There’s only one topic on everyone’s mind right now – when will we get back to normal? And, what will the new normal be like in this era of Covid-19?
As a leading player in the Indian microbrewery industry, we have been in this business for decades. Yet, we have never witnessed a situation like this ever before. Staring out of our windows into the eerie quietness of our streets, the situation outside looks similar to an apocalyptic world from Hollywood movies.
The pandemic has not only shaken our healthcare systems but has also caused massive collateral damage. Businesses are closed, some even shutting down permanently, jobs lost, and the economy going in for a toss. Yes, the current situation is frightening and unparalleled in our recent history.
We are beginning to see the light at the end of this very long tunnel as we approach the end of May. The light shines very dimly, but it’s there. As lockdown restrictions are being relaxed (albeit very slowly and cautiously), people are hoping that life returns back to some kind of normalcy. It’s time we figure out how things will look for breweries in the era of Covid-19.
The Golden Era comes to a Pause – At least, temporarily for Microbreweries
At the end of 2019, the co-author of “World Atlas of Beer,” estimated that there were over 25,000 macro breweries worldwide. And, in India, the number of microbreweries and brewpubs steadily increased over the last few years.
The current situation means that the number of microbreweries will not expand as before. The worst-hit are the small breweries that rely solely on their taproom and brewpub sales for their incomes. With a strict nationwide lockdown, most breweries have not been able to operate for the last 40 – 60 days. Their over-the-counter sales have dried up, and they are financially overstretched.
Bigger breweries have their own array of problems. They are facing significant disruptions in their supply chains. Though they are better financially positioned to weather the storm, they are seeing considerable breakdowns in their local and national distribution systems.
The Debate on Going Out vs. Staying In
Even after lockdowns are fully relaxed, people will still be hesitant to go out and socialise as before. Instead of large public gatherings, people would prefer to stay at home and drink with their close buddies and family. We can expect a change in the preferences of brew lovers. Instead of heading to their favourite pubs and bars, they would prefer to stay at home and drink.
This could prove advantageous for smaller microbreweries. You can cater to your customers’ demand by offering curb-side pickups of their favourite brews. Industry insiders hope that the government will ease restrictions on home delivery of alcoholic beers. This could be a lifesaver for the entire industry.
With doorstep delivery of alcoholic brews, microbreweries will be better positioned to cater to customers’ changing demands.
Is it the Nail on the Coffin for Draught Beer?
With patrons uncomfortable visiting a pub or restaurant, the demand for draught beer is likely to fall sharply. Demand for casks and kegs will fall. Expect a massive increase in the sales of bottled and canned beers.
Wondering how to Weather the Financial Crisis in the Coming Months
Appeal to the “Go Local” Ethos
We are now witnessing a massive change in the mindset of consumers. With the Prime Minister’s address to the nation, most people are looking to “Go vocal about Local.” Appeal to your customers via social media channels to support local businesses like you.
Serve as a Model for your Community
While appealing to your local community to help you, make sure that you give back to them as well. Here’s an excellent example of how a local brewer served as a community model during the pandemic.
A microbrewery in the US was planning to launch a new hard seltzer in their brewery. For this, they had a large barrel of food-grade alcohol in hand. However, instead of going ahead with the launch, they used alcohol to manufacture sanitizer and distribute it for free.
Consider an MSME Loan
The central government has announced several financial relief measures for ailing businesses. See if you can avail a small business loan at low interest to help you tide over the times.
Think of Alternatives
If you are not able to get your brews in the hands of paying customers, you can consider alternative revenue-generating channels for the next few months. Deliver eats from your menu to the homes of customers. Sell merchandise like glasses, t-shirts, etc. You can sell gift cards at discount prices that customers can redeem on a later date when things get back to normal.
This too will pass
Yes. It may appear all gloomy and bleak right now. But, remember this – the crisis will end. And, what will be remembered is how brave (and innovative) you were in these challenging times.