Dean Barber

Beer is The Answer

In Corporate Site Selection and Economic Development on November 23, 2015 at 5:50 am

I am fast coming to the conclusion that beer is the answer to the ills of the world and should be foundational to economic development.

I say that partly in jest, but partly not. I actually believe and have witnessed how the establishment of craft breweries have transformed communities for the better.

Now if those ISIS fellas would only have a pint or two, I think they would calm the hell down. Of course, they’re not going to do that, being the teetotaler bunch that they are, which is part of their problem.

Not Your Father’s Beer

The consumers of craft beers are typically, although not exclusively, millennials who want something better.

The proof is in the numbers, the overall beer market in 2014 was flat, registering one half of 1 percent growth. But the craft beer industry,  made up of small niche players, grew by nearly 18 percent.

And let me tell you, the craft beers being made today are far better brews. They are not your father’s beer, the largely massed-produced stuff with the character of white bread.

Today’s millennials, if I can generalize broadly, do not subscribe to blind consumerism and an unquestioning “follower” mindset, certainly not as much as my generation, the baby boomers. Many have no desire to work for a large company and are attracted to purchase products tailored to their tastes.

The craft brewers inherently get this. By definition, they are makers, engaged in small production runs, or batches, often seasonal and aimed at a niche market.

I mean, why buy a Bud when you can get, for instance, a Velvet Hammer or a Blood & Honey or a Bent Rut? Now those are beers.

A Precursor for Manufacturing

I think in many respects the craft brewers, typically young entrepreneurs, are foretelling the future of manufacturing in this country. And I know certain communities, certain economic development organizations are taking notice.

A couple weeks ago, I proffered that very theory while participating in the Consultant Connect Summit in Dallas. I was one of nine site consultants meeting with nine economic development leaders from throughout the United States.

And while the other consultants talked about workforce and infrastructure, all worthy subjects indeed, I spoke about how craft beer is a revealing forerunner of things to come.

A Different Birmingham

A few weeks back, I was in my old stomping ground – Birmingham, Ala. – where I lived for many years.

When I left Birmingham eight years ago, I did not have a very optimistic view of the city. Local government was dysfunctional, nothing was really happening.

But when I returned a few weeks ago, I saw how local, really non-establishment investors had essentially created entire new entertainment districts. Four craft brewers, that had not existed when I left Birmingham in 2007, were now key to neighborhood vibrancy that was previously not there.

A Neighborhood Transformed

A neighborhood called Avondale was not the Avondale that I remembered. An old-brick mechanic’s garage, probably circa 1930s, where I used to get my truck worked on was now a restaurant/café with many people sitting outdoors. The same was true across the street in another building that was once an auto repair shop.

Up the street, sat Avondale Brewing, and a host of other high-end pubs and restaurants, including SAW’s Soul Kitchen, which has made my list of favorite barbecue restaurants.

SAWS wasn’t around when I lived in Birmingham. Back then, Avondale was a depressed, working-class neighborhood, with a smattering of small businesses just trying to hang on. It is far from that today.

A Personal Brew Tour

My friend, Don Erwin, with the Barber Companies (unfortunately no relation to me) and Doug Neil, with the Daniel Corporation, took me to all four craft breweries in Birmingham during the three days I was there.

In addition to Avondale, there was Trim Tab Brewing Co., Good People Brewing Company (great T-shirt) and Cahaba Brewing Co. (great hat), all populated by patrons who were young, educated, and who I thought of as “hipsters.”

And talking to them, I got a real sense that they had an optimistic view of Birmingham. They saw Birmingham as a good place to live. No need to go to Atlanta, Charlotte or Nashville to get your groove on, to live the way you want to live.

That was not the same Birmingham I left eight years ago. Now Birmingham is cool.

The Coolness Factor

So I have to think this coolness factor should be worthy of serious consideration to economic developers who should want to retain in their communities youth and vitality – the next generation of workers and entrepreneurs.

Bottom line is we are talking about quality of life. And that means different things to different people. For some seasoned citizens like myself, quality of life might mean the availability of good health care.

For others, it might mean good schools for which to send their children to. For others, it might mean outdoor recreation opportunities, or restaurants or whatever. Quality of life is in the eyes of the beholders.

Smart Companies Want to Have Fun

The point is there is an emotional aspect to decision making, where we want to work and where we want to live, and this is especially true of younger people.

