Home brewing on the decline?

[madscientist451]

I was listening to the experimental homebrew podcast today and in episode #3 the question of a decline in homebrewing came up. Podcast co-host, author and Vice Chair of the American Homebrewers Association governing committee Drew Beechum said that the AHA had data from homebrew shops that indicated a decline in sales this year. A quick Google search came up with a Beer Advocate post about the same thing, but no real other information.
My LHBS also sells on Amazon and according to him, his sales are climbing every month.
Comments? Anyone who sells homebrew items want to share their experience? Is homebrewing declining?

 

[iijakii]

I'd be interested to hear how they gather that sales data and what all it encompasses.

 

[Sailingeric]

My LHBS seems busier than ever and they have more staff than when I started brewing a year and half ago.

 

[madscientist451]

They said in the podcast, the AHA has been tracking data for several years by sending out questionnaires to homebrew retailers and then adding up all the responses.

 

[Dirt_McGirt]

I can't speak nationally, but in my town after a revolving door of LHBS businesses that opened then shuttered within a few years, we finally have one that appears to do enough business to stay afloat. Of course, my own contributions probably have something to do with that.

 

[k1ngl1ves]

I think more and more people are buying online. That's probably the reason for a decline in sales at lhbs.

I buy most of my stuff online, instead of driving 25 minutes each way to my lhbs. Plus, the internet sites are cheaper... by a lot sometimes.

 

[jschein]

Yes it has and sorry but it is my fault as I only brew once a month now instead of twice.

 

[OscarBrau]

It's possible same store sales could be down, but I wonder if they are accounting for new stores? Same store sales flatlining doesn't mean much when competition is opening a store across the way and taking some business.

 

[JonM]

If there is a decline, I bet it's a decline from the huge boom in the hobby over the last couple years. I'm totally pulling numbers out of my backside here, but even if there is a decline, I bet it's still bigger than it was in, say, 2006.

 

[day_trippr]

My lhbs has been growing their on-line store so fast they just moved to triple their footprint.
If there's a slow down, I'm not seeing it - and I doubt they are, either...

Cheers!

 

[brewcat]

Could just be overall economics. Many industries are nearing or in recession. One place may be growing while four more struggling. I'd guess the survey takes into account online sales with shops that have an online presence. I'd guess the interest is still there but is budgeted for less.

 

[FirstAidBrewing]

Now that I finally bit the bullet and bought a grain mill I will probably do a lot of online shopping just to save on cost.

That being said the LHBS is under new management and they've really done a good job with more inventory and hardware. Plus the new guys are more knowledgeable so I think it depends on the experience people get when they shop in person versus online

 

[KirkMN]

Part of the reason may be the vast selection of beer you can buy now. Walk into any decent beer store and there is tons of good stuff. I certainly didn't start home brewing to save money, but as an opportunity to learn more and have fun. When I started brewing 6 years ago, the landscape was a bit different, although there was plenty of good stuff too.

 

[mattd2]

They said in the podcast, the AHA has been tracking data for several years by sending out questionnaires to homebrew retailers and then adding up all the responses.

Did they collect data on no respondents...

Probably the only ones that had the time to respond were the LHBS with declining sales, the rest are to busy selling homebrew supplies to have time to fill in a questionnaire

 

[max384]

They said in the podcast, the AHA has been tracking data for several years by sending out questionnaires to homebrew retailers and then adding up all the responses.

If, like many areas of retail, the brick and mortar stores are losing business to a few large online stores, than this method of data acquisition is prone to error.

For example, let's say that they poll 100 stores. There are 95 small brick and mortar stores and 5 large online retailers. 90 of the 95 small stores report declining sales. All 5 online retailers report climbing sales. On paper, this shows decreases in sales in 90% of stores. However, if the large retailers are taking all of the business from the little guys, than there is no net decrease in sales. There are just more of the little guys losing small amounts of business. If each responder, regardless of sales volume, is weighted equally, than this creates error.

Another possible issue with sending out questionnaires is response bias. Those who are losing business may be much more apt to fill out the survey about declining homebrew sales as opposed to those businesses doing well.

Of course, I don't know if any of this is the case. However, I am always suspect of these types of research designs.

