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Growth Of Indiana’s Craft Beer Scene Not Slowing Down

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Photo: Quinn Dombrowski (flickr)

Craft breweries have been steadily popping up throughout Indiana.

It’s hard to imagine you’ve ever been faced with more options when going out to pick up a six pack.

Overall beer sales are down, but craft beer sales are up more than 17 percent.

The craft beer industry has grown by nearly 20 percent in the last year.

In addition to the traditional domestic beers, you might also find 50 or 60 craft beers on the shelf.

The Cup Runneth Over

Steve Llewellyn of Function Brewing says people’s tastes are changing.

Craft beer accounted for nearly 8 percent of sales last year, according to the Brewer’s Association.

Llewellyn brewed beer for himself for about eight years before opening a small brew pub in Bloomington with his wife in January.

They don’t bottle their beer or even sell growlers for takeout. They stay busy just trying to keep up with the brewpub’s business.

“At this point it’s a really exhausting way to make a living,” Arlyn Llewellyn says. “Because we are so small, we are doing everything ourselves that we can.”

But that also means the Llewellyns know every detail about their beers and can talk to their customers about it.

Small Batches, Big Growth

By definition, craft brewers produce fewer than 6 million barrels of beer a year.

Craft brewers are also known for their innovation, their use of non-traditional ingredients, their involvement in their communities and their interactions with customers.

Tristan Schmid, a spokesperson for the Brewers of Indiana Guild says these interactions are a point of pride for many brewers.

“Much in the same way that many people go to farmer’s markets to buy their produce for the week, you go to a local company like Upland, or Bloomington Brewing Company or Function, you fill up a growler and you can often speak to the brewer who made the beer that you’re taking home,” he says.

Upland is just a couple streets over from Function in Bloomington and has been brewing craft beer since 1998.

Like Function, Upland started small, but the brewery now employs more than 160 people.

The beers winding through its assembly line could be destined to any of the five states where Upland distributes its beer.

“Our new production brewery this year will pump out 16,000 brewer’s barrels of beer, which is 1.5 million bottles of beer this year in what we package,” Doug Dayhoff, Upland Brewing Company president, says. “It’s been fun.”

And Schmid says there’s still a lot of room for Indiana’s craft brewing industry to grow.

“Right now we’re at almost 100 craft breweries in the state, but surprisingly the market saturation of craft beer is only about 5 or 6 percent” Schmid says. “So that means that only about 1 of every 20 people that is going to the store to buy beer is buying the local craft option.”

Craft or Corporate?

MillerCoors and Anheuser Busch InBev together still control about 75 percent of beer sales in the U.S., but because of the craft movement, their sales are shrinking.

Domestic light beer sales will hit a 10-year low in 2015, according to a recent report in Bloomberg Businessweek.

The big companies have responded by buying up some of these smaller craft breweries and by creating new products.

“They’ve done some really smart things to sort of copy some of the ideas coming out of the craft brewing movement,” Dayhoff says. “So whether it’s Blue Moon on one side, which is a Coors product, or Shocktop, which is Anheuser Busch In-Bev trying to emulate Blue Moon. The Leinenkugel’s family brewery was bought by Miller, so it’s part of that much larger brewing conglomerate.”

Arlyn Llewellyn says that interferes with the reasons people drink craft beer.

“Part of the reason people drink craft beer is because they are interested in supporting that smaller model, that more innovative model and that is more of a community based opportunity to support community businesses,” she says. “And they are creating products and representing them as belonging to that community when in fact they are brewed by international competition.”

No Sign Of A Slow-Down

At the 21st Amendment liquor store in Indianapolis Tyler Pontius has to work with a limited amount of cooler space. Ultimately he’s going to stock what he thinks people will buy, but that’s gotten trickier to determine with the increase in craft brews.

Some people now are going to grab their 12-pack of Coors Lite or Miller Lite or Bud Lite. Then instead of getting a case of that, they’re getting a 12-pack and then they’re going to grab two six packs of different craft beers.”

Pontius says price is still the sticking point for a lot of his customers. Domestic beers are typically a dollar or two less expensive and he says that’s enough to sway them away from craft brews.

And the competition keeps growing…not just between domestic and craft beers but between the craft breweries themselves.

About 20 new breweries opened in Indiana between 2011 and 2013, according to the Beer Institute.

At least a dozen breweries are set to open this year, which will bring the total number of breweries in the state to 92, according to the Brewers of Indiana Guild.

Clarification: A previous version of this story indicated the number of breweries in Indiana was more than 75, which was based on numbers fro the Beer Institute.

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