Video Capital News takes a tour of the Kichesippi Beer Co. microbrewery.

When the Village Taphouse opened in West Vancouver four years ago, they served what general manager Colin Denton calls “typical” beers — Molson, Sleeman, and Labatt. But the pub’s vibe didn’t feel right, and Denton says they needed a change. 

“How do we make this a good place to watch the Canucks and sports? How do we make it a local watering hole where we can get people to come down after work and this is the place they feel comfortable?”

Looking around, Denton says he saw a shift among beer drinkers, whether they were sports fans or coming in to enjoy a classic pub meal. More and more people were drinking craft beer, he says, and two and half years ago, the Taphouse started to include a wide range of locally brewed beer on their menu. The taps lining the brick wall behind the bar are now labelled with many of B.C.’s micro or craft beers, like Cannog Ale’s Back Hand of God or Howe Sound Brewery’s Yellow Snow India Pale Ale. 

“Not only are people coming in knowing these craft beers and knowing the breweries, they know more about beer. They’re taking time to learn how hops work and what different flavours work together,” says Denton.

Canada is known as a beer-drinking nation, but in the last five years how we drink beer has changed. This has happened alongside the rise of microbreweries. Microbreweries, or craft breweries, are typically independent, local operations that produce a limited amount of distinctive brands. Where once the fridge was full of the big beer brands, more and more people have shifted towards microbreweries, and the move has changed what and how we are drinking.

Some bars are dedicated to serving a variety of craft beers.

Tapping into the market

Roger Mittag, the self-titled professor of beer, says our tastes have definitely changed over the last five years because of what microbreweries have to offer. Mittag runs Thirst for Knowledge in Toronto, the first beer connoisseur certification school in the country, which offers courses on beer tasting and appreciation. He is also a former Labatt brewing executive. Over the years, he’s seen his student body change, from beer executives and people in the hospitality industry, to the everyday person wanting to learn more about how beer should taste and where it comes from. He credits this change to Canadians’ increased exposure to the microbreweries.

"It’s opening up a completely different way of looking at beer."

“It’s opening up a completely different way of looking at beer,” he says. “People think of beer as that universal socializer. When you start learning that there’s a lot more beer available than what we’ve been accustomed to over the last 30, 40, 50 years, then I think people are starting to see their own interests change.”

There is no doubt the microbrewing industry has taken off. The Bank of Montreal released a report in September showing that while Canada and the U.S.’s mega breweries have slumped over the last year, within the microbrewer sector growth has been substantial. According to stats compiled by the Ontario Craft Brewers, average sales between 2004 and 2010 grew 10 per cent a year amongst Ontario craft brewers, while craft beer sales at Ontario liquor stores rose 30 per cent a year between 2008 and 2010. The Brewers Association of Canada says it also seen a noticeable rise in the number of microbreweries over the last two to three years, although no concrete figures are available. Microbreweries, however, still only make up five per cent of the beer market in Canada.

It was a change in Canadian tax laws that helped microbrewers get on their feet, says Mittag. Before the 1990s, all breweries were taxed the same, regardless of their size, which made brewing a rather expensive endeavour. But breweries eventually began being taxed based on how many hectolitres of beer they produced as opposed to a fixed sum.

The current economy also lends itself to beer, Mittag adds, since in poor economic times beer sales go up along with other vices like cigarettes. You may not renovate your house, but you'll treat yourself to a specialty pint of beer, he says. It's also argued that people will give up more expensive liquor like spirits or champagne and turn to cheaper luxury items like craft beer.

Savouring the suds

With the economic temperature just right for microbrewers, craft breweries across the country say that Canadians are expanding their tastes as consumers, savouring each frothy glass more like wine.

“The conception of beer was sort of a yellow, fizzy beverage that was in Canada always five per cent alcohol. So, now we’ve rediscovered that there’s hundreds of styles of beer for all kinds of different occasions,” says Gary McMullen, chair of the Ontario Craft Brewers and president and founder of Muskoka Brewery.

