Monday, June 25, 2018
Bars & Spirits

With new bars, breweries coming to Tampa Bay, will craft beer's bubble burst?

When one of my favorite local craft-beer bars shut its doors last month, I started to think about a fear that I've been hearing more and more of lately. Is the craft-beer industry in a bubble, and if so, how far can it continue to grow before the bubble bursts?

Owners of Crum's Bar and Grill in St. Petersburg said the bar was felled by a broken (and exorbitantly expensive to repair) air-conditioning system, rather than market oversaturation. But if it had stayed open for a few more months — during which no less than six new craft beer bars and breweries are slated to open in St. Pete alone — there's no doubt Crum's would feel the pinch. There soon will be much more craft beer flowing from the taps of bay-area bars, but are there enough people to drink it?

On average, a new craft-brewing operation opens every day in the United States. According to figures released in May from the Brewer's Association, there are more than 1,500 breweries in the planning stages, which — when compared with the 2,400-odd craft breweries currently in operation — represents a massive increase in output on the horizon. It doesn't take much number-crunching to realize that this represents a potentially significant dilution of profits within the industry.

Charlie Papazian, founder of the American Homebrewer's Association and president of the Brewer's Association, is optimistic about such growth, predicting that craft beer will continue to displace larger segments of the market currently held by big-time, corporate beer. Papazian predicts that, by 2017, craft beer will make up 10 percent of the U.S. beer market in volume; in 2012, it held only 6.5 percent of the domestic market in volume.

But on a local scale, it's hard to imagine that the thirst for craft beer among the general public is fast enough to match the speed with which new operations are sprouting up. In St. Pete, Cycle Brewing and Green Bench Brewing are almost ready to open their doors, while in Tampa, Zeke's Brewing is up and running, with Ybor City's Coppertail Brewing following closely behind, complete with a full-scale bottling and canning operation. That doesn't even count the myriad craft beer-centric bars on the way, such as the Brass Tap, Yard of Ale and the Amsterdam — all set to open in downtown St. Pete this year.

I don't think this spells a doomsday scenario, though. In my opinion, the elements that made craft beer so huge will go a long way in helping to maintain it through such rapid growth. That's not to say that things can continue to grow at the current rate without a few changes to the status quo.

Clearly, quality and distinctiveness will become much more important as the market continues to grow. Gone are the days when a brewery could make waves simply by releasing a hop-bomb IPA; breweries will have to start setting themselves apart from the competition, and a reputation for quality will be absolutely crucial. Beer bars will need to offer something unique to bring in business.

Though uniqueness will be a must, cooperation and collaboration will also continue to play a major role in the culture. This isn't like other markets, where overcoming the competition is the prime directive; instead, a sense of community is common, with local breweries and bars working together, supporting each other, and collectively fostering growth within the local beer-drinking community.

Are we in a bubble? It's hard to say, and even if we are, no one knows just how far it can expand. But if the brewers and bars that make up the business side of the craft-beer boom are up to the task of keeping quality high and making innovation a priority, then we may not have to worry about any bubbles bursting in the near future.

Call it cautious optimism, but I'll be watching along with Papazian, waiting for our little niche of the beer world to pass that 10-percent mark.

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