By Noella May Pickett
Vermont has become well-known not only on a national level, but on an international level for its artisan craft beer.
Craft breweries are growing, and the industry contributes approximately $199 million to the Vermont economy annually. Vermont is ranked No. 1 in the nation for breweries per capita, and is recognized as a leader in this thriving trend.
Yet, some predict this big beer boom may be losing its fizz.
“The craft beer industry is calming down, from 15 to 18 percent growth in previous years to 9 to 11 percent for this past year,” said Gregory Dunkling, program director of UVM’s Business of Craft Beer Program.
Brewmasters are trying to figure out what this will mean and what additional challenges they will face. Dunkling said there is no need for concern.
“This decrease will pose positive change, said Dunkling. “From approximately 15 percent to 10 percent is actually healthy — providing more sustainability to small craft brewers here in Vermont.”
In just five years, the number of breweries in Vermont has more than doubled, and the industry provides approximately 1,500 jobs. Additionally, when including the income that stems from craft beer tourism, the annual economic impact reaches approximately $270 million.
“This number exceeds the annual economic impact of maple syrup in Vermont,” said Melissa Corbin, executive director of the Vermont Brewers Association.
“I think the bubble really pertains to the larger and more regional craft beer makers. Again, it is difficult to have a large footprint and not get lost in the sea of craft beer. I believe the smaller, more local breweries will see continued success, as long as they have created a sustainable business model. People will support their local craft breweries and by staying small and local, you really mitigate your risks while staying connected to your community,” said Jennifer Kimmich, co-owner of the Alchemist Brewery in Stowe.
What makes craft breweries craft? According to The Brewer’s Association, in Boulder, Colorado, craft beer is made by small, independent and traditional brewers with annual production of six million barrels of beer or less, and ownership of 75 percent or more of the business. Also, the majority of the total alcohol volume and flavor in the beers brewed are derived from traditional or innovated brewing ingredients and fermentation.
“People in the craft beer industry are more innovative and business savvy than ever before,” Dunkling said.
Due to the magnitude of the industry, the Vermont Brewers Association was founded in 1995 to promote and strengthen the culture of craft brewing in Vermont through marketing, education and advocating for Vermont-made beer.
“There are many challenges in running a craft brewery today. Since we have stayed small and have limited distribution to within a 30-mile radius of our breweries, we don’t have to worry about competing for shelf space or tap lines in other states,” Kimmich said. “I think this is where it gets tricky. People will support their local craft breweries as long as they are good. Once you take your beer to another state, it becomes much more difficult to compete. There are just so many breweries! If you go to a large craft beer retailer, you can see how many beers get lost in the sea. They really need to be great to stand out,” Kimmich said.
The most popular style of craft beer is Indian pale ale. IPAs are “hop forward” ales. With the high demand for hops, which act as a preservative and give the beer bitter characteristics, the largest competing factor for breweries in Vermont is sourcing good hops.
“There are also challenges with securing high-quality hops. We are fortunate that we have been in business 14 years, so we have strong relationships and contracts with our growers. I hear from new brewery owners that they often have difficulty acquiring the hops they planned on using for their flagship beers,” Kimmich said.
Securing a good business model and sourcing ingredients prior to starting production are the key fundamentals in running a successful brewery. In addition to these two main elements, good beer and a good customer base are the fundamentals in retaining success. “Shaun (Hill, owner and brewmaster) started contracting for the hops he wanted and needed for beers such as Edward, a pale ale, prior to opening his brewery,” said Phil Young, special projects manager at Hill Farmstead Brewery in Greensboro. “The only way you can reach us is either two miles down dirt roads or by stumbling upon us while getting really lost down back roads. In all seriousness, through being rated the best brewery in the world and other accolades, our production has grown significantly since the beginning, almost seven years ago. Being a brewmaster and creating your own brewery is not a model everybody could mimic. The beer has to be that good. And, we’ve been lucky enough that people keep coming to visit us.”
Needless to say, not all craft brews are good, and not all big brews are bad. What sets craft breweries apart in Vermont from the big breweries elsewhere is first and foremost, the ingredients and attention to detail. There may be more competition ahead for the future entrants into the business, but those who are established consider themselves part of the same team.
“We here at The Vermont Brewers Association have helped place these craft brewers on the map with our Passport Program. This program provides a major vehicle for tourism, and it drives people into rural parts of the state to visit craft breweries,” Corbin said. “The craft beer industry is a consumer-driven market, and is heavily supported by our Passport Program by picking up an Official Passport at any of our participating members’ brewery or brew pub; which currently includes 51 members. Have your passport stamped at each location visited and mail it in to our office to collect prizes.”