Throughout 2019, a new brewery opened up in New York State at a rate of approximately one every ten days. The Capital Region alone saw more than a half dozen open last year, bringing our breweries in the region to around 40ish. It had been a glorious 10-15 years in the craft beer world, not just in New York, but across the whole country. And then, Covid19 decided to rear its ugly head, and seemingly, the world changed overnight. And it wasn’t just the breweries that were about to take a hit, it was the whole industry. Let’s dive in to explore how the pandemic has affected all four tiers of the craft beer world: Breweries, Distributors, Retailers, and Consumers. Let’s take a look.
BREWERIES ADAPTING ON THE FLY
In Mid-March, New York’s Governor, as did many other state’s Governor’s, introduced an order that required craft breweries (along with restaurants, bars, and taverns) to cease on-premise sales of alcohol beverages and food. With this announcement, New York’s craft breweries felt an immediate impact.
“It’s been a huge hit for our business,” said Sam Pagano, then brewer at CH Evans Brewing, noting their dependence on hosting private events at the Albany Pump Station. “We’ve had to lay off a little over 95% of our staff. We’re working with a real skeleton crew.”
“Not being able to operate our taproom normally has been a huge detriment to us,” said Joshua Whelan, director of marketing and business development for Ninepin Cider.
Thanks to negotiations between the New York State Brewers Association (NYSBA) and the New York State Liquor Authority, breweries were granted the ability to sell beer via takeout, curbside pickup, shipping, and home delivery. Selling in this capacity has helped breweries stay afloat during the challenging times.
Erika Anderson, co-owner of Unified Brewing said, “We’ve completely changed our business model from a taproom with some beer to go – to 100% contactless beer to go via online ordering, pick-up and delivery.”
“Where we’ve lost business, we’re making up for some of it in other ways,” explained Whelan. “We’ve turned into an e-commerce company with our online sales. It’s a totally new strategy in selling and marketing for us.”
“Over the past five weeks, we’ve been spending a lot of time finetuning the backend to make this a seamless, safe process for our employees and customers,” said Christian Weber, co-founder of Common Roots Brewing Company. “We now have a pretty robust delivery system which is a new revenue stream for us.”
Common Roots is currently operating out of a temporary taproom after the South Glens Falls-based brewery burned down in March 2019. “Surviving a fire and a pandemic are very different,” he noted. “Thankfully, no one was hurt in our fire. During this pandemic, safety is our biggest concern. We’re doing our best to remain open but must also protect our customers and staff. That’s the scariest part of this.”
Now more than ever, breweries rely heavily on the support of their local communities.
“It makes me want to cry how supportive everyone’s been,” said Whelan. “When this all started, we thought we would last only two weeks given the circumstances. But here we are, still going strong.”
“We appreciate everyone’s support. Not only when they order from us but when they share it on social media. And I can tell when our customers do,” Pagano stated. “After I deliver beer to one customer, I then start seeing more orders coming from those neighborhoods.”
“We consider ourselves extremely lucky to have the community support that we do,” said Anderson. “That has allowed us to keep most employees on board and to support other small businesses and charities, despite our doors technically being closed.” Unified Brewing is one of the breweries participating in the virtual collaboration beer with Other Half called All Together, raising money for hospitality workers.
Familiar with community support, Weber said, “We have such a wonderful community – not only here in the Greater Capital Region, but also in the beer industry. We were so humbled and thankful for the amount of support we received after our fire. We knew we wanted to pay it forward.”
The brewery has officially announced their Common Roots Foundation to further support area businesses, families, and individuals. In the meantime, they participated in the worldwide All Together collab and joined five other area breweries to form Brewnited. All profits from the group’s Negative Input beer are distributed to local tipped workers who are currently out of work.
Whelan echoed Weber’s sentiment, “It’s good to give back. Some people have really been affected by all of this – they’ve lost jobs, lost loved ones. The fact that we could make the world a little happier by donating cider is a huge deal.” Ninepin Cider has donated cases to Feed Albany, a local charity providing food to families affected by COVID-19.
2020 turned out to be financially devastating for many breweries who have had to reduce business, lay off staff members or close completely. In terms of what comes next, the future is unknown.
“It sounds pessimistic but we’re not thinking too far ahead,” stated Pagano. “We have a big building and in order to maintain utilities and staff, you need to do a decent amount of volume. Even if we’re able to open in the next few months, we’ll likely have limited capacity. It may be even more difficult to stay afloat.” He added, “The future is grim.”
“We’re taking things day by day and are trying to be as nimble as possible as the market is literally changing every day,” said Anderson. “While we do have reopening on our minds, we’re not investing a lot of time in how to do that yet as we want to ensure we’re following Governor Cuomo’s guidelines.”
With construction deemed essential at Common Roots’ new facility, the brewery opened in June 2020. “There’s a scenario that’s very real, where our facility is finished and we’re not comfortable opening to the public,” explained Weber. Looking on the positive side, he said, “A fire and now a pandemic. If we get through all of this, we’ll be one hell of a company.”
One thing that has been felt across the board for these breweries is gratitude.
“The biggest thing we want people to know is how much we appreciate their support,” stated Whelan. “It has been so great that people have come out to buy cider, buy gift cards, help us out, keep the cash flow coming. We want to thank our fans. They’re awesome.”
“We are extremely grateful to be an essential business and are thankful for everything Governor Cuomo and the NYSBA is doing to keep people safe and informed,” said Anderson. “We are also extraordinarily thankful for our customers, as without them, we might not survive. We encourage everyone to safely support small businesses either via take out/delivery, or by donating if businesses can’t be open. Small business is the lifeblood of our communities and we need them.”
