The New Top 50 Craft Brewers
Dear Client:
The Brewers Association’s tally of the Top 50 U.S. Craft Brewing Companies just hit for 2019.
The unveiling of the new list just feels a little different this year, given the circumstances. And the BA hinted as much in the release announcing the new Top 50, with chief economist Bart Watson saying…
“Although 2020 will be a markedly different year than 2019 for the craft brewing market, these companies are well positioned to help the craft category weather the current market uncertainty and rebound with the flavor, variety, and innovation that beer lovers have come to expect from small brewers.”
Indeed, so with that said, let’s take a look at the new lineup.
TOP TEN LARGELY UNCHANGED. The first nine spots on the new list belong to the same craft brewers as 2018.
- Yuengling
- Boston Beer
- Sierra Nevada
- New Belgium
- Duvel Moortgat
- Gambrinus
- Bell’s Brewery
- CANarchy
- Stone Brewing
ABV TAKES THE TEN SPOT FROM DESCHUTES. But we have our first switch up at no. 10, with Artisanal Brewing Ventures coming in to take the spot from Deschutes Brewing, who now sits at no. 11.
There’s plenty of movement after that, but that movement is mostly owed to brewers moving up or down a couple spots over last year. So we pored over the list to pull out the handful of brewers that moved up or down 5 or more spots from last year. Here’s what we got:
THE MOVERS. Georgetown Brewing continues to climb up the list. The Seattle brewer, which made its debut on the Top 50 last year (the 2018 list) at #41, skipped ahead nearly ten spots in the latest list to #33. Indiana’s Three Floyds Brewing jumped eight spots in the latest list, moving from #39 to #31. Gordon Biersch Brewing Co. also made a nice leap, hopping from the 37 spot in 2018 to the 32 spot in 2019 (note, that restaurant-centric brewer is likely to encounter much hardship this year considering COVID shutterings). California’s Lost Coast Brewery advanced a handful of spots too, jumping from #47 to #41 on the latest list.
AND DROPPERS. Shipyard Brewing tumbled over a dozen spots in the latest list to #42 on the latest list. Long Trail Brewing continues to slip further down the list – it dropped seven spots in the list prior to #31 – and fell six spots on the latest to #37.
ONLY ONE NEW BREWER TO THE LIST. We only spotted one newcomer to the list this year, Two Roads Brewing out of Stratford, Connecticut, who sat at the 47 spot. With one new brewer to the list that means a single brewer fell out of the Top 50 — Utah’s Uinta Brewing, which held the 42nd spot in 2018.
UINTA CHIEF PAINTS TOUGH OUTLOOK IN UTAH FOR BEV ALC MANUFACTURERS
In the wake of COVID-era bar and restaurant closures, many states have allowed for delivery, e-commerce or other measures to help redirect those lost occasions.
But Uinta chief Jeremy Ragonese — who shared that they’ve had to lay off a portion of their workforce — says their home of Utah, already a highly regulated state (heck, they just got bumped to 5% ABV beer last November for grocery, c-stores and draft), isn’t making things any easier for craft brewers or any other bev alc producers.
He described their recent trends and efforts to cope.
“On Monday, Uinta went through the same painful process that so many within our industry have been enduring the last few weeks. We laid off 23 employees in total, half of whom worked in our Brewhouse Pub. A number of outside sales reps that covered our core Western region were also let go, but other departments suffered losses as well,” Jeremy told CBD.
“We are fortunate to have a significant percentage of our business focused in the off-premise, so while we’ve made numerous changes to our operations to try and keep employees safe, we do continue to brew and package beers. The state of Utah, however, hasn’t opened up any new pathways for brewers that other states have including ecommerce and delivery, so with DABC store hours reduced and an earthquake last week causing major disruptions, we’ve had more than enough additional obstacles thrown in our way.” They aren’t even allowed to use common e-commerce bev alc platforms, like Drizly.
But Uinta is doing what they can to help combat the “chaos” of adapting their business to the current conditions.
