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COVID-19 and craft beer: 46.4% of craft breweries say they can’t sustain their business more than 1 to 3 months during pandemic, says BA survey

April 8, 2020Keith Gribbins

Photo credit: Rorem.

It’s only more grim news, and I’m sure you’re just as tired of reading it as I am of writing it. Yesterday, we posted a report on a survey from the Texas Craft Brewers Guild that found the average revenue decline that Texas craft breweries are experiencing due to the COVID-19 crisis is 71 percent — with 63 percent of responding breweries being forced to lay off or furlough staff. Also yesterday, the Brewers Association, a trade organization representing craft breweries nationally, released the results and analysis of its second survey designed to gauge the impact of the current COVID-19 pandemic and social distancing public health measures on craft breweries.

The results were depressing.

The first analysis of our second COVID-19 impact survey is done, and the numbers aren't pretty.

– 2.5% of breweries say they are going to close
– 12.7% say they have a month or less based on current conditionshttps://t.co/wEOHrmkn4T

— Bart Watson (@BrewersStats) April 7, 2020

Watson, the BA’s economist, analyzed 455 responses — through the morning of Monday, April 6 — across 49 states plus the District of Columbia. The associated noted here that its “respondents appear to be broadly representative of the small brewing industry, with the exception that brewpubs are slightly underrepresented and small production microbreweries over-represented.” Perhaps the biggest jaw-dropper was the fact that 46.4 percent of responding craft breweries say they can’t sustain their current business more than 1 to 3 months during these pandemic conditions. Watson notes that there are about 8,150 breweries currently operating in America, and that 46.4 percent of that number would be around 3,785.

Four other eye-opening responses from the survey:

  • The median respondent has seen their sales drop 77%, with an average drop of 66%, and an adjusted weighted average drop of 68%.
  • Responding breweries say they have laid off or furloughed 65.7% percent of their workforce. The brewers who responded to the survey stated they employed a collective 13,454 workers prior to COVID-19 (a combo of full and part time workers).
  • About a third of breweries won’t re-hire workers until they can re-open and 35.1% will only partially re-hire. Only 11.9% plan to fully re-hire workers.
  • The sharpest sales declines were in distributed draught. With on-premise largely closed for business, median drop in sales was 100%, average drop being 91% and weighted average (accounting for both sample weights and volume) show a drop of 95%.

Read the entire analysis right over here. Watson does a great job as always, and there is maybe a slight silver lining in off-premise sales. Also, the BA in general has done an excellent job compiling its free-to-everyone COVID-19 resource hub. I am there daily, and the BA continues to show leadership (like many of the state guilds around the nation) during these unprecedented circumstances.

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