Industry Analysis & Industry Trends
Despite an often limited distribution reach and high price points, craft beer has increased in popularity among US beer drinkers. A consumer shift to drinking at home during the recession, as opposed to on premises, benefited companies in the industry because it is easier to place products on retailer shelves than in restaurants or bars that offer a limited selection of alcoholic beverages. During the next five years, the industry is forecast to benefit from brand recognition and increasing disposable income. Beer wholesalers are expected to weigh their product mix toward higher-end products in response to consumer demand and to boost profitability, which will further favor industry products.... purchase to read more
Industry Report - Industry Investment Chapter
Craft breweries require substantial amounts of capital investment in the form of equipment and plants, although this varies depending on the size of the brewer. On average, firms spend $0.79 on capital for every dollar spent on wages. Brewing equipment, including stills, filtration systems, bottling lines and other machinery are bought when a plant is first established but require continuous maintenance and repair. The majority of the industry's production process is mechanized and does not require a significant level of labor.
The industry's capital intensity has grown substantially over the past five years as a result of the industry's massive growth in popularity; firms are both entering the industry and expanding current production processes at a massive rate... purchase to read more