GRAND RAPIDS, MICH. - Mitch Ermatinger’s business model raises eyebrows, as speculation grows in regard to West Michigan reaching a saturation point of breweries, with several closing in the state during the past year.
The owner of Speciation Artisan Ales sells tickets for batches of bottles once a month out of his Comstock Park brewery. Since his first release in January, he’s seen tickets sell out quicker than the last, with March’s gone in 40 seconds. His wild ales also have pushed him into the top 20 world rankings on the beer-rating app Untappd.
Industry professionals, including Ermatinger, expect to see more brewery closings, but the wave is not a bubble bursting, he said. The number of breweries in the United States has jumped to more than 5,000 in 2015, doubling since 2012, up from 1,500 in 2007 and exponentially higher than the all-time low of 89 in 1978.
The all-time high was just passed in 2015, surpassing the 1873 high of more than 4,000 breweries in the U.S., when the nation had far fewer people.
The quick surge is the weak point of growth, Ermatinger said, as he points to the more than 9,000 wineries in the U.S.
“We will see more closings because there was a big rush of people getting into this industry all at once, and they can’t all succeed. It’s a business, and not all businesses succeed,” he said. “Many will fail because they weren’t managed properly, marketed properly or didn’t make good beer.”
Last week, Spring Lake’s Dutch Girl Brewery closed permanently and is searching for a buyer and asking $350,000, according to a Facebook post. Dutch Girl representatives declined to speak to the Business Journal.
Closings have happened in West Michigan in the past, especially following a large burst of brewery growth in the late 1990s, which resulted in companies such as Founders Brewing Co. and New Holland Brewing Co.
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Grand Rapids Business Journal