And, of course, I am subject to my own biases. I am hoping this is not the case and that homebrewing continues to expand!

 

[idiotsinc]

It's probably a combination things, more brewpubs, more homebrew stores, more stores stocking micro brews and more people doing less brewing because of the amount of work involved and the "newness" of the hobby wearing off. As far as surveys I'd have to say, as a retired retailer, they're meaningless. If the government ever realized the amount of figures that were pulled out of the retailer's butt when they sent you the mandatory monthly inventory report to fill out... not that I ever did.

 

[Kampenken]

They said in the podcast, the AHA has been tracking data for several years by sending out questionnaires to homebrew retailers and then adding up all the responses.

That's very standard in trying to get industry figures. My company answers leasing for the ELFA. There are years it's better responded than others, and this is from a less fractured industry. I'd bet there can be significant response swings.

Now that I finally bit the bullet and bought a grain mill I will probably do a lot of online shopping just to save on cost.

Sacks of grain with shipping won't be a savings I'd bet. Go with a group buy if you can. Or, I've found a LHBS a bit further away that uses sacks as loss leaders- pricing like group buys!

Another possible issue with sending out questionnaires is response bias. Those who are losing business may be much more apt to fill out the survey about declining homebrew sales as opposed to those businesses doing well...
And, of course, I am subject to my own biases. I am hoping this is not the case and that homebrewing continues to expand!

Good point, and i too hope it expands!

 

[dbeechum]

Quick word on methodology as I've had it explained to me - the decline figures are calculated both from survey responses and wholesaler responses which should hopefully smooth out some of the missed respondents and online sales pieces.

 

[Bobby_M]

Honestly I think it's impossible to collect accurate data. Polling the major distributors would be best since they are the bottlenecks of the common homebrew consumables but you have to be careful there as well. For one thing, what's a single or group of commodity type items that are used in every batch? Maybe yeast? Well, too many alternate sources of yeast that you can't get through distributors. Grain? What about all the clubs doing huge group buys? You wouldn't see that in the data either. How many shops either lie on the survey, don't know the numbers well enough to give them, or just don't have time to respond. I got the survey and we're so busy at the shop that I don't have time to pull perfectly accurate figures. Now, the shops that are seeing declines would have time to take the survey. Bias?

 

[mongoose33]

If, like many areas of retail, the brick and mortar stores are losing business to a few large online stores, than this method of data acquisition is prone to error.

For example, let's say that they poll 100 stores. There are 95 small brick and mortar stores and 5 large online retailers. 90 of the 95 small stores report declining sales. All 5 online retailers report climbing sales. On paper, this shows decreases in sales in 90% of stores. However, if the large retailers are taking all of the business from the little guys, than there is no net decrease in sales. There are just more of the little guys losing small amounts of business. If each responder, regardless of sales volume, is weighted equally, than this creates error.

Another possible issue with sending out questionnaires is response bias. Those who are losing business may be much more apt to fill out the survey about declining homebrew sales as opposed to those businesses doing well.

Of course, I don't know if any of this is the case. However, I am always suspect of these types of research designs.

And, of course, I am subject to my own biases. I am hoping this is not the case and that homebrewing continues to expand!

This type of research is an area of mine, and you are spot on with your comments. Unless one knows the research design, response rate, sampling frame, and consistency of response from survey to survey, there's no way to know what they're really tracking.

If they're surveying the exact same stores every time, and getting high response rates, and then comparing what those stores are doing and have done, then they might have a decent model.


As for me, I see contradictory factors operating. One is that the US economy is in recession. Oh, they haven't announced it yet, but it is. That could put a damper on sales right there.

On the other hand, I was in my LHBS Friday afternoon; I was thinking, what a great time to go, nobody will be there. Well. Wrong on that. Wanted to pick the brain of the owner and there were too many people in there bothering him with things they wanted to buy.

