• Mary O Sullivan

Alcohol production in the time of Covid-19

Alcohol can be many things; fun, a social lubricant, a chance to be creative, an expression of identity in what you choose to drink.

However, with the social landscape rightly shut during the pandemic, how has this impacted alcohol businesses in other countries?

In America, any alcohol producer who relies on on-premises' sales is in serious trouble. However online sales (according to market research from Nielson, as reported by Forbes) are up 243% since the pandemic started. Looking harder at this data shows that beer, wine and distilled spirits are selling at 42-75% higher than the previous year. The really high percentage sales have been in Tequila, Gin and premixed cocktails.

The flip side of the coin is that smaller distilleries, where often approximately 40% of their income comes from (closed) onsite tasting rooms, are really struggling. A survey by the American Craft Spirits Association found that 87% of tasting rooms have closed, taken with a self reported statement that 67% of distilleries will have to close within 3 months due to financial shortfalls. When this is shown against the statistic that 75% of these same craft distillers are producing hand sanitiser, this could signal a significant drop in production of this essential product.

Craft breweries are facing similar problems. For many their income is roughly broken down into ~40% sold draft, ~26% sold in the on-trade (bars and restaurants) and about 14% sold in brewery tasting rooms. Any brewery without a distribution network is in serious trouble.

All this mean that there could be a major consolidation of brands ahead, without some supports a lot of these smaller businesses can and will fail.

So the take home is wherever you are, buy local and try and support the small businesses near you, they will need it.

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