Brooklyn Brewer

Brooklyn Brewery:
Setting the Course for Growth

ID#160404
PUBLISHED ON
AUGUST 24, 2018
BY STE PHAN MEIE R * AND DAN J. W ANG †
Video Prologue: Before reading the case click here to see
Brooklyn Brewery and meet the company’s
leaders.
Introduction
When Eric and Robin Ottaway took on greater responsibilities
in 2010 as senior executives
with Brooklyn Brewery, the company was thriving. The
brewery, founded by Steve Hindy and

Tom Potter (CBS ‘83) in 1987, had grown exponentially from a
neighborhood enterprise,
brewing traditional lagers for local beer enthusiasts, to one of
the top US craft beer producers.
By 2014 the firm ranked ninth among US craft breweries with
260,000 barrels and $60 million
in sales. Brooklyn Brewery beers were sold in 26 states and
exported to 20 countries.
But times were changing in the craft beer marketplace. Giant
industrial brewers like Anheuser-
Busch InBev (AB InBev) and MillerCoors were entering the
segment, selling their own “craft-
like” beers or buying up craft breweries outright.
Simultaneously, the craft beer business was
attracting a multitude of local start-ups, and each new entrant
promised consumers their local
version of fresh, flavorful craft beer.
In 2015, anticipating tougher times to come, the Ottaways—now
with Eric as CEO and Robin
as President—considered several strategic options: upgrading
production, broadening
distribution, adding new products, investing more in
advertising, or pursuing other ventures.
With these options in mind, the brothers called together the

senior team—Chairman and Co-
founder Steve Hindy, Brewmaster Garrett Oliver, and Director
of Operations Matt Gordon
(CBS ’12)—to determine the firm’s best path forward.
Author affiliation
* Associate Professor of Business, Columbia Business School
† Assistant Professor of Business, Columbia Business School
Acknowledgements
Kate Permut ’83 provided research and writing support for this
case.
Copyright information
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of New York. This case includes minor editorial changes made
to
the version originally published August 14, 2015.
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Company History
The idea for a craft brewery in Brooklyn first came up in a
conversation in 1986 when journalist
Steve Hindy and banker Tom Potter met as neighbors in Park
Slope. Both were looking for a
new career challenge. They decided to team up and share their
love of dark, rich, hoppy beers
with other discerning New Yorkers. At first Potter was
skeptical: “What I knew about the beer

industry was that it was big, consolidated, not very profitable,
actually shrinking, and it
seemed an unlikely place to stick a small business and try to
compete with the giants.”1 But
after attending the US microbrewers’ conference in Portland,
Oregon, Potter became
convinced that there was an opportunity at hand. “It really
intrigued me. I thought, ‘yes, it’s a
good idea, and more particularly, it could be a good idea in
Brooklyn.’”2 The founders put
together a business plan, raised $500,000 from friends and
family, discovered a century-old
lager recipe from a long-gone Brooklyn brewery to use for their
first beer, and launched
Brooklyn Brewery to sell “fresh, copper colored, full-bodied”
premium craft beer in New York
City and beyond.3
LAUNCHING THE BEER
It was a bold move to christen the new venture “Brooklyn
Brewery.” As Eric Ottaway
explained, “When Tom and Steve started the company years ago
and decided they wanted to
call it ‘Brooklyn’ people thought they were crazy.…Brooklyn

back then represented crime,
industrial decay.…If you needed to place the crime scene in a
movie, you shot it in Brooklyn.
That was what Brooklyn represented.…But [Tom and Steve]
really believed that, under all this
mess, there was still a burning ember…a sort of undercurrent of
creativity. Plus, Brooklyn had
a huge brewing tradition.…In 1900 there were over 100
breweries in NYC and half of those
were in Brooklyn. They wanted to bring back this brewing
tradition.”4
Renowned graphic designer Milton Glaser, best known for
creating the iconic I ♥ NY logo,
was persuaded to create the Brooklyn Brewery logo. His elegant
white letter B on a green
background became the brewery’s easy-to-spot label. (See
Exhibit 1 for the logo in use.) He
also advocated for a strong local positioning, saying “Brooklyn
is recognizable the world over,
and somehow it fits with beer. Lay claim to Brooklyn.”5 Glaser
continued to work with the
brewery for decades on design and branding. Hindy recounted,
“The naming of beers and the
developing of packaging [labels] was basically Garrett [Oliver],
and me, and Milton.”6

Although the founders put Brooklyn in the beer’s name, it was
actually brewed in upstate New
York. F.X. Matt Brewing in Utica was hired to produce and
bottle Brooklyn Lager on a contract
basis. This arrangement had a major benefit: it allowed Hindy
and Potter to start selling beer
immediately. But it created challenges, too. Cases of beer had to
be shipped 250 miles to the
Brooklyn warehouse. The brewing schedule for each batch of
Brooklyn Lager was controlled
by F.X. Matt. There was also the awkward marketing issue:
“One of the first PR problems that
we faced was the fact that we were not brewing Brooklyn Lager
in Brooklyn, but upstate New
York,” said Hindy.7 “We overcame this problem by rooting our
story in the history of brewing
in Brooklyn.”
Brooklyn Brewery: Setting the Course for
Growth | Page 2
BY STEPHAN MEIER* AND DAN J. WANG†
2021.

EXPANDING THE BUSINESS
Potter recalled that the Brewery “made tons of mistakes, like
every small company would.”8
But with a growing list of beers, inventive marketing, prices on
par with imports, and
unrelenting sales efforts, the firm’s sales grew. By 1993 sales
were 11,000 barrels a year.9 In
1994 Hindy convinced expert brewmaster Garrett Oliver to join
the firm. With the opening of
a small brewhouse in Williamsburg in 1996, using leased space,
Brooklyn Brewery was able to
achieve two goals: they now actually produced some beer in
Brooklyn and the new equipment
enabled Oliver to test different flavors and beer styles. He
experimented with great flair,

winning Carlsberg’s Semper Ardens Award for brewing
innovation and the James Beard
Foundation Award for culinary excellence.10
As the business grew, some hurdles were tougher to overcome
than others. “We were slow to
realize the power of distribution,” Potter remarked. “It’s the
least glamorous of what a
company like ours does. [But] it was the key to succeeding.”11
Mastering this function was
complicated by the US three-tier alcohol distribution system set
up in 1933. As a result of an
amendment to the US Constitution, a firm could only operate in
one area of the marketplace:
production (producing and packaging beer), distribution
(warehousing and delivering beer),
or retail (selling to consumers on-premise in bars and
restaurants or off-premise in stores).
This three-tier system was meant to prevent monopolies,
increase competition, and provide
greater consumer choice. In some states, companies could only
operate in one tier. But some
states allowed producers to distribute their own products and
some allowed producers to

distribute and sell at retail. According to New York law,
Brooklyn Brewery had to sell its beers
through a New York distributor. Direct consumer sales were
allowed only in the brewery’s
local tasting room.
When the company looked for a regional distributor they could
not find a partner. Regional
beer distributors were more interested in selling large-volume
brands than small craft brews.
With big territories to cover, most distributors did not have the
time, nor interest, to educate
bartenders and store owners on craft beer’s many styles and
flavors. Rather than accept
second-class service, Brooklyn Brewery expanded into self-
distribution. This type of business
was legal in New York State if a brewer set it up as a separate
division. Brooklyn Brewery’s
team targeted upscale restaurants, bars, and stores in New York
City, primarily Manhattan.
Soon other craft brewers and foreign beer importers asked them
to distribute their beers there,
too. Hindy and Potter said yes. The distributor group grew so
rapidly that its profits soon
surpassed the brewery. In 1995 the division expanded to

Massachusetts and was named Craft
Brewers Guild. Eric and Robin Ottaway, sons of an investor,
joined to run the distribution
division, now headquartered in Boston.12
TRANSITIONING TO THE NEXT PHASE OF GROWTH
In 2000 Brooklyn Brewery sold 30,000 barrels of its own beers
while distributing 120,000
barrels for other craft brands.13 Hindy and Potter grew
concerned about the imbalance. There
had been many benefits to running Craft Brewers Guild: their
staff became extremely
knowledgeable about craft beers; new products were noticed
quickly; consumer insights were
gleaned directly from retailers. But the company’s resources
were stretched and selling
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competitors’ beers undermined Brooklyn Brewery’s market
share. Hindy and Potter sold the
division in 2003. The $10 million from the sale was reinvested
in the Williamsburg plant, new
IT, and a regional sales force.14
In 2004 Potter decided the time was right for him to leave and
he sold his part of the firm (50
percent of the company’s voting shares) to the Ottaway family.
Hindy sold his voting shares
to the Ottaways in 2010 and they assumed majority and full
controlling ownership of Brooklyn
Brewery.15 Day-to-day management shifted to Eric and Robin
Ottaway, while Hindy stayed
on as chairman and public spokesman.
The ownership transition was smooth, according to Eric
Ottaway, with the 60-plus

employees16 remaining a happy, tight-knit group. As he
explained “I think people like being
here.…We have very, very low turnover. We take good care of
our people.…I think people
appreciate that.…that loyalty has come back and paid off many,
many times.”
By 2014 the firm was listed among the top 10 US craft brewers,
had $60 million and 260,000
barrels in sales, was sold in 26 states and exported to 20
countries. (See Exhibit 2 for top US
craft brewers and Exhibit 3 for Brooklyn Brewery sales.)
Private ownership has continued to
make sense for Brooklyn Brewery. Eric Ottaway noted, “All the
big players have approached
us…[but] it didn’t match what we thought was right for the
company…There’s so much
growth ahead of us, why would I want to sell now?”17
The US Brewing Industry
The global beer industry earned $514.6 billion in 2013, a slight
increase of 2.9% over the
previous the year. The US was the globe’s second largest beer
market in terms of total beer
sales volume, but was 13th in per capita consumption. (See

