Craft Beer

New Craft Beer Labels Need Approval By Government Before Getting Printed

New Craft Beer Labels Need Approval By Government Before Getting Printed

Chad S

According to “Craft Breweries and Distilleries: Machinery and Automation Trends,” a new white paper by PMMI Business Intelligence, labels for new varieties of craft beer and craft spirits must be pre-approved by the Alcohol and Tobacco Tax and Trade Bureau (TBB) before they are printed.

Many craft producers rely on third party label printers, so issues with slow government approval or label inventory shortages can slow the process of getting a new product to market.

If the product is ready and labels are not, filling must take place without labeling and then run again for labeling at a later date. Or, product must remain in the tanks, holding up the production of other inventory while the tanks are in use. In either scenario, a craft producer is losing valuable production time.

Larger volume craft producers may consider bringing label printing capabilities in-house to avoid these logistical pitfalls. One of the biggest logistical challenges for craft beer and craft spirits producers is the distribution of their products, and distribution regulations vary drastically from state to state.

The vast majority of alcohol distribution operates on the three-tier system, whereby a producer sells to a distributor, who then sells to a purveyor. Regulations vary as some states allow self-distribution, some allow self-distribution up to a certain volume/capacity, and some states disallow it entirely.

There are also 18 states that currently operate under the control of some form of an Alcohol Board, which regulates the production, distribution, and on-site sale of alcohol. Craft producers must examine each state they wish to expand into, to ensure they are in compliance with all state level production and labeling requirements.

Another challenge involved with distribution for craft beer and craft spirits producers is to remain visible on the shelf in a crowded market. Craft producers are reporting that competition is increasing so quickly that simply getting the attention of a distributor to ask a question or to add a product has become a complicated and prolonged endeavor. Said one production manager of a distillery and brewery in MI, “The consolidation in distributors has changed the game; it’s getting harder to get a distributor’s attention with more competition from distillers and brewers.”

Colorful, eye-catching labels and novel packaging are used to attract attention in the crowded market. “We are seeing more custom embossing, silk screening, and stick-ons as companies strive to stand out to consumers,” says a beer industry expert. Vibrantly colored labels can differentiate an array of packages on a shelf, while novel packaging like pouches for mixed cocktails or odd-sized cans for beer may attract a consumer’s attention.

To learn more about craft beer and craft spirits markets, download the FREE white paper below.

Source: PMMI Business Intelligence, “Craft Breweries and Distilleries: Machinery and Automation Trends.”

2019 Craft Beer Trends

2019 Craft Beer Trends

Chad S

Craft beer in 2018 was largely defined by consolidation. While the consolidation of craft brands is not a new story, the past year saw many brands consolidate product lines and distribution footprints. This is a more conservative tack than we’ve seen in years past, and it can be seen as a direct result of increased competition. Many brands were forced to scale back ambitious growth plans, lest they end up like Green Flash, which went from a Brewers Association Top 50 brewery to foreclosure in a matter of months. to foreclosure in a matter of months.

Craft Beer is Growing Fast

Craft beer is growing fast breweries are growing fast, and resorting less to clogged and monopolized retail channels, and more in favor of taproom sales, which will encourage the community aspect at the heart of craft.

Demographically, things are looking up for craft. No longer just a sanctuary for real-life versions of The Simpsons’ Comic Book Guy, women now comprise 32 percent of the overall craft beer market, with the 21-34 subset representing 15 percent of total craft drinking volume, according to a Revel Systems report.

The coming year’s potential to focus on lighter, more palatable styles should serve to bring in more new beer drinkers, as well as the growth of hard soda and seltzer categories.

Report indicates that craft beer drinking among the Hispanic demographic is projected to grow by 31 percent this year, according to Beer Connoisseur.com

58% Of Craft Beer Drinkers Are Millennials

Millennials remain firm as craft’s strongest proponents, comprising 58 percent of the craft drinking constituency. As the majority, this group will largely dictate what styles become popular and what methods of packaging, branding and sales are successful. So, for those in the industry, this is an important group to consider when making business decisions.

Conclusion:

Given the highly competitive nature of a 7000+ brewery climate, knowing what you do and don’t do well will go a long way. Last year’s industry outlook emphasized the value in focusing on specific styles and learning to do more within their stylistic confines, if not redefining them entirely. 2019 will weed out breweries producing anything less than great, consistent product, and having a focused stylistic wheelhouse will increase the odds of standing out.