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Thursday, December 31, 2020

Eyes on a Better Year as 2020 Skulks into History

All things considered, the pandemic hasn't been a bad time to raise an intense Labrador puppy. I hate to think what we would have done without all the readily available time, time required to deal with Bunk's incessant need for exercise, attention and supervision. 

Of the Labs I've had in my life, Bunk is by far the craziest and most difficult to manage. And the competition isn't close. Most Labs calm down and become relatively normal around the age of two. I fear Bunk won't calm down until she's five or six or seven. Wild times ahead.

If the pandemic has been a decent time to raise a puppy, it has been a devastating time for craft beer. That's especially true of smaller breweries and related businesses that depend on foot traffic to generate direct to consumer sales. A lot of these folks have implemented creative strategies to stay afloat, but it's been a tough slog. 

Strangely enough, the pandemic has given a boost to larger, typically older breweries who were seeing catastrophic volume declines prior to 2020. They got new life because their beers have placement in retail, which is where most consumers have been forced to purchase their beer fix during the Covid mess due to the nearly complete collapse of draft.

We don't know for sure what lies ahead. A year ago, people were bitching and moaning about how bad 2019 was and looking forward to 2020. We know how that turned out. But there does appear to be a shard of light at the end of the tunnel. Vaccines are becoming available, though the process of getting people vaccinated is creeping along so slowly that it will take years at the current pace.

In a perfect world, we'd all like to see things return to a semblance of normalcy soon. But we're probably looking at late spring or summer, at the earliest, as the point at which most restrictions will be lifted and people can return to normal activities. Even that timetable may be overly optimistic due to the complications connected with vaccine production, distribution and inoculation.  

As far as the craft beer world goes, there are a lot of challenges that may impact a return to normalcy. Honestly, I'm not sure there can be a return to the old normal. Not in the short run, anyway. Among the challenges facing the industry:

  • Craft beer was losing momentum prior to the pandemic. That was a product of consolidation, market saturation and distribution challenges, but consumer tastes were also evolving toward seltzers and various alternatives to craft beer. While the craft bubble may not have been bursting, it was certainly losing its shape. Then came the pandemic. 

  • The overall economy has been propped up by federal and, in some cases, state help, but it's a mess. The federal response has been so woefully inadequate that there will likely be a lot of pubic sector job losses at the state and local level due to revenue shortfalls and budget cuts. That isn't going to be good news for an industry hoping to regain its mojo.

  • We don't know how many restaurants, bars and taprooms will survive to the other side, but the industry has been hobbled. There are going to be fewer places buying beer from suppliers in the new world. Also keep in mind that the likely surge in patrons when things initially open up probably won't last. Why? The unstable economy. 

  • One big unknown is how much longstanding damage the pandemic did to beer consumption patterns. In my experience, regular beer outings were usually wrapped around my workout schedule. Both of those activities have been completely disrupted by the pandemic. Will I be able to return to that kind of arrangement? Do I even want to? Lifestyles have been skewed for millions and it remains to be seen what that means going forward.

  • Work itself is going to be changed when we emerge from the pandemic. Many who once worked in offices are going to be working remotely because business discovered technology allows it to do so efficiently. That dynamic will alter human movements. How will that impact restaurants, bars and pubs? We don't know. Maybe not much. Maybe a lot.

  • Finally, breweries, beer bars and some restaurants have made it easy for consumers by packaging their beer, offering easy ordering, free delivery, etc. Doing that was a matter of survival. It's low margin business compared to selling draft. Will consumers continue to seek the comfort of online ordering and delivery? How long will it take for breweries to transition out of the desperation model? We shall see.

Notwithstanding the challenges, we're all hoping for a brighter 2021. The experiences of the past year have been unprecedented on many fronts. On the occasion of seeing 2020 in the rearview mirror, I want to extend best wishes to my friends in beer. Most of you have had a much tougher year than I have, despite my challenges with Bunk. 

Time to move onward and upward. Happy New Year!

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