DETROIT (WXYZ) — After years of explosive growth, the craft beer industry is facing some tough headwinds.
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According to a recent report from the Brewers Association, the number of craft breweries closing their doors in 2025 is outpacing new openings, while beer production has also declined year over year. However, metro Detroit breweries are finding ways to adapt and weather these challenging times.
The struggles facing the industry are multifaceted. Scott Graham, executive director of the Michigan Brewers Guild, acknowledges the difficulties breweries have encountered in recent years.
"The last few years have been very difficult and indeed, we've seen some brewery closures," Graham said.
Rising operational costs represent one of the primary challenges. Graham points to lingering effects from the COVID-19 pandemic that continue to impact brewery bottom lines.
"COVID put upward pressure on lots of things and we haven't seen it come back from labor, supply chain, rents in some cases," Graham said.
Beyond economic factors, changing consumer preferences have also shifted the landscape for craft breweries. The beverage alcohol market has become increasingly crowded with alternatives.
"There's so many options out there for beverage alcohol, that beer has had some of its spotlight taken away, at least temporarily," Graham said.
Kyle Gierada, owner of Dog and Pony Show Brewing in Oak Park, has experienced these cost pressures firsthand. His brewery faces higher expenses across multiple areas of operation.
"Cans are more expensive, our bottom line, our grain, our shipping is more expensive. So, everything has gone up," Gierada said.
Despite these challenges, Gierada reports that 2025 has actually been a positive year for his business. His strategy focuses on beer variety and enhancing the customer experience to differentiate his brewery from competitors.
"We don't want to compromise the quality of our product, the quality of our service. So, I'm willing to make less as a business now and survive that, so long term, we're still here," Gierada said.
Meanwhile, Full Measure Brewing in Detroit's Eastern Market is navigating the challenging landscape as a newcomer, having opened this summer. Co-owner Skip Elmer has found advantages in being new to the scene.
"It's been great actually. Being the new kid on the block is always helpful," Elmer said.
Elmer's approach involves diversifying beyond traditional beer offerings. He believes breweries that have struggled most are those that limit themselves to beer-only operations without food service.
"We've expanded our menu into wine, spirits, NAs (non-alcoholic), kombucha, all sorts of offerings to make sure we're inclusive for everybody," Elmer said.
Despite current industry challenges, Graham maintains optimism about the future of craft brewing. He believes the fundamental appeal of beer will endure.
"People have been drinking beer for centuries and I think they're going to continue to love beer," Graham said.
The Michigan Brewers Guild encourages community members to support their local breweries during these challenging times.
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