The coronavirus pandemic has changed our everyday life, but it doesn't need to change who we are. So, in addition to our ongoing coverage of the coronavirus, OnMilwaukee will continue to report on cool, fun, inspiring and strange stories from our city and beyond. Stay safe, stay healthy, stay informed and stay joyful. We're all in this together. #InThisTogetherMKE
Milwaukee craft brewers have found themselves in an unusual position.
Their own taprooms and the restaurants (and, for some, arenas and stadiums) to which they supply beer are closed, cutting into sales and forcing the furloughing of front of house staff. Nationally, some breweries are being forced to dump beer.
But, according to Nielsen, retail sales of liquor are doing well and the brewers themselves have been extremely resourceful in organizing curbside and carryout sales, as well as newsworthy events like multiple Beer Drive-Thrus, drink kits and other promotions that have brought in much-needed cash.
That means some brewery staff is still working, at least at times, to keep beer flowing to thirsty quarantined Milwaukeeans.
But we’re drinking differently and surely the landscape on the other side of this pandemic shutdown will be affected. But how?
Well, no one really knows for sure, but hoping to get a sense of how a post-coronavirus Milwaukee craft brewing world might look sent me to the folks who know best: Milwaukee’s craft brewers.
I asked a number of them how they’re being affected by the Safer at Home order and how they see things shaking out once we’ve moved beyond it. Each brewer answered at length and I found their replies thoughtful and interesting and so I’m sharing them with you in their entirety.
Here’s what they had to say, in alphabetical order by brewery:
Toni Eichinger, Black Husky
First, "when this is all over" is one of the key questions. We anticipate partial openings and monitoring of new COVID-19 cases and then we may go back to where we are at now. This will continue for 12-18 months, perhaps.
I don’t think we’re going to see beer festivals again and I’m OK with that (Note: Madison's Great Taste announced on Monday that it was canceling the 2020 festival). We’re not going to see packed restaurants and taprooms. I think events will be ticketed rather than open-ended so restaurants especially know how much product to prepare and also how to maintain social distancing.
The market itself will get hyper-local. There has always been the concept of buying local but now people can see tangible results of what happens when businesses aren’t frequented. Closures, lay-offs have become commonplace and the connection of keeping funds local and helping your neighbor and community will resonate with people.
Obviously there is a lot of uncertainty but I believe those breweries that have a sound foundation and mix of business – wholesale can and kegs, as well as a robust taproom – and who hadn’t leveraged themselves with expansion will come out of this OK.
James Larson, Enlightened Brewing
Obviously we have no idea what the scene or industry will look like, that's the short answer. We really hope that everyone in the industry can find a way to make it to the other side of this thing, whatever that looks like.
We are changing our operations to suit the needs of customers every day and we will continue to do that in order to make sure we can keep doing what we love. We are doing as-safe-as-possible curbside pick up. We turned our product cooler into a staging cooler for the orders so that the beer can stay cold for however long it needs to until it gets picked up. Sometimes people place the order and then come in another day to pick it up.
I think when we invite people back into our brewery we will all be cleaning and sanitizing more than ever, that's a given. Additionally, we might have to self-regulate a smaller occupancy. Right now our occupancy is 280 people. That might be a little much moving forward from a social aspect. During regular hours we might have to cap ourselves at 50 or 100 people.
We were getting into event booking before this all went down and feel that our space lends itself well to that even after all of this is over.
Production-wise we will continue to package cans and hope to launch new cans to keep things fresh. We were starting a one-off / limited-release label that we feel will become more of a feature to our portfolio. Draft sales will be down more than likely even into 2021, we feel, but there will always be a need for a nice cold pint of beer from a keg! We hope.
I think that one of the biggest things that I would like to continue to do is keep an online store. I think that selling merch through the store would be great and if we can continue to have people place orders for cans for pick up that would be a cool thing to keep going in the new climate that is the post COVID-19 world.