Exhibit 4 for countries ranked by
sales volume and Exhibit 5 for per capita consumption
rankings.) Europe was the largest beer-
drinking region, with 37.4% of the world’s beer volume.
European drinkers spent $192.6
billion in 2013 to enjoy their beers.18
PRODUCERS
A striking characteristic of the industry was the dominance of
four breweries. The leader was
Belgium-based AB InBev, which sold 20% of the world’s beer.
SABMiller was next with a 12%
global share, followed by Heineken NV at 9.2%, and Carlsberg
A/S at 5.7%. Industry analysts
had long noted a decline in the number of macro brewer firms.
(See Exhibit 6 for the decline
in macro brewers and related rise in industry concentration.)
The market shares enjoyed by
the top four came about primarily through mergers and
acquisitions, not organic growth.
These four brewers used their market dominance to lock in
long-term commodity price deals,
secure top ad placements, and efficiently spread operations
across multiple sites to minimize

transport costs. (See Exhibit 7 for the top firms’ production
capabilities.)
In the US in 2014 there were over 3,400 breweries making beer,
but many were quite small,
producing less than 1,000 barrels a year.19 (See Exhi bit 8 for
the US brewery count by size.)
Some believe this proliferation of craft breweries had its roots
in a 1978 bill eliminating excise
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taxes for home brewers.20 As home breweries experimented
with craft, consumer preferences

began to change—leading to the launch of craft breweries. As
consumer preferences and the
composition of the industry changed, several distinct tiers of US
beer producers emerged:
reweries
dominated US beer sales. The
largest firm, AB InBev, controlled 50.4% of US beer volume in
2013. MillerCoors
controlled nearly one-third, garnering 29% of US market
share.21
-tier domestic producers. Independent private
breweries and regional
producers also captured a portion of US sales, together
accounting for a nearly 10%
share.
-selling imported
beer, with $1.3 billion and
41 million cases sold in 2013. Heineken was the next largest,
with 2013 sales of over
$670 million. Constellation Brands imported leading global
beers such as Corona,
Modelo, and Tsingtao.22 Diageo imported Guinness, Red
Stripe, Harp Lager, and other
brands. 23
were

identified by three factors: size
(annual production of six million barrels or less), independence
(no more than 25%
owned by a larger non-craft beer alcohol beverage company)
and ingredients (majority
of beer’s flavor derived from traditional or innovative brewing
ingredients). 24 The
number of new microbreweries launched in the US had recently
soared. (See Exhibit 9
for yearly growth of US craft brewers.) In 2014 craft beer sales
were 21.8 million
barrels.25 Total dollar sales hit $19.6 billion, up 22% from
2013. Craft brewers were the
only beer producers to experience annual double-digit growth.
CONSUMERS
In 2013 two-thirds of US adults consumed alcohol. Among
those, 41% preferred beer versus
31% wine and 23% spirits.26 Yet, while beer was a clear
favorite, the market had been in a
decades-long decline since 1994, when nearly half of Americans
preferred beer. The amount
consumed had been dropping, too. United States’ beer per capita
consumption declined from
25 gallons in 1981 to 20 gallons in 2012.27 Forecasts to 2018

predicted a drop of -0.3% CAGR as
consumption slowly declined.28
In terms of taste preferences, half the beer Americans consumed
was light beer, 100 million
barrels in 2014. (See Exhibit 10 for top US beer brands based
on volume.) Bud Light topped the
list of individual brands, selling 295 million cases for nearly $6
billion in 2014.29 But its flavor
was rated “awful” by BeerAdvocate, an independent grassroots
community of beer drinkers
and beer professionals. The tastiest beer among the top 20
sellers was Yuengling Lager, an
historic beer from a Pennsylvania regional brewer.30
Although volumes were declining, US consumers were still
spending a lot on beer, paying
$101.5 billion in 2014, up nearly 1% from 2013 spending.31
The slight rise in dollar spending
was a result of many beer drinkers trading up to better–and
higher priced–brews. Twenty five
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percent of beer volume and 35% of dollars spent on beer were
attributed to consumer
purchases in the high-end beer segments.32
MANUFACTURING PROCESS & COSTS
Startup costs for a new brewery were low, depending on the
owner’s decisions on how to
operate the business. First, the firm had to decide whether to

build a plant, get new or used
equipment, or use a “contract arrangement” to rent another
brewery’s excess capacity. Second,
raw materials were needed. Water was available for a small
charge, depending on location.
Although grain and hops were relatively inexpensive for small
quantities, the quantities
needed were huge. Malt prices averaged 40 cents to 50 cents per
pound.33 Hops usually cost
$4-$6 a pound, though some special varieties neared $20.34
Third, the firm decided on a beer
recipe. The amount of malt controlled alcohol content, color,
and sweetness. Hops effected
bitterness and aroma. Yeast varieties determined whether ales or
lagers were produced. By
adding other ingredients, altering brew times, and adjusting
temperatures, one brewhouse
could produce many beers. Packaging costs (bottles, cans,
kegs), warehousing, shipping, and
taxes varied by volume produced.
Video Insight: Click here for a tour of the Williamsburg plant,
led by Brewmaster Oliver, to
understand the beer production process. See also Appendix 1.

Brewers managed the manufacturing process closely to
maximize efficiency. Product loss
could occur when liquids transferred between vessels or if
something went amiss and a batch
had to be discarded. Losses varied by facility, near 15% -20% in
older plants and 5% in newer
breweries.35 There were some economies of scale in brewing,
from production to bottling. (See
Exhibit 11 for estimated minimum efficiency scale (MES).)
Jimmy Valm, Brooklyn Brewery’s
production manager noted that recipes made for a 25-barrel
system, when scaled up to brew
in a larger plant, used only 85% more hops and yeast to brew
100% more beer, preserving the
same flavor. However, there were no such economies of scale
for malted barley.36
Determining the right amount to brew was a delicate
calculation. Brewers wanted their
product to be fresh when it reached consumers. If beer sat in a
warehouse it could potentially
be exposed to heat and light, which eroded flavors. Brewing
beer in the optimal quantity, so it
was fresh when bought, required constant process adjustments
and fine-tuning.

In general, beer manufacturers enjoyed sizeable margins. Both
large and smaller brewers
reported earning substantial gross profits and regularly made
double-digit returns. But the
scale of industrial manufacturers allowed them to typically
outperform smaller brewers on
most key financials measures. (See Exhibit 12 for a comparison
of key financials of industrial
brewer AB InBev versus craft brewer Boston Beer Company.)
DISTRIBUTORS
The role of American beer distributors was to manage beer
inventories, deliver beer in cans,
bottles or kegs to bars, restaurants, and retailers, stock shelves,
set up promotion materials,
and collect taxes. Almost every state required breweries to sign
an exclusive contract with a
single distributor. This gave the distributor virtual carte blanche
to decide how a brewer’s beer
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was sold in bars and stores.37 Beer breweries took great care to
sign with the right distributor
since, once the state-approved relationship was established, it
could only be broken if the
distributor agreed to relinquish the brand. The distributor paid
the brewery for its beer then
set its own price for retailers. Distributors cultivated
relationships with many stores, bars, and
restaurants then worked together with them to promote different
beers during the year.
Just as consolidation took place among producers, it also
developed among US distributors.
Where once there were 5,000 US beer distributors, in the 1970s,

there were only 3,333 by 2013.38
These firms were supposed to be independent, but AB InBev
and MillerCoors dominated
many operators. Many distributors were asked to sign an “equity
contract,” to sell either AB
InBev or MillerCoors’ beers, not both.39 As AB InBev’s North
American president stated “I’m
loyal to my wholesalers. Why would I not expect the same
loyalty to me?”40
“Big Beer’s” influence created problems for regional and
microbrewers. They had to rely on
high customer demand and high margins per case or keg to keep
their distributors’ attention.
As a rule of thumb, distributors usually added at 33% markup to
the wholesale price when
they sold their beers to retailers. 41 In 2013 distributors
averaged a $4 margin per case of
American light lager beers compared to a $7 margin per case of
craft beers.42
RETAILERS
The retail part of the three-tier system consisted of businesses
where consumers bought their
beer either on-premise, at a bar, restaurant, or concession, or
off-premise at grocery or

convenience stores, supermarkets, package liquor, mass
merchandise, or other types of stores.
-Premise. In 2013 US on-premise beer sales reached $56.2
billion, equal to 53.3% of
dollars and 17.9% of volume, and were predicted to grow 14.6%
through 2018. 43
Reaching these retailers required intensive sales efforts, as the
category was
fragmented, with high turnover: 80% of new restaurants closed
within five years.44 A
new beer was easily added to a menu, or its tap handle added to
a bar’s draft line-up,
but slower selling beers could also be easily eliminated. On-
premise managers set the
consumer price, typically multiplying the beer’s cost by about
five to calculate the
amount charged.
-Premise. Beer sales in US stores reached $49.3 billion in
2013, accounting for 46.7%
of dollars and 82.1% of volume sold. Off-premise grew 3.9%
annually on average, with
craft beers leading the field at an annual growth rate of
18.2%.45 Firms such as Wal-
Mart, Costco, and Target accounted for a large share of off-
premise sales, especially

dominating the market in states like California that allowed beer
sales in grocery stores.
Hindy reported that some of his colleagues out West told him
that Safeway (a large
supermarket chain with stores throughout the western United
States) was a quarter of
their business.46 Stores set consumer prices by marking up
costs per case by anywhere
from 33%-50%.47
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MEDIA SPEND
US beer companies spent $1.35 billion on traditional advertising
media in 2013.48 Anheuser-
Busch InBev spent the most at $572 million, followed by
MillerCoors spending $429 million,
Constellation Brands $125 million, and Heineken $123 million,
respectively. Television ads
were closely associated with iconic sports events like the
National Football League’s Super
Bowl, the National Collegiate Athletic Association’s March
Madness basketball tournament,
and Major League Baseball’s World Series. Among the most
enduring were Bud Light’s “Yes,
I Am,” Miller Light’s “Tastes Great, Less Filling,” and Bud’s
“Whazzup!” campaigns.
Among craft brewers, only Boston Beer Company made a
significant investment in traditional
advertising media. The company spent $38 million in “measured
media” (TV, print, radio) out

of a $45.6 million marketing budget in 2013.49 Few other craft
breweries had the financing to
pay for traditional TV or print media, even on the local level.
These brewers relied on social
media, promotion, signage, samplings, events, and word of
mouth to grow their customer base
and sales instead.
The Craft Beer Revolution
According to most beer aficionados, the craft beer movement
began in California and the
Pacific Northwest in the 1960s when home brewers started
making fresh European-style beer
to enjoy with friends. Craft beers featured strong, hoppy tastes
and a large variety of styles,
e.g., pale ales, IPAs (Indian pale ales), stouts, porters, bitters,
and more. When Brooklyn
Brewery launched in 1987, there were 33 microbreweries in the
US.50 By 2014 the craft beer
revolution was well underway as 3,418 craft brewers produced
22.2 million barrels, a volume
rise of 18% annually.
With $19.6 billion in sales, craft beers captured a double-digit
share of the total US beer market

in 2014, representing 11% of volume consumed. 51 IPAs were
the most popular style sold,
accounting for 17.7% of craft sales, with seasonal and special
edition beers close behind for
16.3% of sales.52 In 2014 new microbreweries were opening at
the rate of 1.5 a day53 and the
majority of Americans lived within 10 miles of a local craft
brewery.54
CRAFT BEER DRINKERS
The rise of Millennials was an important part of craft beer’s
success. These drinkers wanted
beers that were “local, small-batch, authentic, cool and new.”55
Among the most coveted
group, 21- to 27-yearsold, 44% had never tasted a Budweiser.56
Studies found that “consumers
buying specialty beers...balked at beverages brewed by large
corporations. 57 Steve Hindy
noted “microbrews appeal to younger drinkers [who are] very
suspicious of Budweiser ads
during the Super Bowl. My own children scoff at ads that target
them in a deliberate and
heavy-handed way."58
The largest-volume craft drinkers were men ages 25-34. Women

