Has Coronavirus Doomed Craft Beer?

COVID-19 might kill thousands of craft breweries. Atlanta, GA craft brewery Monday Night Brewing has shared the results of a recent survey it conducted regarding the Coronavirus pandemic, revealing that 75 percent of their recent craft beer consumers won't be returning to a brewery until June this year, at the earliest. Even more alarming to small brewers, 35 percent said they would be holding off visiting a brewery taproom until July or later. Even with shelter in place restrictions loosening in states like Georgia and Ohio, it seems that drinkers will be self-extending their compliance with cautious behavior. “Anyone thinking we will return to ‘business as usual’ anytime soon—if at all—is in for a rude awakening. The COVID-19 pandemic has completely changed the way we do business, and will significantly impact how we run our taprooms going forward,” said Monday Night CEO Jeff Heck. This new data comes in the midst of a wave of information about the craft brewing industry and how it is coping—or failing to cope—with the economic fallout of COVID - 19. One such startling piece of information was another survey conducted by the Brewers Association which found that around 45 percent of American craft brewers felt they could not last the duration of the pandemic and accompanying mandatory business closures if it was longer than one-to-three months. Brewers Association Chief Economist Bart Watson wrote in April, "...there are about 8,150 active breweries in the country. If 2.3 percent of those breweries close, that would mean about 190 closures, 11.8 percent about 930 closures, and 45.8 percent about 3,735." The other 14.1 percent of craft brewers Watson referred to are respondents who said they felt they could only last a few weeks or fewer--that alone is a shocking statistic. Monday Night Brewing asked their survey questions of 743 people—not exactly a scant sample size. If applied to consumer markets nationally, this report out of Atlanta could spell disaster for the entire U.S. craft brewing industry, which has been a beacon for the potential of small business success for almost a decade. Contributing almost $30 billion to the U.S. economy and employing over 160,000 Americans in 2019, few industries have been as strong of a platform as small beer for launching workers into entrepreneurship. The Brewers Association has reported that sales for the industry are already down 65 percent, and—like in most of the retail economy—many staff members have been laid off indefinitely. Monday Night has stated that despite the relaxation of shelter-in-place and social distancing restrictions in the state of Georgia, their two taprooms will remain closed for the near future. Out of respect for the safety of their employees and customers, it is reasonable to expect that breweries all over the country will be following suit. One bright spot for both craft brewers and craft beer lovers is that many breweries have kept open for packaged distribution, to-go-sales and limited sales to restaurants who are permitted to sell to-go alcohol. These sales, however much they have been able to make up for taproom declines, are likely not enough for small breweries to cover for the loss in keg sales to bars and restaurants. As Watson notes, "One hundred percent growth in taproom sales via drive-up only helps so much when your taproom was 5 percent of sales and distributed draught 75 percent." The Brewers Association is acting on behalf of the industry, despite having to lay off some of its own staff. This week the BA announced the creation of the Believe in Beer relief fund to raise money for breweries in need. The goal is to raise a million dollars, and any craft brewery seeking assistance can apply by May 17. Their plea to drinkers: If you've ever enjoyed a craft beer at home or at a brewery with friends, please consider making a donation. We can and WE WILL save this industry. Additionally, for American Craft Beer Week (May 11-17), the BA is challenging beer lovers to give the gift of beer and to commit to purchasing gift cards or brewery merchandise. Another way to help stave off more craft brewery closures is to order more to-go beer directly from your local breweries or craft beer from your local bottle shops. Spread the word to everyone you know that craft beer needs their help now more than ever, and persuade them to spend their adult beverage dollars with independent breweries. And if you need help persuading them away from any big beer brands, share the tweet below with them. Potbelly ties for 2nd on this list of coronavirus stimulus takers. They took $10 million intended for small businesses. Potbelly is a major investment of the firm 3G Capital (Brazil's richest men), which owns Burger King, Popeye's & AB InBev (Budweiser). https://t.co/aG28mcQHDw — Craft Beer 40 (@BrewStuds) April 22, 2020

Has Coronavirus Doomed Craft Beer?

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