Stone Brewing Co., the 10th largest craft brewing company in the U.S., announced Thursday the layoff of “approximately 5 percent”, which is about 60 of its 1,200 employees. The announcement marks a turning point in the success story of the American craft beer industry which has only seen growth since its early beginnings in the 1980s.
“Due to an unforeseen slowdown in our consistent growth and changes in the craft beer landscape, we have had to make the difficult decision to restructure our staff,” explains Dominic Engels, CEO Stone Brewing, who succeeded iconic founder and new executive chairman Greg Koch last September.
During the last 20 years, Stone Brewing has grown from a small microbrewery with just two founders into one of the largest craft breweries in the United States. The company has been listed on the Inc. 500 | 5000 Fastest Growing Private Companies list 11 times, and has been called the “All-time Top Brewery on Planet Earth” by BeerAdvocate magazine twice. In February this year California based Stone Brewing opened its 220,000-square-foot (20,000 m²) East Coast brewery and distribution center with retail store and tasting room in Richmond, Virginia. In September it was the first American craft brewery to open up a facility in Europe. The new site in a former gasworks facility in Germany’s capital Berlin covers an area of 56,000 square-foot (5.200 m²) and resembles with its huge beer garden with 1.200 seats remotely Hofbräuhaus or Oktoberfest.
According to Bart Watson, chief economist, Brewers Association. “the craft brewing industry is entering a period of maturation. As craft’s base gets larger, as with any industry, it becomes more difficult for it to grow at the same percentage rate.” Still, “the opening rate compared to closing rate for breweries remains incredibly strong, with a historic number of breweries operating in the U.S.,” Watson adds. As of June 30, the Brewers Association counted a record high of 4,656 operating breweries in the U.S, an increase of 917 breweries compared to last year. On top, there were approximately 2,200 breweries in planning.
New entrants to the market and a consolidation, where heavyweights like AB InBev, MillerCoors or Constellation Brands are buying up the most valuable brands in the craft beer sector, make it harder for the pioneers of the industry. Boston Beer Co., the number 2 in the U.S. craft beer market, reported recently the third consecutive quarter of sales and profit decline and a sales volume decrease by 5% over the first half of 2016.