Just as breweries have had to adapt and adjust the way they do business, so have the local beer distributors. Distributors serve as the logistics and delivery vessel that allows for your favorite beer to find its way into bars and restaurants as well as grocery stores, convenient stores, beverage centers, and pretty much anywhere that you buy beer. And, regardless if you are a local distributor with major national brands and regional and local brands, such as DeCrescente Distributing of Mechanicville, NY and Saratoga Eagle of Saratoga Springs, NY, or a small regional distributor such as Remarkable Liquids, which covers off on all of NY State and NJ, all have had to adjust.
“The first thing that we did was take extra measures that our employees were safe and taken care of,” says Russ Teplitzki, General Manager of DeCrescente Distributing Company (DDC), “at the same time, we had to clean up the local market at store level.”
Teplitzki discusses how his drivers and on-premise sales team went about removing all back-stock full kegs from the bars, taverns, and restaurants and issuing credits for that beer. “I’ll tell you what,” explains Teplitzki, “dropping a 160-pound keg down into a bar cellar and getting it into their cooler, is a heck of a lot easier getting them out! It was a ton of work, but our team rallied and got it done.” He goes on to discuss that taking care of, and working with, their staff and retailers during this trying time has been the priority.
While the on-premise flow of beer at your favorite tavern has all but stopped, the off premise has become much busier. “The distributors are the ones that keep the grocery and convenient stores shelves fully stocked,” says Scott Ferris, Craft Beer Manager for Saratoga Eagle. “Keeping them stocked has become an around the clock job. The grocery and C-stores are busy. Our on premise sales team, as well as the overall management team, have shifted our efforts and we are all spending time working merchandising at store level.”
THE CONSUMER ADJUSTMENT
Frankly, we, the consumer, have been the least affected by the pandemic, when it comes our consumption and our ability to support local breweries. We can still go to the grocery store, beverage center, or local brewery to get our favorite brews. We still can pick up food to go at our favorite watering hole and bring home a growler of fresh beer. We can still enjoy supporting the efforts of our emerging craft beer scene.
The difference is, we really can’t do it TOGETHER right now. Paused are the days with meeting with our beer nerd friends in the taproom and enjoying a flight. Delayed are the days of checking out a band at the brewery while grabbing a bite from the food truck. On-hold are the days of going to a Brewfest, partying with your friends, and sampling an array of new and exciting beers. Heck, right now, we can’t even have a deck party or a fire pit circle with our best friends.
But let’s not hang our heads and let’s not think that this will last forever. This too shall pass. And until it does, we can all do our part. We can all go to a local brewery and pick up some beer for the week. We can all go to our favorite better-beer-bar to pick up some food to go, a growler, and give them a 50% tip. We can all go the grocery store or beverage center and, instead of reaching for the national powerhouse craft beer, reach for something local.
Most important, we can thank our brewers, distributors, bar owners and staff for keeping the beer flowing. And we can realize that it’s up to US to keep these local breweries afloat and relevant during this trying time. We can still raise a glass and say, ‘Cheers to Life’. And we can all be proud to live in a time where so many delicious local beers are at our fingertips.
While grocery stores have had to adjust to the increased purchasing of beer in their locations, the burden of execution at store level really falls on the distributors that place the orders and merchandise the shelves. That’s not so for the Beverage Centers, which have also seen a slight to moderate increase in their business. “Overall, we are doing pretty good,” says Jack Minogue, owner of four beverage centers in Saratoga County. “When everyone first got sent home, we were busy and there was quite a bit of buy-in. Customers did a bit of pantry loading. But, as everyone has settled in, things have become a bit more regular, but still busy.”
Still, increasing inventory and adding sanitization measures have been quite an adjustment for this segment of retail. “Our stores are exceptionally clean, and we take extra precautions to assure that our customers and staff are safe. Lots and lots of sanitizing and hand washing.
While the off premise segment of purchasing beer is flowing and growing, the on premise is in trouble. Our favorite taprooms, better-beer-bars, taverns, and pubs essentially have had to close their doors and/or immediately adapt to a new normal of being a pick-up and delivery business. Most have had to lay off or furlough much of their staff. Their regular customers can no longer go in, enjoy themselves, and support the business by spending their hard earned money there.
“We had no choice but to adapt quickly,” says Bridget McGinley Huska, co-Founder of Lost & Found pub in Albany. “We put together a strategy to try to keep engaged with our customers while also taking care of our talented Chef, Ian. Each of us (four owners) are all stepping up and essentially, not taking any money right now so that we can keep the place going and take care of Ian.
Other restaurants groups, such as the Rusty Nail/Bentley, and the Mill, have closed their doors completely. “Each restaurant is currently closed, and we won’t consider reopening until the guidelines from the state are all being met, and we feel that it is safe for our staff and our customers, “Says Melanie Beale, Marketing Manager for the group. “That day can’t come fast enough right now. We are hoping for the best and look forward to seeing our regulars soon.”
Meanwhile, other establishments are using this time to focus on projects that they’ve wanted to accomplish. “I’ve been wanting to tear up the bar floor and replace it for some time now,” explains Brian Gilchrist, owner of The Ale House in Troy. “We’ve gotten into a rhythm with our take-out food and growler fills. This allows me to use this time to get the floor replaced, so we’ll be looking good when we open. We can’t wait for that day and look forward to things getting back to normal.”