The New Craft Beer Community

The New Craft Beer Community

Craft beer is defined by change but the industry has never seen anything like this.

The New Craft Beer Community

Photo by Gor Davtyan​. 

By Andy Crouch

March 23, 2020 4:56pm

We’re still in the early days of dealing with the COVID-19 pandemic. Many people around the country remain defiant even in the face of public and governmental pleas to stay indoors and practice social distancing, a phrase that was hardly in our collective lexicon only a few weeks ago. Millions of others are taking the threat seriously, retreating from society and maintaining vigil in their homes. We don’t know how long this will last or what the final outcomes will be. We can only tell you what we’re seeing and offer some possible future scenarios.

In the past two weeks, John Holl and I have spoken with dozens of people across the beer industry, getting updates on how things are playing out around the country. While there is much grim news to report, from brewery tap rooms to bars and restaurants closing their doors and hundreds of thousands of related workers losing their livelihoods, there is also some positivity out there. The biggest note of optimism comes resoundingly in the form of craft beer’s sense of community. A decade or two ago, the phrase craft beer community was widely bandied about. Brewers joked that the industry was 99 percent asshole free. There were only a few thousand breweries spread widely around the country and they rarely referred to one another as the competition. Even small craft brewers would’ve told you the real enemy was Big Beer.

The local brewery tap room challenged that community narrative.

Thousands of new breweries sprung up across the country, each bearing a new model: serving their own beer in their own house. These local tap room focused breweries had little connection to the outside beer world. They eschewed distributors, beer bars, and liquor stores. They sustained themselves on the margins they saved by not selling their beer outside of their four walls. And things were good. While overall beer industry growth slowed to a trickle, thousands of new breweries opened and thousands planned to do the same. Then COVID-19 dropped like a bomb on their business model.

With tap rooms closed, thousands of breweries around the country no longer have a source of income. Most don’t have their own canning or bottling equipment. They don’t have relationships with distributors or bars, restaurants, or off-premise stores. They never saw the need to diversify their operations because nothing could ever shut off their money maker, the customer at their own bar. 

These will be dark days for many breweries around the country. Without the option of being open to the public, many have scrambled to offer limited can sales with shops manned by a single employee. This model, while offering some sales for owners, isn’t enough to sustain much of a staff let alone justify continuing to brew once their existing tanks run dry. Many will likely close up shop and hope for insurance or governmental assistance when the crisis subsides. 

Ironically, the COVID-19 virus has managed to bring brewers back together. In these tough times, almost every brewery is in the same boat. Brewers and other craft beer industry players are banding together, often under the leadership of state guilds, to lobby their representatives for assistance. They’re talking with one another to share ideas and survival strategies. In this, COVID-19 has managed to do what little else could: bring together disparate and competitive players under one shared umbrella.

For many larger craft brewers, the ones that long heralded the community spirit of craft, recent events have completely upended their operations in an oddly positive way. These breweries, which produce between 50,000 and a million or more barrels of beer a year, were once cast aside and left for dead in the local tap room movement rush. They were large organizations with massive off-premise packaging capabilities, even relying on bottling lines, all while beholden to decades old flagship beers, things that seemed ill-fitted for the new new. 

Now these breweries are among the only ones well-positioned to meet the surging demand for off-premise beers. These breweries have long-standing and well-developed relationships with distributors across the country. They operate substantial and largely automated bottling and canning operations and packaging lines that do not require the many hands on deck models that smaller craft operations employ. They can manage their production, scale back to a small selection of well-known beers, and get those beers to specific target markets to meet rising consumer demand. As one brewer told us, while others have had to close, they’ve been overwhelmed by demand lately and are kicking ass right now. 

What was once unthinkable now appears likely to be true for the foreseeable future: flagship beers are back and local is dead or at least dying. 

As the outlook for the COVID-19 virus appears to rest in months not weeks, the face of craft beer is going to change for now. The vibrancy accompanying the small brewery movement has receded while major manufacturing breweries appear best equipped to adapt to the new reality. When we get past this pandemic, the long term effects of all of this are unknowable. The only truth is that the craft beer community will look different yet again.

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Scenes From A Brewery: Rockwell Beer Company

Scenes From a Brewery:
Rockwell Beer Company

Selling beer straight from the door and being thankful for the “saints” buying gift cards is how this Saint Louis, Missouri brewery is handing the COVID-19 pandemic.

Photo courtesy of Rockwell Brewing Co.

Photo courtesy of Rockwell Brewing Company. 

By John Holl

March 16, 2020 1:56pm

The bar at this brewery is usually reserved for special events and it seems like what’s happening this week counts as such. Jonathan Moxey, the head brewer for Rockwell Beer Co., rolled it out of the events space earlier today, into the garage bay near the Missouri brewery’s packaging hall, and set up for impromptu to-go sales. The brewery had started this practice over the weekend and kept it going Monday, a day it is usually closed. 

Word came down on Sunday Night from the Saint Louis mayor that gatherings of more than 50 people would be prohibited for the next eight weeks. Moxey says that since upwards of 90 percent of the brewery’s business is done from the taproom, they are gearing up for some tough times but will do whatever they can in the meantime to get their beer to the people. 

