“Actually no-one can see a bubble, that's what makes it a bubble."
- The Big Short
“Those who do not know their history are bound to repeat it.”
- George Santayana
Having recently been at work on a major project on New York beer, with other, much more esteemed contributors than myself, at 10,000 feet, one begins to see the swings of history. What our industry is going through is a natural cycle of it's progression. While many are yelling the sky is falling, it's just a part of the cycle of the life of these industries.
Arthur M. Schlesinger's book, The Cycles of American History, published in 1986, posited that American history is characterized by alternating cycles of liberalism and conservatism. The central thesis of this volume was that American history moved in cycles, with phases of liberal idealism giving way to conservative pragmatism, and vice versa. Schlesinger framed this struggle as a recurring conflict between two fundamental visions for America. That dynamic may be playing out right now on the national political scene, but the pendulum has always swung, too, for the beverage industry.
The beverage business has always been victimized by such swings. Boom and Bust has always been at the heart of its very nature. Most of these businesses never see a third generation - and when they do, it's more likely a sell off rather than a rebirth. In the 1800s and 1900s, a brewery's life expectancy averaged somewhere around eight years, give or take.
In 1900 the beer and whiskey industries was at an all time high. America had never had so many distilleries or breweries as it did then. But also, since just before the Civil War, and certainly making headway afterwards, Temperance also saw a rise, and the eventually collision between the two was historic.
But no matter which side of the Atlantic imbibers have been on, the beverage industry has seen a number of booms and busts. It is the very nature of the industry.
When Temperance held sway it pointed to very important social issues, like derelict fathers, abused wives and children, violence, and wasted lives. These were no small matters, as alcoholism rose (even if only in the public's optics), laws were inevitably erected to protect women and children from the rage of intoxicated spouses or partners. Not all was perfect. But improvements were made. The actual Prohibition amendment set the country back a generation, fiscally, and in the meantime created modern organized crime.
Here's a history of the booms and busts of the last 120 years (very glib and easy to poke holes in - but not wrong):
In the 1800s, wars and transportation played huge parts in the rise and fall of the industry. Styles too. In New York State Dutch style beers were the first popular wave, followed by the wave of British styles, once the colony was taken over by the British Crown. With the first waves of German and Irish immigrants arrives, styles changed too - lagers and stouts and bocks became more and more popular. With each of these waves brewers rose and fell. Whiskey also made huge gains at this time (both imported as well domestic). Both were seen as curses by "nativists" from these unwanted immigrants.
Transportation lead to massive changes, from the Hudson River, to the Erie Canal, to the Railroads, each step led to a large style of industrial production, until by the end of the 1800s, NYC sported five breweries that would each make more than 1 million barrels of beer a year each and employed approximately 10,000 laborers and skilled men. Price wars, changes in style, leadership, were al determinants in how these businesses rose and fell.
Since the days of New Amsterdam many breweries were farm breweries. Post-bellum Civil War America saw industrialization change the business model. Changing populations, changing demands from new immigrants, new packaging and transportation meant the death of many small brewers who eventually could not compete with the larger and larger brewers - especially those who lacked superior transportation. Cut throat competition remained a hallmark of the industry - including violence.
As America and Canada come out of the Spanish flu epidemic, in 1920 alcohol consumption rose.
But the industry took a huge gash in the mid-and-late 1920s with the enactment of. Prohibition. Many British and Irish distilleries started off the first wave of shuttered factories known as "Ghost Distilleries". The beverage industry struggled to get back on its feet in the 1930s.
The War was a big boost to the industry.
The 1940s and 1950s saw the rebound of brown whiskies, and commercialization of the industry through advertising and sports. The 1960s saw beer take a hit as the "Beer Wars" gutted the field. The brewing industry went through massive, bloody rounds of "consolidation" (competition was either brutally put out of existence or consumed into larger companies). Whiskies started to tail off as restaurants like TGIF and other bars soon embraced the "singles scene" and began courting women customers.
In the 1970s, the beer industry suffered another set back when the "health craze" boomed. Running and jogging and aerobics became the fad. 3-4% beer, lampooned during Prohibition, made a huge comeback as a healthier choice, now marketed as "Light Beer".
