How craft breweries are adapting to changes in the industry

PORTLAND Ore. (InvestigateTV) - In the last two decades craft breweries ballooned in numbers, helping to reshape some neighborhoods across America.

But experts point to more competition and rising costs associated with ingredients and utilities are contributing to shrinking the industry.

Oregon’s craft beer industry experienced significant losses in 2025, with 29 breweries, taprooms and cideries closing as the national market contracted for the second consecutive year.

Major breweries including Rogue Ales shut down alongside smaller operations like Upright and Assembly Brewing, reflecting a national trend where more craft breweries closed than opened.

The Brewers Association reports production declined 5% nationally after years of growth.

The New School, which tracks brewery openings and closings across Oregon, said the 29 closures represent a decrease from 35 in 2024 but remain concerning for industry observers.

Lisa Allen, president of the Oregon Brewers Guild, attributed the closures to rapid industry expansion that created unsustainable conditions and broader economic uncertainty affecting small businesses.

“I think that there was a lot of growth that happened that people were just wanting to get on the beer train. So I think it did create like a little bit of a bubble. And with any bubble, you’re going to see some contraction,” Allen said.

“I think a lot of it is that there’s a lot of uncertainty right now in the economy. It’s not just breweries, but any small business right now is feeling that squeeze. People are not spending as much,” Allen said.

The economic pressure extends to craft beer retailers. Rob Petros and his brother own John’s Marketplace, which operates stores around the Portland metro area but closed their Beaverton location last year due to financial losses.

Craft beer four-packs now cost between $13 and $25, according to Petros. He said younger consumers face particular challenges with craft beer pricing and have more beverage options including CBD-infused drinks and seltzers.

“I don’t think that there’s a necessarily a lack of interest. I think that there’s a lot more choice. And so you have CBD infused drinks. You have seltzers. And just like when we were all in college, we were really didn’t have the budget for a $5 beer. We were looking for $2 beers,” Petros said.

Petros said his strategy involves meeting customers where they are rather than being selective about products.

“When we hire people, we say, don’t get snooty about what you like because in here, every single beer, wine, mead, cider that is in this store has got somebody that it’s their favorite,” Petros said.

George Johnson, owner of Assembly Brewing, cited lack of neighborhood support as a factor in his closure.

“For the last few years, if we had the real support of this neighborhood, we wouldn’t be in this position,” Johnson said.

Petros said Rogue’s closure served as a warning for the industry.

“Who would’ve thought? Rogue. I mean, we thought that, you know, they’d be around for a long time,” Petros said. “And it just it’s a, it’s a very the ground is shifting so fast in this industry, and you have to be nimble. And you, you can’t forget how to, again, innovate. Because if you rest on your laurels, they expire.”

Experts say the key to success is diversifying your business model. That can include expanding food menus, offering low-alcoholic or non-alcoholic options, and even hosting events.

While some brewers are focused on taproom sales, others have cut costs by self-distributing or sharing their production space.