While the Bud Light scandal got a lot of media attention, it’s not just a boycott that has hurt the brand: Anheuser-Busch InBev has also suffered from changing trends.
Americans are simply drinking less beer.
A giant global company can handle something like this. If Americans drink less beer, Anheuser-Busch InBev can sell its products worldwide and it has countless beverages that are more on trend with what people are consuming now.
Related: Big fast-food chain nears end after failed Chapter 11 bankruptcy
Beer sales are simply down overall.
“Since 1970, the peak year for beer consumption was 1981, when the typical American age 21 or older drank 36.7 gallons. By 2021, beer consumption had fallen to 26.5 gallons per person,” Pew Research reported.
“Over those four decades, the amount of wine the average American drank annually rose from 3.2 gallons to 3.8 gallons. Meanwhile, consumption of distilled spirits dropped slightly, from 3.0 to 2.8 gallons.”
For regional breweries falling consumption mixed with added debt taken on during the covid shutdown has been a devastating combination. Many of these beermakers make the bulk of their revenue from tap-room and in-person sales.
Losing those, or seeing them limited, for many months left them in a debt hole from which they can’t climb out. Numerous big-named breweries and beer brands have filed for Chapter 11 bankruptcy and many have closed their doors for good.
Regional breweries depend heavily on in-person sales.
Image source: Shutterstock
Another regional brewery files Chapter 11 bankruptcy
The list of shuttered breweries starts with San Francisco’s nationally distributed Anchor Brewing. That was a stunning failure if only because Anchor had achieved a level of success that craft-beer brands rarely reach.
A number of other regional breweries, including Chicago’s Metropolitan Brewing, New Jersey’s Flying Fish, Denver’s Joyride Brewing, Tampa’s Zydeco Brew Werks, and Cleveland’s Terrestrial Brewing have also filed for bankruptcy. That’s not a complete list as it seems as if there a new filing or closure every few days.
That speaks to the overall bleak market for regional breweries and craft beer. Now, District 9 Brewing (known by many as D9 Brewing) has joined the list of regional breweries filing for Chapter 11 bankruptcy.
The North Carolina brewery, which began in a garage in 2008, then moved to a production location in 2014. D9 has grown steadily over the course of its history but now its future remains very much in doubt.
“After winning multiple prestigious medals in coveted sour beer categories, D9 became one of the Charlotte area’s largest breweries,” the company says on its website. “Staying true to their roots, the founders focused on the creation of smaller microbrewery locations throughout North Carolina where their passion for “Unquestionably Original” ales could continue to grow and connect with the local community.”
District 9 Brewery faces deep debt
District 9 operates 3 microbreweries and 1 production brewery, and operates a distribution center.
In its Chapter 11 bankruptcy filing, the company disclosed that it had less than $7.5 million in debt. The company did not provide a financing or turnaround plan as part of its filing.
District 9 Brewing did say that it expected funds to be available for unsecured creditors. The company said it owed money to between 50 and 99 creditors while its assets are less than $500,000.
District 9 appears to have closed its taprooms, perhaps temporarily. Its website shows no upcoming events. The online store linked to its website, which appears to be operated by an unrelated third party, still enables purchase of D9 beers.
District 9 Brewing made supporting its community a core pillar of its business philosophy.
“Our mission at D9 is to inspire and support the community through the creation of exciting and originally crafted ales,” the company wrote. “As explorers of all beer styles, we offer a wide variety of selections for exceptional craft drinking experiences. We invest in the scientific exploration of the natural world to produce the highest quality, and unquestionably original, crafted ales.”
The company also supported local charities with some of its events.
“D9 greatly values coming alongside our local nonprofit community partners in supporting efforts to drive meaningful change for our neighbors,” the brewery added.
