The Meaning of Now: Taking Stock of Oregon’s Craft Beer Climate

It’s funny… this space hadn’t seen new content in over 8 months, as if I’d fallen off a horse and was afraid to get back on. Sometimes life happens, inspiration goes away. Not quite writers block, more like getting lost in a creative fog.

Regardless, I’ll never take for granted the power of inspiration.

So, just the other night I was navigating the depths of instagram and happened upon an image of Breakside Brewing’s Flagship IPA, one of a few local inspirations that finally got me into the style, when I came to an epiphany, if you will.

In almost any other year, Breakside winning silver in the American IPA category, as they did at the Great American Beer Festival on Saturday, would be a really big deal… but it didn’t really go down that way this time. Why?

Well, for one, Breakside won gold for the same beer, in the same category, 9 years ago. They also won three other medals at GABF this year, all gold. Not to mention this particular beer can be found regionally in most grocery stores, it’s been around for 12 years, and it’s not brewed by a scrappy, upstart brewery attempting to break into the industry.

Another big reason why: for the first time in at least a decade, American-style India Pale Ale didn’t top the list of Most-Entered Style Categories, nor was it even in the top 3… it was the fifth highest entered category. Juicy/Hazy IPA took the crown of most popular style category, with the newest category, West Coast IPA, second most entered, followed by Light Lager (GASP), and German-Style Pilsener (yes, they still spell it that way), each having more entries than the apparently archaic American IPA.

Breakside returning to the podium for their long-cherished and supremely drinkable IPA is a testament to all the tweaks and hard-work put in by Ben Edmunds and his team – of this there is no doubt. Yet it’s even more a testament to who’s succeeding in today’s seemingly volatile craft beer space.

Truth be told, today’s craft beer reality isn’t nearly as scary as some have made it out to be, though for some it’s been harder than ever to plant their flag in a crowded marketplace. So just what does success look like today in the Oregon world of craft beer?

That Post-COVID Drip

By the way… did you notice that 2 of the top GABF styles, according to the categories brewers feel most confident to brew, are now Lagers?! This has got to be the most under reported, earth-moving development in the industry I can recall, other than COVID.

Oh… and that’s over, right? Seems like cases of COVID are back up again, though it’s more akin to getting the flu these days than acquiring the Black Pest. Still, more mask wearing than we’ve seen in quite sometime.

There’s a correlation here somewhere…

And while I can’t provide empirical evidence to back this assertion – other than what I regularly see selling in the market vs what doesn’t, but it’s pretty clear that during the pandemic folks got burned out on drinking high calorie, high alcohol, and heavy duty beers. This should come as no surprise to anyone.

Though we also can’t discount that craft beer has also evolved into a far more mature industry with nearly 10,000 American breweries in operation today. This means we’ve got more experienced brewers than we’ve ever had, learning and evolving faster than ever, all doing their best to adapt in this ever-changing landscape like never before.

Hype is still a thing, but not like it used to be. Social media appears to be dying a slow death as humans have found other options for spending their free time besides staying in and lamenting our collective devolution.

Draft beer sales have been irregular and still seasonally driven. Packaged beer is certainly down from it’s mid-pandemic peak, so it seems that both cans & draft are far more complicated than ever before. Not to mention the complexities of a “maximum-employment” economy amid record inflation which cannot be overlooked.

Lost Relevance Found Again

In the 3 years leading up to the pandemic, larger legacy breweries were freaking out because they were struggling. Why? Overextending the hyper-regional or national markets they’ve been nursing since the boom-eras of the early 1990’s and early 2010’s resulted in less interest in non-local brands and less innovation at a large scale.

Concurrently, the (clearly) smart arbiters of beer at AB-InBev started snatching up craft breweries to compete as “craft” at a larger scale, yet the prolific growth of local craft breweries created better informed drinkers who opted for quality craft beer in their own backyard. About 6 weeks ago they sold off 8 under-performing brands, half of which are from the PNW, at a dramatic discount.