The smart companies, the 21st century companies, get that and they are coming up with ingenious ways to connect with their customers.  They don’t necessarily play by the same rules as their predecessors, which was the subject of my Nov. 8 blog.

Sure, there are some constants. Even smart companies will want to be cognizant of costs. They would prefer a favorable business climate pertaining to taxes, permitting and regulation. But they also tend to gravitate to places where they can find the kind of people that they want.

Riding the Youth Train

By definition, youth represents the future. Always has. More and more, youth will be calling the shots in this new digital age that we are entering. Of course, they are that already.

And don’t you know the moneyed establishment in Birmingham and throughout the country is trying to grab a ride onto to that youth-driven train. I want some of that. There is money to be made.

After I gave my talk at Consultant Connect, several economic developers told me how craft brewing had made a significant positive mark in their respective communities.

One was Ron Kitchens, who served as the moderator to the Consultant Connect. Ron is also CEO of Southwest Michigan First. He said he had 15 microbreweries in his region, with the vast majority having located in downtown Kalamazoo in historic buildings.  Another five are on the way.

“Beer creates a mixing bowl for the community. We are no longer members of private clubs. I am a Mason and I am younger by 20 years than anyone else at my lodge. Microbreweries have replaced that in the community,” Kitchens said.

“It’s a place where people meet and where they get to enjoy a local product. It’s a culture. It’s become the Midwest’s version of California wine country. Many of the craft breweries are now adding gourmet restaurants, or gastropubs, with really unique food. Then they will often add entertainment to go with the food and beer.”

Kitchens said there are now walking beer tours and bused beer tours in and around Kalamazoo, which got its first commercial brewery in 1837. In 2015 Kalamazoo Beer Week featured over 250 events all across Kalamazoo County.

With more breweries per capita than anywhere else in the U.S., Asheville, N.C., was first named Beer City USA in 2009. Asheville has 18 breweries and counting, making about 100 local beers. You’ll find artists, farmers, lawyers and possibly the mayor rubbing shoulders and drinking craft beer there. A great mixing bowl, indeed.

Duluth has claimed to be the craft brewery capital of Minnesota. I was there a couple years ago, and I won’t argue that point. North Shore brewery tours are scheduled for Dec. 5 and Jan. 16 to six of the ten local breweries. My kind of fun.

The International Economic Development Council to its credit has sponsored seminars on how craft brewing and craft distilleries have been able to grow local economies. But as my grandfather used to say, even a blind hog can find an acorn ever once in a while. Ok, that was a low blow.

No Small Potatoes

According to the Brewers Association, the trade industry group for the craft brewing industry, the craft brewing industry contributed $55.7 billion to the U.S. economy in 2014 and more than 424,000 jobs.

Those numbers are derived from the total impact of beer brewed by craft brewers as it moves through the three-tier system (breweries, wholesalers and retailers), as well as all non-beer products like food and merchandise that brewpub restaurants and brewery taprooms sell.

Now those are no small potatoes by any account.

There are now about 4,000 breweries in more than 2,000 cities across all 50 states. At the same time, there are also nearly 1,000 cities with a population of more than 10,000 that don’t have a local brewery yet, and numerous neighborhoods in larger cities without a local brewpub or taproom.

So there is hope. There is room for growth.

In the Dallas-Fort Worth area, where I live, there are currently 39 craft breweries, according to the website Dallas Brew Scene, with more on the way, which indicates that I live in a bastion of civilization.

As an aside, my hobby is music, and the Lone Star String Band, to which I am a member, has performed at a number of local craft breweries, including Franconia, Deep Ellum, Martin House, and Cedar Creek. (With more on the way.)

Cradle of Civilization

The cultivation of grain saw man transition away from a hunter-gatherer lifestyle and drove the desire to settle down and start a farm. This started happening about 10,000 years ago.

Some scientists say it was brewing that drove agriculture, that bread actually came afterward.

Now if this is true, and I am emotionally biased to believe that it is so, then this is further proof that beer is a foundational block to civilization as we know it.

Yes, beer is the answer, creating culture, prosperity and that great mixing bowl. So Cheers!

 And I’ll see you down the road.

Dean Barber is the president/CEO of Barber Business Advisors, LLC, a location advisory and economic development consulting firm based in Dallas.  If you liked what you read here, invite Dean to speak at your next meeting. He can be reached at dbarber@barberadvisors.com or at 972-767-9518.

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