The State's Beer Business Experiences Growing Pains

Colorado has a history steeped in beer

From the Coors family empire to the brewpub owner who became governor, Colorado has a history steeped in beer. The Brewers Association, a nonprofit based in Boulder, ranks the state third in the country for its number of craft breweries: 400 in all. Colorado has four establishments among the top 50 U.S. craft breweries, with New Belgium taking the No. 4 slot, and the others including Oskar Blues, Odell and Left Hand Brewing.

Though craft beer remains popular and prosperous, the state’s rich brewing legacy is striving to overcome obstacles as it matures. The capital, distribution, sales, branding and promotion required to keep beer businesses afloat inevitably puts smaller, independent operations at a disadvantage. Last year, 20 Colorado craft breweries closed up shop, begging the question: Has the industry reached a saturation point?

“In places like Denver and Boulder, where a brewery’s rent might increase dramatically over the years, some might simply not be able to afford renewing their lease and may have difficulty finding a new and affordable location,” says Tristan Schmid, marketing and events manager with the Colorado Brewers Guild.

On the national stage, small, independent craft brewers made $79.1 billion in 2018, a 4% year-over-year increase, according to data from the Brewers Association’s annual Beer Industry Production Survey. The craze of buying out small craft breweries persists. Breckenridge Brewery sold to Anheuser-Busch in 2015 while Avery Brewing Co. sold roughly 30% of its business to a Spanish company in 2017.

According to Schmid, “Internationally based conglomerates have seen the increasing popularity of local, independent breweries and sought to capitalize on that by acquiring formerly independent breweries to take advantage of local love for the brands.”

The ability of Colorado retailers to sell full-strength beer for the first time isn’t helping, either. The more that customers spend on beer at grocery stores, as opposed to ma and pa shops, the more likely it is the independents could go belly up.

It’s not all bad news: In 2018, the state saw 65 openings, the second-most in a single year, says Stephen Adams, known as the Colorado Beer Geek. He has more than 40 brand new breweries in his “under construction” category that are actually building out on a location, another 30 in the active planning stages and nearly 50 in the “concept” category that intend to open in the future.

“I don’t foresee any time where we are going to see more closures than openings,” he says.

Colorado's 2019 Closures

  • FATE Brewing Co.: Boulder
  • 38 State Brewing: Littleton
  • Ironworks Brewery & Pub: Lakewood
  • Ute Pass Brewing: Woodland Park
  • Lost Highway Brewing: Centennial 
  • Fermaentra: Denver
  • UTurn BBQ: Lafayette 
  • The Brew Pub & Kitchen: Durango
  • 1876 Ale Works: Colorado Springs
  • Grand Lake Brewing: Arvada
  • Dodgeton Creek Brewing: Trinidad
  • The Brew on Broadway: Englewood
  • C.B. & Potts Brewery: Greenwood Village 
  • Brewmented: Longmont

Gabrielle Lyana is a Denver-based writer. 

Categories: Company Perspectives, Magazine Articles