The craft beer industry, once a beacon of rapid growth, has hit some obstacles in recent years. In 2019, U.S. breweries reached the peak of production but then saw a significant plunge due to the COVID-19 pandemic. The market bounced back slightly in 2021, only to see a slow but steady decline since.
Many craft breweries
cite this drop in production and volume sales as a result of higher material and overhead costs, more competition within beer and other bev-alc categories as well as difficulties balancing demand with the supply chain. Despite these challenges, opportunities for differentiation and growth remain, particularly through the adoption of technology.
Enterprise resource planning (ERP) software can provide a competitive edge for breweries to simplify operations, improve business management and enhance marketing efforts in a flatlining industry. It allows you to rapidly adapt to changes in the market, assess efficiency in brewing cycles, perform quality checks and reduce process bottlenecks. With real-time monitoring and control measures, you can identify where improvements are needed and make quick adjustments.
The craft beer market has grown fragmented with the rise of numerous small and independent brewers. Today, there are over 9,300 operating craft breweries in the U.S., up by more than 6,100 a decade ago. This has led to saturated markets and localized competition, slowing the once steady growth of the industry.
Changing consumer tastes and an increased preference for other bev-alc categories has also contributed to craft beer’s downward shift. In 2022, spirit sales surpassed beer for the first time, demonstrating how consumers are choosing spirits and spirit-based ready-to-drink (RTD) beverages over beer.
Additionally, breweries struggle with operational issues like managing cash flow and inventory, retaining top employees, navigating complex state and federal compliance regulations, and, in many states, competing for shelf space over their friends and peers.
The lack of adequate
tools for effective business management and financial tracking is also a roadblock for smaller breweries. Managing operations with disparate software systems is time consuming and leads to operational inefficiencies and data and reporting errors.
Despite the slowdown, there are plenty of opportunities for craft breweries to differentiate and carve out a niche for themselves. Success lies in understanding and capitalizing on these trends, such as
eco-friendly practices, innovative flavors, non-alcoholic beers and even entering other bev-alc categories.
By optimizing operations, breweries can create lean, cost-saving processes. Analyzing consumer behavior and preferences will also help breweries tap into new markets. This is where brewery software can create a competitive edge.
ERP software plays an important role in brewery business management, from streamlining operations to improving production, sales, accounting and compliance processes. Real-time monitoring allows for complete data transparency, helping owners quickly adapt to changes in demand or supply.
Production inefficiencies and difficulty tracking batches can lead to lost time and revenue. Brewery software provides a comprehensive view of operations to assess the efficiency of fermentation cycles, quality checks and packaging and help reduce process bottlenecks.
Brewery ERP allows you to:
Effective inventory management can be a make-or-break factor for your brewery. ERP tools provide detailed visibility into your inventory to ensure you have the right amount of finished product on hand and necessary ingredients for future batches.
Here are some ways brewery software helps with inventory management:
Brewery-specific ERP software covers the unique reporting and financial requirements of the craft beer industry. Owners can gain a consolidated view of all financial information across the entire operation.
Brewery software also enables:
ERP software can greatly enhance a craft brewery business model and strategic plan. When production, inventory and reporting processes are modernized, teams can focus on what is most important – crafting amazing brews. Then, the next step is getting it in the hands of consumers.
Effective use of ERP systems fuels marketing and sales tactics to increase revenue and market share. Brewery software with integrated customer relationship management (CRM) and sales can be a powerful marketing tool used to uncover new opportunities and enhance decision-making.
Integrated CRM tools provide substantial benefits for craft breweries. ERP systems provide data on buying habits, preferences and order history, which can be used to create targeted marketing campaigns to engage specific customer segments.These systems can track the performance of your campaigns, among other KPIs, to help optimize your marketing investments.
Brewery software with built-in sales and marketing modules can provide substantial benefits, including:
Teams can assess vast amounts of sales, inventory and operational data to uncover buying trends and patterns. Based on this information, you can make decisions about everything from which beer styles sell best during certain times of the year to how sales are affected by local events, weather conditions or demographic changes. Strategic business plans built off informed data leads to more profitable returns.
Though the craft beer industry is experiencing a slowdown, opportunities for differentiation and optimization remain strong. The adoption of brewery ERP software emerges as a pivotal tool for businesses seeking to refine production processes, manage inventory effectively, reinforce accounting and compliance best practices, and build deeper customer relationships.
ERP empowers breweries to navigate through competitive waters, improve operational efficiency and make informed decisions to stimulate growth and success in the changing landscape.
Help your brewery thrive by leveraging the leading end-to-end brewery software on the market – Crafted ERP.
Contact our team of craft beer specialists who can evaluate your business needs and recommend a software plan that can scale with you as you grow. Don’t be discouraged by a mature craft beer market, turn challenges into opportunities, we're here to help.
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