were significant customers
too, consuming a third of volume sold. 59 Household income
was the strongest factor
determining purchase. Of respondents with annual household
income above $150,000, a third
drank craft beer regularly.60 These enthusiasts were interested
in trying new beers, sharing
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their knowledge, and learning more about craft whenever
possible.61 They viewed their drink
preferences “not only as a beverage choice…but as a lifestyle
choice, to express their individual
sense of style.”62
MARKETING AND PROMOTION
At the start of the craft revolution, microbreweries positioned
their beer as “the American
alternative to imported beer” to convince US drinkers to give
craft brews a first try. Since craft
pioneers often had tight budgets, they used public relations and
promotions to build sales. As
Kim Jordan, founder of New Belgium Brewery, explained, her
business grew through heavy
“barstool-to-barstool” marketing. “We simply didn’t have the
resources to throw at things like
television.…We relied on our sales force to go out, meet and
interact with customers…[then]
relied on our communities of fans to help us spread the
word.”63
Strong customer ties helped craft companies tap social media,
as marketing became more

digital in the 2000s. Facebook, Twitter, and Instagram were
natural places to expand lively
barstool conversations and became the place where brewers and
fans directly interacted. As
Steve Hindy noted, “Social media has just been the biggest
benefit for craft brewers…Because
the special thing about craft beer I think is that the beer
drinkers discover us. “
Craft brewers also used low-cost philanthropic efforts to build
local awareness and sales.
Donating a few cases of beer to community events, benefits, art
openings, and fundraisers was
an easy way to promote trial among consumers. Event
sponsorship was another successful
marketing channel. By 2015 there were over 1,300 craft beer
festivals across the US annually.64
PRICING
Craft beer was more expensive than regular American light
lager, but industry research
discovered that craft beer was an affordable luxury for many
consumers. 65 Microbrewers
looked at imports and their craft peers to set pricing policy. As
Brooklyn Brewery’s Matt
Gordon described their approach: “we try to ‘line price’ with

our main competitors. Sam
Adams and Sierra Nevada are two we constantly look at.”
On-premise a glass of craft beer averaged $6, versus $4.25 for a
domestic beer.66 Many bars
expanded their beer offerings during the craft revolution. Where
four beer taps was the
average number in the 1990s, by 2005 most bars offered 10 or
more drafts.67 Specialty beer
establishments offered 70 or more beers to choose from.68
Despite their higher price point, craft
beers captured 26.5% of all on-premise beer volume sales for
2014.69
Higher priced craft beers did well off-premise, too. In terms of
dollars, craft beer totaled 15.4%
of supermarket beer sales in 2014 and was growing 17.5%
annually, the fastest of any beer
segment. The average consumer price per case was $34 for a
craft beer, versus $28 for
imported, and $25 for a US super-premium brand, so craft sales
offered supermarkets the
highest margins. 70 When crowded store shelf space became a
challenge, craft brewers
responded by creating “variety packs,” which were 9% of off-
premise sales in 2014.71 Seasonal

and limited edition craft offerings helped store managers create
more excitement, and sales, in
the beer aisle.
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TOP CRAFT COMPANIES
By 2014 the craft beer segment was well developed, with
several companies gaining

nationwide reach. Each of these brewers used a different
approach to expand beyond their
initial local base:
Boston Lager, the best-
selling craft beer in the US. Its 2013 revenues were $739
million, up 24% for the year.
The firm netted $70 million in profit on sales of 3.4 million
barrels, brewing 64 different
beers in its four Boston, Cincinnati, Los Angeles, and
Breinigsville, Pennsylvania
plants.72 Boston Beer products were sold in 50 states and 20
countries. Its line of Angry
Orchard hard ciders dominated that beverage category, reaching
$200 million in sales
and a 57% share of the emerging cider market in just three
years. In 2015 the firm
planned to expand its retail offerings, launching “beer halls”
next to new breweries in
Los Angeles and Miami. (Boston Beer Company went public in
1995. Its IPO opened at
$20 a share and founder Jim Koch netted $100 million. But in
1999 the stock sagged to
$9.50 and Koch worked for years to regain Wall Street’s favor.)

craft brewer, Sierra
Nevada beers were sold in 50 US states, Canada, Australia, and
14 European countries.
The brewer offered 55 different brands.73 Sales reached one
million barrels and over
$200 million in 2013. 74 The company expanded production
outside California,
spending nearly $200 million to build a new brewery in North
Carolina to open in 2015.
The added capacity would allow fresher beer to be delivered to
East Coast and
European outlets, saving on transportation costs as well.
Company. This employee-owned
brewery was home to Fat Tire
Amber Ale and the third largest US craft company. New
Belgium produced 945,000
barrels. They reported revenues of $190 million in 2013,
reaching customers in 39 US
states and Canada. All beer was brewed in Fort Collins,
Colorado but the company
invested $140 million to build a new plant in Asheville, North
Carolina, scheduled to
open in 2016. The firm sold a core group of nine beers, with
several new seasonal and

limited edition brews issued each year. CEO Kim Jordan
planned to expand
distribution to all 50 states by 2018.75
COMPETITIVE TRENDS
Big industrial brewers wanted a piece of the craft beer business
and took different approaches
to make inroads in the category. MillerCoors launched Blue
Moon wheat beer in 1995,
positioning it as a craft brewery despite their full ownership; in
2010 they opened a separate
subsidiary named Tenth and Blake Beer Company to support the
launch of additional craft-
like brands. Chicago’s Goose Island Brewery had ties to
Anheuser-Busch since 2006, when it
sold a stake in the company to the Craft Brewers Alliance,
which included Redhook, Widmer
and Kona; Anheuser-Busch owned 32% of the Craft Brewers
Alliance at the time. In 2011,
Anheuser-Busch parent company AB InBev bought a controlling
interest in Goose Island. AB
Growth | Page 10

2021.
https://brands.73
https://plants.72

InBev also acquired Elysian Brewing, Blue Point Brewing, and
10 Barrel Brewing soon after
closing the Goose Island deal.76
The craft beer industry association labeled these companies’
products crafty beers, since most
labels failed to mention the big corporation behind the local
name. But crafty beers were
gaining traction with consumers. Powered by an $18.9 million
annual advertising budget from
MillerCoors, Blue Moon sold more than two million barrels in
2013, equal to 15 % of the entire

craft segment. 77 AB InBev spent $3 million to advertise Shock
Top, its competing crafty
Belgian-style wheat beer, and expanded its seasonal and limited
edition offerings in 2013.78
On the local level, an abundance of smaller startups were
entering the craft market, too. In
2014, 456 new microbreweries opened in the US, a 27.8% rise
over the year before. Meanwhile,
159 new brew pubs were launched, representing an annual
increase of 10.3%.79 California had
the largest number of craft breweries of any state with 431.
Vermont had the highest per capita,
with 8.6 craft breweries per 100,000 adults.80 All competed to
offer fresh, flavorful beers to
discerning craft consumers.
Brooklyn Brewery in 2015
From 2010 onward Brooklyn Brewery’s sales rose steadily. By
2014 the firm was recognized as
one of the top 10 craft breweries in the US, producing 260,000
barrels with $60 million in sales.
PRODUCTION AND COSTS
The company expanded its Brooklyn brewhouse in 2011 with
new equipment that could brew

close to 100,000 barrels a year. Still, 20% of volume was
produced in Williamsburg and 80% in
Utica. Matt Gordon explained: “Utica’s batch size is about 500
barrels at a time….For products
like Brooklyn Lager, where we’re running thousands of
cases…it creates a lot of efficiencies….
Brooklyn is a much smaller facility, designed for specialty
batch production.… It’s great for
the higher-end products.” 81 But there were challenges to this
model, too. Gordon noted,
“When we produce in Utica, we have much less control over the
timing of production. We can
request a certain number of brews per month, try to suggest they
be brewed on certain
days.…but in the end that facility is worried about other
production, including their own beers
[Saranac brands].”82
See Exhibit 13 for all cost components of producing a typical
craft beer.
Shipping costs were worrisome, too. As Gordon explained,
“Managing the supply chain from
upstate New York, especially during the winter, has at times
been a challenge…it’s costly….In
NYC we are able to compete, but as we get further away, trying

to ship to states like Texas or
Tennessee, where sales prices are lower and shipping costs are
higher, we can’t really discount
the way that [Sam Adams and Sierra Nevada] can and that hurts
our business.”83 (See Exhibit
14 for Brooklyn Brewery shipping costs.)
BRAND MARKETING
Brooklyn Brewery continued to tie its brand closely to its native
borough. By 2015
Williamsburg was considered “the home of a global youth quake
of fashion, music and
Course for Growth
2021.
https://costly�.In
https://adults.80
https://10.3%.79

culture.” 84 The brewery was both a driver and a beneficiary of
this revitalization. It had
sponsored local events—such as the Celebrate Brooklyn!
concert series and Brooklyn Lager’s
Best Indie Bandsearch—and by 2015 was donating beer to over
100 local non-profits per
month, mainly small grass roots organizations. They also took
Brooklyn “on the road,”
sponsoring a multi-city Brooklyn Brewery Mash festival each
summer.
Some pundits claimed that the Brooklyn brand was starting to
suffer from its own success,
becoming expensive and increasingly corporate. Local headlines
exclaimed “So much for that:
Brooklyn is now officially over”85 But the brewery’s leaders
felt a strong foundation remained.
Steve Hindy commented “Brooklyn is known all over the
world….it’s become a by-word for
young, entrepreneurial kinds of neighborhoods…When you go

to any city they will show you
the ‘Brooklyn’ neighborhood in their town….‘Brooklyn’ has
been a big win for us.”86
PRODUCT MIX AND PRICING
About half of Brooklyn Brewery’s total sales volume was
Brooklyn Lager, with its seasonal
ales the second best selling product. Customer preferences
varied by geography, with New
York City drinkers preferring Brooklyn Lager while Midwest
customers favored seasonal ales.
Among the firm’s export customers, UK beer drinkers showed a
strong preference for Lager
while Swedish and Norwegian consumers were more
adventurous, drinking Brooklyn
Brewery’s core and specialty beers in large amounts. (See
Exhibit 15 for the product mix by
geographic region.)
Off-premise sales accounted for 47% of the company’s US
volume in 2014. (See Exhibit 16 for
product mix on- versus off-premise.) In terms of the prices
consumers found in stores,
Brooklyn Brewery averaged a dollar or two higher than other
crafts, depending on packaging.