They launched a website for all Utah brewers on March 19, “so consumers could use a single source to track information including hours and available beers to be purchased direct from the breweries,” he said. Breweries self-manage their information on the site.
“We also continue to support local initiatives that provide relief for affected hospitality industry workers, including the Salt Lake City Creative Community Fund,” he shared.
BANKRUPT CRAFTWORKS FIRES ALMOST 18,000 EMPLOYEES
The layoff stories continue, unfortunately.
Restaurant operator CraftWorks, behind chains like Logan’s Roadhouse and Old Chicago, fired almost the entirety of its 18,000-person workforce and severed employee-benefit plans in an internal memo on Tuesday, per the Wall Street Journal. Most employees had been furloughed at the time of notification.
“The status of all team members will be revised from furloughed to terminated,” the memo said. “Please know that we continue to work diligently towards a reopening date and are looking forward to the day when we hope to bring many of you back with a new suite of benefits.”
CraftWorks Holdings Inc. was in the midst of a bankruptcy sellout when the coronavirus pandemic and subsequent economic turmoil became widespread in the U.S. More tomorrow in BBD.
TTB ANNOUNCES 90-DAY POSTPONEMENT FOR EXCISE TAX-RELATED FILINGS
To try and assist businesses during these trying times, the TTB announced yesterday that it is “postponing several filing and payment due dates for 90 days where the original due date falls on or after March 1, 2020, through July 1, 2020.”
The TTB highlighted some of the filings they’re pushing back the due dates for with this announcement, including:
- Postponing tax payment due dates for wine, beer, distilled spirits, tobacco products, cigarette papers and tubes, firearms, and ammunition excise taxes.
- Postponing filing due dates for excise tax returns.
- Postponing filing due dates for submission of operational reports.
- Postponing filing due dates for claims for credit or refund by producers.
- Postponing filing due dates for claims by manufacturers of nonbeverage products.
- Postponing due dates for submission of export documentation.
- Considering emergency variations from regulatory requirements for affected businesses on a case-by-case basis.
- Reviewing requests for relief from penalties based on reasonable cause.
The U.S. Customs and Border Patrol also issued a bulletin stating it “will approve on a case by case basis additional days for payment of estimated duties, taxes and fees due to this emergency.” It appears the federal government is still working things out for importers.
We’re expecting the TTB to issue further guidance on returns in the coming days. Stay tuned.
NEW BELGIUM SAYS IT ALWAYS SUPPORTED DISTRIBUTORS VIA 55% FOB COST BUY BACKS FOR EXPIRED KEGS
BBD and CBD have been covering brewers big and small — from Molson Coors to Boston, Sierra and Summit — who have announced programs to help defray the cost of out of code kegs to their three-tier partners. Some have had those programs in place, even prior to COVID’s acceleration of out-of-code kegs.
New Belgium shared that they have such a program in place, and in fact they kicked it off last year.
“It’s worth noting that New Belgium has always supported wholesalers with out of date beer, and we already have an existing policy in place to support wholesalers at 55% for all out-of-date package and untapped kegs,” the company told CBD.
The topline parts of the plan include:
New Belgium is covering 55% of landed cost (FOB + freight);
NBB’s buy-back includes keg and package;
NBB’s buy-back includes beer in wholesaler warehouses and beer pulled; from retail (package and untapped kegs); and
NBB’s policy has no expiration date.
STONE CHIEF DISCUSSES NEW DYNAMICS IN THE MARKETPLACE; AND WHAT THEY’RE DOING TO ADJUST
Inside Hook sat down with Stone chief Dominic Engels earlier this week to discuss how the large California craft brewer is weathering these challenging times, and what they’re observing as both a brewer and distributor in the marketplace.
We’ll get to Stone’s own changes in the wake of COVID-19, but first a few high-level takeaways from Dominic.
