Off-Premise Growth Ain’t Cutting it for California Craft Brewers

Dear Client:

For those of you following along with our scan data updates, then you know that the craft segment has grown double digits in national IRI data week after week, since March 15. 

The segment peaked on the week ending March 22, up 31.5% in IRI’s all channel plus liquor store universe, and grew 18.4% in the latest week available (the week ending April 5).

If you’re under the impression that these eye-popping growth rates may offset some of the tremendous blows craft brewers are taking from the virtual shutdown of their own-premise sales and on-premise sales, well, you’d be incorrect.

The latest Impact Survey from the Brewers Association (published April 8) estimates that the total craft category – including at-the-brewery sales, on-premise and off-premise — is down around 29%. If you cherry pick the best growth rates from the off-premise scan data, “the number ‘improves’ to -23%,” wrote BA chief economist Bart Watson. 

A recent survey conducted by the Texas Craft Brewers Guild revealed that brewers in the Lone Star State are seeing an average drop of 71% in revenue due to the COVID-19 crisis [see CBD 04-08-2020].

And now a recent survey conducted by the California Craft Brewers Association shows brewers in the state are “currently experiencing an average of 43% decrease in overall sales.”

Of course, the majority of California’s 1,040 craft breweries rely heavily on tasting room sales and bar/restaurant sales. “CCBA survey respondents sold an average of 50 percent of beer through the brewery tasting room with an additional 20 percent through bars/restaurants,” per release. So a 43% drop in sales shouldn’t be too surprising, with most brewers in the state generating 70% of all sales in channels that are temporarily shut down.

Still, keep in mind that the state’s largest brewer, Sierra Nevada, which sells the majority of its volume through the off-premise, told us last week that despite some incredible growth rates in the channel as of late, they don’t expect to grow this year [see CBD 04-06-2020].

Sierra Nevada expecting to be down for the year… “That’s a big impact,” CCBA executive director Tom McCormick told the San Francisco Chronicle

“The reality is that grocery store (beer) sales are not making up for the loss of sporting events, bars, restaurants,” he said. “The notion that people are drinking more at home — I doubt it. People aren’t going out and playing pool at a bar, or sitting outside and ordering pitchers, or watching a basketball game.”

Indeed, Collin McDonnell chief of Petaluma-based HenHouse Brewing told the SF Chronicle that although his brewery is “large enough” to carry beer in Safeway and Whole Foods, “the increase in grocery store sales doesn’t make up for the loss of draft,” as kegs accounts for about a third of their income and half of their volume. 

President of Russian River Brewing Co., Natalie Cilurzo, shared a similar remark to the SF Chronicle, stating that while the Sonoma-based brewery is “selling 21% more beer by volume through stores,” it is less profitable than selling it through their own-premises, and the “company’s gross revenue was down 78% year-over-year during the last two weeks of March.” Seeing a hit like that coming forced Russian River to make the difficult decision to furlough 160 of its employees, per report.

Many other California brewers are in the same boat, according to the recent CCBA survey.

“29 percent of respondent’s total workforces have been laid off and additional 31 percent furloughed.” And half of the respondents “are considering or planning additional layoffs in the coming weeks.” 

More from the Golden State as it rolls in.


Yuengling announced yesterday that they are committing $100,000 to benefit the Gary Sinise Foundation and the Hospitality Assistance Response of Pennsylvania (HARP) fund.

“As America’s Oldest Brewery, for nearly 200 years, we have survived a number of highs and lows throughout our nation’s history. We have learned that the best way to get through tough times is to stick together and support one another. We firmly believe in these efforts to assist our communities as they grapple with the unprecedented impact of COVID-19,” Chief Administrative Officer at the brewery, Wendy Yuengling, said. 

The donation to the Gary Sinise Foundation will benefit its newly formed campaign, the Emergency COVID-19 Combat Service, which provides grants to help first responders acquire personal protective equipment, especially for volunteer operations, and emergency financial assistance to healthcare workers, first responders, veterans, service members and others directly impacted by COVID-19. The donation will be a 1:1 match up to the first $45,000 the campaign raises, benefitting emergency workers and service members in the 22 states Yuengling has operations.

Yuengling is also acting as a Founding Donor for the HARP fund, benefitting workers in the hospitality and restaurant industry in their home state of Pennsylvania through emergency funding.

In addition to these donations, the company also announced that they are working with brand ambassadors “including country singers Lauren Alaina and Cliff Cody, professional soccer player Rose Lavelle, celebrity chef Kelsey Barnard Clark and Philadelphia Phillies pitcher Aaron Nola” to continue seeking opportunities to provide to those in need in their communities. 


Today A-B made several announcements regarding their efforts to help the on premise, and its displaced workers, in the wake of COVID-19 devastation.

Part of that starts with their own employees. 

“Despite the impact to the company’s own on-premise business, Anheuser-Busch and its craft partners are focused on retaining their employees as they continue to evaluate the extent of this crisis,” the company said. 

“While many brewpub and biergarten employees have been temporarily reassigned to other roles within the company, others will volunteer through Meals on Wheels and other local organizations providing critical resources to communities in need during this crisis.”

A-B CEO Michel Doukeris said their “first priority is our people and at Anheuser-Busch, ‘our people’ includes our employees, our communities and our partners.”

Besides that, specific A-B craft brands have earmarked donations for restaurant workers:

  • 10 Barrel Brewing Co. (OR), Devils Backbone Brewing Co. (VA), Four Peaks Brewing Co. (AZ), Golden Road Brewing (CA) and Goose Island Beer Co. (IL) are offering free or discounted meals to bar and restaurant workers whose jobs have been impacted by COVID-19.  
  • Elysian Brewing Co. (WA), Karbach Brewing Co. (TX), Maha (CA), Platform Beer Co. (OH), Veza Sur Brewing (FL) and Virtue Cider (MI) are donating a portion of their beer, cider, food or merchandise sales to local organizations or funds that support bar and restaurant workers.
  • Wicked Weed Brewing (NC) has made a $50,000 donation to non-profit groups, including the NC Restaurant Workers Relief Fund that are providing resources and meals to out-of-work bar and restaurant employees.

Sales chief Brendan Whitworth also shared other innovative ways their partner brands are helping other restaurant workers. For example, Ohio’s Platform Brewing Co. has been delivering (to consumers) a local cookie dough company’s products alongside its own beer recently in Cleveland. Platform has expanded the delivery partnership to other area businesses. They don’t charge the businesses for the deliveries, and donate $500 to their charity of choice, to boot, per this article on the initiative, which so far is expected to continue through May.

Until tomorrow,

Jenn, Jordan, and Harry 

“The time to relax is when you don’t have time for it.”

– Sydney J. Harris

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