(See Exhibit 17 for Brooklyn Brewery costs and prices versus
competitors’ beers.) When
Consumer Reports did a comparison of average US prices for
six-pack bottles of beer, Brooklyn
Lager was $9.81 versus Sierra Nevada at $9.49, Sam Adams
Boston Lager at $8.60, and Blue
Moon Belgian White Ale at $8.25.87 However Brooklyn Lager
ranked #1 as “best tasting”
among 69 craft beers, when Consumer Reports experts ranked
the category in 2013.88
On-premise sales accounted for 53% of Brooklyn Brewery’s
volume in 2014 and were highly
profitable. “Just selling draft beer locally—those are really high
margins,” recalled Potter.89
The opportunity to expand this area of the business remained
strong. A 2015 study of 6,000
bars and restaurants found “when consumers go out, they’re
trading up to more expensive
drinks.”90 Craft beers represented 31% of on-premise beer sales
volume in the US despite its
significant price differential: craft beers averaged $6 per glass
versus $4.25 for domestic
mainstream beer.91
NEW PRODUCT DEVELOPMENT

Brooklyn Brewery came up with new products by testing novel
beers directly with consumers.
“We don’t do any market research,” explained Hindy. “We look
to Garrett Oliver to lead our
brewing team and come up with ideas….it’s kind of trial and
error.”92 Oliver clarified this
further: “I am the ‘chef’ of the brewery…What we’re trying to
do is to create something which
is actually beautiful.…rather than engineering something from
the point of view of ‘what do
Growth | Page 12
2021.
https://Potter.89

we think is going to sell?’…It’s a completely different
[approach], which is why we don’t really
do focus groups. It’s up to the consumer whether or not we’ve
succeeded.”93
This development method led to many successful product
launches such as Brooklyn Black
Chocolate Stout (a 2009 and 2011 World Beer Cup gold medal
winner) and Brooklyn Pilsner
(a 2010 and 2011 Silver medalist at the World Beer
Championships). Other new beers that
made it into production included Brown Ale, American Ale,
East IPA, Greenmarket Wheat,
and Sorachi Ace (named for its rare Japanese hops). However,
not all experiments were
winners. “We made [a beer] called the Concoction…kind of like
a scotch whiskey sour with
ginger and then you float some really peaty single malt on top,”
recalled Hindy, “some people
loved it. But most people said ‘what the hell did you put in
this?’ so it doesn’t always work
but that’s the game we play.”94
The company took note of new non-beer products launched by

competitors, particularly hard
ciders, a category with nearly $400 million of sales by 2014. 95
Eric Ottaway said, “We’ve
debated the cider thing. [This] is New York State, the Big
Apple, etc…. it would seem kind of
like a natural…I’m sure we could sell some cider, but it seems
like a bit of a distraction.”
At the end of 2014 Brooklyn Brewery’s product line, as noted
on its website, included 11
perennial (year-round) beers, six rotating seasonal ales, three
specialty brews in distinctive 750
ml bottles, five “quarterly experiments” and 18 limited-issue
Brewmaster Reserve offerings.
(See Exhibit 18 for all Brooklyn Brewery beer products.)
RETAIL OPPORTUNITIES
Brooklyn Brewery had experimented with direct-to-consumer
retail efforts with mixed
success. They tested web sales with a site called totalbeer.com,
which folded in 2000. A 2008
partnership to launch ‘Brooklyn Beer Garden’ restaurants in
NYC’s airports did well initially,
but then floundered. As Hindy recalled “it was all great until
the owner of the restaurants sold

to Host Marriott…[and] they go for the lowest common
denominator.…We entrusted a retailer
with our brand and the place became kind of shabby. We
insisted they close it down.” 96
Yet senior management remained interested in exploring retail
options. As Eric Ottaway
explained “there’s a tremendous opportunity to do retail …We
think that Brooklyn can have
a really strong and effective presence…At this point we’re
actually leaving a huge opportunity
on the table.” Finding the right partner would be the key to
success. Robin Ottaway concurred,
“We’re not in the bar and restaurant business…What we have to
do is figure out who we are,
because we can’t do Brooklyn Brewery Night Club in one
market, Brooklyn Brewery Sushi in
another, and Brooklyn Brewery Pizza in another.”97
GLOBAL REACH
Among the 80 US craft brewers exporting beers in 2014,
Brooklyn Brewery was the largest.
Nearly one-third of the firm’s volume was shipped overseas
each year. 98 After New York City,
Brooklyn Lager’s second largest geographic sales market was
Sweden. 99 The average

consumer price for a bottle of Brooklyn Lager in Europe was
€5-€7, same as an imported
Budweiser, but twice the charge for a local European brew.100
Course for Growth
2021.
https://totalbeer.com

The brewery worked with diverse partners to tap different
international markets. When Oliver
went to Copenhagen to receive Carlsberg’s Semper Ardens
Award, the two companies
developed a collaborative partnership. Carlsberg distributed
Brooklyn Brewery beers across
Scandinavia. The firms opened the new Nya Carnegiebryggeriet
or New Carnegie Brewery

together in Sweden—the first European craft brewery to be
operated by an American firm.101
Garrett Oliver also collaborated with Birra Amarcord
(Amarcord Brewery) in Italy on new
beers to compliment Italian cuisine. He worked with Belgium’s
Brasserie d’Achouffe
(Achouffe Brewery) to develop Brooklyn Cuvée d’Achouffe.
Some of the new beers were
brewed and sold only in Europe; others were distributed in
Europe and the US, too.
Brooklyn Brewery’s European business required careful
attention to succeed. The continent
was home to 4,000 breweries and competition was fierce.
Consumer beer-drinking habits
varied widely from nation to nation. For example, only 15% of
Poles drank beer off premise,
while 55% of Portuguese did so. Consumer prices varied widely
too—a pint of beer in Porto,
Portugal, could cost as little as US$2 while a similar pint in
Bergen, Norway cost US$11. The
difference was explained by cost and tax variations between
particular countries, but vigilance
was needed to track changing markets. 102 Robin Ottaway
described the firm’s approach:

“You’ve got to look at each market [separately]…In certain
countries our beer is just going to
be way too expensive to sell any volume… Sometimes the
market’s just not big enough…We
look at two criteria: is there a market for our brand and do we
have a good partner?”103
Looking Ahead
By 2018, Brooklyn Brewery had reaped the rewards of the
strong Brooklyn brand and the
thriving craft beer industry it had helped to build. However, in
2016-2017, many craft brewers
begain reporting declines in sales, reflecting an overall
deceleration in growth.104 Moreover,
with the success came an influx of competitors, both large and
small. Finally, Brooklyn
Brewery’s lease on its iconic Williamsburg location was set to
expire in 2025, with no obvious
location for a new facility. Actions taken relating to the
following issues would determine
Brooklyn Brewery’s success the years to come:
consolidate brewing in-house, and
eliminate F.X. Matt Brewing costs as a contractor

US or overseas
o launch a retail presence and, if so,
how
the success of Sam Adams
Growth | Page 14
2021.

Exhibits
Exhibit 1
Brooklyn Brewery Logo
Logo Tap Handle
Bottle and Six Pack Bar Glass
Source: Company documents.
Course for Growth

2021.
Exhibit 2
Top US Craft Breweries (based on sales volume)
Rank Brewing Company City State Rank Change
1 Boston Beer Co. Boston MA 0
2 Sierra Nevada Brewing Co. Chico CA 0
3 New Belgium Brewing Co. Fort Collins CO 0
4 Gambrinus San Antonio TX 0
5 Lagunitas Brewing Co. Petaluma CA +1

6 Deschutes Brewery Bend OR -1
7 Bell's Brewery, Inc. Galesburg MI 0
8 Duvel Moortgat USA Kansas City & Cooperstown MO/NY
N/A
9 Brooklyn Brewery Brooklyn NY +2
10 Stone Brewing Co. Escondido CA 0
Note: Rank change indicates whether a brewery moved up
(positive) or down (negative) the rankings
versus the firm’s position a year ago.
Source: Brewer’s Association List of Top 50 Brewers of 2013,
based on 2013 beer sales volume,
http://beerstreetjournal.com/top-50-craft-breweries-2013-sales;
https://www.brewersassociation.org/attachments/0001/4525/CB
P13_Top_50.pdf.
Growth | Page 16
2021.
http://beerstreetjournal.com/top-50-craft-breweries-2013-sales
https://www.brewersassociation.org/attachments/0001/4525/CB
P13_Top_50.pdf

Exhibit 3
Brooklyn Brewery Annual Sales (by volume and in dollars)
Brooklyn Brewery
Sales 2009 2010 2011 2012 2013 2014
Volume Shipped
Bbls (000)
90 108 140 176 216 260

Annual Revenues
In $ Millions
18 NA 35 50 NA 60
Note: Bbls means barrels; in the US each barrel is equal to 31
gallons.
Sources: www.beerinsights.com, “Small, Specialty Brewer and
Brewpub Shipments 2009-2013,”
accessed February, 1, 2015; Columbia CaseWorks interview
with Eric Ottaway, April 2015; “Top
Entrepreneurs of 2009,” Crain’s New York,
http://www.crainsnewyork.com/gallery/20090501/FEATURES/5
01009996/1;
http://www.nytimes.com/2013/02/14/business/global/a-
brooklyn-specialty-brewer-dares-the-french-
market.html; Slide 21 in
http://www.slideshare.net/gustavopereira5/brooklyn-brewery-
and-beer-market-
in-sweden.
Course for Growth
2021.
http://www.beerinsights.com/
http://www.crainsnewyork.com/gallery/20090501/FEATURES/5
01009996/1

brooklyn-specialty-brewer-dares-the-french-market.html
and-beer-market-in-sweden
and-beer-market-in-sweden

Exhibit 4
Top Countries for Total Beer Consumption (ranked by beer
volume
consumed in 2013 in kiloliters)
2013 2012
Consumption Global Consumption Global
2013 2012 Volume Market Growth Rate Volume Market
Rank Rank Country (thousand kl) Share (%) 2012-2013 (%)

(thousand kl) Share (%)
1 1 China 4.631.3 24.5 4.8 4,420.0 23.5
2 2 United States 2,408.2 12.8 -1.3 2,441.9 13.0
3 3 Brazil 1,252.0 6.6 -2.0 1,277.6 6.8
4 4 Russia 1,005.6 5.3 -8.0 1,093.0 5.8
5 5 Germany 841.0 4.5 -2.2 859.8 4.6
6 6 Mexico 673.0 3.6 -1.9 685.7 3.7
7 7 Japan 548.9 2.9 -1.0 554.4 3.0
8 8 United Kingdom 424.2 2.2 -1.3 429.8 2.3
9 9 Spain 364.8 1.9 -0.6 367.0 2.0
10 11 Vietnam 360.1 1.9 7.3 335.8 1.8
11 10 Poland 351.1 1.9 -3.6 364.3 1.9
12 12 South Africa 315.0 1.7 0.0 315.0 1.7
13 13 Ukraine 276.0 1.5 -8.2 300.5 1.6
14 15 India 243.6 1.3 14.1 213.4 1.1
15 18 South Korea 227.7 1.2 15.2 197.6 1.1
16 17 Venezuela 212.6 1.1 3.2 206.0 1.1
17 14 Canada 212.0 1.1 -2.6 217.6 1.2

18 16 Colombia 210.7 1.1 0.9 208.9 1.1
19 20 Czech Republic 190.9 1.0 0.2 190.5 1.0
20 19 France 186.3 1.0 -3.2 192.5 1.0
21 23 Thailand 183.7 1.0 0.3 183.2 1.0
22 21 Argentina 182.8 1.0 -1.4 185.3 1.0
23 24 Australia 174.3 0.9 -0.3 174.8 0.9
24 22 Romania 173.5 0.9 -6.1 184.8 1.0
25 25 Italy 166.4 0.9 -1.0 168.1 0.9
Source: Kirin Beer University Report Global Beer Consumption
by Country in 2013, “Global Beer
Consumption Reached a Record High in 2013, Marking 28
Consecutive Years of Growth. Asia and Africa's
Strong Consumption Acted as the Driving Force.,” December
24, 2014,
http://www.kirinholdings.co.jp/english/news/2014/1224_01.html
; Kirin Beer University Report Global Beer
Consumption by Country in 2012, “Global Beer Consumption
Marks a Record High for the 27th
Consecutive Year,” January 8, 2014,
.
Growth | Page 18

