Friday, November 1, 2019

A North Texas craft beer state of the union - 2019 edition

Image credit: Brewers Association.

Since late 2011, the refrain has remained the same - the North Texas beer scene is booming. Breweries continue to open, and more are on the way, suggesting the surge hasn't stopped and is showing no signs of slowing down.

The starting point of the boom dates back to the debut of Deep Ellum Brewing Co. in November 2011. When Deep Ellum arrived, it was the first locally-owned brewery to open in Dallas since 1998. And, at the time, there were only eight active brewing operations in the entire region.

Today, North Texas is home to over 80 brewing companies, with the jump here an extension of a national trend where brewery numbers in the U.S. have increased from around 2000 eight years ago to 7,346 in 2018. Local growth rates are greater, but given where the industry started, North Texas had nowhere to go but up.

Still, Texas as a whole ranks 46th out of 50 states and the District of Columbia for number of breweries per capita, with 1.4 breweries per 100,000 adults 21 years of age or older (source: Brewers Association). Numbers are similar for Dallas-Fort Worth specifically, but things should improve locally based on 40 or so new ventures working to open in the near future.

Despite the per capita gap, state rankings are higher if you consider the amount of beer made in Texas and its economic impact. According to the Brewers Association, over 1.1 million barrels of beer were produced in Texas during 2018, the eighth highest total in the country. Even more impressive, the state's craft brewing industry contributed nearly $5.1 billion to the U.S. economy last year, trailing only California and Pennsylvania.

One thing lagging, however, is the size of the local customer base compared to other markets. Texans love their light beer, and it shows in certain metrics. Using U.S. Census Bureau statistics, along with data taken by Scarborough (a division of Nielsen) during 2016 and 2017, an estimated 5.7% of the over 21 population in Dallas-Fort Worth drinks craft beer on a regular basis. That trails the national average of 7.3%.

Consequently, while craft beer is big business in Texas, it could be even bigger. Getting more people into craft beer has been a priority from day one, and it will remain important as the number of breweries in North Texas nears the century mark.

If that milestone occurs, what happens next is anybody's guess. Will the market support over 100 breweries, or will a tipping point be reached? The general belief is consumers will continue to support local breweries as long as quality and customer service don't falter. Differentiation and the taproom experience are factors as well, especially as the playing field gets more crowded.

Either way, for now it appears North Texas will keep setting records for the number of breweries within its borders. That's great for consumers wanting additional options for drinking local in Dallas-Fort Worth, but it ups the ante in an already challenging market for local breweries. Indeed, how those breweries respond will go a long way towards determining the health of the North Texas brewing industry going forward.

Originally published as part of a special section on NTX Beer Week in the October 31, 2019 edition of the Dallas Observer. An online copy of the complete newspaper is available by clicking here.

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