A brewery founded in San Francisco in 1896 and claiming to be America's first craft brewer is shutting down.

The Anchor Brewing Company announced that it will cease operations and liquidate the company, citing years of declining sales. The Japanese brewing behemoth Sapporo, which acquired Anchor in 2017, stated that efforts to revitalize the brand were unsuccessful. It was deemed the "godfather" of the American craft beer revival.

Anchor Brewing's spokesman Sam Singer characterized the decision as "extremely difficult." He stated that the company acknowledges the importance and historical connection  of Anchor to San Francisco and the craft brewing industry, however the effects of the pandemic, inflation in San Francisco in particular, and a highly competitive market compelled the company to make this regrettable decision.

Once upon a time, brewing titans such as Miller and Anheuser-Busch dominated the American market. Since the 1980s, however, the number of independent beer producers has exploded. Anchor, a company with origins in the Gold Rush, was a pioneer of this trend, expanding its reach beyond San Francisco in the 1970s and 1980s with the help of an heir to the Maytag appliance fortune and an appearance in the television drama "The Streets of San Francisco" starring Arnold Schwarzenegger.

In a 2017 profile of the company, the food website Eater described it as a "bubbly, malty, somewhat bittersweet alternative to the watery pilsners that had long dominated the market." This flavor was derived from the steam technique of brewing, which Eater identified as one of the few indigenous to the United States. Recently, however, the brand, which made the majority of its sales to taverns and restaurants, has struggled.

According to Sapporo, which purchased the company for $85 million in 2017 in an effort to expand its presence in the US beer market, the company's revenue decreased to $10 million in 2017 from $12 million the year before.

Sapporo claimed that it tried to revive sales by updating products and making additional investments, but had been unable to overcome the pandemic's impact on its business. The novel coronavirus had a substantial impact on Anchor, and this impact was particularly protracted in the San Francisco area. As a result, Anchor's sales have decreased substantially, Sapporo cautioned investors, adding that the decision will cost the company Y6 billion ($43 million).

According to the Brewers Association, craft beers accounted for just over 13% of all beers sold in the United States last year, and roughly 25% of sales by value. However, the beer industry has been under pressure due to the rising prevalence of pre-packaged cocktails.

The Breweries Association reported that the number of beverages sold in the United States dropped by 3% in 2017. The sales volume of tiny, independent brewers was relatively stable. Anchor informed its roughly 60 employees that it had repeatedly sought a buyer in recent years and remained hopeful that one would emerge during the liquidation process.

It stated that it would continue packaging and distributing its bottles in California until the end of July despite ceasing production of beer. Additionally, the local pub will remain open temporarily to offload remaining stock.