2021.
Exhibit 5
Top Countries for Per Capita Beer Consumption (ranked by
liters

consumed per person in 2013)
Per-capita Beer Consumption
Total 633-ml Bottle
Consumption Consumption Bottle difference Volume
2013 2012 Volume Volume Equivalent 2012-2013 Ratio
Rank Rank Country (thousand kl) (liters) (bottles) (bottles)
(Japan = 1)
1 1 Czech Republic 147.1 232.4 -2.3 3.4 190.9
2 2 Namibia 108.6 171.6 -3.3 2.5 25.0
3 3 Austria 105.9 167.3 -3.4 2.5 89.8
4 4 Germany 101.7 160.7 -3.4 2.4 841.0
5 5 Belize 99.4 157.0 1.0 2.3 3.3
6 8 Estonia 93.6 147.9 -1.5 2.2 12.0
7 6 Poland 91.9 145.2 -5.4 2.1 351.1
8 7 Lithuania 89.5 141.4 -8.9 2.1 27.0
9 10 Romania 79.9 126.2 -7.9 1.9 173.5
10 11 Finland 79.6 125.8 -1.3 1.8 43.2
11 9 Ireland 79.2 125.1 -10.1 1.8 43.3
12 12 Spain 77.7 122.7 -1.2 1.8 364.8
13 13 United States 76.2 120.4 -2.5 1.8 2408.2
14 21 Gabon 74.8 118.2 2.1 1.7 12.5
15 14 Australia 74.7 118.0 -1.8 1.7 174.3
16 19 Slovenia 74.3 117.4 -0.3 1.7 15.4
17 16 Croatia 74.3 117.4 -1.1 1.7 31.9
18 18 Bulgaria 73.5 116.1 -1.5 1.7 53.1
19 15 Slovakia 73.0 115.3 -3.3 1.7 39.8
20 22 Netherlands 72.6 114.7 -0.1 1.7 121.6
21 20 Belgium 72.0 113.7 -3.2 1.7 80.2
22 23 Panama 70.8 111.8 -1.0 1.6 27.3
23 25 Venezuela 69.9 110.4 1.8 1.6 212.6
24 17 Latvia 69.8 110.3 -7.8 1.6 14.3
25 31 Congo 67.4 106.5 4.5 1.6 30.0

26 26 United Kingdom 67.4 106.5 -2.0 1.6 424.2
27 27 Brazil 66.9 105.7 -2.2 1.6 1252.0
28 34 New Zealand 64.1 101.3 2.1 1.5 28.9
29 24 Montenegro 64.1 101.3 -10.4 1.5 4.0
30 30 Hungary 63.2 99.8 -2.3 1.5 63.0
31 28 Ukraine 61.0 96.4 -7.9 1.4 276.0
32 36 Denmark 60.4 95.4 -1.5 1.4 34.0
33 33 Serbia 60.3 95.3 -5.2 1.4 43.2
34 35 Canada 60.3 95.3 -3.4 1.4 212.0
35 37 South Africa 59.7 94.3 -0.7 1.4 315.0
Reference
47 54 South Korea 46.2 73.0 9.3 1.1 227.7
52 50 Japan 43.1 68.1 -0.6 1.0 548.9
Source: Kirin Beer University Report Global Beer Consumption
by Country in 2013, “Global Beer
Consumption Reached a Record High in 2013, marking 28
Consecutive Years of Growth. Asia and Africa's
Strong Consumption Acted as the Driving Force.,” December
24, 2014,
.
Course for Growth
2021.

Exhibit 6
Industry Consolidation Trends
NUMBER OF US MACRO BREWERS

INDUSTRY CONCENTRATION MEASURES
Notes: CR4 indicates the Four-Firm Concentration Ratio, which
is the proportion of total output in an
industry produced by the four largest firms; HHI denotes the
Herfindahl-Hirschman Index, another
commonly accepted measure of market concentration.
Source: Jayendra Gokhale and Victor J. Tremblay, “Competition
and Price Wars in the US Brewing
Industry,” Beeronomics Conference at UC Davis,
November 3, 2011, http://aic.ucdavis.edu/cwe/Tremblay.pdf
Growth | Page 20
2021.
http://aic.ucdavis.edu/cwe/Tremblay.pdf

Top Global Beer Firms’ Production Capabilities
Company
Countries with
Brewery Operations
# Breweries Total
Worldwide
# Breweries Operating in the
US
AB InBev 23 160 11
SAB MillerCoors 33 104 10
Heineken 70 171 --
Carlsberg S/A 40 77
Imported to the US by St. Killian
Importing, MA
Sources: AB InBev and Heineken data from MarketLine
Industry Profile: Beer in the United States,
August, 2014, www.marketline.com ; SABMiller data from
http://www.statista.com/statistics/269564/sabmillrs-number-of-
breweries-worldwide-by-region/;
Carlsberg S/A data from
http://www.carlsberggroup.com/investor/downloadcentre/Docu
ments/Annual%20Report/Carlsberg_AS
_Annual_Report_2014_WEB.pdf.

| Brooklyn Brewery: Setting the
Course for Growth
2021.
http://www.marketline.com/
http://www.statista.com/statistics/269564/sabmillrs-number-of-
breweries-worldwide-by-region/
http://www.carlsberggroup.com/investor/downloadcentre/Docu
ments/Annual%20Report/Carlsberg_AS

Exhibit 8
Number of US Breweries by Produ ction Size in 2014
Production Size Based on
Barrels Produced in 2014 Brewery Count % of Firms in this
Category
1 - 1,000 Barrels 2,628 71.8
1,001 - 7,500 711 19.4
7,501 - 15,000 100 2.7
15,001 - 60,000 122 3.3
60,001 - 100,000 21 0.6
100,001 - 1,999,999 55 2.5
2,000,000 - plus 21 0.6
Total Number of Breweries 3,658 100.0
Note: % of Total refers to the percentage e of beer producing
entities this size in the United States.

Source: National Beer Wholesalers’ Association, May 10, 2015,
https://www.nbwa.org/resources/industry-fast-facts.
Growth | Page 22
2021.
https://www.nbwa.org/resources/industry-fast-facts

Exhibit 9
Number of US Craft Brewers, by Category
Note: Categories are defined as:
Brewpub—A restaurant-brewery that sells 25% or more of its
beer on site, often dispensed
directly from the brewery’s storage tanks; where allowed by law
a brewpub can sell beer “to-
go” and /or distribute to off-site accounts (Note: The Brewers
Association re-categorizes a
company as a microbrewery if its off-site-distributed beer sales
exceed 75 percent.);
Microbrewery—A brewery that produced less than 15,000
barrels (17,600 hectoliters) of beer
per year with 75% or more of its beer sold off-site;
Regional Craft Brewery—A brewery with an annual beer
production anywhere between
15,000 and 6,000,000 barrels; over 50% or more of their volume
focuses on all-malt beers.
Source: Brewers Association,
http://www.brewersassociation.org/statistics/number-of-
breweries,
accessed May 8, 2105.
Course for Growth

2021.
http://www.brewersassociation.org/statistics/number-of-
breweries

Exhibit 10
The 20 Most Popular Beers in America (ranked by USD sales)
Annual Sales Annual Price Per ABV BA
Beer ($) Cases Sold Case ($) Owner (%)1 Score2 Style
Bud Light 5,946,766,000 294,749,300 20.18 AB InBev 4.2 47
Light Lager
Coors Light 2,360,430,000 118,469,600 19.92 MillerCoors 4.2
50 Light Lager
Budweiser 2,110,352,000 104,390,500 20.22 AB InBev 5.0 57
American Adjunct Lager3
Miller Lite 1,868,866,000 94,262,870 19.83 MillerCoors 4.17
53 Light Lager
Corona Extra 1,221,351,000 41,170,180 29.67 Constellation*
4.6 56 American Adjunct Lager
Natural Light 1,122,770,000 72,203,900 15.55 AB InBev 4.2 43
Light Lager
Busch Light 844,276,000 56,008,580 15.07 AB InBev 4.1 46
Light Lager
Michelob Ultra (Light) 777,196,700 31,626,370 24.57 AB InBev
4.2 47 Light Lager
Busch 673,394,400 43,374,170 15.53 AB InBev 4.3 49
American Adjunct Lager
Heineken 669,337,000 22,449,080 29.82 Heineken N.V. 5.0 64

Euro Pale Lager
Modelo Especial 574,636,000 21,648,650 26.54 Constellation*
Keystone Light 493,993,600 33,586,780 14.71 MillerCoors 4.2
46 Light Lager
Miller High Life 476,895,100 30,259,841 15.76 MillerCoors 4.6
63 American Adjunct Lager
Natural Ice 335,392,900 21,708,278 15.45 AB InBev 5.9 45
Bud Light Platinum 321,408,700 12,202,304 26.34 AB InBev
6.0 54 Light Lager
Pabst Blue Ribbon 288,487,900 17,807,895 16.20 TSG/E.K.
Bud Light Lime 285,037,200 10,870,984 26.22 AB InBev 4.2 53
Light Lager
Bud Ice 248,717,600 14,410,058 17.26 AB InBev 5.5 47
Yuengling Lager 248,673,600 11,370,535 21.87 Yuengling 4.4
78 American Amber
Bud Light Lime Straw 246,550,800 7,107,259 34.69 AB InBev
8.0 56 American Malt Liquor
Ber Rita
Notes: 1 ABV is alcohol by volume as a percent
2 BA Score indicates the Beer Advocate rating, an average of
millions of consumer reviews; ratings are
as follows: 95-100 = world-class; 90-94 = outstanding; 85-89 =
very good; 80-84 = good; 70-79 = okay;
60-69 = poor; less than 60 = awful.
3 The definition of ‘American adjunct lager’ is “light bodied,
pale, fizzy lagers featuring low bitterness,
thin malts, and moderate alcohol; … mass-production cuts
flavor, and sometimes costs, with adjunct
cereal grains such as rice and corn.
Sources: Kate Bratskeir, “The 20 Most Popular Beers Indicate

That, Deep Down, Americans Are Frat Boys,”
The Huffington Post, March 4, 2015,
http://www.huffingtonpost.com/2015/03/04/popular-beers-in-
america-
_n_6787494.html; chart was originally created by Joshua Malin,
Feb. 20, 2015, for Vine Pair at
http://vinepair.com/wine-blog/20-most-popular-beers-america;
http://www.beeradvocate.com/community/threads/beeradvocate-
ratings-explained.184726.
Growth | Page 24
2021.
america-_n_6787494.html
america-_n_6787494.html
http://vinepair.com/wine-blog/20-most-popular-beers-america
http://www.beeradvocate.com/community/threads/beeradvocate-
ratings-explained.184726

Exhibit 11
Minimum Efficiency Scale Estimates for National Brewers
Market Share
of
National MES-Output
Brewers (million MES-MS
Year (percent) barrels) (percent) N N* K
1950 16 0.1 0.1 350 840 0
1960 21 1.0 1.5 175 87 88
1970 45 8.0 6.4 82 16 66
1980 59 16.0 9.0 40 11 29
1990 79 16.0 8.4 29 12 17
2000 89 23.0 14.0 24 7 17

2009 93 23.0 14.0 19 7 12
Notes: MES-Output measures minimum efficient scale measured
in millions of (31-gallon) barrels.
MES-MS represents the market share needed to reach minimum
efficient scale. N is the number of
macro brewers. N* represents the cost-minimizing industry
structure (i.e., the number of firms that the
industry can support if all firms produce at minimum efficient
scale).
MES - MS = (Industry Output)/MES. N* = 100/MES-MS;
rounding errors explain the discrepancy in
calculations. K = N - N* when (N - N*) >0 and 0 otherwise.
Sources: Steinberg (1980), the Statistical Abstract of the United
States, Tremblay et al. (2005), and
Tremblay and Tremblay (2005); Jayendra Gokhale and Victor J.
Tremblay, “Competition and Price
Wars in the US Brewing Industry,” Journal of Wine Economics
7, no. 2 (2012): 228.
Course for Growth
2021.

