With draught beer off the menu in many parts of the United States, the pandemic has had a noticeable impact on the beer sector which contracted three percent between 2019 and 2020. The crisis has also resulted in the craft beer sector experiencing its first production decline in the modern era, though the state of the industry remains positive with the number of new breweries climbing to an all-time high. According to the latest Craft Brewing Industry Production Report from the Brewers Association, craft beer producers churned out 23.1 million barrels of beer in difficult circumstances in 2020, a nine percent decline in 2019. That saw craft’s share of the total beer market fall from 13.6 percent to 12.3 percent.
Revenue also fell noticeably with the $22.6 billion made last year down 22 percent in 2019. Despite falls in production and revenue that can be broadly attributed to a major decline in draught sales, the number of operating craft breweries continued to grow steadily, reaching a record 8,764 in 2020. That figure encompasses 1,854 microbreweries, 3,219 brewpubs, 3,471 taproom breweries, and 220 regional craft breweries. Somewhat surprisingly, only 346 breweries closed in 2020 while 716 new enterprises joined the market.
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Michael N. Mercurio is a leading attorney in the field of mergers and acquisitions (M&A). He serves as outside general counsel in buy-side and sell-side M&A, as well as in all business law and real estate law matters. As a strategic partner to firm clients, Mr. Mercurio regularly counsels entrepreneurial individuals and assorted entities on the many challenges, issues, and opportunities companies face throughout the business lifecycle—from start-up to eventual exit.
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