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How the craft beer revolution started
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More Books by Ben Novak
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Australia New Zealand. Argentina Brazil Chile Colombia Venezuela. The craft beer revolution came at the end of a dramatic transformation in the beer industry. Macrobrewers chose product characteristics that appealed to as many consumers as possible, resulting in a more homogeneous and milder lager beer. As microbrewers consolidated, craft brewers began to enter the market, filling product niches left by the homogenization of macro beer.
Consumers and society as a whole began showing an increased interest in local products and environmental and sustainability considerations and a rising sentiment against globalization and products from giant and multinational firms. The diffusion of organic foods, the spread of geographical indications such as the EU certifications P. The growth of the craft beer market is inherently associated with the growth in consumer desire for variety.
Craft beers are typically more expensive than standard lagers. Higher incomes not only stimulate an increase in demand for more expensive products but also stimulate demand for more variety. It is thus not surprising that the craft beer market expanded as incomes increased substantially in industrialized countries in the decades after World War II. In several countries, consumers created associations to mobilize craft beer enthusiasts.
The role of consumer associations and communities has contributed to the development of craft beer for at least two reasons. First, consumer associations stimulated the activity of the first entrants in the craft beer segment, sustaining demand for specialized products against mass-produced beer.
America's Craft Beer Revolution Is Still Going Strong [Infographic]
Second, consumer associations often promoted home-brewing, which played an important role in developing experience among the first entrepreneurs. The growth of the craft sector and the entry of increasing numbers of small brewers was enhanced by the growing availability of technical equipment and capital allowing brewing on a small scale.
In the infancy of craft beer, entrepreneurs faced major difficulties financing their breweries and finding appropriate equipment. The early craft brewers regularly used capital equipment designed for other industries such as dairy or wine and adapted it to brewing and packaging or made use of contract brewing as an institutional mechanism to overcome capital and technology constraints. Today, there is a rapidly developing market for craft brewing equipment. Similarly, as craft brewing revealed itself to be a profitable business, new sources of financing have developed and supported the start-up of new craft breweries.
Banks became more familiar with the concept of craft brewing and started providing start-up capital. Crowdfunding has reduced entry barriers for starting up or expanding craft breweries.
Related The Birth of the Craft Brew Revolution
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