Beer is now chosen like wine, accompanying food and picked out carefully for an occasion. The options have allowed people to be selective, says McMullen, perhaps choosing a lighter beer on a hot summer’s day or pairing a darker beer with a hearty meal.

There are also more specialty seasonal beers, such as pumpkin beer for fall and blueberry beer for summer. These are some of the seasonal varieties at Alley Kat Brewery in Edmonton, where co-owner Neil Herbst says they’ve been trying to educate people for years about the beer industry. Only now, he says, has it reached a tipping point where consumer attitudes are changing.

“There’s been more interest in craft-brewed beer and I think more interest in beer in general,” says Herbst. “People are just realizing the breadth and the depth of the beer category.”

The tipping point also has to do with a changing demographic amongst consumers. When McMullen started Muskoka Brewery in 1994, the clientele was middle-aged, upper-middle class. Now a younger generation of consumers with a different attitude has stepped in. These new consumers want choice and they want to learn about the product. 

“More and more consumers are empowered. [Younger consumers] have a choice and they want to exercise their choice. Knowledge about products within their peer groups is power,” he says. “They want to know the details … You can actually walk into the brewery and meet the founder, meet the brewer. It’s all very real.”

Young consumers in particular are turning to craft beers.

At the Village Taphouse, Denton has also noted this shift, where the biggest craft beer drinkers fall into the 25- to 35-year-old demographic.

“They’re here after work having a couple of pints with their buddies,” he says.

Brewing change or fizzling out?

Mittag says the growth in the industry is a bit misleading, where Canada’s mega brewers still make up more than 90 per cent of the beer market. Growth seems huge when you’re looking within the niche market and not at the larger picture. Microbreweries still have just a sliver of the market.

But Mittag says microbreweries are starting to make small gains in the import market's terrritory. Imports were previously seen as the more specialized beer, but that isn’t the case anymore.

“Beer is best when it’s closest to home. It’s freshest,” he says, adding, “[microbreweries] are growing but they’re not growing in leaps and bounds within the industry as a whole.”

Beer costs vary across the country, but the average six-pack of a microbrew costs $12 to $13, the same price as imports. A six-pack of Labatt or Molson is around two to three dollars less at $10.

Nevertheless, there’s no doubting the overall effect craft beer has had on the consumer, changes even the big breweries can’t ignore. The Sleeman company, for instance, bought Upper Canada Brewing Company in 1998, where it still produces some of its craft beer varieties. Molson Coors Canada has bought a number of microbreweries, as well. Creemore Springs Brewery in Clearview, Ont. was one of its earliest acquisitions in 2005. Creemore then purchased Granville Island Brewing in 2009, located in Vancouver. On top of this, in May 2011, Molson Coors launched Six Pints Specialty Beer Company to appeal to what it called “the fastest growing market” of specialized beer drinkers.

“The craft in the micro-industry is really the creative driver of what’s going forward in the beer industry. It’s forcing the big guys to take a serious look at what they’re doing,” says Mittag. “That localized micro-portfolio needs to be part of their business as they move forward.” 

The mega brewers aren’t going anywhere, and the future of microbrewing in Canada is anything but certain. There will always be a need for the big companies, Mittag says, and they will continue alongside the budding microbrewing industry. His biggest concern is about microbrewers maintaining what beer is known for: consistency and quality.

“If you’re not getting the quality you’re looking for then you’ll stop shopping at that particular place,” he says. “Success to one brewer is not necessarily success to another.”

While the number of microbreweries may flatten over the next few years, they’ve changed the market and our tastes.

“It’s a very interesting time in the brewing industry,” says Mittag, “and I really don’t see this going backwards.”

Microbreweries have recently begun popping up around the country. Phil Kochanke of the Kichesippi Beer Co. takes us on a behind-the-scenes look at one such microbrewery in Ottawa to illustrate both the scale and process of this increasingly popular style of craft brewing.