SMALL RESTAURANTS AND A LOT OF CRAFT WILL STRUGGLE TO COME BACK ONLINE. Dominic told the outlet that “it’s no secret that if you’re a small restaurant in these times, the likelihood of you being able to open back up and get back to normal and return soon is low.”
Indeed, a recent poll of 4,000 restaurant operators conducted by the National Restaurant Association, revealed that 3% have already permanently closed, 44% have temporarily closed and 11% say they expect to permanently close within the next month.
Unfortunately, the Stone chief believes “you can kind of extend” this sobering reality for small restaurants “to a lot of craft beer.”
A MOVE TOWARDS TRUSTED BRANDS. “I think there’s definitely a movement towards brands consumers trust, and that they’re familiar with,” said Dominic. “So that bodes well for a brand like Stone, or like Deschutes, for example. I think they’re experiencing a similar dynamic, and we can see that.”
We have heard and seen the same. Consumers aren’t experimenting with new brands right now, they’re picking the ones they trust.
AND A MOVE TOWARDS “COMFORT” BEERS? Another transition he sees in the marketplace that bodes well for Stone, Dominic said, is a move towards what he calls the “comfort food” of alcohol.
“…I can’t see how it’s comforting to sip a White Claw on your couch, but I can see how it’s comforting to sip an IPA on your couch. It’s kind of intuitive,” he said. As hard seltzer is just a few years old, he thinks consumers wouldn’t find that as comforting as something like Stone IPA, which people have “been drinking for 20 years.”
We’re a little unsure of this observation, it may be taking place, but we don’t really see that playing out in the data. Seltzer is still growing at an unbelievable clip, with category dollars up over 400% for the week ending March 22, per the IRI all channel plus liquor universe.
Still, Dominic cautions that “it’s very early days in the numbers, so again, we’ll see what happens over time. If this is a four-month situation, there’s plenty of time for different dynamics to emerge.”
HOW STONE IS ADAPTING. Dominic explained to Inside Hook how Stone essentially operates three businesses, a hospitality business, a distribution business, and, of course, the brewing side of things.
On the hospitality side, Dominic said “they’re all shut down, except for DoorDash and curbside pickup.” Though he did note that they are still making use of that hospitality side to serve their local community, whether that be preparing meals for first responders and medical professionals, or donating “family meals” to the school district. “We’ve done tons to kind of use our kitchen and our food to help the community,” he said.
As for the distribution side, “other than the safety and health precautions, it’s sort of business as usual,” Dominic shared… well, almost. Like the majority of distributors out there, they’re no longer making routes to bars and restaurants, they’re “just delivering to [off-premise] retail now… The consumption has gone to in the home, and the grocery store is the main source for that.” He also noted that they’re doing some core beer deliveries across California for those in-state residents who have ordered direct from their website.
On the brewery side, Dominic said, “we’re staggering the shifts… but the brewers are continuing to brew beer, and we’re continuing to ship packaged beer. Obviously draft beer is a different story.”
HITTING PAUSE ON SPECIAL RELEASES. Although they have made the call to postpone some of their special releases, “because we don’t really have a home for them,” with all the focus on brewing “Stone IPA, Stone Delicious IPA, 12-packs, mixed packs, those types of items.”
Hitting pause on the special release production, in the grand scheme of things, is a “relatively small change” to the brewing schedule, Dominic said.
“Our special releases don’t represent significant volume,” he said. “They’re sort of top dressing, parsley on the plate, if you will. So we’re just going to table those. They’re all great ideas, the packaging is done, hops are bought, and we’ll be ready to brew those and they’ll eventually come to life. But we’ll pause on those for now.”
Until tomorrow,
Jenn, Jordan, and Harry
“It’s choice – not chance – that determines your destiny.”
– Jean Nidetch
———- Sell Day Calendar ———-
Today’s Sell Day: 1
Sell days this month: 22
Sell days this month last year: 22
This month ends on a: Thurs.
This month last year ended on a: Tues.
YTD sell days Over/Under: +1