Kristopher Volkman, The Fermentorium
As we’ve already seen, brewers have had to adapt to the "curbside economy" while the taprooms are closed. Taprooms, like restaurants, will begin to return to activity when they are able, but likely at lower capacities. Regardless of any governmental policies, I believe many people will continue to voluntarily social distance for the foreseeable future.
Because of this, I expect to see taprooms operating in a hybrid capacity where there will still be online ordering and curbside pickup while taprooms are open. It would be great if we could see a change in policy to allow reasonable home delivery of beer. The benefits would be reduced exposure for customers, as well as an increase in employment.
Release parties, anniversary parties and private events will look different, as well. Our anniversary party fell a few weeks after the Safer at Home order came out. We still released the beer but it was tough to not be able to celebrate and thank our loyal customers in the way we had hoped.
As of now, any gathering we will plan in the future will be extremely scaled back. I’m trying to imagine what a Black Friday release looks like with six feet between people in line. The line could be its own taproom crawl starting in Waukesha. OK, maybe that’s a slight exaggeration.
As far as what the overall scene will look like is a different story. The amazing thing about craft brewers is we all have our own business models and our own takes on things. I believe more of us will persevere than some of the early dire predictions stated. The BA survey came out right at the start of shelter in place orders and before any guidance, leadership and aid existed, and before breweries had a chance to pivot.
While I’m sure we may lose a few, I really don’t think a 50 percent closing rate is realistic as long as things don’t take a turn for the worse. I think you’ll see a lot of out of season beer when things open up. Breweries are sitting on a lot of kegs and many will likely be discounted to bars and restaurants when they start to re-open. I also think we will see a lot of lagers (Note: which take time to age) through summer and barrel-aged beers in fall and winter.
I can see breweries that have been able to maintain their production staff taking advantage of the reduced demand by brewing beer that requires extended aging in tanks and barrels. I also think there will be variety in the stores like we’ve never seen before as smaller brewers that traditionally are taproom-only begin to self-distribute.
Overall I remain very optimistic for the future of the industry as a whole; we just need to get through this together and healthy and get those that are really hurting back on their feet.
Joe Yeado, Gathering Place
The pandemic is rapidly changing the craft beer landscape, with some immediate changes and some that will play out over several months or years. In short, I think a lot of breweries will close. Unfortunately, I think whether a brewery closes or not will have very little to do with the quality of their beer. Instead, I think those decisions will be based on access to capital and relationship with a distributor, where well-financed breweries with wholesale contracts will be fine.
For decades there had only been one brewery business model: a production brewery that sold beer to a distributor. That started to change in the 1990s, first with brewery tours and then with brewery's adding taprooms and encouraging people to linger and enjoy beer on-site.
Gathering Place – like thousands of breweries nationally – was built on the taproom model, but that model doesn't work if taprooms closed. Even with taprooms reopened, social distancing measures might limit the customer capacity to a level below what's needed to break even.
We're in a good position because we've worked hard over the past couple years self-distributing our beer to local bars/restaurants and developing those relationships. I think there are hundreds – thousands? – of breweries out there that don't have those relationships and will struggle and close in the next 12-18 months.
I really worry about breweries that recently expanded and took on lots of debt to make it happen. Banks are playing ball right now, but that won't last forever and if revenues are down from closed taprooms and bars, some breweries may face an uncertain future.
Craft beer is about getting people together and events have been a big part of the industry growth – our Lager & Friends festival is a great example. It's possible that prolonged social distancing will prevent these events from happening, which will greatly reduce revenues for breweries to say nothing of lost economic benefits for cities like Madison (Great Taste) and Denver (Great American Beer Festival).
Packaging beer in bottles/cans will only become more important. Regional breweries have seen declining production due to competition from small local producers, but are now in a strong position because people want packaged beer from a liquor/grocery store.
Mobile canning enables small breweries – Gathering Place included – to compete in this market, but it's tough. I think breweries who have distribution contracts are in a stronger position than self-distributed breweries. As the pandemic continues, the shelf space at liquor/grocery stores will only become more competitive. It's very possible that self-distributed breweries could get shut out altogether, which could contribute to hundreds of breweries closing.
