Craft Brews Grow As Beer Sales Drop

by Gabe Bullard on November 26, 2010

Despite the economic slump, craft beer sales are healthy in Louisville and the surrounding area.

According to the Brewers’ Association, the independent, craft brewing industry grew between 9 and 12 percent in the first half of the year. That’s in the face of a nationwide decline in overall beer sales.

Roger Baylor is co-owner of the New Albanian Brewing Company in southern Indiana. He attributes the interest in craft beer to the growing local, organic food movement. But he says the situation isn’t new.

“We’ve already gone through a bubble like this in the late 90s,” he says. “The first craft beer bubble was a lot of people investing in capacity and then the market didn’t support that, so a lot of them went down. We had our bubble burst at the same time the dot-com bubble did.”

Baylor is among several local brewers or beer retailers to have opened a new location in the last two years. He says expansion can be tempting as interest in craft beer rises, but brewers should be careful not to grow too fast.

“In something like craft beer, where you are coming out of the gate saying ‘This is all about having the fresh, best and innovate product.’ If you’re not then fresh, best and innovative, you’re sort of contradicting your idea that way,” he says. “It’s not about making a zillion barrels of it, it’s about making four thousand barrels that are good.”

Baylor says if brewers hope to expand, they should put quality ahead of market share and profit. Several Kentucky brewers and retailers are profiled in the latest issue of the Lane Report.

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