Exhibit 12
Comparison of 2014 Key Financials: Industrial Brewer AB
InBev vs.
Craft Brewer Boston Beer Company
KEY STATISTICS
Anheuser-Busch
InBev Boston Beer Company

For the Fiscal Period Ending 12 months 12 months
Dec-31-2014A Dec-27-2014A
Total Revenue $47,063.00 $903.0
Growth Over Prior Year 8.95% 22.2%
Gross Profit $28,307.00 $465.0
Margin % 60.15% 51.5%
EBITDA $17,997.00 $183.5
Margin % 38.24% 20.3%
EBIT $14,984.00 $148.3
Margin % 31.84% 16.4%
Earnings from Cont. Ops. $11,302.00 $90.7
Margin % 24.01% 10.0%
Net Income $9,216.00 $90.7
Margin % 19.58% 10.0%
Diluted EPS Excl. Extra Items 5.54 6.69
Growth Over Prior Year -36.47% 29.3%
Source: S&P Capital IQ. Financials posted June 9, 2015.
Growth | Page 26
2021.

Exhibit 12 (continued)
INCOME STATEMENTS
Anheuser- Boston Beer
Busch InBev Company
Reclassified 12 months
12 months Dec-27-2014
For the Fiscal Period Ending Dec-31-2014
Total Revenue
47,063.0 903.0
Cost Of Goods Sold
18,756.0 438.0
Gross Profit
28,307.0 465.0
Selling General & Admin Exp.
14,509.0 316.7

- -
Depreciation & Amortization
Other Operating Expense/(Income)
(1,186.0) -
Other Operating Exp., Total
13,323.0 316.7
Operating Income
14,984.0 148.3
Interest Expense
(2,333.0) -
Interest and Invest. Income
335.0 0.0
Net Interest Exp.
(1,998.0) 0.0
Income/(Loss) from Affiliates
9.0
Currency Exchange Gains (Loss)
255.0
Other Non-Operating Inc. (Exp.)
11.0 (1.0)
EBT Excl. Unusual Items
13,261.0 147.4
Restructuring Charges
(277.0)

Merger & Related Restructuring Charges
(77.0)
Asset Write down
- (1.8)
Gain (Loss) On Sale Of Assets
162.0 -
Other Unusual Items
732.0 -
EBT Incl. Unusual Items
13,801.0 145.6
Income Tax Expense
2,499.0 54.9
Earnings from Cont. Ops.
11,302.0 90.7
Net Income to Company
11,302.0 90.7
Minority Int. in Earnings
(2,086.0) -
Net Income
9,216.0 90.7
Source: S&P Capital IQ. Financials posted June 9, 2015.
Course for Growth

2021.
Exhibit 13
Cost % Breakdown of Components in a Typical Bottle of Craft
Beer
Note: Loss indicates the amount of beer that was lost due to
spills and production transfer between
machines; if loss is minimized the Brewer’s Margin will be
higher.
Source: Joe Satran, “Here’s How a Six Pack of Craft Beer Ends
Up Costing $12,” HuffingtonPost.com,

September 12, 2014,
http://www.huffingtonpost.com/2014/09/12/craft-beer-
expensive-
cost_n_5670015.html.
Growth | Page 28
2021.
expensive-cost_n_5670015.html
https://HuffingtonPost.com

Exhibit 14
Brooklyn Brewery Shipping Costs, from Utica to Key
Destinations
Cost Per Container /
Region Destination Trailer from Utica ($)
EXPORT UK 3,000
EXPORT Sweden 3,000
EXPORT Australia 3,500
EXPORT Brazil 3,500
DOMESTIC NYC 775
DOMESTIC Northeast 875
DOMESTIC Midwest 1,100
DOMESTIC Southeast 1,850
Note: Brooklyn Brewery did not have distribution in western
states, so cost data unavailable for that
region.
Source: Brooklyn Brewery data averages, provided to Columbia
CaseWorks, May 19, 2015.
Course for Growth

Exhibit 15
Brooklyn Brewery product sales mix by geographic region 2014
BB Product Total US Northeast Sweden
Group NYC excluding NYC excluding NYC Midwest South UK
and Norway
Lager 56% 31% 30% 25% 40% 92% 67%
Seasonal 19% 37% 38% 46% 30% 4% 1%
Beers
Legacy Core 18% 23% 24% 21% 17% 4% 27%
Other Beers 7% 9% 8% 8% 13% -- 5%
Note: Definition of Product Groups: Lager is Brooklyn Lager;
Seasonal beers include Winter Ale,
Summer Ale, Pumpkin Ale, Oktoberfest, Dry Irish Stout, and
Black Chocolate Stout; Legacy Core
includes Pilsner, Brown Ale, Pennant 55, East IPA, Variety
Packs, Brooklyner Weisse; Other Beers
include Greenmarket Wheat, Sorachi Ace, ½ Ale, BLAST!,
Shackmeister Ale, Local 1, Local 2,
quarterly draft and 750ml bottle releases, specialty and one-off
beers.
Source: Brooklyn Brewery company documents.
Exhibit 16
Brooklyn Brewery 2014 US Sales Mix
Package Size Total % Mix by Volume On-Premise % Mix Off-
Premise % Mix

1/2 barrel 36 68 5
1/6 barrel 7 12 2
1-6 pack Bottles 37 12 62
1-4 pack 16oz Cans 2 3 1
1-12 pack Cans 7 4 10
1-750 ml Bottle 2 1 3
Note: For 2014 total sales breakdown was 53% on-premise and
47% off-premise
Source: Brooklyn Brewery domestic-only data averages
provided to Columbia CaseWorks, May 19,
2015.
Growth | Page 30
2021.

Exhibit 17
Brooklyn Brewery Costs and Prices (by package size)
BB BB Average BB Average SUPER PREMIUM CRAFT
COMPETITOR
Average Price To Price To Average Price to Average Price to
Package Size Cost ($) Retail ($) Consumer ($) Consumer ($)
Consumer ($)
1/2 barrel 40 150 -- -- --
1/6 barrel 20 70 -- -- --
1-6 pack Bottles 3 -- 10 8 9
1-4 pack Bottles 3 -- 10 -- 10
1-12 pack Bottles 6 -- 16 13 15
1-4 pack 16oz Cans 3 -- 9 7 9

1-12 pack Cans 6 -- 17 13 15
1-750 ml Bottle 3 -- 12 -- 11
Note: Examples of Super Premium brands include Michelob
Ultra (Light), Bud Light Platinum Lager, Bud
Light Lime, and Blue Moon Belgium Ale; examples of craft
competitor brands include Sierra Nevada Pale
Ale, Sam Adams Lager, and Sam Adams Summer Ale.
Sources: Brooklyn Brewery domestic-only data averages
provided to Columbia CaseWorks, May 19, 2015.
Course for Growth
2021.

Exhibit 18
Brooklyn Brewery Product List
Perennials Seasonals 750ML
Bottles
Quarterly
Experiments*
Brewmaster
Reserve*
Brooklyn Lager
Brooklyn Sorachi
Ace

Brooklyn Blast!
Brooklyn ½ Ale
Brooklyn Pilsner
Brooklyn
Greenmarket
Wheat
Brooklyn Brown
Ale
Black Chocolate
Stout
Brooklyn Dry Irish
Stout
Brooklyn Summer
Ale
Brooklyn
Oktoberfest
Post Road
Pumpkin Ale
Brooklyn Winter
Ale
Brooklyn Local 1
Brooklyn Local 2

Brooklyn Sorachi
Ace
Quintaceratops
K is for Kriek
Hand & Seal
Cuvée Noire
Wild Streak
I Wanna Rye-It
Wild Horse Porter
Quadraceratops
Weizenhammer
Ridgy-Didge
Hammarby
Syndrome
Fire & Ice
Brooklyn Cuvée
la Boîte
Brooklyn East IPA
American Ale
Brooklyn

Shackmeister
Brooklyn Best
Bitter
Scorcher #366
There Will Be
Black
Cuvée Noire
Fiat Lux
Brooklyn Gold
Standard Export
Mary’s Maple
Porter
The Companion
The Concoction
Main Engine
Start
Buzz Bomb Ale
Note: Quarterly Experiments and Brewmaster Reserve are all
one-time releases that are not repeated.
Source: Brooklyn Brewery, www.brooklynbrewery.com as of
July 9, 2015.

Growth | Page 32
2021.
http://www.brooklynbrewery.com/
Appendices

Appendix 1
The beer brewing process
Milling – Dried, malted grain is milled down into smaller
particles to better facilitate mashing.
Mashing – Milled grains and hot water are mixed and cooked
together. The starches of the grains are
converted into sugars and begin to flavor the mixture, called
mash.
Lautering – The mash is separated into two parts: “spent” grain
and sugary water, called wort.
Boiling – The wort is moved into a kettle and boiled with hops
and other ingredients to add
flavor/aroma.
Whirlpooling – Solids are removed from the wort through
centrifugal force.
Cooling – The wort is cooled quickly to a temperature (20-26°
Celsius), so live yeast can be added.
Fermenting –Yeast is added and converts the sugars into
alcohol. As the wort ferments it becomes
beer. Fermentation can last two days or several weeks,
depending on the beer style in production.
Maturing – Beer is put in conditioning tanks. Hops, fruits, or
other ingredients are added for more
flavor.
Filtering – Filtering removes remaining solids and stabilizes the
flavor and carbonization of the beer.
Packaging – Beer is put in cans, bottles, or kegs under pressure
to remove oxygen, which alters
flavor.
Note: Some loss/waste of ingredients occurs during the
production process, due to transition between
machines, spills, etc. Amounts can vary from 5% in new

breweries to 15%-20% in older facilities.
Sources: Illustration from The Institute of Brewing and
Distilling, Asia-Pacific Division, May 5, 2015,
Education page, http://www.ibdasiapac.com.au/brewing; text
from the High Desert Museum exhibition
“Brewing Culture: The Craft of Beer,” February-May 2015,
http://www.highdesertmuseum.org/brewing-
culture-craft-beer ; wikipedia.com,
http://en.wikipedia.org/wiki/Brewing, accessed May 6, 2015;
Scott
Metzger, “What does your beer really cost?” The New Brewer,
January/February 2012,
https://www.brewersassociation.org/attachments/0000/8424/JF_
TNB12_Beer_Costing-1.pdf; Brooklyn
Brewery executive interviews April 2, 2015.
Course for Growth
2021.
http://www.ibdasiapac.com.au/brewing
http://www.highdesertmuseum.org/brewing-culture-craft-beer
http://www.highdesertmuseum.org/brewing-culture-craft-beer
http://en.wikipedia.org/wiki/Brewing
https://www.brewersassociation.org/attachments/0000/8424/JF_
TNB12_Beer_Costing-1.pdf
https://wikipedia.com

