Although there’s never a good time for a global pandemic, with almost 8000 brewers currently online and craft beer’s momentum slowing, Covid-19 couldn’t have come a worse time.
The degree to which the coronavirus will affect the craft beer industry remains to be seen, but it will impact the biz and lead to (some/many?) brewery closings.
America’s retail landscape is changing by the minute and we promise you no one is thinking about catching up with friends at the local tasting room.
Officials in the nation’s largest cities, New York City, Chicago, Los Angeles, Washington DC and San Francisco have already ordered restaurants, bars, and cinemas to close and that trend will only continue.
Apple, Nike, Patagonia and Nordstrom have already closed their doors, with scores of other retailers expected to follow suit across the country.
Starbucks has removed chairs from thousands of locations and only doing to-go business. McDonald’s is closing its dining rooms and only serving customers at drive-thru windows. Craft beer-friendly resorts and sports arenas are closed. Ski-lifts are empty and local gyms shuttered.
It doesn’t help that the stock market has already lost a third of its value either. That at this point a recession seems inevitable.
And while a time like this does call for a drink, craft beer is for many a luxury, and these are no longer luxurious times…
Bart Watson, Chief Economist at the Brewers Association, expects an on-premise (bars, restaurants) and own-premise (brewery taprooms) sales hit no matter how American cities face the pandemic…
“Let’s start with the short-term impacts. Sales of beer in taprooms and other on-premise establishments are certain to fall.”
“Some of this will be supply-side with breweries shutting their doors for health and safety concerns, and some of this will be demand-side as beer lovers simply venture out less. Several states are taking the unprecedented step of closing bars and either closing or limiting the capacity in restaurants.”
“For taprooms and brewpubs, there is some hope that those drops might be partially offset by to-go sales or even delivery, Watson added. And he suggests that taprooms and brewpubs take their lead from Starbucks and McDonalds and beef up their ‘to-go’ programs.
But with cities like San Francisco ordering it populace to weather this storm at home (and more sure to follow), is that concept really viable?
And is home delivery in the midst of an ultra-contagious virus outbreak really a safe for either the consumer or the delivery person? There are still HUGE questions about COVID-19’s transmission and how long it remains contagious on surfaces.
It’s all enough to make you want a drink (or three!)….
But you’ll probably be drinking whatever you already have around the house, not something fresh from you local brewery.
And that’s a HUGE problem for a craft brewing industry with much product to move at a time when Americans are isolating themselves and retailers are closing their doors.