Take a look at how Oregon breweries with multiple brew house locations and R&D-style small brew systems (small batches are often made specifically for competition) performed at GABF:

• Breakside Brewing (founded 2010; ~30K bbls annually): 3 medals awarded for beers brewed at 3 different locations
• pFriem Beer (founded 2012; ~25-30K bbls annually): 3 medals, all brewed at Cascade Locks, not Hood River
• Deschutes Brewery (founded 1988; 225K bbls annually): 3 medals, 2 brewed at the Portland Pub, 1 at the Bend Pub
• 10 Barrel Brewing (founded 2006; ~100K bbls annually): 3 medals, 2 brewed at Bend production facility, 1 at the Bend Pub
• Bend Brewing (founded 1995; <1k bbls annually): 2 medals, both brewed at their Bend pub
• Falling Sky Brewing (founded 2012; ~1K bbls annually): 1 medal, brewed at their Eugene pub
• Hopworks Brewery (founded 2007; ~10K bbls annually): 1 medal from their Portland location
• Ninkasi Brewing (founded 2006; ~60K bbls annually): 1 medal from their sole Eugene location

* OLCC has not released monthly production data since May of 2021, so the numbers above are brewery released numbers and best estimates based on historical data.

Note that of the 23 medals earned by Oregon brewers, 17 were won by breweries that are at least 11 years old. Also, 6 of the 8 listed above brew in excess of 10,000 barrels annually, plus a few of them have had multiple changes in ownership, and various locations open and/or close over the past 3 years.

This is a dramatic shift from those pre-covid fears of losing relevance in a crowded market… or does no one care about brewery awards anymore? A topic for another conversation I suppose.

My point here is that success is what you make of it. If you invest big or need financial leverage, you better have a business plan and a quality product to succeed. To hang one’s hat on big investments in new brick and mortar locations or expensive canning lines, only to find yourself overleveraged, may not be the path to long term success.

How Craft Beer is Succeeding in Oregon

Success today requires constant attention to the unending push and pull of the market, keeping an even keel in relation to styles specific to your area or patrons interests, devoting the time and attention needed to not only your taproom, but also chain stores, off-premise retail, and draft accounts.

The latest trend for (apparent) success in Oregon has been the opening of new taprooms, for instance here are some prominent & growing Orgeon breweries with 3+ locations:

• 10 Barrel Brewing: 5 locations including a production brewery and two taprooms in Bend, plus Boise & Portland. Closed during AB-InBev ownership: Denver & San Diego.
• Baerlic Brewing: 3 locations including expansion of the original production location into the adjacent taproom, plus the Barley Pod, and Alberta taprooms in NE Portland.
• Breakside Brewing: 6 locations including Dekum, Milwaukie, and Slabtown breweries, plus the Lake Oswego, Astoria, and Beaverton taprooms.
• Great Notion Brewing: 8 locations including the Alberta and Northwest 28th Breweries, plus taprooms in Beaverton, 2 in Seattle, Sacramento, Berkeley, and a seasonal pop-up on SE Division.
• McMenamins Brewery: 62 locations including 24 breweries and 2 distilleries across the Pacific Northwest..
• Steeplejack Brewing: 3 locations including the Broadway and Hillsboro breweries, and the Pizza & Beer location in the West Hills of Portland.
• Von Ebert Brewing: 4 locations including their Pearl & Glendoveer brewpubs, plus Pizza & Beer locations in Beaverton & Cascade Station.

What the newest wave of successful brewery owners have capitalized on, which their predecessors may not have, is a diversification of investment. They’ve looked beyond big distribution into grocery stores (or eschewed it entirely) and often avoided chasing new markets in other states. Instead they’ve grown into new neighborhoods, keeping as much of the sales margin for themselves by selling their own beer over their own bars, not somewhere else.

Much has been said recently about how craft brands have fallen on hard times since the pandemic, though from all the evidence I’ve seen of those who’ve struggled versus those who’ve succeeded, it’s about being a great business who makes great beer, but also a vested partner in their community.

Visibility on the shelf and on local tap lists is always important, but marketing who you are to your community, creating a fun atmosphere, offering high quality beers (don’t forget food options), and not being afraid to diversify your brand will go along way in weathering the economic climate right now.