"Brews and Blues: Inflation's Toll on Craft Beer Lovers"

In America, prices are going up because of inflation. This makes it hard for people to pay for things like housing, food, transportation, and fun activities. By August 2022, the average household needed about $72,900 each year—$11,500 more than in 2020.

This price increase has also affected the beer industry. The cost to make beer, including ingredients, packaging, and shipping, has gone up. Craft beer, which is made by small breweries, has been hit hard.

Craft Brewers and Sales Decline

Big beer companies have raised their prices, but many small craft brewers tried not to increase prices. Despite this, craft beer sales went down in 2022. People bought less craft beer at bars, restaurants, breweries, and stores. This is different from 2020, when sales went up by 23% during the COVID-19 pandemic.

Beer Prices and Sales Trends

The relationship between beer prices and sales is complicated. Usually, higher prices mean people buy less beer. But since 2008, beer sales haven't dropped as much as prices have gone up. This is because people who buy craft beer often have higher incomes and are less worried about price increases. During the pandemic, some people chose more expensive craft beers, while others bought more cheap beer.

The Pandemic's Impact

The COVID-19 pandemic forced breweries to change. Many started canning and bottling beer because bars and restaurants were closed. But there was a shortage of aluminum cans. Small breweries without strong distribution networks had a tough time. Total sales for the industry fell from $29.3 billion in 2019 to $22.2 billion in 2020, and 568,000 jobs were lost.

Study on Craft Beer Drinkers

This study looked at how craft beer drinkers changed their habits because of rising prices and inflation. It asked four main questions:

1. Are people drinking less craft beer at bars and restaurants?

2. How much more are people willing to pay for craft beer at bars and restaurants?

3. How much more are people willing to pay for craft beer in stores?

4. How much are people willing to pay for delivery services?

Survey Results

An online survey in Fall 2022 got answers from 350 craft beer drinkers. Most were men (61.1%), aged 26-40 (56.8%), and earned less than $80,000 per year (64.6%). Key findings include:

• Almost half said they drink craft beer away from home less often.

• People are not very willing to pay higher prices for craft beer at bars, restaurants, or stores.

• People with higher incomes are more willing to pay higher prices.

• Use of delivery services increased during the pandemic but has gone down since. Some people still like using these services.

Implications for Craft Brewers

The study shows that inflation makes it hard for craft beer drinkers. Even though people think craft beer drinkers are not very sensitive to price increases, some are drinking less away from home.

Craft brewers have adapted by changing production methods, using local ingredients, and trying different pricing strategies. Selling beer at brewery taprooms is still important because it makes more profit than selling in stores. Brewers should keep innovating and exploring new ways to sell beer, like using delivery services.

Conclusion

The study highlights the complex relationship between the economy, consumer behavior, and the craft beer industry. Rising prices and inflation are big challenges, but some consumers are willing to pay a bit more for craft beer. Future research should continue to look at how consumer preferences change and how economic changes affect the craft beer market.

For further details, refer to the full study here.