Bottoms Up

Beer and wine in the Bay Area and beyond

Craft Brewers Buzzed Over Sales Increase

By William Brand
Monday, August 21st, 2006 at 4:54 pm in Uncategorized.


This story ran in our newspapers on April 15, 2006.

David Heist, the owner of HopTown Brewing Co. in Pleasanton, prepares kegs for filling. (Michael Lucia/staff)

By William Brand
Oakland Tribune

PLEASANTON – David Heist spent a day this past week washing bottles and kegs in his one-man HopTown brewery tucked away in a strip mall on Hopyard Road. It was tedious, lonely work. But at the end of the day, he took a sip of his Imperial Pale Bock, a beer he has brewed to mark the brewery’s 10th anniversary next week.

“It made me smile,” he said. “I got this one just right.” Some days he’s discouraged. But sales are up. His beer is now in most of the large Beverages and More group’s stores.

While Heist struggles on his own, Pyramid Breweries Chief Executive Officer John Lennon said the company’s Berkeley and Seattle breweries are booming.

“We had to hire more help in Berkeley. Sales are up 14 percent; our best-seller, Hefeweizen, is up 18 percent; and we had record production in Berkeley,” he said.

After a decade in the shadows — eclipsed by America’s big three brewers with their saturation televisionadvertising — the nation’s more than 1,300 craft brewers and brewpubs, small and large, have emerged into daylight.
Sales for the big three — Anheuser-Busch, Miller and Coors — have hit the wall. Total beer shipments in California in 2005 dropped 4 percent, the Beer Institute said.

But craft beers — brews that emphasize full flavor and striking, often unusual recipes — are on a roll, especially in key markets like Northern California.

The craft and import sector had a 20 percent share of total supermarket beer sales in the United States in 1999, Dan Wandel of Chicago-based Information Resources Inc. told brewers at the annual Brewers Association meeting this week in Seattle.

“Today, in 2006, craft and imports have over a 26 percent share, an increase of over 6 percentage points in less than six years,” Wandel said. “That’s a tremendous sign of growth. It’s just 1 percentage point behind the sales of Miller and Coors combined.” Craft beers, the American part of the equation, now account for 8.5 percent of supermarket sales nationwide, he said. “That’s up 13.7 percent from a year ago.”

Craft beer sales have even been strong in January, February and March — traditionally a slack season for beer, he said.
Paul Gatza, director of the Boulder, Colo.-based Brewers Association, said total sales of craft beer were up 9 percent in 2005 over 2004 and up 7 percent in 2004 over the previous year.

But craft beer still has far to go, the numbers show.

Gatza said craft beer had a 3.5 percent share of total beer sales in 2005; imports 12 percent; Anheuser-Busch, 48.6 percent; Miller, 18.4 percent; Coors, 10.6 percent; and Pabst (Blue Ribbon), 3.2 percent.

Here in the Bay Area, one local marketing official
said, imported beers — brews like No. 1 import, Corona — have been strong for several years. Now, the craft beer portion of the segment is heating up, he said.

There are good reasons, said Lennon, Pyramid’s CEO.
The beer-drinking consumer is really changing, he said. Older beer drinkers have gotten more sophisticated, and people 21 and over just coming into the beer market are starting out drinking craft beer and imports.
“They’re looking for more variety and flavor,” he said. “It’s why they go to Peet’s or Starbucks for coffee. They can get their coffee 21 different ways.”

Craft beer offers a lot of flavor and a lot of choice, Lennon said: including hoppy ales; dark, intense stouts; and superior, full-bodied pilsners. “It’s an exciting category to be in right now.”

Garrett Oliver is brewmaster at Brooklyn Brewing in New York and author of “The Brewmaster’s Table: Discovering the Pleasures of Real Beer with Real Food” (Ecco, an imprint of HarperCollins). Speaking at the Seattle conference, he equated mainstream, pilsner-derived lagers like Budweiser with supermarket white bread.
“A loaf of bread doesn’t stay fresh in a bag for three weeks. It doesn’t smell like bread. It doesn’t taste like bread. That’s kind of what happened to beer in this country. The average American beer doesn’t taste or smell or act like beer,” Oliver said.

When you put real beer in front of actual people, they do like it, he said. It’s happening all over the country.

Anheuser-Busch, the world’s third-largest brewer after InBev (whose brands include Beck’s, Labatt and Stella Artois) and SABMiller, may have gotten the word.

The company is test marketing craft-style beers around the country, including Organic Wild Hop Lager in Santa Rosa. The lager is made at the Anheuser-Busch brewery in Fairfield. All malt, certified organic, it’s 5 percent alcohol by volume and has 20 International Bitterness Units, a measure of the hops in beer.

But Pyramid, for example, boasts a string of beers with more malt, more hops and a bit more alcohol. And back in HopTown, Heist’s not too worried. His new Imperial Bock is 10.2 percent ABV, is extremely malty — and the IBUs? Too high to count.

William Brand can be reached at bbrand@angnewspapers.com.

William Brand
Beer Columnist, Blogger
Oakland Tribune
401 13th St.
Oakland, CA 944612
510-915-1180
www.insidebayarea/beerblog
www.beernewsletter.com
whatsontap@sbcglobal.net

[You can leave a response, or trackback from your own site.]