“I got hired by [the financial firm] Standard and Poors in December of 2007 and honestly this feels a lot like that,” he said of the 2008 financial crisis. He, like so many others at the time, used downtime created by the recession to turn his homebrewing into a professional career. 

As he sells to-go orders to folks that drive up and use the touchless credit card reader (no cash and wipe downs after each interaction), Moxey said in a phone interview that first and foremost, he’s worried about his staff that will still need to pay rent, no matter what happens next. 

There are four people on the production staff, one on sales, and eight working front of house. Last year the brewery produced about 2,000 barrels. 

“We also want to keep everyone safe,” he says. “Figuring out what to do is almost an impossible decision beyond that.”

In addition to can sales he is also immensely thankful to “the saints who are buying gift cards.” 

On the production side some planned brewdays for later this week, like wheat, have been called off. He noted that they will eat the cost of a yeast pitch but that it’s a small financial sacrifice in the short term. 

“We’re not making IPA [for the foreseeable future]. We’ll package what we have ready. But our lagers are seven week turns so we’ll keep those going. It’s obviously hard to forecast demand but we’re hoping that if the world makes it to summer, we’ll have some lager,” he says. 

That is a hope we all share.

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Looking For Positives In A Pandemic

Looking For Positives In A Pandemic

Our editor reflects on the past and searches for perspective as
we all stare down the barrel of a troublesome week.

Photo by Andrew Seaman. 

By John Holl

March 15, 2020 9:25pm

​What is an appropriate beer for a pandemic? That’s the question I found myself asking on Friday afternoon as I stood in the beer aisle of my local liquor store. Stopping in was a snap decision between runs to the bank and to get a haircut. 

I wanted to see what people were stocking up on as they prepared to withdraw from life for a bit. The results were what you would expect. 30-packs of macro lager, six packs of Irish stout (St. Patrick’s Day is on Tuesday, after all), and four packs of local IPA pint cans. 

It seems almost quaint that just two weeks ago the focus was on hard seltzer making its big push into the beer space, threatening brewers. Now the focus is on the COVID-19 pandemic and the news is almost impossible to keep up with. 

For now, social distancing is the new normal and that means tough times are ahead for breweries that rely on people visiting their taprooms. While for the breweries that distribute or are in grocery chains, there might be a sales spike as people stock up for hunkering down. But the long term impacts of this virus are still unknown here in the United States and across the world. 

In planning this weekend’s newsletter, I struggled with what to focus on. We know that the Craft Brewers Conference and World Beer Cup won’t happen next week. Smaller conferences like the New York State Brewers Guild have also been called off. Cigar City Brewing called off its Hunahpu Day fest with just 24-hours to spare, and Firestone Walker Brewing canceled it’s annual invitational, scheduled for June, months in advance.

Larger breweries with the financial means to weather the pandemic, like Boston Beer, Dogfish Head, and Guinness, all closed their doors this weekend for at least a week. By the time this all ends, or we settle into a new normal, some breweries that close for a week or two will turn into permanent closures. The owner of Trinity Brewhouse in Providence, Rhode Island, blamed the outbreak (and nearby sporting event cancelations) for forcing him to lay off about 20 employees last Thursday. 

And so it begins. It’s not hyperbole to say that it’s going to get a lot worse before it gets any better.  

The service industry is a tough one to survive in when the economy falters. We know that many breweries are living week to week, and their employees paycheck to paycheck. With economists predicting that the country is heading into a recession, a large chunk of breweries are about to face a real test. 

The craft beer industry saw a boom following the 2008 recession, and a lot of those breweries have only known good and profitable times. That’s about to change and it’s not unreasonable to think that many folks are going to have a hard time paying for staff, ingredients, and infrastructure. 

Where do we look for hope? I found it in the beer aisle of that liquor store in the form of a six-pack, the Sierra Nevada 40th anniversary IPA, released a few weeks ago. It’s a pine and citrus heavy ale reminiscent of the centennial-forward beers that built the microbrewing industry just a few decades ago. 

Ensconced in the store’s atmosphere of quiet panic, what struck me was the final line of the beer’s label copy: “Here’s to following your passion, and to the next 40 years.”

We are in a different place than we were 40 days ago. And 40 days from now we’ll likely face a different landscape as well. But when we pull back and look at the larger picture, we see that changes come and go, and that life goes on.

Forty years ago, it was tough to imagine a country with 80 breweries, let alone 8,000. Yet here we are, with a bright future to look forward to. 

For now, our worry is good. Worry means that we are paying attention. But we cannot be crippled by fear. 

You are likely worried about your business. We are too. Andy Crouch and I launched this newsletter just a few months ago and it survives thanks to your support. We’re committed to our future, and to yours. 

No matter what happens next, we’re going to be here, covering the industry and telling your stories. We’ll get advice from the experts, track the fallout, and search for novel approaches to a complex situation. The beer industry is unique and deserves unique coverage, which we’re here to provide. 

It’s time to be forward thinking. Just please remember to wash your hands.

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