make are good.  But some of these commercial craft beers I've had were truly dreadful.  

 

Z table curve. Most will be mediocre beer. Only about 10% will really make good to fantastic beer. Among homebrewers if you've taken the time and effort to really learn and practice making good beer it's easy enough to do on your own. Far easier for a homebrewer than for a brewery that's constrained by market influences and profit.


Edited by SchwanzBrewer, 03 February 2019 - 11:57 AM.

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#32 ER Pemberton

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Posted 03 February 2019 - 12:08 PM

Z table curve. Most will be mediocre beer. Only about 10% will really make good to fantastic beer. Among homebrewers if you've taken the time and effort to really learn and practice making good beer it's easy enough to do on your own. Far easier for a homebrewer than for a brewery that's constrained by market influences and profit.

Yes, much agreed.  The part that gets me is the red tape, the money, all the planning, etc. and then the product isn't good.  Were these people just naive?  Did they have poor direction?  Did they do any market research to see what was really needed in their marketplace?  The truth is that I still love to brew and serve my beer to anyone interested in drinking it.  It's a hobby and it's fun.  I don't want that to go away by making it my job.  In terms of the drop in brewers, I still see it as easier to stop brewing altogether than it is to go pro.  I know A LOT of brewers in my area and from forums and it's an extremely low percentage that have gone pro (of those brewers I've had contact with).  I think it got big, many people realized how big it was so they tried it themselves and then when they saw what was required of them to make good beer, they bailed.  



#33 SchwanzBrewer

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Posted 03 February 2019 - 12:30 PM

Yes, much agreed.  The part that gets me is the red tape, the money, all the planning, etc. and then the product isn't good.  Were these people just naive?  Did they have poor direction?  Did they do any market research to see what was really needed in their marketplace?  The truth is that I still love to brew and serve my beer to anyone interested in drinking it.  It's a hobby and it's fun.  I don't want that to go away by making it my job.  In terms of the drop in brewers, I still see it as easier to stop brewing altogether than it is to go pro.  I know A LOT of brewers in my area and from forums and it's an extremely low percentage that have gone pro (of those brewers I've had contact with).  I think it got big, many people realized how big it was so they tried it themselves and then when they saw what was required of them to make good beer, they bailed.  

 

Kinda hard to tell someone their beer sucks. On top of that you have to deal with egos that just don't wan to hear it. It's especially hard to get someone to understand when they still sell it all. We have a local brewery that makes terrible beer and their customers love the place. They are the only game in the area so they succeed. None of us around here that know good beer ever go there. 


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#34 ER Pemberton

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Posted 03 February 2019 - 12:38 PM



Kinda hard to tell someone their beer sucks. On top of that you have to deal with egos that just don't wan to hear it. It's especially hard to get someone to understand when they still sell it all. We have a local brewery that makes terrible beer and their customers love the place. They are the only game in the area so they succeed. None of us around here that know good beer ever go there. 

Yeah, that's very interesting too and I suppose I would say more power to them.  I have been to a number of places that were packed and everyone was drinking the craft beer the brewpub was making.  I might try one style (really poor) and then another (better but not good) but then I see the reviews of the place and everyone is screaming about how good the beer is.  :o  None of this is good news for our beer culture because there are plenty of people out there who are still Bud, Miller, Coors people and what if they said, Okay, I'll try some of this craft beer! and then they taste the helles or the kolsch or whatever and it's really poorly made?  They could say See?  All of this craft beer bullshit is nonsense! and that would be unfortunate because they just had a bad example.  



#35 denny

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Posted 03 February 2019 - 01:29 PM

Lots of homebrewers went pro. Probably a pretty large chunk of the hard core homebrewers I'd say.

 

No, actually a very small percentage compared to the total number of homebrewers.


Over 6300 breweries now. I'd bet that the vast majority are homebrewers that are either running them or own them. That probably cuts the number of hard core homebrewers nation wide by double to triple that. Those brewers probably brew 20 times a year, so lets say 2 homebrewers go pro for every brewery @ 6000 breweries, that's 120,000+ less sales per year. If they spent $35 each sale then that's $4.2 million less in the pot. When a homebrew shop probably does $150k in revenue, that's 28 shops that are now making $0. Now, it doesn't really work that way, but that's a big decline in revenue when that $4.2 M is spread around. When your margins are so small in retail you can't afford to take a big hit before the shop closes. Thus the decline.


Well that's my conjecture anyway.

 

I think you're WAY overstimating


My angle on this is that homebrewing absolutely exploded in the past 5-10 years and maybe a good chunk of those people ended up making marginal beer and decided that it wasn't worth the work especially with all the new commercial breweries around.  I'm a fan of beer, brewing and beerdom in general.  I was just on vacation where the beers available were all in the pale and fizzy variety and I still like to drink that style of beer especially in the setting.  I also like to make that type of beer.  I would think it's more likely that many people got into it and then jumped back out of it as opposed to getting into it and going pro.  

 

It's lifestyle change and age.  More younger people have gotten involved in homebrewing.  They have jobs and families.


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#36 denny

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Posted 03 February 2019 - 01:33 PM

Yes, much agreed.  The part that gets me is the red tape, the money, all the planning, etc. and then the product isn't good.  Were these people just naive?  Did they have poor direction?  Did they do any market research to see what was really needed in their marketplace?  The truth is that I still love to brew and serve my beer to anyone interested in drinking it.  It's a hobby and it's fun.  I don't want that to go away by making it my job.  In terms of the drop in brewers, I still see it as easier to stop brewing altogether than it is to go pro.  I know A LOT of brewers in my area and from forums and it's an extremely low percentage that have gone pro (of those brewers I've had contact with).  I think it got big, many people realized how big it was so they tried it themselves and then when they saw what was required of them to make good beer, they bailed.  

