Popular brewery files for bankruptcy | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

In the immortal words of Homer Simpson, “Ah, good ol’ trustworthy beer. My love for you will never die.”

While beer is a staple that many fans of the brew can’t imagine their lives without, there’s no denying that — at least in certain sectors — it’s a little less popular than it used to be.

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That’s not about beer itself, but more about a trend of consumers seeking out non-alcoholic options. The popularity of non-alcoholic beer and mocktails has soared in the past decade, and it’s still climbing. It was valued at USD $1.2 billion in 2023 and is expected to grow at a CAGR of 7.4% by 2030. Simply put, people want options that are better for their health.

Another thing keeping people from choosing beer is the blossoming cannabis drink market (think low-dose THC, often blended with CBD). In 2023, the market size for these new beverages was valued at USD $1.16 billion — and it’s just getting started. The market is also projected to grow at a CAGR of 19.2 percent to reach $3.8 billion by 2030, according to a Grand View Research study.

Now a popular brewery has announced it will be closing its doors, and any mix of these factors could be a part of the reason.

A bartender pours out a cold beer from the taps.

Image source&colon; Getty Images

A partnership gone sour

Cotton House, a beloved family-owned craft brewery located in Cary, North Carolina, made an announcement on its Facebook page on April 9 that it will file for bankruptcy, mentioning a partnership it attempted to forge that did not go as planned.

“The partnership we hoped would flourish took a different direction, and over the past two years, we have faced significant financial strains as a result,” the post reads. “Despite these challenges, we have remained committed to our mission, and it is this resilience that has led us to our next chapter. Today, we announce that Cotton House Craft Brewers will undergo a strategic restructuring by filing for Chapter 11 Bankruptcy. While our business model has evolved, our dedication to the community and to providing exceptional craft beer remains unwavering. We are still here, we are still beer, we are Cary!”

While loyal patrons expressed their worries in the comments about the future of the brewery, Cotton House reassured them, saying, “We aren’t going anywhere!”

The ever-changing craft beer market

While the craft beer market went through a hot streak starting in the ’90s that exploded into the 2000s, it’s been struggling a bit lately as consumers consider new options.

U.S. beer production and imports were down 5% in 2023, according to the National Brewers Association, while craft brewer volume sales declined by 1%.

“Craft has been going through a painful period of rationalization as demand growth has slowed and retailers and distributors look to simplify their offerings or add options for flavor and variety outside of the craft category,” said Bart Watson, vice president of strategy and membership, Brewers Association. “That said, breweries have reacted to these changes by focusing on distribution, continuing to innovate in their taprooms and brewpubs, creating groups and partnerships, and offering a wider range of beverages in their portfolios.”

Here’s hoping that Cotton House’s restructuring plan can create new opportunities for it to thrive, as it’s obvious that loyal fans would be heartbroken to see it close its doors.