David Dupee, Good City
We've mapped out all kinds of different scenarios and contingencies for 2021. The difficult thing is that everything is so fluid and changing daily. The only thing we know with some degree of certainty right now is that people will continue to drink craft beer and eat. It's just how those experiences are delivered that has changed.
One thing that has not changed is off-premise. In fact we have seen a 50-70 percent increase in our grocery and liquor store sales, which is very encouraging. As far as food goes, we've been overwhelmed by the response to our curbside service, which has allowed us to keep our skeleton crew employed.
However, obviously on-premise distribution and our taproom and event business are facing an indefinite pause. Taproom margins in particular are a critical component to most young breweries and so unfortunately I think you'll see many closings nationwide over the next year.
We don't expect to return to any sort of normalcy until a vaccine is in place and so therefore we view the next 12 months or so as survival mode. Every brewery has to circle the wagons with their teams and come up with creative ways to survive.
In many senses this has been the silver lining in all of this: it's been an absolute joy to watch our team roll up their sleeves, adapt and execute a completely new business model – curbside/carry-out. It will require this mentality and teamwork to survive.
While we're confident there will always be strong demand for local beer and food, it's anyone's guess what the new normal will look like in a post-vaccine world as far as how these products are enjoyed.
Will people be more or less likely to gather in crowds? Will certain beer styles gain in popularity as a result of all this? We don't know, but we're determined to get through to the other side in order to find out and continue providing our customers with unique local experiences.
Henry Schwartz, MobCraft
There are a lot of things I am scared about, like how many old kegs are sitting in coolers and in warehouses across the state, and what is going to happen with those. Depending on the beer style some kegs may still be great, others may be of really inferior quality.
If there is a fire sale on old kegs for low prices some beer that probably should not end up on tap lines will, potentially leaving a bad taste – literally – in the mouths of consumers. Craft brewers have worked so hard over the years to produce high-quality products, I'd hate for opinions of local craft to change after these potential bad experiences.
I think society is going to continue to look for deals and to save money. I know I am super conscious of my household budget right now toeing the fine line of supporting the business of my friends and community, and making sure my bills are all paid. I think we will see a rise in purchases of less expensive beer. I am thankful that MobCraft can still produce a beer that you can find on the shelves for $7-$10. So, I think in that aspect we will be OK.
Right now we are working on launching a new product and plan to continue to do so, which is super exciting, but also leaves some level of concern that our target demographic will still be purchasing.
That all said, there are also many things I am confident and excited about. I truly believe our community has changed, and the impact of supporting local businesses has been affirmed. People have seen the slow down and the effect that has had on the hospitality industry.
Although our community might be a little more cash-poor after businesses re-open, I believe there will be a higher number of individuals supporting local businesses than before. This will produce a net positive. Say 100,000 Milwaukeeans supported a local business with $10 creating $1 million in spending before COVID, I am hoping we will see 200,000 Milwaukeeans support local businesses with $7 creating $1.4 million in spending after COVID.
I also see local businesses trying to make every dollar earned impact multiple parts of the community. For instance the Walker's Point Wheat beer we are brewing. Instead of selling it at our regular keg price, we will bring the cost down so bars and restaurants can make a few more dollars. Those extra dollars are being used to help the establishment get back on their feet, to fund tip pools, etc. At MobCraft we will sell pints of this beer for 1/2 off if you bring in a receipt from another Walker's Point business.
I was just on a call yesterday with a local music venue coming up with ways to help cross-promote with some of our current online events and their regular musicians, then our beer at their establishment once it opens back up.
If local businesses buy local products from local distributors dollars stay in our community and the circle of spending stays here which has the biggest impact of bringing Milwaukee back up!
Sharad Chadha, Sprecher
On a macro level. We are in unprecedented times and uncharted waters. None of us have seen this before, just a few weeks ago no one could have imagined that the world would come to a halt and virtually stop so quickly. I hear and read crazy numbers on the impact of this pandemic on the craft and micro-breweries. I think we need to temper and look at the long term view.
