Chapter 11, 7 bankruptcy filings claim more beer, brewery brands

It has been a dark period for beer drinkers. First, the Bud Light controversy made beer drinking — something most people associate with fun — political. That has been followed by a general downturn in beer drinking, especially among younger drinkers.

It's not that nobody drinks beer, but the alcoholic beverage has been fighting a number of trends. Hard seltzer and canned cocktails have seen their market share grow significantly.

Related: Iconic retail chain closing roughly half its stores

That has included major players, including Coca-Cola (KO) , entering the market offering a boozy version of its Topo Chico seltzer and partnering with Brown Forman (BFA) to bring Jack Daniels and Coke to market in ready-to-drink  (RTD) cans. Shelves have gotten crowded with options that are not beer, which seems to appeal to younger drinkers.

In addition, beer companies have also suffered from a declining market. That's something the Beer Marketing Industry (BMI) shared in its annual report on the state of the industry.

"The report reveals that beer shipments have fallen by 5% in the first three quarters of 2023, and were on track to fall below 200 million barrels for the whole year. As a result, this would be the lowest level of beer consumption in the USA since 1999, and against a 23% population growth since the turn of the Millennium," The Drinks Business reported.

Another brewery appears to be gone for good

The downturn in beer sales, along with debt caused by the covid pandemic, has caused a massive problem for the craft beer business. A number of local and regional breweries have shut their doors because they can't service the debt they had to take on when they were shut down for months during the pandemic.

Casualties have included huge names, including San Francisco's Anchor Brewing, a nationally known brewery. A number of other regional favorites of varying sizes, including Chicago’s Metropolitan Brewing, New Jersey’s Flying Fish, Denver’s Joyride Brewing, Tampa’s Zydeco Brew Werks, and Cleveland’s Terrestrial Brewing, have also filed for bankruptcy.

It's a sort of beerpocalypse that does not appear to be slowing down as another regional favorite brewery, 7 Mile Brewery of Rio Grande, NJ has filed for Chapter 11 bankruptcy protection. The company, which closed in May, filed for bankruptcy in late -February.

The company did share a goodbye on its Facebook page after its last day of operations in May.

"Well that’s a wrap. Thank you to all that came out this weekend to support us. Thank you to all of you for sharing your memories and sending well wishes. We will miss you all. We would also like to thank all our amazing employees through the years. 7 Mile Brewery was all because of you," the company shared.

7 Mile finally files Chapter 11 bankruptcy

It remains unclear why 7 Mile Brewery waited this long to file as it did not appear to be working toward a plan to reopen. The company reported liabilities of $601,000 and assets of $135,000, which is mainly in brewing equipment.

Filing for Chapter 11 bankruptcy protection might allow the company's owners to work out a plan to keep that equipment. That could, in theory, allow them to open in another location or brew beer to sell to wholesalers. 

A local radio station, 92.3 The Buzz shared what it believes to be the reason for the filing. 

"The craft brewer closed down its operation in May 2023 but has gone to court seeking protection after landlord threats of on-site auctions to sell the property outright.

7 Mile and the other breweries named above are not the only beer brands and breweries that have gone bankrupt and, in many cases, closed their doors.

Deadwords and Persimmon Hollow, two Florida breweries also filed for Chapter 11 bankruptcy earlier this year. Both of those beer brands are trying to stay open. 

Forgotten Boardwalk Brewing in New Jersey was not as lucky, having closed down in February. That was the same fate met by The Alementary Brewing Co., another New Jersey brewery which closed after a bankruptcy filing. 

In addition, franchise retail chain Craft Beer Cellar filed for Chapter 7 bankruptcy to liquidate its assets, after suffering from financial distress and failing to sell its business.