Around that same time, whiskey began dying off. Gin and vodka, as mixers in bars, made a big return (gin and vodka had been the number one sellers during Prohibition (both were easier and faster to make, package, and sell by bootleggers), which would last though the end of the 1990s. Whiskey became almost non-existent (so much so that the largest US whiskey producer - Seagram's - sold off five of it's whiskey distilleries). Scotland and Ireland were also his hard by the lack of demand, and many distilleries were shuttered - leaving more "Ghost Distilleries".
The wine industry started experiencing small growth in the 1960s, with the advent of cooking shows, and food centered magazines. By the 1970s Blue Nun, Mateus, Bolla, Paul Masson, Inglenook, and other large market brands began to make head way.
In the 1970s, the UK experienced as call for a return to "Real Beer" resulting in Campaign for Real Ale. aka CAMRA. By the end of the 1980s, the North American beer industry had taken a number of body blows, not the least of which was that the entire industry was making relatively same style beer - lager.
In the late 1980s and 1990s craft beer experiences its first wave.
Cult wineries come into fashion as California Cabernet Sauvignon dominated the wine scene from the early 1980s (first predominantly American wine list was the Four Seasons created by Kevin Zraly). This trend continued to the early 2000s.
The cocktail culture kicked off in the last of the 1990s, and by the mid-2000s mixologists began demanding more bourbon and bringing back rye. Scotch experienced a resurrection, selling large quantities of single malt into the new whiskey boom.
The second wave of craft brewing rises, as the industry turns from basic traditional styles, to more experimentation. The series of Small Farm winery bills (introduced in the late 70s and early80s) across the country begins to bear fruit, as Agritourism is born. In the US and Canada. The local wine scene grows exponentially from 1995 to 2000. Whiskey roared back in the US and Canada.
The third craft brewers wave, based on new hybrid hops from the west coast, introduced in 2008 and 2009, reinvigorated the stalled craft beer movement, pressing a wave of IPAs that extended from 2011 or 2012-ish to the present.
By 2015 the US and Canada have more distilleries, wineries, and breweries than ever before in their nations. It is the "Golden Age" of the adult beverage industry. This is where the bubble began to build-up. New factories, new brands, new releases. High prices. New consolidations. Over investment.
With the onset of COVID, from 2020 to 2023 the intake of alcoholic beverages rose. With all the new beer and distilled spirits, from 2022 to 2025, wine sales begin to slide. Large wine conglomerates, especially Constellation Brands and others, start slashing their portfolios and streamline their offerings.
In the 2020s, a new form of temperance takes hold. Social media influencers lauded health benefits (like the 1970s version) - Dry January, #SoberCurious, #AlcoholFree , The Sober Girl Society, #happywithoutthehooch, etc. begin to take root.
By 2024 and 2025, despite the rising tide of new bottle and label releases, whiskey sales were down. The Single Malts, once so adored, started to lose shelf space, as did bourbons an ryes. Tequila and clear spirits started to see rebounding sales.
Seltzer products - with 4-5% alcohol became the rage, cutting into spirits, beer, and wine sales.
No-alcohol beers became a sizable segment of the market as well, selling the same "Near Beer" their grandfathers has railed against in the 1920s.
Trade tariffs, health trends, and over production hit the adult beverage industry. Sales stalled, then began to fall.
And that is where we are. The pendulum has swung back and forth. An industry prone to Boom and Bust, has seen it happen once again. The bubble has burst. MGP the largest producer of whiskey in America (an former Seagram's plant) had over diversified, buying it's two largest customers, hoping for a more vertical operation (never of a strong suit of the company's history). Overspending plunged MGP into an untenable position. Uncle Nearest, Bulliet, and numerous others, dealt with numerous troublesome issues. Large distilleries erected to handle the booming demand went to half schedules, shuttered, or worse never opened.
There were many more beverage industries icons that did the same. InBev bought Appalachian Mountain Brewery and later sold back to the founders. They sold off several craft brands to other, small conglomerates. Constellation Brand bought Ravenswood, busted it out, and then sold the label to Gallo - who then brought back the founder Joel Peterson - who has since revived the label successfully.
More history is yet to be written - innovation and people will be the real difference makers in the next wave - as they usually are. There's still room to launch new brands, new products, but each of these three industries is currently still looking for the new hook.
I, for one, will continue to promote the industry. The products. The people. I have been at it for more than 20 years.
In the mean time, many did not see the bubble - the nature of a bubble, of course - but we should also know our history. These "corrections" are bumps to be expected. The important part is not to panic, but to get around to the next corner.