Green Flash Brewing was one of the fastest growing breweries in California these past few years. They were growing so fast they also acquired Alpine Brewing Company in 2014. Then in late 2016 they followed suit of other west coast breweries and opened a brand new brewery on the east coast.
Dreams were (no doubt still ARE) high. But the craft beer market can play cruel games when the iron is hot. Businesses expand quickly to meet speculated and calculated demand. A few days ago The Full Pint announced layoffs of 25 people and that more are on the way. These layoffs were in their events and marketing. Green Flash hasn’t specified why, but those that have been laid off were given severance packages and asked to sign a non-disclosure agreement.
The Full Pint followed up with more information today saying that CEO Mike Hinkley has stepped down and Green Flash’s aforementioned Alpine Brewing company has temporarily halted production for the past month.
Green Flash follows Stone Brewing and Craft Beer Alliance (Kona Brewing, Widmer and Red Hook) in recent layoffs and we’d speculate there will likely be more in 2017 from other larger breweries. Breweries had to make calculations on production over a period of time, so they could ramp up. To maintain those, you need to increase infastructure, labor and distribution to meet those. Even though many are still growing, some are not growing at the rate they originally projected and they need to adjust.
California has over 750 (15%) of the United States’ 5,000+ breweries. At some point these numbers have to start reaching some level or saturation. Perhaps some of the larger breweries are starting to feel those pressures. As we’ve said before the future for smaller, mid size and even neighborhood breweries is quite bright because they require less infrastructure and expensive distribution plans. Craft beer’s future is bright and seems to have woven itself into the fabric of our culture, no matter where it settles.