Artisanal businesses should innovate to remain competitive

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Artisanal businesses should innovate to remain competitive

The COVID-19 pandemic exposed critical vulnerabilities within the craft ***** industry, but many had been brewing beneath the surface. Ivey prof Andreas Schotter studied what it takes to make it as an artisanal business. Credit: Elevate/Pexels

The craft ***** industry, once the darling of consumers and entrepreneurs alike, has faced unprecedented challenges in recent years. Closed taprooms, canceled festivals, and changing consumer habits have led many to declare the end of its golden era.

But is the craft ***** party truly over—and with it, the artisanal movement as a whole?

A new study from Ivey Business School professor Andreas Schotter,

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in the Journal of Business Venturing, suggests otherwise.

The rise of craft *****

For years, craft ***** was the toast of the town, with a meteoric rise that rewrote the rules of the brewing industry. By 2019, it claimed an impressive 10.1% of ***** consumption in Canada and 13.6% in the U.S., becoming a cultural phenomenon.

The industry prided itself on tradition and individuality, a collective of small-scale brewers who stood as the scrappy David to Big *****’s Goliath. With their hands-on craftsmanship, endless creativity and uniquely collaborative spirit, craft brewers built an identity rooted in authenticity and community.

Just as craft ***** reached its zenith, the COVID-19 pandemic struck. Sales plunged. Small breweries—the soul of the craft movement—were hit hardest. The once-vibrant spirit of collaboration unraveled as businesses fought to stay afloat.

Driven to understand how disruptions shape craft ventures, Schotter and his U.S. colleagues conducted interviews with brewery stakeholders and analyzed industry data. What they discovered was unexpected: the craft sector isn’t going stale. Instead, it’s evolving, undergoing a profound transformation that could redefine the very meaning of “craft.”

The great craft shakeup

Like industries across the globe, COVID-19 exposed critical vulnerabilities within the craft ***** sector. Schotter said three that had long been brewing beneath the surface:

• David becomes Goliath: In the craft world, smallness was the hallmark of authenticity, with purists casting doubt on brands who had invested in larger operations. Yet, it was these small, independent companies that proved most vulnerable in crisis, while the ******* players’ growth became a vital lifeline. “It leads us to the question: in today’s craft landscape, does size erode authenticity? Or might it just be the key to survival?” asked Schotter.
• The comfort in the known: The industry’s passion for novelty—a defining trait—suddenly gave way to a craving for consistency and familiarity throughout the pandemic. In uncertain times, consumers sought comfort in trusted brands and classic styles, challenging the industry’s reliance on constant innovation.
• The collaboration myth: In crisis, the “rising tide lifts all boats” mentality that defined craft’s early days has been put to the test. As resources became scarce, many businesses turned inward, focusing on self-preservation—raising uncomfortable questions about the limits of collaboration in a maturing industry.

“These trends point to an industry—and a broader movement—that’s growing up,” Schotter said.

“The idealism of craft’s early days is giving way to a more nuanced, resilient approach to artisanal business.”

To support craft enterprises in building resilience and adapting to this evolving landscape, Schotter outlined key recommendations:

• Embrace scale smartly: Growth doesn’t have to mean selling out. Craft businesses need to find ways to scale that preserves their ethos while building resilience against future shocks.
• Redefine innovation: Innovation isn’t just about the product, it’s about the business model. Craft industries need to innovate in how they reach customers and deliver experiences, not just in what they produce.
• Reimagine collaboration: The spirit of collaboration isn’t *****, but it needs reimagining. Strategic partnerships that go beyond feel-good gestures to create real value will define the next phase of craft industries.
• Reclaim real: As craft businesses grow, they need to find new ways to maintain the connection with consumers that made them special in the first place. This might mean leveraging technology to create personalized experiences or doubling down on local engagement even as distribution expands.

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Craft businesses need creativity

As global markets regain stability, Schotter’s team is noticing the stirrings of a craft revival, but it’s far from business as usual. The pandemic’s aftershocks, coupled with shifting consumer preferences, have flung the doors wide open to a new wave of players.

With competition intensifying and the old playbook tossed aside, Schotter said the path ahead will be daunting for entrepreneurs in this space. He called on craft businesses to embrace creativity, striking a balance between artisanal passion and business savvy, authenticity and adaptability.

“Be it in *****, furniture design or artisanal chocolates, for entrepreneurs the message is clear: the craft party isn’t over, it’s just moving to a *******, more interesting venue,” Schotter said. “The question is, are you ready to adapt and join the celebration?”

More information:
Daniel S. Andrews et al, Trouble brewing: Craft ventures during market disruption, Journal of Business Venturing (2024).

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Provided by
University of Western Ontario

Citation:
Researcher studies shifting craft ***** industry: Artisanal businesses should innovate to remain competitive (2024, November 27)
retrieved 1 December 2024
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