Jon Taffer Foresees a Craft Beer Bubble

The on-premise veteran Jon Taffer thinks craft beer is coming up on a bubble.

He tends to be right about these things. Taffer is perhaps best known for his starring role on Spike TV’s Bar Rescue. During his decades in the industry, Taffer has been behind numerous on-premise innovations that improved guest experience and drove revenue — including the NFL Sunday Ticket. Most recently, Taffer and his company partnered with BAR16 at the National Restaurant Association Show.

In a recent interview with Cheers Magazine, a sister publication to Beverage Dynamics, Taffer had this to say about the future of craft beer:

 “I find the whole craft-beer craze fascinating. A lot of the core beer brands in America — Budweiser, Coors, etc. — have taken a real hit from it. Some of these brands, they’ve never lost market share in their entire existence. They’re scared by it. So they panic and turn executives over.

Craft beer has created a culture, not a trend. A trend grabs market share and then disappears and gives it back. A culture grabs market share and then keeps it. The craft-beer culture isn’t going anywhere in America.

That said, I think that about 60% of craft beer basically sucks. I’ve been to a lot of the facilities. They’re not exactly clean. They’re rookie-run. The problem is that people are now looking at craft beer as an investment opportunity. They’re getting into it to make money. Many people don’t get into it for the love of making beer. Of course, that’s not how it began. Jim Koch founded Boston Beer because he loves to make beer. But today, it’s much more in the investment space.

That’s why I think there’s going to be a wash out in craft beer over the next two years. Half of the craft breweries are going to disappear. And the word “craft” will become known more for spirits.”

Do you agree with Taffer? Comment below.

Feature photo courtesy of Spike TV.

27 Comments

  1. Charlie P Reply

    Taffer is an idiot. If you watch any of his bar rescue shows you would know he is in bed with Diageo and their crappy line of macrobrews. Craft beer is booming for a reason, people want beer that tastes good and is different than the swill their parents and grandparents drank.

    1. Jeremy singer Reply

      Bro your spot on I totally agree with u Taffer thinks he knows everything he’s just an ** craft beer is booming and will just get bigger!

      1. James Sites Reply

        Intelligently translated, “I agree with your sentiment, Mr. Taffer’s opinions are rather unfounded and based upon conjured statistics. The popularity of craft beer in the U. S. has been increasing over the past decade and, very probably, has another decade of growth before reaching market saturation.”

  2. Jason Alstrom Reply

    John … you come off more clueless about beer than ever here. This is why I turned down invites to your show. ** clueless about the small brewers around the globe. I am sure there is some sort of sponsorship deal with Spike on whatever beer brands you talk about. If so this makes you a ** schill. Good day!

  3. Jason Alstrom Reply

    How can you believe someone that is the biggest shill on TV?

    1. Jared Reply

      You have just as much skin in the game in wanting this to not be true as he has wanting it to be true. Oddly he came out with his own app without begging for money to get it started and then taking that money to take a trip to Belgium. Name calling is adorable but you are in no position to do so.

    2. James Sites Reply

      Careful who you call a shill without looking in the mirror first. You and your brother run a for-profit, user-driven website, which you parlayed into beer festivals and a print magazine, for which the users got zero credit and, at times, were even banned from your site for expressing their opinions if they did not coincide with those of you and your sponsors.

  4. Bob W. Reply

    I don’t disagree with Taffer entriely. I own a homebrew supply shop with a taproom and have thought about going into brewing myself, but I find craft breweries are now becoming similar to a Walgreens found on nearly every corner in America. Instead of “At the corner of happy and healthy” we can now say Craft Breweries “At the corner of happy and drunk.”
    I think that as all of these small breweries pop up there will be “wash out” like Taffer states, but I think it will be a good thing. I think it will create a more competitive market and craft beer drinkers are going to demand better quality out of even the small breweries.
    In the meantime craft beer is still on the rise in my opinion and there’s a lot of the sticky bubble of $$ to grasp onto if you work it right. So to that I say “Cheers!” and drink on my friends.

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    1. Ralph Hernandez Reply

      Well said!

  6. Peter Reply

    Jason Alstrom, just keep in mind, the space that Taffer runs in is consulting to ownership/management of bars and restaurants. His concern is towards the bottom line, i.e……is the place clean? Is the food good? Are the bartenders doing their job? Is the P/L in good shape and keeping the place in business? Is there a unique “angle” to the bar that’s keeping the customers rolling in? ARe the promos that the bar rolling out helping to make money or are they money-losers? Etc. etc.

    IMHO, at the end of the day, Taffer couldn’t care less about what product is being sold at the bar IF the stats coming out of POS are showing that it’s selling at a decent clip and turning over with some amount of regularity.

    And…to his taste buds, maybe 60% of craft beer IS crap for one reason or another! (Skunked, served at wrong temp, too old, just has a disagreeable flavor profile, blah blah.)

    1. James Sites Reply

      This “article” is not about his preferences. It is about industry trends. HUGE difference. Therefor, HIS particular taste buds don’t matter. The overall direction of the industry does. The fact of the matter is that if 60% of craft beer by volume “sucked”, then craft beer as an industry would not be expanding. It is, so that leaves us with the possibility that maybe 60% of the 4000+ U.S. craft breweries “suck”. I’d agree with that assessment, but that doesn’t mean that 50% of them are going to close within the next 2 years. He just pulled that number, along with the 60% figure, out of his arse. That doesn’t make for an informative article. Makes for decent click-bait, though, I suppose.

