“Craft Beer” Means ... Anything Boston Beer Wants It To?

Update: On December 18, 2018, the Brewers Association announced it had changed the definition of membership for the second time. It was crafted entirely to accommodate Boston Beer. The new definition omits the criteria of “traditional” and defines brewer as: “Has a TTB Brewer’s Notice and makes beer.”

 This is literally unbelievable:

The Brewers Association board of directors today informed members of proposed changes to its bylaws that would significantly alter the trade organization’s official craft brewer definition, and create a new voting member class, Brewbound has learned.

It’s the last pillar, traditional, that is under review, in part because  an increasing number of craft brewers are already experimenting with  non-traditional beer offerings such as flavored malt beverages and hard  seltzers. A growing number of BA members have also expressed interest in  creating beverages infused with THC and CBD, Wallace wrote. 

Not to put too fine a point on it, but this means that the erstwhile beat cop that has spent decades policing the meaning of “craft beer” is about to redefine craft brewer to mean “a company making alcoholic seltzer.” If this seems to run counter to the mission of an industry organization created to support small breweries, it’s because you haven’t read this:

But perhaps more importantly, the proposed change would also allow the BA to continue counting its largest voting member, Boston Beer Company, as a “craft brewer.”  In 2017, Boston Beer — which produces the Samuel Adams, Angry Orchard, Twisted Tea, and Truly Spiked & Sparkling product lines — made 2 million barrels of beer, according to BA data. At the time, “traditional” beer was a majority of its total alcoholic beverage output, since the company shipped about 3.8 million barrels of product.

Since the first years of craft brewing, there has always been a cleavage, a faultline, at the heart of the organizations of small brewers. (The Brewers Association was preceded by precursor organizations that merged in 2005). In the main, the member breweries were small and brewed their own beer. On the other side were the business practices and priorities of Jim Koch and Boston Beer, at the center of these organizations and also their largest member. At key points in its evolution, when the needs of Boston Beer ran up against concerns of the group, Boston Beer carried the day.

In the 80s and 90s, Koch’s use of contract brewing to become the country’s biggest brewery was highly controversial. The Association of Brewers decided it was fine. In the aughts, when Boston Beer pushed up against the definition of “small” by brewing too much beer, the definition changed to accommodate the giant. (That decision, to bump the ceiling from two million to six million barrels a year, could now be seen as a metaphor for hubris, as Boston’s beer production began falling after the definition was changed for it.)

Days ago Boston Beer issued its third-quarter earnings report, in which a years’-long trend continued: “increases in the Company's Truly Spiked & Sparkling, Twisted Tea and Angry Orchard brands, [were] partially offset by decreases in its Samuel Adams brand.” So now Boston Beer is poised to transition into life as a company principally focused on selling flavored malt beverages and cider rather than beer. And it looks like the Brewers Association is ready to flex the definition for Koch and Boston Beer one more time. 

The ironies are incredibly rich. Koch spent decades and millions of dollars marketing Sam Adams as the avatar of craft beer, the antithesis of big beer. He got in a high-profile battle with Anheuser-Busch in the 1990s. And yet, with each passing decade, Boston Beer comes to resemble big beer more than any other craft brewery in America.

For decades, the Brewers Association has managed to paper over the cleavage and square the circle—promoting both the general interests of their many smaller members and the specific interests of a NYSE-listed company and its billionaire owner. But are member breweries, who have been cajoled for over a year to sign up to the Brewers Association’s “independence seal” branding, ready to sign up for this? What would it say about the mission of an organization dedicated to beer that their most powerful member mainly doesn’t make it?

This strikes me as a pivotal moment—perhaps the most important in the Brewers Association’s history. On the one hand, its own rules, which stipulate that 50% of a company’s production must be beer, are about to mean removal of its most powerful member. On the other hand, changing the rules would effectively redefine the organization’s mission. Can this circle be squared again? It’s hard to see how.