Tim Harty, The Business Times

In late January the Colorado Beverage Coalition announced Colorado “lost” 41 craft-beer breweries, taprooms and brewpubs in 2024.

When The Business Times asked for the list of the businesses that closed, the number climbed to 44.

Regardless, after 35 closures of Colorado craft-beer breweries, taprooms or brewpubs in 2023, the increase signified a disturbing trend, which Colorado Brewers Guild Executive Director Shawnee Adelson addressed by saying, “Colorado’s breweries are facing major challenges. Between inflation, supply-chain issues, employee shortages, a pandemic and a downward trend of drinking, these local businesses need the support of the public and lawmakers to survive.”

Or, perhaps they just need to be in the Grand Valley, where only one brewery earned a spot on the list of closures for 2024. That was Suds Brothers Brewery in Fruita, but technically, the brewery was sold to Russell Klase III in September and was closed for a couple months for renovation, then reopened Dec. 2 as Reckless Brewing Company.

The majority of the closures were on the Front Range, in particular the Denver metro area, and a common word used by Grand Valley craft brewers in regards to that area and breweries is “over-saturation.”

Before starting in sales for Palisade Brewing Company, 200 Peach Ave., in January, Brett Zahrte amassed 20 years in the craft-beer industry on the Front Range. He said the effects of over-saturation there were due to hit at some point, and he thinks it arrived in the late 2010s, just in time for the devastating effects of the COVID-19 pandemic to start a wave of closures in 2020 and 2021.

“Those that found their niche and stayed within their means did really well,” Zahrte said. “Those that expanded too fast regionally had a really hard time. A lot of the closings in that first big wave were small brewhouse settings like this (Palisade Brewing), where we’re just under 3,000 barrels of production last year. Some of those places that were this size or smaller tried to get up to 10,000 to 20,000 barrels really quickly and struggled.”

Ryan Dutch, owner and general manager of Trail Life Brewing, 463 Main St. in Grand Junction, echoed Zahrte.

“In Denver, the places that are closing are too big,” he said. “They tried to go too big.”

At The Rockslide Brew Pub, co-owner and General Manager Brian Oliver knew the proliferation of breweries in Colorado had gotten “over-saturated” when he had problems buying equipment.

“They were popping up left and right,” he said. “It was hard to get equipment; everybody was buying it. We had to get a grinder from Canada. One of our mills we bought from Canada, because the supply was low and the price was so high in state.”

Zahrte said a similar saturation point hasn’t hit the Grand Valley yet.

“I mean, when you can name every brewery within 45 miles on two hands, that leaves a lot of room at the table for others to join,” he said.

That doesn’t mean Grand Valley brewers went unscathed.

Gemini Beer Company’s Todd Williamson, who along with Tyler Frye bought the business in October, has been a brewer at several other breweries in the Grand Valley, so he’s about as tuned in as a brewer can be to the local scene. He said he talks to other brewers and winemakers, and they give honest assessments when asked how their businesses are doing.

“Overall, we have taken a hit just like the entire nation has taken a hit for craft (beer),” Williamson said. “Maybe our numbers are less down than everywhere else, but it seems like breweries are down about 12 to 15 percent, from the conversations I’ve had, and wineries around town about 15 to 20 (percent) in terms of business being down.”

Similarly, Base Camp Beer Works owner Brian Fischer said, “I’d say the craft brewery scene in general in the state of Colorado, like a lot of other industries, is struggling to maintain the numbers that we saw two, three years ago. And a lot of that is to do with the cost of goods. The cost of ingredients has gone up, and the cost of labor has gone up significantly.”

Base Camp Beer Works owner Brian Fischer added, “So, while our projections for this year are to produce and sell about the same amount of beer, we can only charge so much for it. At some point the consumer is going to say, ‘I don’t want to pay $8, $9 for a beer.’ So, while we’re producing and selling the same amount of beer, our revenue is shrinking, because our expenses are growing while our prices for our product are not.”

Rob James, co-founder and co-owner of Ramblebine Brewing Company, 457 Colorado Ave., added, “We’re all coming off a 2024 that was a down year for the craft beer industry as a whole. It was the first down year for craft beer in 10 or 15 years. I forget the numbers, but the Brewers Association was estimating the industry to be down at eight, eight-and-a-half percent last year as a whole.”

Dutch thinks a couple more breweries may be all it takes to send the Grand Valley into oversaturation. And based on the trends he sees, he thinks it’s inevitable.

“Here on the Western Slope, we’re eight to 10 years behind the Front Range,” he said. “So, eight years ago (in the Denver area), it was thriving, and new places were opening, and it was like: Boom, done, you’re set. Now it’s harder. So, yeah, the eight to 10 years is just something that we’ve noticed. 

“I don’t know if you find data on that, but I think it’s true with beer styles that we’re behind; or it’s true with the housing market, we’re behind; it is true with tourism, we’re behind; the breweries opening up, the restaurants, we’re just behind. So, I wouldn’t be surprised in eight years we’re gonna have some of these same issues that the Front Range is seeing now.”

All that said, life as a brewery or brewpub in the Grand Valley has been sustainable, and Zahrte sees it staying that way for a while.

I don’t think we’re gonna see anything like what has been seen out in the Front Range in the Valley anytime soon,” he said. “I think it’s only gonna be growth here, and hopefully continued, sustained growth for many years. I think the Valley has the opportunity.

“I think it really does leave a lot of opportunity for others and a lot of opportunity for the existing breweries like ours to continue to expand. As we change our offerings and have different seasonal rotations, we can get better penetration as well. I think more competition is only an exciting thing rather than, you know, a detriment to the existing businesses, expanding-too-fast thing.”

Klase’s decision to buy Suds Brothers made it clear he thinks things are sustainable in Fruita, even with Copper Club Brewing Company, 153 Mulberry St., and Base Camp Provisions, 155 Mulberry St., a stone’s throw down the street from his business, which is at the corner of East Aspen Avenue and Mulberry.

He renamed the brewery Reckless Brewing Company, but there was nothing reckless about his decision-making. For starters, he checked how the population’s trending.

“As an entrepreneur, business owner, that was one of the things I researched,” he said. “How’s my demographic growth looking? What are the projections? And it’s only showing projected growth for the Grand Valley area right now.”

Copper Club Brewing co-owner Michele Collins didn’t have any statistics in front of her, but she’s seeing what Klase is seeing, and along with it there’s the tourism benefits and the Fruita faithful.

“The tourism industry has built up, so it’s like our busiest times are spring and fall, the mountain-biking times, so a lot of people are coming to Fruita then,” she said. “We just have a good local base, so that kind of keeps us going. More people moving here, that’s helping.”