19 Jun The Shutdown Showed Breweries New Ways to Meet Customers On Their Terms – Will They Last?
It’s said that necessity is the mother of invention. It’s also said that desperate times call for desperate measures. Both of these have been true as small businesses and craft breweries/wineries/distilleries have attempted to stay afloat during the storm that was/is the pandemic. In order to survive as a business, revenue streams needed to be invented or bolstered in order to deal with the restrictions imposed in the name of public health.
To their credit, craft beverage producers and retailers did come up with new ways to generate sales, including takeout, delivery, gift cards, online ordering and sales, carryout, virtual events, food, and packaged product. In some cases, these were completely new projects for the businesses, in others they were things that went from ideas or small projects for the future to immediate big changes.
Now that things are starting to open up and people are back at the bar (except in Marion County, not until June 19), the question becomes “Which of the new things will stick around as permanent reminders of the pandemic?” Consumer habits have changed over the last three months, and there’s no guarantee that they will completely go back to where they were before – perhaps out of fear, perhaps because people just discovered that the new way works better for them. Therefore, craft beverage sellers are looking to merge the old with some of the new.
Let’s take a look at some of the new ways to sell craft beverages, and here what producers are looking to keep and what to jettison. In truth, it looks like a good amount of what was “new” or “enhanced” is going to be sticking around.
Delivery. This was new to almost everyone during the shutdown. True, a few places that did a lot of delivery of food also did some beer delivery, like Greek’s Pizzeria & Taproom on 49th and College in Indy. But for straight breweries/wineries/distilleries, delivery is a newly discovered species. It involves man hours and overhead (vehicle, gas, labor, etc.), but delivery has been embraced by many breweries and some plan to continue the practice because people are still asking for it.
Grand Junction Brewing in Westfield, Switchyard Brewing in Bloomington, Pax Verum Brewing in Lapel, Black Acre Brewing in Irvington, and Bare Hands Brewery in Granger are just some of the breweries that are continuing to do delivery runs. Bare Hands had such great response to their delivery project in the Indy area that they have had to pause it just to keep up with taproom and distribution demands, while Pax Verum states that they would be willing to buy additional branded vans just to keep the deliveries going.
Bare Hands’ Eric Foust told me that one day alone they had 45 deliveries in the Indy area and it took from 8am to 8pm. That’s not tenable with all the retailers now wanting beer as well. Heck, the entirety of the Bare Hands Brewery staff is ten people; that and the fact that their new fermentors won’t arrive for a couple months means that as much as they might like to do deliveries, they will only be able to do it sparingly for a few months.
Takeout and Curbside. Carryout beer was perhaps the greatest winner during the pandemic, especially when the liquor stores went to curbside pickup only. The state relaxed some restrictions on carryout, allowing restaurants and bars to do growler sales (normal rules are that only producers can do growlers, and then only their own products). Brewpubs and breweries can also do growler sales of guest beers now, but who knows how long that will last.
The industry (as far as breweries) is split about 50/50 on retail growler sales. Some small breweries that distribute rightly believe that this will cut into taproom sales where their margins are higher, while many retailers see this as a significant area of growth for their sales. Indiana is sort of on an island in not allowing growler fills by retailers (all the surrounding states do), so we may see some movement on this in the next year.
Breweries and retailers aren’t the only ones who were strongly affected by the takeout sale revolution. Kori Pugh at Schnabeltier in Rochester told us on Saturday that wine slushies were their saving grace during the shutdown. Kori, Haley and the team at Schnabeltier would fire up the slushy machine in the morning and they would sell curbside slushies all day. They said the demand was phenomenal – they sold them all day long.
Along with the selling changes, ordering has also changed. Many breweries have signed on with either shipping companies for their beer, or companies that specialize in online ordering and billing for delivery or takeout. The results have generally good, but some bugs or timing issues have plagued some systems. These will get better, and I see them being a permanent change to help accommodate takeout and delivery orders.
Teays River Brewing & Public House head brewer Jason Cook has seen a shift in their sales after the shutdown was lifted (look for more on them later this week). He said, “We still see a very steady number of carryout orders come through but delivery orders have tailed off considerably so, we have already discontinued that service.” You can see that trends can be specific to particular breweries or regions.
