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Craft beer in Bloomington-Normal keeps growing, but is a saturation point near?

Keg Grove Brewing in Bloomington benefits from a location within a neighborhood, near the Constitution Trail, and with main arterial road access.
Charlie Schlenker
Keg Grove Brewing in Bloomington benefits from a location within a neighborhood, near Constitution Trail, and with main arterial road access.

In the last 15 years, McLean County has gone from one craft brewery to eight, and another just over the county line in Fairbury. There are six in Bloomington-Normal alone. At some point, craft brewers will start competing and there won't be room for more — but not yet.

There are various estimates of how many is enough.

There are 302 breweries and 336 brewing licenses in Illinois. There are 9,552 licenses in the U.S., up from 1,459 in 2007, the year Destihl opened its gastropub and microbrewery in Normal, according to the U.S. Brewers Association.

 Economic impact of Beer in Illinois
Brewers Association
Brewers Association
A Brewers Association study chronicles a hefty economic impact from craft beer in Illinois.

“I don't think there is room for any more breweries in Bloomington-Normal. I could be wrong. I don't know what the sign would be that we've reached saturation, but five within a 20-mile radius is pretty dense," said Dave Casper of the Casper Brewing Company on Bloomington's far southeast side, and among the newest of the craft breweries in the Twin Cities.

On the other hand, Casper said in some North Carolina cities, it seems like there are dozens of craft tap rooms all within walking distance of each other.

“You'll know it when you get there. The community can handle as many craft breweries as they are interested in handling," said Jeff Mroz of Keg Grove Brewing Company in central Bloomington.

Economic impact

This is not just a question for craft beer lovers. Brewing has become an important part of the Illinois economy. The Beer Wholesalers Association estimated the economic impact from craft brewing at nearly $2.98 billion in 2021.

Craft brewers made about 427,000 barrels of craft beer that year in Illinois. The Beer Serves America study from the wholesaler’s association showed that in the two congressional districts serving Bloomington-Normal (16th and 17th), beer supported more than 11,000 jobs, more than $600 million in annual wages and benefits, and more than $2 billion in economic output in 2021.

There are mixed signals. The National Beer Purchasing Index suggested beer is poised to contract, though the craft beer segment of the index improved from this time last year. Most projected contraction is coming in the segment covering below-premium beer. There is strong improvement in the imported beer sector.

Though some forecast a contraction in the beer sector, growth in craft brewing has been explosive in the last fifteen years.
Brewers Association
Though some forecast a contraction in the beer sector, growth in craft brewing has been explosive in the last fifteen years.

Even craft brewing may be too broad a category. Some parts of craft brewing are doing quite well.

"The segment that is really shining right now are the hyper-local brewpubs," said Steve Fiala, of Fiala Brothers Brewery and Beer Hall in Uptown Normal.

A lot of people, particularly younger drinkers, are migrating to hard seltzers or hard liquor mixed drinks instead of beer. Beer in general is competing with those hard seltzers and canned mixed drinks for shelf space in retail outlets, though Ray Stout, director of the Illinois Craft Brewers Guild, said the smaller operations don't depend as much on retail sales.

"Most of our breweries here in the state of Illinois make 70% plus of their revenue from on premise sales, and that is what is continuing to be strong in this beer market right now," said Stout.

Most brewers in Illinois make less than 300 barrels of beer per year. Each barrel is 31 gallons, and Stout said that scale of brewing will not be greatly affected by the retail segment. He said Illinois is a long way from market saturation in craft breweries.

"If you look to our east in a state like Ohio there are a million less people and a hundred more craft breweries, so we have some catching up to do here," said Stout.

He said people travel to find local breweries — not just in beer tourism but local fans of malt and hops. He said craft brewers have helped a lot of small towns.

"If you look at Petersburg and Hand of Fate Brewing, that whole downtown came up around that craft brewery. A lot of times breweries do go into neighborhoods that need some level of revitalization, but they are the cornerstone business that jump starts the coffee shop and that antique shop and everything else that comes with it," said Stout.

The barrel room at Destihl's production facility in north Normal.
The barrel room at Destihl's production facility in north Normal.

That seed to grow the small-town economy is what Analytical Brewing is trying to do in Lexington and what Emancipation Brewing is attempting in Fairbury.

Beer identity

Twin City craft brewers said for them and any new brewers to succeed, they need to make themselves distinct in the kinds of beer they offer, the culture and vibe of the tap rooms and pubs they operate, and perhaps even in geography.

“Every brewery has their own niche. Destihl is excellent with sours and their Deadhead Series. White Oak is fantastic with hazies. Lil Beaver does a great job with flavor-forward beers. We have a lot of fruit beers, a diverse offering," said Mroz of Keg Grove.

