Four String Brewing is the latest victims of the changing environment in the American craft beer market. The brewery, which was one of the first to start the craft beer boom in the area around Columbus, Ohio, is now one of the first to close again. The company has this week shut down production at its brewery in Columbus, Ohio, canceled events in the two taprooms and laid off its staff.
Last year, Four String Brewing produced nearly 8,900 barrels (10,400 hl) of beer, making it the second-largest craft beer maker in Central Ohio, just behind Columbus Brewing Co.
As it looks now, the brewery did not foresee in time the boom in local breweries which made expansion out of the own market very difficult. In 2015, the brewery spent $2 million to triple the existing capacity and move to a new 25,000 square foot facility. Earlier this year, Dan Cochran, who founded Four String Brewing 7 years ago, explained in an interview that the initial idea behind the expansion did not work out.
“The way we are growing is a lot different than it was a few years ago,” Cochran said. “We planned [the expansion of our brewery] in 2013 and we build it out in 2015 (…) We expected to be in 10 to 20 states and we could expect our highest volume here [in Central Ohio] and have all these nice little pockets of markets around the Midwest to make up for a whole of a lot of another volume. That is not how it works now. All of these little pockets have their own local breweries. And this is good overall for business. But it was quite a change in our business model.”
For this reason, Cochran had to focus again on the home market. “About a year and a half ago I said we are going to change this whole thing and we are to focus on our home,” he said. However, the Columbus beer market has also changed over the last years. Many more breweries have opened new facilities in the region, including Scottish “punk brewer” BrewDog, which has opened in August the world’s first crowd-funded beer hotel in Columbus, Ohio. (inside.beer, 24.8.2018)
“As we were going to far-off markets trying to spread the word of Four String, ten breweries popped up in Columbus and just started hammering at the local market,” Cochran said.
“There’s any number of reasons why a brewery may close, but it isn’t indicative of a drop in demand for craft,” says Justin Hemminger, spokesman for the Ohio Craft Brewers Association, as cited in Columbus Business First. “We’re still seeing growth in demand. It’s not exponential like it was a few years ago, but craft is still growing, despite a slight decline in overall beer sales.” But he also admits: “It’s definitely getting harder for brands that are distributed. The taproom/neighborhood model is what has the most traction.”
San Diego based Green Flash Brewing Co. suffered a similar fate like Four Strings. The brand, which was distributed in all 50 US-states, was sold and the brewery had to close its one-and-a-half-year-old Virginia Beach brewery in March 2018. In addition, the company had to make deep cuts to survive. (inside.beer, 20.06.2018 )
Another example is Redhook Brewery. Once one of the leading craft breweries in the United States, Redhook suffered from the fact that more and more small breweries opened up and competed in local markets, where Redhook was selling its beers before. In 2016 the brewery sacked half of its staff at its in Woodinville, Washington, brewing site (inside.beer, 19.10.2016) and announced in May 2017 to close the site completely. In December 2017 the site was sold for 24.5m and in May 2018 it became known that two wineries, DeLille Cellars and Sparkman Cellars, will move their operations to the former brewery site.
