When visitors get carded during weekend tours at the Brooklyn Brewery in New York’s trendy borough, the company says the most common form of identification isn’t a local driver’s license. It’s a Swedish passport. Soon, Swedes won’t have to travel so far. Sweden, already the craft beer’s biggest market outside the Big Apple, will be home to Brooklyn Brewery’s first overseas plant. In January the company will start producing beer and open a restaurant in an old light-bulb factory in Stockholm.
The beermaker, founded in the 1980s by a former journalist and a banker who wanted to bring good lagers back to New York, claims to export more beer than any other American craft brewer. While it could just keep doing that, the new plant gives the company a priceless asset: local street cred that could encourage its most avid foreign fans to drink even more of its products.
In an age where local is supposedly best and everything from the meat at Chipotle Mexican Grill (CMG) to the wheat in Russian Standard vodka has a story, craft beer has grown into a $12 billion industry in the U.S., with sales doubling in the past six years, according to researcher Mintel. That’s “the big oxymoron of the proposition of craft,” says Spiros Malandrakis, an analyst at Euromonitor International. Much of the appeal of craft beers is “the localization and the small scale,” he says. So as Brooklyn Brewery becomes more global—it now sells in 20 countries—it risks being seen as the next Bud Light. “The more successful you become,” Malandrakis says, “the less you can claim to be the underdog.”
Brooklyn Brewery hopes to avoid that fate on the shores of the Baltic Sea. It’s teamed up with the Swedish unit of brewing giant Carlsberg Group (CARLB:DC), Stockholm-based holding company D. Carnegie, and a few private investors to create the New Carnegie Brewery, with an annual capacity of 1 million liters (264,172 gallons). Carnegie Porter, available since 1836 and now made by Carlsberg, was originally brewed by Carnegie and is Sweden’s oldest trademark still in use. The brewery and pub will cost 25 million kronor ($3.9 million).
Brooklyn brand beers sold in Sweden will still be made in the U.S., while the new brewery will develop fresh recipes in collaboration with the American operation. “We intend to have some fun exploring the great things Sweden has to offer,” says Eric Ottaway, general manager of Brooklyn Brewery. “It’s an exciting and dynamic market with soaring interest in craft beers.”
While craft beers represent just over 1 percent of the global market, they account for about 4 percent of the beer consumed in Sweden, estimates Nomura Holdings (NMR). The state liquor store chain, Systembolaget, which controls all beer sales via its monopoly, last year offered 3,290 types of brew in its 422 shops.
Sweden is the second-biggest export destination for American craft beer, after Canada, according to the Brewers Association, the U.S. craft brewers’ trade group. Brooklyn’s lager has a 39 percent share at Systembolaget among the most expensive brews, those costing more than 17 kronor ($2.67) for a 12-ounce bottle.
Eager to boost the bona fides of New Carnegie is its head brewer, Anders Wendler, Sweden’s 2013 homebrewing champion, who says he’s a fan of Brooklyn’s Radius unfiltered draft beer.
The company hasn’t yet decided how evident the Brooklyn Brewery affiliation will be on the new products. Wendler will work with Garrett Oliver, Brooklyn’s brewmaster since 1994, to create as many as four brews. “We’re certainly not just going to copy recipes,” Wendler says. “We will work together and come up with our own ideas.”
Part of the reason for Brooklyn Brewery’s success in Sweden, a country the size of California with a population of 9 million, is its partnership with Carlsberg, the market leader. Carlsberg started importing Brooklyn’s brews in 2006. The two beermakers have since stoked consumer interest with an annual event called Brooklyn, Sweden. In its second year, the festival of Brooklyn bands, food, film, and art drew more than 5,000 visitors in August for such hipster-friendly pastimes as a Found Footage Festival, featuring clips from VHS videotapes salvaged from American garage sales and dumpsters, and Swedish bicycle polo championship matches. Channeling Williamsburg has struck a chord with Sweden’s own trendsters. Says 31-year-old ad executive Oscar Trollheden, while quaffing a pint of Brooklyn Lager in Stockholm: “Swedes love New York and think Brooklyn is a cool place.”