The rise of Chicago’s craft breweries

by Brenden Miranda and Yaricza Flores

In the bustling city of Chicago lives a quaint establishment, nestled away in a small industrial district of the city’s West Town. Emblazoned on the side of the building reads, “On Tour Brewing Company”, although you’d easily miss it if you’re not paying attention.

Outside of On Tour Brewing Company in Chicago’s West Town neighborhood. (Photo/Brenden Miranda)

On Tour is just one of the many craft breweries to pop up within the city recently, which already boasts over 200 breweries in the metropolitan and suburban areas combined.

Craft breweries, sometimes referred to as microbreweries, were first discovered in the United Kingdom back in the 1970s but has since taken to international fame, creating an entirely new market that cities such as Chicago have taken to en masse.

There’s no surprise that Chicagoans are ecstatic about new brews in the area — the city has shared a multi-decade camaraderie with names like Old Style and Goose Island. However, this new shift to the brewing industry, one that amounts to more than 7.8 percent of the market, leaves many wondering how these breweries attempt to differentiate themselves, and whether or not this trend of craft breweries has any long-term substance.

I had to wear a lot of hats opening this business,said Mark Legenza, founder and master brewer at On Tour. “In the very beginning, I had to write a business plan that was 42 pages long and covered a lot of topics I wasn’t necessarily an expert in.”

Legenza launched On Tour Brewing Company early last year to massive fanfare. The opening was met with local excitement and received a large amount of media attention from critically-acclaimed food blog Eater amongst others, yet certain Chicagoland publications, such as Chicago Magazine, were quick to point out how it can begin to feel difficult to distinguish from the ever-expanding array of breweries this city has.

A map indicating the proximity of Chicago’s West Town and West Loop craft breweries.

When asked about what sets his brewery apart from the rest, Legenza replied with “our goal has never been to be different.He added that the idea stems from a “love with spending time at tasting rooms with friends over many years” and that competition isn’t “always a bad thing.”

“People who are attracted to our brand may have an emotional attachment to it that separates us from other[s],” he said.

It’s no secret that whatever it is these craft breweries are doing, they’re doing it right and in turn, are actually helping out their local economies in a big way. When reviewing data from the Brewers Association, a trade group for small and independent craft brewers, Illinois craft breweries alone are contributing more than $2.6 billion in economic impact, and are producing over 385,000 barrels of craft beer per year. Another one of Chicago’s craft breweries that has left a massive footprint is Revolution Brewing.

Revolution Brewing, which is located in the city’s Logan Square neighborhood, was founded in 2010 by Josh Deth, a former cellerman at Goose Island, and has since received multiple awards as well as local and national recognition.

Revolution Brewing’s main brewery, located in Chicago’s Avondale neighborhood, also features a taproom. (Photo/Yaricza Flores)

Revolution Brewing currently brews 22 different beers, this alongside a collection of 10 new ‘barrel-aged’ beers that are still currently being released. Revolution, which is featured everywhere from your local grocery store to the big screen, claims that “a commitment to quality” plays a big role in their success.

“We’re currently distributed in eight states and do around 90,000 barrels of beer annually,” said John Carruthers, Communications Manager for Revolution. “Trends come and go, but a commitment to quality endears you to beer drinkers in a way that goes beyond being the flavor of the week.”

What Carruthers is referring to here is the relationship these breweries have with their communities, and that the expansion of craft breweries is incredibly vital to not only the success of these craft breweries now, but also their continued success into the future.

When asked about how they saw their businesses scaling in the future, Legenza and Carruthers responded similarly. Legenza hopes to see On Tour increase productions in 2019, by investing in more tank capacity. Carruthers noted that Revolution will continue to play into their “strengths in our home state”, citing industry growth isn’t what it used to be. Both Legenza and Carruthers actually hope to see more craft breweries begin to spawn in the Chicagoland area.

The neighborhood in which On Tour is located is also home to Goose Island, who has cemented a name in the city. With advertisements slapped left and right, and their products served in just about every establishment imaginable, you’d be hard-pressed not to find a Goose Island in a Chicago hangout.

Founded in 1988 in the Lincoln Park neighborhood and eventually cementing a brewery in the city’s West Town neighborhood by 1999, Goose Island turned a single local brewery into a distribution empire, allowing their beers to be represented in countries such as China, South Korea, London among others.

One of Goose Island’s main breweries, located in Chicago’s Fulton Market District. (Photo/Brenden Miranda)

While a licensing agreement signed to beer conglomerate Anheuser-Busch helped accelerate the brand’s progress, the company’s continued success is still an undisputed testament to the craft and care Goose Island creates their products with. Just two weeks ago, thousands of eager consumers were waiting at their turn to purchase Goose Island’s annual Bourbon County Stout — a beer that typically sells out within hours after its release. And while we were interested to learn more about Goose Island, their marketing strategies and their plans to scale, they declined to comment.

Bart Watson, Ph.D, the Chief Economist of the Brewers Association, said he believes that “as the number of breweries increases and competition increases with it as well, but most breweries still see the growth of ‘better beer’ as helping the industry”, and that, “a study of breweries in metro areas found that the best predictor of where a brewery locates is the presence of an existing brewery.

A hyperlapse of Goose Island’s Fulton Market District brewery. (Video/Yaricza Flores)

Breweries are continuing and will likely continue to take over major cities en masse for the foreseeable future. Not only are we seeing major expansion in robust areas, but also within small-town markets, where craft breweries are also continuing to make a major impact on their communities. In a New York Times article published earlier this year, brewers are begin to rent up commercial real estate in “sleepy commercial” districts, and are willing to pay a pretty penny to do so. The article touched on a small brewery in Middletown, New York in which patrons were traveling from states away just to get ahold of select brews.

The beer industry is certainly flourishing in ways not many expected. Although we’re seeing increased competition, with the rise and acceptance of breweries and craft breweries not only within major metro areas, but also within smaller, quaint communities, there is a renewed energy within the beer community that gets brewers excited for the future.

Watson was asked how he sees the future of the breweries and the competition in this ever-evolving industry, he posed a question in response: “Who does your brewery appeal to, and how are you marketing and staying relevant to that community? If it’s the same market as everyone else, it’s pretty crowded.”

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