Food Takeout and Expanding Food Sales. Offering takeout food sales is something that a lot of brewpubs and restaurant/bars did before the shutdown, but it has become much more important to the bottom line since the shutdown started. For many brewpubs and restaurants that have a lot of craft beer, food take out amounted to 1-2% of revenue before the pandemic.
After the shutdown, that increased to 20-30% in some cases. As the brewpubs opened back up, the takeout sales didn’t drop at a commensurate rate. It appears than more people are looking to take food home rather than eat out – it’s eating out without eating out. Of course there are other places that have always done a lot of takeout sales. Fork + Ale House in Carmel has always sold a bunch of takeout since they are in the middle of a residential/office/park environment. There are 600+ employees and residents in the buildings around them every day, so it’s no surprise that the pandemic made little difference to their takeout sales.
On the other hand, many breweries were contemplating food, and the pandemic pushed them forward faster than they had anticipated. Black Acre Brewing had always intended to add food to their Garden space, the shutdown just moved it forward in time so that the Black Acre Garden could qualify as a brewpub and open in Stage 2 as opposed to waiting until Stage 4. This action was taken by many breweries to greater or lesser degrees, adding just enough food to their menus to meet the minimum guidelines. We’ll see how many keep those food choices when they aren’t required to.
Packaged product. By this we really mean canning; canning has blown up during the shutdown. Teays River Brewery is just one of the many breweries were thinking about canning or had done a run or two in total, but the shutdown accelerated their timetable. I talked to Jason about the canning explosion in his brewery (no, not like other canning explosions you have heard of). He said, “Now that we finally pulled the trigger canning, I can’t see us not continuing to schedule sessions on a regular basis. It had already been in the plan for this year but we just accelerated the timeline a little bit. Carryout has always been available but obviously more widely used over the past few months.”
Our Lady of Perpetual Hops in New Albany also began canning during the shutdown, as have many other breweries that wouldn’t have considered it earlier or were only considering it as a “future plan.” The numbers are too big to name everyone who has started canning under the shutdown cloud, but they include Backstep Brewing in Crawfordsville, Myriad Brewing in Evansville, Wedgewood Brewing in Middlebury, Wildrose Brewing in Griffith, Black Dog Brewing in Moorseville, Crasian Brewing in Brookston, Function Brewing in Bloomington, GnomeTown Brewing in Fort Wayne, Switchyard Brewing in Bloomington, and Ruhe Brewing in Nappannee.
This list doesn’t even count the number of breweries that had done a bit of canning, but expanded greatly during/because of the pandemic shutdown. Cedar Creek Brewery has added an in-house canning line and Ironwood Brewing and Plat 35 Brewery expanded the number of beers they can just before the shutdown. Many breweries expanded their canning, either in pints or crowlers (like Black Circle Brewing), and the majority of those are looking to maintain that canning as a new way of getting more of their beer to their patrons.
Sitting Outdoors. A number of breweries have increased their outdoor space – and don’t look for it to contract soon. Is it fear of the virus; is it nice weather? Who knows, but people are sitting outside like it’s going out of style. On Monday I wrote at Fork + Ale House and on Tuesday I first stopped at Blind Owl Brewery in Indy and then met a friend (Hi Mike) at Nigh Brewpub in Plainfield. At all three places the outdoor seating was much more popular than the indoor seating. True, it was a nice day, but I talked to Josh at Blind Owl and he said that outside seating has been unusually popular since they have reopened.
Grand Junction Brewing agrees with that statement. Good or bad, hot or cool, people are sitting outside more than usual. Maybe it was being stuck at home from a couple of months or perhaps it is a desire to be further apart and in the open air. Whatever it is, if brewpubs and taprooms have the room, they are expanding their outdoor seating.
Conclusion. Make your wishes known – breweries/wineries/distilleries/restaurants are looking for guidance on what you want and what you will support. That a business can find a new way to make money is important – if not stunning. But it only helps as long as people use the service. (NOTE: One thing I’m not a big fan of is the QR code-reached menu. My phone doesn’t do that, so it’s sooner the better for reusable menus as far as I’m concerned.)
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