SAN FRANCISCO, CALIFORNIA: Anchor Brewing, a historic craft brewery based in San Francisco, has announced it was shutting down after 127 years in operation. The beloved business cited a combination of challenging economic factors and declining sales since 2016 as reasons for its decision to cease operations and liquidate assets, according to a press release.

The craft brewing industry as a whole has faced numerous difficulties, including changing consumer habits, rising costs and ongoing supply-chain challenges. One significant factor contributing to Anchor Brewing's struggles has been its acquisition by the Japanese beer company Sapporo in 2017.

Why is Anchor Brewing shutting down?

Employees of Anchor Brewing have voiced concerns about Sapporo's alleged mismanagement and lack of understanding of the US craft beer market. Additionally, the company faced criticism in 2021 when a rebranding attempt deviated too far from the brand's classic image. "This was an extremely difficult decision that Anchor reached only after many months of careful evaluation," said spokesperson Sam Singer, adding that the "impacts of the pandemic, inflation, especially in San Francisco, and a highly competitive market left the company with no option but to make this sad decision to cease operations."

The brewery, which employs 61 individuals, provided its workers with the required 60-day notice and will offer transition support and separation packages. Brewing operations have ceased immediately, but the remaining beer inventory will be sold through the end of July. It was reported that Anchor Brewing scaled back its distribution, limiting sales to California only. The company also announced the discontinuation of its popular Christmas Ale, which had been in production for nearly 50 years.

These measures were taken in an effort to "reduce costs while final attempts were made to evaluate all possible outcomes," however, "in the end, expenses simply continued to outstrip revenues, leaving the company with no other viable choice." Sapporo made "repeated efforts" to sell Anchor Brewing over the past year but was unsuccessful. Though the company did say it was "possible that a buyer will step forward for the brewery as part of the liquidation process."

'A sad day in the history of craft brewing in America'

The brewery, founded in 1896, held the distinction of being the nation's first-ever craft brewery. Fritz Maytag, who purchased the struggling brewery in 1965, played a pivotal role in establishing the craft beer industry in the country. Anchor Brewing's notable brew, Steam Beer, gained recognition as a pale ale. Under Sapporo's ownership, Anchor Brewing's beer production has experienced a steady decline each year, except for 2021, as reported by the Brewers Association. Concerns among employees were raised when Sapporo acquired another craft brewer, Stone Brewing, further highlighting uncertainty about the future of their own brewery within Sapporo's plans.

Unfortunately, the overall state of craft breweries has not shown any improvement in 2023. Data provided by NIQ to Craft Business Daily indicated that the segment's sales have declined nearly 4% a year to date, with volume down by over 7%. Craft beer faced a challenging start in 2023, according to the publication. "This is a sad day in the history of craft brewing in America," remarked Harry Schuhmacher, publisher of Craft Business Daily, adding, "I know Fritz must be heartbroken. He literally nurtured that brewery from insolvency in the 60s to becoming San Francisco's hometown beer and symbolic of America's craft beer resurgence."