  7. Rob Reply

    This is a pretty true assessment. Anyone who goes to microbrewerys can see that some have lackluster beer and/or service. It’s a natural fact that places will close. He says it will be around because it’s a culture not a trend. Surely more will open, but several will start closing or being over taken for their one or two recipes. Don’t bash Taffer who has been in the bar industry for years and is realistic. While a bit more conservative on views, he has a good point.

  8. jimmyd2 Reply

    Taffer is from Las Vegas and the craft beer scene the is generally pretty abysmal. Joseph James and Tenaya Creek are the only bright spots, he’s right there is going to be a shake out. He needs to expand his view of what craft beer is, not just what he’s able to get in Vegas.

  9. Duke Yuengling of Milwaukee Reply

    He may be a TV SHILL at times, but I think he gets many points correct. Are there suddenly a lot of microbreweries and brewpubs run by guys (or girls) without business skills to stay afloat? Yes. Breweries with business sense and uninspired bleh beers? Yes. Will there likely be a shake out? YES. IS CRAFT BEET a movement and culture that will last? YES. are some Brewers less than pristine clean and true wizards of the craft? Yes. Is microbrew/pubs a place for easy investment and huge return? NOPE. CHEERS!!

  10. James Sites Reply

    Was about to dismiss this as a bit of fluff, but I definitely agree with him regarding the culture vs. trend component of craft beer, people looking at craft as an investment opportunity, and the fact that there are a lot of rookies in craft beer at the moment. However, the rest is horseplop. 60% of craft beer doesn’t suck. 60% of the breweries might, but not 60% of the beer overall. Jim Koch didn’t found Sam Adams because he loved to make beer. He founded it because he needed to do something with his MBA from Harvard and he figured that beer was an untapped resource. Good on him for having that vision, but Boston Beer Company doesn’t exist only because Jim loves beer. He might love beer, but he loves money even more. The bit about half of craft breweries disappearing in the next 2 years is the most ridiculous statement in the whole “article”. Craft has some room to grow before we’ll see any contraction. However, during that growth, we’ll definitely see undergood and underfunded breweries going by the wayside, in favor of breweries who make a better quality product. The next 5 – 10 years will see craft’s market share probably plateau at around 30% of the overall US beer market, with more quality products being available at more locations and very good local craft beer options in all major US markets.

  11. Diane Catanzaro Reply

    Taffer makes a good point in that craft beer has changed the culture and this culture is not going away. It is not a ”trend’. I don’t know what craft breweries he has been visiting but I don’t believe many people get into this business solely as some sort of a get rich quick scheme. Although I think in any other kind of business the goal of making money is usually not considered a negative, so I don’t know why that should be a negative for people who start craft breweries. Where he gets this notion that 60% of craft breweries will go out of business is mysterious. Perhaps it has something to do with the big breweries buying up craft breweries and offering distributors incentives to not stock true craft beer. That could be the goal of some of the corporate brewers that may support Taffer’s business, which could be where he gets this talking point.

  12. Paul Radabaugh Reply

    Half of the breweries currently in existence are going to just blink out within the next two years? And this guy is supposed to be an expert? I’m not going to to day it’s impossible barring cataclysmic events, but given the relatively inflexible market demand for alcohol, it’s highly improbable that he’s correct.

  13. David1111111 Reply

    He’s right as far as On-Premise taps go. Lots of bar owners put a craft beer on tap that they don’t even handle (less than 1% of their beer sales). Eventually right-minded bar owners will see the wasted profit potential taken up by these fancy tap knob micros that eventually go out of code and start tasting sour. Then Joe regular customer samples one and thinks it tastes like that always, and never orders that brand again. Another problem is most micro-breweries don’t offer beer line cleaning like the national brands.

  14. kelly a Reply

    But today, it’s much more in the investment space. – nope! not sure where you live buddy you cannot possibly know everything about every brewery everywhere. not possible. the brewers i know are in it for the beer. i speak to them, do you? this guy is way off. just had a new brewery open walking distance from my house 9 months ago. they are packed daily. hasn’t slowed down a bit. people turn 21 everyday mr smart guy 😉

  15. Greg Reply

    I don’t totally agree with his reasons but the bubble is very real and quite different then the last correction. This time it’s going to come through under-capitalization and overvaluation thanks to Ballast Point and other sales and general over-spending by the macros in these buyouts. Also, we are about to see an influx of bank backed securities jumping on the band wagon. Once the banks are involved, the bubble is right behind no matter what industry or sector you’re talking about…

    http://craftbrewconnections.com/index.php/2016/02/18/hate-to-burst-your-bubble/

  16. Jean Santi Reply

    I agree in part with regard to the investors that are chasing the dollar and had no prior interest in craft beer at all. Its a money maker. The true craftsmen who create a delicious product and cool environment to drink in will survive and prosper because of the their true passion. The wanna be money grubbers. Sorry, it may not work out for you.

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  19. David Lee Reply

    Craft beer is trendy thing that will never compete with the European market which is the best beer in the world. I’d make a comparison of Canadian cuisine to Italian, Spanish, and French cuisine: we can’t come close. We–I’m Canadian- have drank mouth wash brew for years and now there’s this yuppy slosh that is the thing to drink and be cool. Good luck but it’s all a fading thing that will change when THEY–who is they? You know that’s the guy who knows what is what to be cool. There’s not a stout of yuppy-craft that could carry the dirty underwear of a beer master who brews Guinness and so on and so on. If you were to make the comparison to the American brews I’d say that the craft brew has a good shot and I’d also say that towards Corona which is a glass of carbonated water squeezed out a cactus of Northern Mexico while he or she is running from the cartel and pissing their pants.

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