Appendix 2
Beer Industry Conversion Calculations
1 Barrel = 31 gallons
1 Barrel = 3,968 ounces
1 Barrel = 13.778 cases
1 Liter = 0.26418 gallons
1 Hectoliter = 0.852 barrel
1 Case = 24 12-ounce bottles or cans of beer

Source: Beer Institute, Beer Resource Center, Brewer’s
Almanac, http://www.beerinstitute.org/br/beer-
statistics/brewers-almanac, Standard Beer Industry Calculations
per Excel spreadsheet accessed June
3, 2015.
Growth | Page 34
2021.
http://www.beerinstitute.org/br/beer-statistics/brewers-
almanac,%20Standard%20Beer%20Industry%20Calculations%2
0per%20Excel%20spreadsheet%20accessed%20June%203,%202
015
015
015

Endnotes
1 Tom Potter, Brooklyn Brewery interviews, Columbia Business
School CaseWorks, April 2,
2015. This statement, and all others by Tom Potter unless
otherwise noted, are from an
interview with case writers on April 2, 2015 in New York, NY.
2 Potter interview.
3 Steve Hindy and Tom Potter, Beer School: Bottling Success at
the Brooklyn Brewery (New
Jersey: John Wiley & Sons, 2005), 75.
4 Eric Ottaway, Brooklyn Brewery interviews, Columbia
Business School CaseWorks, April 2,
2015. This statement, and all others by Eric Ottaway unless
5 Hindy and Potter, Beer School, 26.
6 Steve Hindy, Brooklyn Brewery interviews, Columbia
Business School CaseWorks, April
21, 2015. This statement, and all others by Steve Hindy unless
8 Potter interview.
10 Brooklyn Brewery, Garrett Oliver biography,

http://brooklynbrewery.com/about/about-
the-brewery#the-brewmaster-link, accessed May 15, 2015.
11 Potter interview.
13 Alan J. Wax, “Beer Sales are Brewing at Site,” Newsday,
December 6, 2000.
15 Lisa Fickenscher, “From Print to Pint: Newspaper Scions
Hop On at Brooklyn Brewery,”
Crain’s New York Business, May 13, 2012.
16 Employment figure as of 2015.
17 Eric Ottaway interview.
18 MarketLine Industry Profile: Global Beer, 2014, April 24,
2015, www.marketline.com.
19 National Beer Wholesalers Association Industry Fast Facts,
May 10, 2015,
https://www.nbwa.org/resources/industry-fast-facts.
20 https://www.congress.gov/bill/95th-congress/house-bill/1337
21 MarketLine Industry Profile: US Beer , April 24, 2015,
www.marketline.com.
22 John Tierney, “The State of American Beer,” The Atlantic,
April 15, 2014.
23 Advertising Age, Marketing Fact Pack 2015, Beer measured
media spending 2013, December
29, 2014, 12, http://www.slideshare.net/aidelisagutierrez/ad-
age-marketingfact-
pack2015?qid=eb6bb6da-a294-4193-a9c1-
215f551b80c2&v=qf1&b=&from_search=3.
24 Brewers Association, “Craft Brewer Defined,”
https://www.brewersassociation.org/statistics/craft-brewer-

defined, accessed May 8, 2015.
Course for Growth
2021.
http://brooklynbrewery.com/about/about-the-brewery#the-
brewmaster-link
http://brooklynbrewery.com/about/about-the-brewery#the-
brewmaster-link
https://www.nbwa.org/resources/industry-fast-facts
https://www.congress.gov/bill/95th-congress/house-bill/1337
http://www.slideshare.net/aidelisagutierrez/ad-age-
marketingfact-pack2015?qid=eb6bb6da-a294-4193-a9c1-
215f551b80c2&v=qf1&b=&from_search=3
marketingfact-pack2015?qid=eb6bb6da-a294-4193-a9c1-
215f551b80c2&v=qf1&b=&from_search=3
https://www.brewersassociation.org/statistics/craft-brewer-
defined

25 Brewers Association, “National Beer Sales and Production
Data: US Beer Sales Volume
Growth 2014,”
https://www.brewersassociation.org/statistics/national-beer-
sales-production-
data.
26 Lydia Saad, “Beer is Americans’ Adult Beverage of Choice
This Year,” July 23, 2014, Gallup
Inc., http://www.gallup.com/poll/174074/beer-americans-adult-
beverage-choice-year.aspx.
27 Fred Tasker, “What to drink: Americans Want More Craft
Beer and Wine,” Pittsburgh Post-
Gazette, January 2, 2014, http://www.post-
gazette.com/life/libations/2014/01/02/More-wine-
craft-beer/stories/201401020076.
Growth 2014,”
https://www.brewersassociation.org/statistics/national -beer-
sales-production-
data.
29 Julie Johnson, “Don’t Count Beer Out Yet,” Beverage
Dynamics, September/October 2014.

30 www.wikipedia.org citing Andrew Smith, The Oxford
Encyclopedia of Food and Drink in
America 1 (New York: Oxford University Press, 2013), 646,
ISBN 9780199734962.
Growth 2014,”
sales-production-
data.
32 Beer Institute Annual Report 2013/2014,
http://www.beerinstitute.org/assets/uploads/BEER_4167_AR_20
13_For_Web-Final.pdf.
33 Joe Satran, “Here’s How a Six-Pack of Craft Beer Ends Up
Costing $12,”
HuffingtonPost.com, September 12, 2014,
http://www.huffingtonpost.com/2014/09/12/craft-
beer-expensive-cost_n_5670015.html.
34 Satran, “Here’s How a Six Pack of Craft Beer Ends Up
Costing $12.”
35 Matt Gordon, Brooklyn Brewery interviews, Columbia
Business School, CaseWorks, April
2, 2015. This statement, and all others by Matt Gordon unless
36 Jimmy Valm, Brooklyn Brewery interviews, Columbia
Business School, CaseWorks, April

2, 2015. This statement, and all others by Jimmy Valm unless
37 Steve Hindy, “Free Craft Beer!,” The New York Times,
March 29, 2014,
http://www.nytimes.com/2014/03/30/opinion/sunday/free-craft-
beer.html?_r=0.
38 First Research, “Beer, Wine& Distilled Spirits Wholesalers
Industry Profile,” November 12,
2012, http://www.firstresearch.com/Industry-Research/Beer-
Wine-and-Distilled-Spirits-
Wholesalers.html.
39 Steve Hindy, “Don’t Let Big Brewers Win Beer Wars,” CNN,
December 12, 2012,
http://www.cnn.com/2012/12/12/opinion/hindy-beer-wars.
40 Tim Logan, “Beer Battle between Wholesales, Brewers,” St.
Louis Post Dispatch, May 6,
2012, http://www.stltoday.com/business/local/beer-battle-
between-wholesalers-
brewers/article_d7985f04-96d5-11e1-920a-001a4bcf6878.html.
41 “The US Beverage Alcohol Industry: Navigating Brand
Entry,” US Drinks Conference 2010
presentation, http://slideplayer.com/slide/3930398.
Growth | Page 36

2021.
sales-production-data
http://www.gallup.com/poll/174074/beer-americans-adult-
beverage-choice-year.aspx
http://www.post-gazette.com/life/libations/2014/01/02/More-
wine-craft-beer/stories/201401020076
http://www.post-gazette.com/life/libations/2014/01/02/More-
wine-craft-beer/stories/201401020076
http://www.wikipedia.org/
http://www.beerinstitute.org/assets/uploads/BEER_4167_AR_20
13_For_Web-Final.pdf
http://www.nytimes.com/2014/03/30/opinion/sunday/free-craft-
beer.html?_r=0
http://www.firstresearch.com/Industry-Research/Beer-Wine-
and-Distilled-Spirits-Wholesalers.html
http://www.firstresearch.com/Industry-Research/Beer-Wine-

and-Distilled-Spirits-Wholesalers.html
http://www.cnn.com/2012/12/12/opinion/hindy-beer-wars
http://www.stltoday.com/business/local/beer-battle-between-
wholesalers-brewers/article_d7985f04-96d5-11e1-920a-
001a4bcf6878.html
http://www.stltoday.com/business/local/beer-battle-between-
wholesalers-brewers/article_d7985f04-96d5-11e1-920a-
001a4bcf6878.html
http://slideplayer.com/slide/3930398
https://HuffingtonPost.com

42 Logan, “Beer Battle.”
43 Bethany Wall, “On-Premise Alcohol Consumption Trends,”
May 2014, Executive
Summary, Mintel Group.
44 Richard Feloni, “Food Network Chef Robert Irvine Shares
The Top 5 Reasons Restaurants
Fail,” Business Insider, Feb. 25, 2014,
http://www.businessinsider.com/why-restaurants-fail-
so-often-2014-2.
45 Brewers Association, Craft Brewers Off-Premise Sell Sheet,
December 2014,

https://www.brewersassociation.org/wp-
content/uploads/2015/04/Off-Premise-Sell-
Sheet.pdf.
46 Hindy interview.
47 Priya Anand, “10 Things the Beer Industry Won’t Tell You,”
MarketWatch, December 13,
2014, http://www.marketwatch.com/story/10-things-the-beer-
industry-wont-tell-you-2014-
11-28.
48 Advertising Age, Marketing Fact Pack 2015, Beer Measured
Media Spending 2013,
December 29, 2014, 12,
marketingfact-
pack2015.
49 Boston Beer Company, “Boston Beer Reports Fourth Quarter
2013 Results,” press release,
February 25, 2014,
http://www.bostonbeer.com/phoenix.zhtml?c=69432&p=irol -
newsArticle&ID=1903459.
51 Brewers Association, “Number of Breweries: Historic US
Brewery Count,”
https://www.brewersassociation.org/statistics/number-of-
breweries.
52 Jennifer Haderspeck, “Tis the season for craft beer,”
Beverage Industry 104 no. 12,

