“Breweries Slightly More Optimistic, But Challenges Remain”* So begins Bart Watson’s new survey summary on the Brewers Association website. This week on Beer Notes, we are reporting on more positive business projections from breweries as states start to reopen.
The Brewers Association reported that 53% of breweries believed they would be out of business at the end of three months if business conditions continued as they were at the beginning of the Stay at Home orders and business shut-downs.
That was before the US Government stepped in with aid packages and PPP loans. It was also before many of the breweries knew what they could do to increase sales in a world shut down by a deadly disease. Innovation and aid, creativity and perseverance have changed this pessimistic outlook and we have NOT seen a massive surge in brewery closures.
On May 29, the Brewers Association re-surveyed over 850 breweries to take the business temperature of the industry. Now, only 15 – 20% of breweries are unsure or actively pessimistic about their prospects. Bart Watson, the Brewer’s Association economist, estimates that craft beer is down 20-25%, adjusting for likely survey biases.
Re-opening across the country is a reported cause for an increase in optimism. PPP loans helped stave off brewery closures so far. 85% of breweries surveyed applied for PPP loans and 96% of those that applied received this aid.
Breweries report better sales, new sales channels, and the ability to decrease costs as also contributing to their increased optimism.
We aren’t out of the woods yet, but with our continued support of our local craft breweries, we are making a difference to an industry that is now vital to many of our ways of life.