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January 4, 2011

What is "Small"?

In a move that shocked absolutely noone who follows the beer industry, the Brewers Association changed the definition of "small" in the definition of a craft brewer to one that makes no more than 6 million barrels of beer per year, up from 2 million barrels per year.

Why the change from the original (and completely arbitrary) 2 million per year to the new (and still completely arbitrary) 6 million per year?  The press release says it is because "The largest brewer in the U.S. has grown from 45 million barrels to 300 million barrels of global beer production" in the 34 years since the original tax law was put into place.  But the real reason for the change is Boston Beer Company, maker of Sam Adams, is about ready to break through that 2 million barrel per year cap. Since Sam Adams represents about 20% of the craft beer market all by itself, if Boston Beer was to grow out of the definition of a "craft brewer" the market share of craft beer will plummet.

And we can't have that.

Every industry needs limits and definition.  It is essential for giving the industry an identity so it can thrive.  The definition of a craft brewer, as defined by the Brewers Association, is a brewer that is "Small", "Independant", and "Traditional".  However, is a brewer that makes approximately 55 million cases of beer per year (2 million barrels) a small brewery?

I am very happy for Boston Beer company and I wish them nothing but success in the future, but I think the Brewers Association needs to change the definition to what they really mean when they say craft brewer:  Someone who is not owned by MillerCoors, or AB-InBev.

You can read the press release here

Cheers.  Na zdrowie.  Gun bae.

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