(December 2013): 20,
http://connection.ebscohost.com/c/articles/92734398/tis-season-
craft-
beer.
53 Brewers Association, “Number of Breweries: Historic US
Brewery Count,”
,https://www.brewersassociation.org/statistics/number-of-
breweries.
54 Brewers Association, “Craft Brewer Defined.”
55 Andy Crouch, “Wasted: How the Craft Beer Movement
Abandoned Jim Koch (and His
Beloved Sam Adams),” Boston Magazine, January 2015,
http://www.bostonmagazine.com/restaurants/article/2015/01/05/
jim-koch-sam-adams-beer/.
56 Tripp Mickle, “Bud Crowded Out by Craft Beer Craze,” Wall
Street Journal, Nov. 23, 2014,
http://www.wsj.com/articles/budweiser-ditches-the-clydesdales-
for-jay-z-1416784086.
57 Glenn Carroll and Anand Swaminathan, “Why the
Microbrewery Movement?
Organizational Dynamics of Resource Partitioning in the US
Brewing Industry,” American
Journal of Sociology, (November 2000): 729, http://faculty-
gsb.stanford.edu/carroll/documents/Carroll-
SwaminathanAJS2000.pdf.
59 Brewers Association, “The Year in Beer: 2014 Craft Beer in
Review from the Brewers

Association,” press release, December 9, 2014,
https://www.brewersassociation.org/press-
releases/year-beer-2014-craft-beer-review-brewers-association.
Course for Growth
2021.
http://www.businessinsider.com/why-restaurants-fail-so-often-
2014-2
http://www.businessinsider.com/why-restaurants-fail-so-often-
2014-2
content/uploads/2015/04/Off-Premise-Sell-Sheet.pdf
http://www.marketwatch.com/story/10-things-the-beer-industry-
wont-tell-you-2014-11-28
http://www.marketwatch.com/story/10-things-the-beer-industry-
wont-tell-you-2014-11-28
marketingfact-pack2015
marketingfact-pack2015
newsArticle&ID=1903459
newsArticle&ID=1903459

breweries
craft-beer
craft-beer
breweries
http://www.bostonmagazine.com/restaurants/article/2015/01/05/
jim-koch-sam-adams-beer/
http://www.wsj.com/articles/budweiser-ditches-the-clydesdales-
for-jay-z-1416784086
http://faculty-gsb.stanford.edu/carroll/documents/Carroll-
SwaminathanAJS2000.pdf
http://faculty-gsb.stanford.edu/carroll/documents/Carroll-
SwaminathanAJS2000.pdf
https://www.brewersassociation.org/press-releases/year-beer-
2014-craft-beer-review-brewers-association

60 Chris Funari, “Mintel: Sales of Craft Beer Could Eclipse $20
Billion in 2014,” Brewbound,
August 13, 2014,
http://www.brewbound.com/news/mintel-sales-of-craft-beer-

could-eclipse-20-
billion-in-2014.
61 Mintel Group, “Craft Beer Sales Surge 110 Percent as
Americans Embrace Sense of
Individual Style,” July 25, 2014, http://www.mintel.com/press-
centre/food-and-drink/craft-
beer-trends.
62 “Craft Beer Sales Surge 110 Percent, Mintel Reports,”
Beverage Industry, July 28, 2014,
http://www.bevindustry.com/articles/87688-craft-beer-sales-
surge-110-percent-mintel-
reports.
63 Evan Benn, “Craft Breweries Lean On Social Media for Free
Advertising,” St. Louis Post-
Dispatch, October 27, 2011,
http://www.stltoday.com/entertainment/dining/bars-and-clubs-
other/hip-hops/craft-breweries-lean-on-social-media-for-free-
advertising/article_b0fbcc77-
29f1-56a1-a8b3-3d08132145f5.html.
64 Data from “Beer Festival Calendar” on
http://www.beerfestivals.org/tools/faqs.html,
accessed June 10, 2015.
65 Ben Steverman, “Americans are Drinking Less but Spending
More on Fancy Booze,”
Bloomberg Business, May 8, 2015,
http://www.bloomberg.com/news/articles/2015-05-

08/americans-are-drinking-less-but-spending-more-on-fancy-
booze.
66 Steverman, “Fancy Booze.”
67 Mickle, “Craft Beer Craze.”
68 Crouch, “Wasted.”
69 Brewers Association, Craft Brewers On-Premise Sell Sheet,
2014,
content/uploads/2015/04/On-Premise-Sell-
Sheet.pdf.
70 Brewers Association Off-Premise Sell Sheet, December
2014,
content/uploads/2015/04/Off-Premise-Sell-
Sheet.pdf.
71 Brewers Association, “The Year in Beer: 2014 Craft Beer in
Review from the Brewers
Association,” press release, December 9, 2014,
https://www.brewersassociation.org/press-
releases/year-beer-2014-craft-beer-review-brewers-association.
72 MarketLine Research, Company Profile: The Boston Beer
Company, Inc., July 10, 2014.
73 Brian Solomon, “King of Craft Beer: How Sierra Nevada
Rules the Hops World,” Forbes,
February 12, 2014,
http://www.forbes.com/sites/briansolomon/2014/02/12/king-of-
craft-beer-

how-sierra-nevada-is-winning-the-hops-war.
74 Tony Kiss, “Area Breweries Investing Millions, Adding
Staff,” Asheville Citizen-Times,
September 10, 2014, http://www.citizen-
times.com/story/news/local/2014/09/10/area-
breweries-investing-millions-adding-staff/15392497/
75 Chris Furnari, “All 50 By 2018: New Belgium CEO Shares
Expansion Schedule,”
Brewbound, July 11, 2013,
http://www.brewbound.com/news/all-50-by-2018-new-belgium-
ceo-shares-expansion-schedule.
Growth | Page 38
2021.
could-eclipse-20-billion-in-2014
could-eclipse-20-billion-in-2014
http://www.mintel.com/press-centre/food-and-drink/craft-beer-
trends
http://www.mintel.com/press-centre/food-and-drink/craft-beer-
trends
surge-110-percent-mintel-reports

surge-110-percent-mintel-reports
advertising/article_b0fbcc77-29f1-56a1-a8b3-
3d08132145f5.html
3d08132145f5.html
3d08132145f5.html
http://www.beerfestivals.org/tools/faqs.html
booze
booze
content/uploads/2015/04/On-Premise-Sell-Sheet.pdf
content/uploads/2015/04/On-Premise-Sell-Sheet.pdf
craft-beer-how-sierra-nevada-is-winning-the-hops-war

craft-beer-how-sierra-nevada-is-winning-the-hops-war
http://www.citizen-times.com/story/news/local/2014/09/10/area-
http://www.citizen-times.com/story/news/local/2014/09/10/area-
ceo-shares-expansion-schedule
ceo-shares-expansion-schedule

76 Emily Bryson York and Josh Noel, “Goose Island Sold to
Anheuser-Busch for $38.8 Million:
Chicago-born brewery's Move Follows Trend among Craft-Style
Beers,” Chicago Tribune,
March 28, 2011.
77 Duane Stanford, “Blue Moon vs. Craft Beer Rivals:
MillerCoors Strikes Back,” Bloomberg
Business, August 8, 2013,
http://www.bloomberg.com/bw/articles/2013-08-08/blue-moon-
vs-

dot-craft-beer-rivals-millercoors-strikes-back.
78 E.J. Schultz, “Shock Top Beer Debuts National Campaign as
it Battles Blue Moon,”
Advertising Age, March 14, 2014,
http://adage.com/article/news/shock-top-debuts-national-
campaign-battles-blue-moon/292157.
79 Brewers Association,
breweries.
80 Brewers Association, “State Craft Beer Sales & Production
Statistics, 2014,”
https://www.brewersassociation.org/statistics/by-state.
81 Gordon interview
82 Gordon interview
83 Gordon interview
84 Anne Szustek, “Hipster Brooklyn has Peaked,” Business
Insider, March 11, 2015,
http://www.businessinsider.com/brooklyn-has-peaked-2015-3.
85 Kim Velsey, “Brooklyn is Now Officially Over: The
Ascendance of Brooklyn, the Lifestyle,
Above All Else,” New York Observer,
http://observer.com/2014/03/so-much-for-that-brooklyn-
is-now-officially-over.
86 Hindy interview.
87 Consumer Reports, “23 Best Craft Beers,” August 2013,
http://www.consumerreports.org/cro/magazine/2013/08/best-
craft-beers/index.html.
88 Stuart Pfiefer, “Consumer Reports Rates Top Craft Beers;

Suds Snobs Indignant,” Seattle
Times, July 2, 2013,
http://www.seattletimes.com/business/consumer-reports-rates-
top-craft-
beers-suds-snobs-indignant.
89 Potter interview.
90 Ben Steverman, “Americans are Drinking Less but Spending
More on Fancy Booze,”
Bloomberg Business, May 8, 2015,
booze.
91 Steverman, “Americans are Drinking Less.”
92 Hindy interview.
93 Garrett Oliver, Brooklyn Brewery executive interviews,
Columbia CaseWorks, April 2,
2015. This statement, and all others by Garrett Oliver unless
94 Hindy interview.
95 Jonah Keri, “Hard Cider Is Having a Moment,”
FiveThirtyEight blog, Jan. 9 2015,
http://fivethirtyeight.com/features/hard-cider-is-having-a-
moment.
96 Hindy interview.
97 Robin Ottaway, Brooklyn Brewery executive interviews,
April 2, 2015, Columbia
CaseWorks. This statement, and all others by Eric Ottaway

unless otherwise noted, are from
Course for Growth
2021.
vs-dot-craft-beer-rivals-millercoors-strikes-back
vs-dot-craft-beer-rivals-millercoors-strikes-back
campaign-battles-blue-moon/292157
campaign-battles-blue-moon/292157
breweries
https://www.brewersassociation.org/statistics/by-state
http://www.businessinsider.com/brooklyn-has-peaked-2015-3
http://observer.com/2014/03/so-much-for-that-brooklyn-is-now-
officially-over
http://observer.com/2014/03/so-much-for-that-brooklyn-is-now-
officially-over
http://www.consumerreports.org/cro/magazine/2013/08/best-
craft-beers/index.html
http://www.seattletimes.com/business/consumer-reports-rates-
top-craft-beers-suds-snobs-indignant
http://www.seattletimes.com/business/consu mer-reports-rates-
top-craft-beers-suds-snobs-indignant

booze
booze
http://fivethirtyeight.com/features/hard-cider-is-having-a-
moment
an interview with case writers on April 2, 2015 in New York,
NY
98 Hindy interview.
99 Hindy interview.
100 Linda Hervieux, “Brooklynite Hits France, with Plans to
Seduce,” New York Times, Feb. 13,
2013, http://www.nytimes.com/2013/02/14/business/global/a-

brooklyn-specialty-brewer-
dares-the-french-market.html.
101 Steve Hindy, “Ottaway Brothers Assume Leadership Roles
at Brooklyn Brewery,”
Brooklyn Brewery blog, October 28, 2014,
http://brooklynbrewery.com/blog/uncategorized/ottaway-
brothers-assume-leadership-roles-
at-brooklyn-7brewery, accessed May 18, 2015.
102 MarketLine, “Regional Beer Market: A Changing
Landscape,” April 2014, 12.
103 Robin Ottaway interview.
104 https://www.inside.beer/news/detail/usa-nearly-one-third-
of-all-craft-beer-breweries-saw-
declining-sales-in-2017.html
Growth | Page 40
2021.
http://www.nytimes.com/2013/02/14/business/ global/a-
http://brooklynbrewery.com/blog/uncategorized/ottaway-
brothers-assume-leadership-roles-at-brooklyn-7brewery

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