Yes there will be some businesses that may not be able to make it. It will depend a lot on the speed of rebound of the economy. There will be a new normal, a major reset. Social habits will change and evolve.
As soon as the economy opens up, does not mean it will be back to the "old" normal. If you are a bar, restaurant, mall, movie theater, cruise, airline, others, there will be changes due to social distancing. That will result in lowering capacity, revenue and margins for businesses. That will impact brewers and manufacturers like us. Yes, there will be culling and the strong will become stronger and weaker players will go under. There will be some value opportunities for breweries and other companies, that will come on the market at a good value.
Work from home, virtual meetings, virtual bars and get-togethers will become more commonplace. Healthy habits like washing hands, increased sanitation protocols in tap rooms, bars, restaurants, workplaces and manufacturing facilities will improve and hopefully have a good impact on healthcare long-term.
On a micro level for us, our taproom is closed, our brewery tours are closed, our retail sales are dramatically down. Our on-premise business to bars and restaurants has almost halted. Luckily we have Sprecher root beer, craft soda and seltzer water that are doing well at the retailers and grocery stores.
We are trying to take care of our staff, keep them healthy and safe, maintaining their jobs, trying to do our best to support their compensation. The production and retail staff need our help the most right now and we are supporting them as much as possible.
We are also leaning into our innovation of new craft beverages that will be launched in a few weeks. We are focusing on sales and marketing, to grow as a craft beverage company with quality and taste being paramount. We are Sprecher Brewing company, always the best taste and quality fire brewed, local, natural ingredients, made in Wisconsin.
Andy Gehl, Third Space
This is a very challenging time for Milwaukee's craft beer scene because we were just hitting our stride collectively in a very early growth stage. We have many start-up craft breweries who either just opened or have invested significantly in growth very recently. Losing out on bar, venue and taproom revenues for a significant period is going to stymie that growth and may put several breweries on shaky ground.
That said, hopefully we can emerge from this pandemic even stronger than before. Responding to challenges like this will test all of our businesses and force us to be better business owners, really putting our business models under the microscope.
At Third Space, we are confident in the approach we have taken with our business but we are also challenging ourselves to analyze how we must adapt to the current and future craft beer marketplace.
Craft beer lovers are not going away and the desire to support local craft breweries is stronger than ever. Our own curbside pickup program is a testament to that. We are amazed at the support we have been shown. However, how people enjoy craft beer may change, so we also need to change. We expect customers to return to tap rooms, bars and restaurants but it may happen slowly and customers may become more comfortable enjoying beer at home and ordering it online for pickup and delivery, where permitted by law.
We are looking at ways to meet our customers where they want to purchase our beer and we are hopeful that our state government will be open to these changing dynamics as well and adjust liquor laws as needed to help this booming industry back on its feet and into continued growth in the future.
Born in Brooklyn, N.Y., where he lived until he was 17, Bobby received his BA-Mass Communications from UWM in 1989 and has lived in Walker's Point, Bay View, Enderis Park, South Milwaukee and on the East Side.
He has published three non-fiction books in Italy – including one about an event in Milwaukee history, which was published in the U.S. in autumn 2010. Four more books, all about Milwaukee, have been published by The History Press.
With his most recent band, The Yell Leaders, Bobby released four LPs and had a songs featured in episodes of TV's "Party of Five" and "Dawson's Creek," and films in Japan, South America and the U.S. The Yell Leaders were named the best unsigned band in their region by VH-1 as part of its Rock Across America 1998 Tour. Most recently, the band contributed tracks to a UK vinyl/CD tribute to the Redskins and collaborated on a track with Italian novelist Enrico Remmert.
He's produced three installments of the "OMCD" series of local music compilations for OnMilwaukee.com and in 2007 produced a CD of Italian music and poetry.
In 2005, he was awarded the City of Asti's (Italy) Journalism Prize for his work focusing on that area. He has also won awards from the Milwaukee Press Club.
He can be heard weekly on 88Nine Radio Milwaukee talking about his "Urban Spelunking" series of stories.