Industry revenue is forecast to rise at a CAGR of 0.6% to $8.0 billion over the five years to 2028, with industry net profit margin reaching 4.4% in 2028.
Globalization increases domestic exposure to international brands and foreign craft beer
movements are catching on in America. For example, Swedish breweries are creating innovative styles, like organic beers, that satisfy US consumers’ evolving taste and food and beverage preferences, which include marketing toward “healthier” options.
While revenue is projected to increase only modestly, well-known brands will continue to win in their backyards as more turnover is seen away from newer brands or one-hit-wonders.
US craft breweries are also piquing the interest of foreign consumers – increasing an already burgeoning role in the global beer market. As exports rise with growth in foreign
interest and the value of the USD deflates, US craft offerings will be relatively less expensive
for international consumers.
Over the past five years, the emergence of more than 3,000 new craft breweries (totaling over 9,000 in the US in 2021) has furthered market over-saturation. Craft brewers now contented with fierce geographical and brand
competition.
While the classic pilsner and pale ale beers will be year-round staples, seasonal beers,
seltzers and pre-mixed drinks present opportunities for craft brewers to attract
customers with new flavors – and take risks.
Source: IBISWorld
Brewery M&A Multiples
2019-Present
Source: Pitchbook
2021-Present
Source: Pitchbook
Craft breweries are inherently small-scale because of the definition of craft, which limits producers’ production. Still, major craft brewers like the Boston Beer Company and others below are acquiring smaller brands to expand product portfolios. Brand equity and durability of brand loyalty will be the key to success as we see discerning interest from investors in this space (IBISWorld, Jan. 2023).
Select Brewery M&A Transactions