 

Yes, they are naive.  I've seen it over and over..."my friends love my beer and think I should open a brewery".  The beer may suck, but the biggest mistake I seeleading to brewry closing is that they simply don't realize it's a business.  They think they'll make great beer and have fun sitting at the bar while the customers tell them they make great beer.  They don't know, don't think about marketing, shelf space, adverting, all the "boring" stuff that goes into a successful business.  I ran my own biz for 30 years and I recognize the failings of these breweries.  It's all pie ion the sky, "if I make great beer they will come".  Real life isn't like that.


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#37 LeftyMPfrmDE

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Posted 04 February 2019 - 07:51 AM

Yes, they are naive.  I've seen it over and over..."my friends love my beer and think I should open a brewery".  The beer may suck, but the biggest mistake I seeleading to brewry closing is that they simply don't realize it's a business.  They think they'll make great beer and have fun sitting at the bar while the customers tell them they make great beer.  They don't know, don't think about marketing, shelf space, adverting, all the "boring" stuff that goes into a successful business.  I ran my own biz for 30 years and I recognize the failings of these breweries.  It's all pie ion the sky, "if I make great beer they will come".  Real life isn't like that.

valid point. there's a group of folks around my way that are opening a brewery; they got into homebrewing hard about 2 or 3 years ago; from what i see and read on the social media, they are going to to have a 7 BBL brewhouse, and in nicely decorated taproom and brew space. 

 

they are searching hard for head brewers, servers, etc. hitting up the local brew clubs for folks to work for them. I've had a couple of their beers at meetings, and well, it sure tastes like who is really passionate about beer, but, it has faults of a brewer who's just really started. 

 

there is a pool going on with a few folks on when they will shut their doors. I don't wish ill-will on anyone who wants to start a business, and maybe they have a boat load of time on the business side of beer, but, the product isn't impressive. word is that they are going to brew with extract. best of luck to them. 

 

I'm sure the locals who are of the non-craft beer drinkers will keep them going, for ad least a little while. 


Edited by LeftyMPfrmDE, 04 February 2019 - 07:52 AM.

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#38 SchwanzBrewer

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Posted 04 February 2019 - 09:32 AM

Denny, I wasn't talking about the total homebrewers. AHA estimates that there's 1M homebrewers in the US. Obviously the chunk that have gone pro is tiny compared to that, but what we really need are the numbers that represent the types of homebrewers.

 

Types:

Brew once and done - christmas gift type brewer - $80 revenue ea batch - 20% of total brewers

Brews 2-4 times a year - $40 ea batch - 50% of total brewers

Brews 5 - 10 times a year - $35 ea batch - 20% of total brewers

Brews 11+ times a year - $30 ea batch - 10% of total brewers

 

I'm making the batches cheaper because the more you brew the more likely you are to be able to do things that save you money. Buying hops and malts in bulk for instance.

 

So lets look at the revenue generated by each category of brewer...

 

1X : $80 X 200,000 = $16M

2-4 X: $40 X 3 X 500,000 = $60M

5-10 X: $35 X 7.5 X 200,000 = $52.5M

11+ X : $30 X 11 X 100,000 = $33M

 

Average retail net margins are around 5%, so if we lose a sector of homebrewers for some reason, if we surpass 5% we'll see a decline and closures of shops.

 

6300+ craft breweries. Lets say 2 homebrewers from the 11+ side quit homebrewing and went pro for every craft brewery. That's 12600 homebrewers lost from that category. That represents a loss of $4,158,000 loss in revenue in the hobby. That's 2.57% of total revenue lost. If any other of the sectors see a decline for some reason then the profit margin will be consumed and we'll see shop closures. Since that's exactly what we're seeing then I'd say my point is valid. Now, I pulled all of these numbers out of my ass based on an educated guess and not all of the homebrewers that go pro are from the 11+ category as we all know, but i'd say its a likely scenario. It would be interesting to actually see the data, but I really doubt it's out there.


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#39 SchwanzBrewer

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Posted 04 February 2019 - 09:58 AM

2015 report shows about $764M in retail revenue, with most of that being equipment sales. So my numbers are way off. 


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#40 Genesee Ted

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Posted 14 February 2019 - 11:22 PM

Yes, they are naive. I've seen it over and over..."my friends love my beer and think I should open a brewery". The beer may suck, but the biggest mistake I seeleading to brewry closing is that they simply don't realize it's a business. They think they'll make great beer and have fun sitting at the bar while the customers tell them they make great beer. They don't know, don't think about marketing, shelf space, adverting, all the "boring" stuff that goes into a successful business. I ran my own biz for 30 years and I recognize the failings of these breweries. It's all pie ion the sky, "if I make great beer they will come". Real life isn't like that.

Yup

I brew for a living but I still homebrew a few batches a year. I get to do it at work and brew what I want so I just get my creative brewing juice there. Homebrew batches are generally me teaching someone else.

Even if I didn’t brew for work, I’d still brew less than I used to. I started Brewing when I was 16 just so I could have beer. Then I learned more about beer and wanted to make styles that I couldn’t purchase. Then I started getting creative. Now that there is so much commercially available beer of so many styles, I don’t need to brew it. I hear about a lot of questionable quality but I really don’t see that around here. Some aren’t good. For sure. But most of the beer I have around NYS is pretty good. Maybe I’m selecting places that are just good but I do think the quality is generally there.
So that just leaves brewing for creativity. I guess I would still brew for that if I wasn’t pro.
I was at my LHBC meeting on Tuesday and it was maybe a quarter of the size that it was when I was President of the club a few years back.


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