 

[Jaybird]

Hmmmmmm. Declining market you say? interesting thought.....I am selling more false bottom systems and ingredient kits world wide right now than I can even try and keep up with and my store is SLAMMED just about all day every day. Is that because we take care of our customers and treat them with respect? Uhhhhh yeah! I like to think so... I hear stories of some of the stores around this area that have closed. NOT GOOD! Honestly I think there is more of a shift in buying than a decline in overall sales. More people rely on Amazon and their online marketplace than they do their walk in LHBS. But in reality there are only like 10 major wholesale groups to buy supplies from and we "ALL" buy from them all. If the AHA wants SERIOUS data. All they need to do is look at those companies annual sales volumes and be done with it. I mean you don't ask the car lots if sale are good you look a the manufacturers, right?. They are the ones who can have a better dictation of the market. But I digress. Our sales have continued to increase every year for the last 7 years. I just didn't have time to let them know the last 7 times they asked..LOL


Interesting topic though. I will stay connected and curious to hear form some of the other retailers.

Cheers
Jay

 

[val214]

My local homebrew shop is always busy and do fairly well. They do a great job in offering free classes every Saturday which Draws a good amount of interest and new Brewers. I think the e-commerce business is hurting some LHBS that don't have a loyal customer base or added services. We all search the web for the best deals and free shipping. This hurts the LHBS that can't compete with the amazons and free shipping.

 

[madscientist451]

Quick word on methodology as I've had it explained to me - the decline figures are calculated both from survey responses and wholesaler responses which should hopefully smooth out some of the missed respondents and online sales pieces.

Has the AHA membership been declining? I'm also wondering if the big industry suppliers like Briess, BSG Craftbrewing, Country Malt Group and the various Hops Wholesalers have data that indicates how much of their product goes to homebrewers versus commercial breweries?

 

[k1ngl1ves]

Could just be overall economics. Many industries are nearing or in recession. One place may be growing while four more struggling. I'd guess the survey takes into account online sales with shops that have an online presence. I'd guess the interest is still there but is budgeted for less.

When money gets tight, the first thing put on hold is your hobby... or at least it should be. Lol!

 

[Nagorg]

When money gets tight, the first thing put on hold is your hobby... or at least it should be. Lol!

Or you just brew lower gravity and less hoppy beers?

 

[k1ngl1ves]

Or you just brew lower gravity and less hoppy beers?

I don't even...

 

[SMPress]

Our club has seen a steady increase in members over the last 2 years, and the local shop has moved into a bigger facility, so things are looking pretty good in my local area, cant speak to the nation at large...

Also, as far as stopping your hobby spending when things are tight, that's crazy talk, switch your diet to Raman, beer is a staple!

 

[aprichman]

I do a lot of shopping online, my LHBS has good customer service but terrible prices. A lot of time getting things shipped to me is cheaper than running across town to buy something. It's nice to have in a pinch but that's about all I use it for these days.

 

[m00ps]

When money gets tight, the first thing put on hold is your hobby... or at least it should be. Lol!

I'd just switched to an all beer and cereal diet before resorting to that mess

 

[dbeechum]

Following up a little further - I'd have to dig into the data that was gathered by the third party, but that's not happened yet. From what I was lead to understand, data was collected from all the tiers in the industry - small mom & pop, large national retailers, online and the suppliers (e.g. the guys selling malt/hops/supplies to the shops).

All in all the data shows over the past few years a flattening trend to the industry. This is especially true for older shops. Until this past data run, the trend was flat, but not down with relatively newer shops enjoying solid growth. When we reported the data, what it showed was all segments generally down including the new shops and the internet sales channels. (Big mail order and internet were just dipping below the flat mark for the first time). Older shops in particular were getting hit harder.

From my own experience, I know that my local is down some, but not drastic amounts (which is great because he's one of the oldest shops in the country). I also know that my club has experience growth stagnation in the last year, but we're also insanely large, which I think leads to some natural stalling.

Anyway, we're keeping an eye on additional data and will report as we see more information.

 

[TxBrew]

Yes, homebrew as a hobby is on a decline however homebrewing is a hobby with peaks and valleys. We saw on a massive onslaught of new brewers with the TV shows that came out 4-5 years ago, then a boost with the rise of the one gallon kit. Now it's receding, AHA and the large distributors are saying it, I see it too. It will come back. I'm seeing cannabis growing forums trending hard, I've wondered if there is a correlation there, as the laws allow you to grow your own, are people migrating to that.

 

[Phunhog]

I have always thought HBT forum traffic would be a good indicator as well. My casual observance is that it isn't quite as busy as it once was.