Sorry Dave. I have to disagree.
While I agree location is important, I've seen breweries in great locations and busy areas that served crappy beers and they closed in short order.
I hope you are right, honestly. I do think competition and market dilution is probably an even more critical factor than quality. If your brewery is the only one in town (Crescent City in NOLA in 2003, I'm talking to you), then people will flock there regardless of quality. But, if there are 2 or 3 or 10 breweries in close proximity, and some are serving stellar beer while others are serving crappy beer, then of course the crappy ones are going to lose.
Meanwhile, for ~15 years, the Courthouse Pub in Manitowoc was the only brewpub or microbrewery in the county where I live. And their beer is --- honest-to-God --- UTTER CRAP, friggin undrinkable. No one I know ever went there for anything but the FOOD, NOT the beer. They fully deserve their reputation for bad beer. HOWEVER, fortunate for them, the food is very good, which has kept them alive; and also, until more recently, the average joe around here didn't care about the difference between Busch Light and fizzy extract water as long as it gave them a buzz. But now, finally, a new nanobrewery has just opened (PetSkull) and another is almost ready to rock (and I've already tasted it, Sabbatical), and FORTUNATELY, both are making fantastic beers. So finally we will have someplace to flock for beer. And, like I say, we are (finally!) fortunate that they won't all suck. But even if I'm wrong and one of the latter two ends up only being mediocre instead of stellar, they will still have regulars at both as long as they're not utter crap like that other one. In the end, all will remain in business, albeit for different reasons. All 3 are in pretty decent locations downtown, and I think that definitely helps, especially for the Courthouse Pub. If on the other hand they were surrounded by old abandoned warehouses and/or in a shady neighborhood... might not be successful. Now........ if 15 more breweries are built in this county in the next 5-10 years, I cannot promise that all 15 will be successful. With that many to choose from in a small community, there would certainly be winners and losers. In a bigger city, though, it wouldn't matter quite as much. So many factors.
But anyway.
Cheers.