What The Success Of Microbreweries Can Teach Business Owners

We live in an era of corporate domination that can be discouraging to many small business owners. When entrepreneurs, small- and medium-sized business (SMB) owners who do research into their industries discover that a vast majority of their potential competitors are actually acquisitions of the few major corporations that have effective monopolies over many American industries, they can easily lose their motivation.

However, one small business-driven industry has repeatedly been seeing year-after-year growth – microbrewing. Here are some takeaways from the microbrewing industry’s rapid and successful expansion that entrepreneurs, small- and medium-sized business owners can use to grow their own businesses.

How The Microbrewing Industry Has Grown

The microbrewing industry hasn’t just grown, it’s done so exponentially. Since 2008, the number of breweries in America has multiplied by a factor of six, and the workforce of breweries has expanded by 120 percent. That’s almost 70,000 brewery employees, three times the number that existed only 10 years ago.

These microbreweries aren’t undercutting the corporate competition either – average beer prices have grown almost 50 percent. In other words, microbreweries aren’t selling cheaper beer, they’re selling better beer, and they’re proving there’s an audience waiting to consume it.

The microbrewing industry is growing rapidly. However, big corporations in the brewing industry are declining, with five of the biggest brewers – Diageo, Heineken, Pabst, MillerCoors and Anheuser-Busch – experiencing a 14 percent drop in shipments in 2016. This can be partially attributed to Prohibition-era laws that discourage monopolies in the brewing industry but should more so indicate the extent to which business owners of microbreweries are revolutionizing the brewing industry.

Why The Microbrewing Industry Is So Successful

As previously mentioned, Prohibition-era laws that prevent alcohol brewers from simultaneously making, distributing and selling alcohol have contributed significantly to the opportunity microbrewers have to break into the industry as business owners. For example, would Starbucks have a monopoly on the coffee industry if they were legally prevented from making, distributing and selling their own coffee? Chances are slim.

Anti-monopoly brewing laws are not the only factor in the success of microbreweries. Entrepreneurs and small or medium business owners identified an opportunity in the microbrewing industry. They answered a demand for variety and high-quality products, all while simultaneously benefiting from affordable infrastructure (brewing equipment has become increasingly commoditized recently).

Social media also plays a fair role in the success of microbreweries, who are able to use internal marketing to their advantage. By having employees and local social media influencers promote their products, microbreweries can initiate grassroots ad campaigns.

The previous point serves to highlight perhaps the biggest reason for the success of the microbrewing industry – the sense of community that it revolved around. Rather than competing with each other, microbreweries support each other, and will often collaborate to create new brews or share business tips. Microbreweries thrive on crafting narratives specific to the communities they serve, both through social media campaigns that put consumers in touch with employees and with grassroots drives that support the unique, higher quality products that microbreweries specialize in crafting. As a result, consumers of microbreweries feel like they are engaging in a story when purchasing craft beer, not just absorbing a commodity.

What Entrepreneurs, Small And Medium Business Owners Can Learn From Microbreweries

• Carve out a niche. Microbreweries also avoid corporate competition. Microbreweries will either carve out a specific niche with their products that corporations can’t successfully enter (you won’t see Budweiser making a dark, earthy craft beer anytime soon), or they simply sell off to large breweries if they start growing exponentially. By creating a niche, a microbrewery can prevent competition with corporations whose infrastructure small business owners simply can’t match.
• Work with others in your community. By working with other businesses with a similar size to your own, you can take a page from the books of microbreweries and simultaneously eliminate competition and build a community of like-minded consumers and businesses.
• Use internal marketing to your advantage. When it comes to promoting your products or services, few ad campaigns will be as influential as your own employees. Not only are the families and friends of your employees likely to ask them about what they do – giving them a great chance to promote your product or service – but also, your employees want to like what they do. Give your employees a reason to post on social media and rep your business, and you won’t be disappointed.
• Make your business a social experience. Part of the reason microbreweries are so successful is because they get local communities together and excited about sharing a social experience. Take a page from that book to boost your own business. Give local distributors some free stock if you can afford to. Provide local content creators and social media influencers with samples they can freely use and market. Reach out to local charities such as homeless shelters or food drives and take part in them. By making your business an active part of the community, you create a strong foundation to then expand upon.
• Consider limited releases. They might seem like a fad, but they don’t only work for microbreweries – companies like Supreme have also capitalized on the consumer interest that limited releases drive. If your products are high quality and the need is there, limited releases can be a great way to generate grass-roots hype for your product or service.
• Roll with the punches. Being a small business owner isn’t always easy. But, as the microbrewing industry has illustrated,if you have the right niche and the drive, success will make its way to you eventually.

Are you an entrepreneur or a small business owner on the cusp of success, but don’t know quite what you need to do in order to break through? Let us help! HJR Global specializes in providing entrepreneurs, small, and medium business with the resources they need to achieve their true potential. To learn more about what we can do for you, click here.

To read the previous blog, click here.