When considering the best location to succeed with a new craft brewery, cities in beer-mad Colorado, Washington and Oregon may come to mind. A new study, however, finds an unlikely winner: Somerville, Massachusetts.
Somerville, a city with about 80,000 residents two miles north of Boston, ranks No. 1 because of a large population that can drink legally, a low state excise tax on barrels of beer produced and one of the nation's lowest brewery license fees. That's based on a study of more than 180 U.S. cities with a population of at least 50,000 people by Bid-on-Equipment, an Illinois-based Internet site for buying and selling used machinery, including brewing equipment.
Somerville's HONK! is an annual three-day free festival with brass bands joining together to celebrate music, community and activism. The city outside Boston has been named the best U.S. city to launch a successful craft brewery. (Photo: Getty)
Massachusetts has two other cities — Boston and Worcester — in the nation's Top 30 locations to open a new brewery, but cities in western states dominate the survey results. Twenty of the Top 30 cities are in the West, including seven in Colorado, seven in Washington and four in Oregon.
Madison, the home of the University of Wisconsin, ranks No. 2, followed by Seattle, Denver and two smaller Colorado cities, Longmont and Loveland.
"The top five cities struck a balance between the right business environment and the right age and income level of a population able to patronize a brewery establishment," says Collin Czarnecki, a researcher for Digital Third Coast, a marketing agency that conducted the study for Bid-on-Equipment.
Anyone considering opening a brewery in top-ranking Somerville may want to know more facts about the city. Somerville, according to the city government, "is an eclectic mix of blue-collar families, young professionals, college students and recent immigrants from countries as diverse as El Salvador, Haiti, and Brazil." Only New York has more artists per capita than Somerville, the city government says.
Cities in the survey were compared based on business environment and business costs, the Bid-on-Equipment study says. Within those two categories, each city was scored on six metrics: percent of population age 21 or over; median income; number of breweries per 50,000 people; whether the state allows breweries to self-distribute; the state excise tax per barrel, and brewery license cost. Oversaturation of breweries was considered: Cities with more than 10 breweries were given a lesser grade.
State excise tax was weighted heavily when calculating the cities' rankings, the Bid-on-Equipment study says, because the Beer Institute trade group said taxes are the most expensive ingredient in beer, costing more than the labor and raw materials combined.
Here are Bid-on-Equipment's Top 30 cities to launch a successful craft brewery, followed by each state's excise tax based on data of the Brewers Association craft-beer trade group.
1. Somerville, Massachusetts, $3.30 per barrel
2. Madison, Wisconsin, $1
3. Seattle, Washington, $4.78
4. Denver, Colorado, $2.48
5. Longmont, Colorado, $2.48
6. Loveland, Colorado, $2.48
7. Portland, Oregon, $2.60
8. Royal Oak, Michigan, $6.30
9. La Crosse, Wisconsin, $1
10. Fort Collins, Colorado, $2.48
11. Missoula, Montana, $3.30
12. Bellingham, Washington, $4.78
13. Boston, Massachusetts, $3.30
14. Frederick, Maryland, $2.79
15. Vancouver, Washington, $4.78
16. Scottsdale, Arizona, $4.96
17. Bellevue, Washington, $4.78
18. Boulder, Colorado, $2.48
19. Colorado Springs, Colorado, $2.48
20. Eugene, Oregon, $2.60
21. Tacoma, Washington, $4.78
22. Bend, Oregon, $2.60
23. Milwaukee, Wisconsin, $1
24. Portland, Maine, $10.85
25. Spokane, Washington, $4.78
26. Worcester, Massachusetts, $3.30
27. Yakima, Washington, $4.78
28. Ann Arbor, Michigan, $6.30
29. Medford, Oregon, $2.60
30. Aurora, Colorado, $2.48