Casper Brewing, the newest Twin City entry, is even more eclectic.

"OK, so I brew everything else nobody else would put on draft," said Casper, adding he's a big fan of Fuller's Extra Special Bitter and Lion's Pride, two British beers that are almost impossible to find in the U.S.

"I said I'm just going to make one, I've never seen an ESB on draft in any brewery I've ever been to," said Casper.

Another variety he brews is a style of German Altbier, which, along with Kolsch, lays claim to the title of oldest kind of beer in Germany. They are common to the Dusseldorf area.

Casper said there's no rubric to help decide whether to go for a cutting-edge beer, and several kinds of, say, a hazy IPA or go for something in a different niche.

"My take on that is if you do something well you really shouldn't have to jump into anybody else's pool. If you keep trying to be what everybody else is, you will never find your true self. If you stick to what you do well, people will know you for it and they will come to you," he said.

Location, location, location

Bloomington-Normal craft breweries are dispersed on your Google map. Some are not in residential or retail areas. Getting people to come also depends on customers liking the surroundings. It's not enough to have good beer. The tap room itself is a key part of the mix.

Steve Fiala said it should be an experience for whoever is going there and that experience is tough to describe.

"That's a good question. Culture is one of those things people are constantly trying to define and learn about. For us, it started with just the building, the way that this place felt. We wanted it to feel different and unique with it being multi-level, mixed materials, giant serving tanks when you walk right in that your eyes can't miss," he said.

Staff quality, Fiala said, is a close second.

Casper said he wanted his tap room to be family-friendly as a way to distinguish himself from his peers.

"We have chalk boards that kids can reach. There are games all over the place. There is nothing that a baby or a kid can put in their mouth and get hurt. We wanted a mom and dad to come here and have full line of sight on their children and just not worry where they are at or how many more minutes they have before this kid freaks out and screams and then they gotta go," said Casper.

Both Fiala Brothers and Keg Grove are centered in neighborhoods that can bring local foot traffic to make it their local pub.

There's a disconnect, though, between that neighborhood brewer common in the 1800s and before Prohibition in the 1900s and today when tap rooms like White Oak Brewery in Normal, Lil Beaver in south Bloomington and Casper Brewing are in out-of-the-way places — in industrial parks and metal buildings without a true neighborhood to support them.

Fiala said there are tradeoffs to both models, and you shouldn't assume an industrial setting necessarily has a disadvantage.

"You give yourself more options to expand and do some creative things," he said. "When you open in a place like we did which is a narrow space in a more urban environment, we are kind of handcuffed in terms of what we can do on the beer side. We knew that coming in. If we wanted to be more of a production facility, we would have looked elsewhere."

Food also also be important to small craft brewer success. Destihl began with food just as much as beer. Fiala Brothers and Lil Beaver have distinct menus. But Keg Grove does not have food in house. Jeff Mroz said he compensates by scheduling food trucks and building on certain occasions.

"You bring in those different events, those collaborations in order to draw the non-neighborhood," said Mroz.

Keg Grove’s latest is a partnership with the Illinois Symphony Orchestra.

Mroz said some of the best breweries began in isolated areas and people flocked to them because their product shines. They create a niche and become sought out destinations. He said they become a little like "Cheers" with their own set of people.

Illinois is ranked 32nd in the nation for breweries per capita, but 16th per capital in barrels of craft beer produced, according to the National Brewers Association. Illinois Craft Brewers Guild's Ray Stout said one thing the state has done well that will keep things growing is a law change that allows craft brewers to sell directly to the public or retailers and not go through a distributor who can take 30%. He said Illinois still lags places like Ohio in one regulatory aspect.

“Since 2007 in the state of Illinois, you have been able to ship wine. It is currently illegal to ship beer in the state. Ohio legalized direct consumer beer shipping which helped them greatly during the pandemic and the proof is in the pudding where their industry is significantly larger than ours just to the west," said Stout.

So how much more room is there for new craft brewers in Bloomington-Normal? Even though it's grown to become an international distributor, Destihl Brewing is still small enough to confound the national flat growth trend in beer.

Destihl Director of Sales Bob Ryan said they grew 27% last year, adding there's still very much an upside for small craft brewers in Bloomington-Normal.

"I'd love to say in the 10-20 range," he said.

Stout also said people will travel for beer. And with five vastly different craft brew operations in the Twin Cities and several more nearby, Stout said Bloomington-Normal will draw beer tourism from people who want to make several stops in an area.

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Corrected: July 16, 2023 at 10:02 AM CDT
This story has been changed to correct the number of craft breweries in McLean County, and to correct that Destihl was not the first craft brewer in Bloomington-Normal.
WGLT Senior Reporter Charlie Schlenker has spent more than three award-winning decades in radio. He lives in Normal with his family.
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