With the number of craft breweries in BC expected to reach at least 130 by the end of 2016, competition is growing to the point where I expect we’ll see an increasing number of business failures. That’s not because there’s a lack of room for growth. BC has a population and GDP similar to Oregon, yet they have double the number of breweries we have. It’s because there’s a shrinking margin of error, especially in outrageously expensive Vancouver.
Growth of the BC craft beer market alone hasn’t floated all boats. (Remember Plan B, DIX, Taylor’s Crossing, and Surlie?) Yet, that’s what many of the startups seem to be counting on without a much deeper consideration of to whom and how they will sell their beer. In fact, there are breweries that don’t even have a working marketing plan (not the same as a promotion plan), never mind a marketing budget (not the same as ad hoc spending). We’ll see how much longer they’ll last on passion after the next 30 breweries open their doors.
Thanks to Beer Me BC, we have a better idea of whom the typical BC craft beer drinker is and their consumption habits. According to the most recent self-selecting survey, they are predominantly males between the ages of 27 and 42 living in the Lower Mainland and Greater Victoria. They drink, in ranking order of preference, India pale ale, stout, pale ale, sour ale, or saison from a bomber 3-5 days per week, mostly at home. Their beer is chosen foremost for its style, then by brewery and reputation.
I remember when I was beer shopping in Sint-Niklaas, Belgium, and came across a Jeroboam (3L) of Chimay Bleu. The enormous bottle made an immediate impression. I imagined cellaring it for years, then opening it on a special occasion to share the Trappist elixir with good friends. Needless to say, bringing it back to Vancouver in my luggage was not an option and I didn’t have time to find out what shipping it would cost. The opportunity slipped from my grasp.
Now, beginning on November 19, there’s an opportunity in the Lower Mainland for you to acquire an even larger rarity. Chambly, Quebec, brewery, Unibroue, will be selling exclusive 6-litre bottles of La Fin du Monde and 17 Grande Réserve through the 39th & Cambie Signature BC Liquor Store. At $149 each for La Fin du Monde and $199 for the 17 Grande Réserve, these will be the largest and most expensive bottles of beer ever sold in Canada†. Only 50 bottles are available.
With the craft beer market share in BC at 20% and the number of craft breweries in the province approaching 100, the landscape is starting to look a lot like Downtown Vancouver’s skyline. That’s not to say the market can’t sustain more breweries, given the other 80% that hasn’t come under the craft beer umbrella, but there will need to be more growth. The question is, where will it come from?
No Sure Bet
The easy days – if there really ever was such a thing – are over. Considering names like Surgenor, DIX, Taylor’s Crossing, and R&B, opening a craft brewery in BC is no longer a sure thing. Having a passion is not enough to carry a business. Now, a lot more dispassionate business acumen has to go with it. Marketing needs to be a fundamental component of one’s business plan, not an afterthought. That means realistically analyzing the market to find your niche and developing a strong brand around it before spending a cent on real estate and plant. Or for those with an existing business, it’s time to take a hard look at where the industry is going and ask yourself if major changes will be needed in how you operate to stay in the game.
As I anticipated, increased competition has breweries – especially those without a clearly defined niche – increasingly searching for new markets. Logically, the first forays outside BC have been to Alberta and Washington. Then, it’s only natural that the rest of North America eventually came into view. Anywhere else?
Read the rest of this entry »
‘Tis the season to open a new craft brewery in British Columbia, apparently. While I was in the Comox Valley for the holidays, I learned that Cumberland Brewing Company was officially opening their doors. According to The Vancouver Sun, 21 breweries are in the planning stage across the province, 13 of which are to be in Metro Vancouver. Canada’s third largest city has proven friendly to nano-breweries where patrons can walk in the door and get a pint or growler fill of a unique tasty local beer. Will the Comox Valley prove as friendly? I hope so.
The Cumberland Brewing Company (CBC) was started by Darren Adam and Caroline Tymchuck, whom I contacted via the brewery’s Facebook page to see if they were interested in talking to a blogger about their business. Darren and Caroline told me to come down to their Dunsmuir Avenue location the next day, their fourth day of operations, for a quick chat. Despite it being a holiday, there was a line out the door and it was tough to get a seat in the tasting lounge. When Darren could spare a minute, he was happy to answer a few questions. Read the rest of this entry »
The So You Want To Open A Brew Pub series ended many moons ago, but people still read it and it has become a valuable resource for entrepreneurs and beer aficionados. Sometimes folks leave comments and questions and sometimes they find my personal email address and write me directly. The most common question is, do I think [insert small Canadian town name] is a good spot to open a brew pub? Read the rest of this entry »
Almost anyone who enjoys having an alcoholic beverage in British Columbia will have a gripe or few about the legal restrictions on doing so. Well, now you have a chance to influence some changes the government will make to bring our laws more in line with the current social culture. Like Halley’s Comet, this opportunity does not come often. Don’t let this chance to have your views included pass. Saying your individual opinions don’t matter is lame. It’s not about you! It is the sum of the parts that matter, so make yourself part of the equation by October 31 for the collective impact to be greater.
So what should those changes be? It’s easy to leap right into the details, but I have to agree with Anthony Gismondi:
Modernizing B.C. liquor laws has to start with a philosophical change about how we interact with alcohol.
In many respects, I think we are already there, given the many parties that are pushing for change. The challenge is for the government to accept the broader cultural underpinning for these changes and approach this issue from that perspective, rather than reacting piecemeal to parochial lobbying, which is what led to the LDB warehouse privitization fiasco and special dispensations to the wine industry (BYOB, legal personal importation) that irritated beer and spirits folks.