If you think that your favorite craft brewery is doing okay during these times, just because you are buying their beer, guess again. Chances are that they are struggling to survive and wondering if they will be able to keep their doors open long enough for a vaccine to arrive to allow life for them to go back to normal.
One of the hardest hits to their pockets came with the closure of on-premise tap and tasting rooms across the country. This was particularly painful too small to mid-size breweries that heavily relied on pints poured on site to generate a consistent stream of revenue. When their tap lines went dry many were stuck wondering how they would survive. “Luckily we had just installed a canning line before COVID hit shutting down our ability to pour pints on site” says Jake Gardner the head brewer of Westbound and Down Brewery in Idaho Springs. “While we were fortunate to have that line of income coming in it still does not even come close to replacing the revenue we were making each day. I cannot imagine how hard it is for breweries that relied solely on their tasting rooms.”
Then came the second punch to the gut when the restaurant and bar business dried up overnight and has struggled mightily to regain even a fraction of the momentum it had before COVID. A recently released survey from the Colorado Restaurant Association in July stated that an eye popping 62% of the state’s restaurant owners that they might have to close their doors within the next six months if things don’t change and restrictions are lifted. Couple that with the restrictions placed on bars (currently all alcohol sales must cease at 10p.m.) and it’s safe to say not much beer is getting poured from taps across the state.
But, what about the beer I buy in my local liquor and grocery stores, that should be helping them. It is, but barely. First off, a large percentage of the beers you see filling the shelves of your local grocery stores comes from a few powerful distributors in the state. Budweiser and MillerCoors are formidable forces in beer sales, ones that cause grocery store owners to listen when they speak. Years ago, they recognized the threat the burgeoning craft beer business had to their bottom lines, so they acted. AB InBev, the owners of Bud, have an impressive lineup of crat beers in their craft beer division, The High End, breweries they own and distribute across the country. In fact, their CEO Carlos Brito told investors in 2018 that they were the number one craft brewer in the world. Breckenridge Brewery, Elysian Brewing, 10 Barrel Brewing, Goose Island, and Wicked Weed are a few of their brews. That coupled with Miller Coors portfolio of Blue Moon, Leinenkugel, Hop Valley, Terrapin Beer, and Saint Archer means that the shelf space available to smaller local breweries is tight.
So, while things might look better for the myriad of neighborhood craft breweries spread throughout the state, things are still a long way from stable. As winter approaches, and the warm afternoons sitting around improvised outdoor seating areas disappears with the change of seasons, many wonder will their customers too? “I have heard from many of our members expressing fear about what will happen this fall and winter,” says Bart Watson the Chief Economist for the Brewers Association. “They are already looking at depleted bank accounts and many fear that a harsh winter might do them in.”
For fans of craft beer and the culture that has grown up around it this could be a winter of discontent, the seeds of which were planted last winter, when COVID reared its ugly head. Many neighborhood watering holes could go under. Only time will tell.
