CRG Bulletin looks at the effects of COVID on craft breweries.

Channeled Resources has recently launched a monthly “Bulletin” where we’ll share a few factoids on some of the many markets where our customers are continuing to find growth and new opportunities in these strange days! Our first issue took a look at Craft Beer.

What’s happening in the market?

According to a recent article from Craft Brewing Business brewery taproom sales and bar sales were decimated in the
first part of the year by government-issued stay at home orders. Total brewery sales were down 30.5% through May 2020
compared to prior year. No big revelation there! Local breweries have had to become creative and shift distribution
which has in fact been a boon for many converters serving this industry:

  • Orders have shifted towards to-go orders of crowlers and growlers – all needing labels!
  • Revenue from to-go sales is a fraction of pre Covid taproom sales – so long-term impact is uncertain
  • Even as states have loosed restrictions – capacity limitations will likely continue to damper brewery taproom sales
  • Large craft brewers are diversified and have established distribution channels – which will separate them from local breweries that rely on taproom sales …. and are forecasting strong growth

Estimated Sales Growth for Q2 2020–Q2 2021

Good news on the horizon?  Optimism among brewery owners has been increasing significantly since April as states are allowing reopening.  And with craft breweries representing 12% of all beer sales — let’s hope it continues.  Visit an outdoor patio while the weather is still nice, take home a growler and support your local brew pubs!

How about the labels?

Photo credit:

Meanwhile, while researching this topic, we came across some really cool craft beer design trends from the past decade from Cododesign. The upshot? “Branding and packaging is shifting to communicate to consumers exactly what a brewery is about and exactly why you should drink their beer.” As you print labels for your craft beer customers, take a look at these interesting design trends:

  1. Good design is critical and the industry is getting smarter – even small breweries on shoestring budgets are hiring designers for foundational branding. And that means they’ll value top quality labels from a good converter!
  2. Color for SKU differentiation is one of the most
    pervasive trends of the decade.
  3. Bright white and minimal has been and will be a strong trend – less is more.
  4. But on the other side — there’s thickly-illustrated labels  – lush and detailed.  But it has to be done carefully.
  5. Pressure-sensitive labels on cans are a great answer to limited releases/promotions.
  6. Over-can boxes are effective ways to stand out from the rest.

And what are we all drinking?

Here are six interesting craft beer product trends offered up by Beverage Dynamics.

  • It’s the taproom era – many newer brewers forgo broader distribution, and instead focus on taprooms sales and the bulk of their income occurs onsite.
  • Hazy IPAs are here to stay
  • Low-ABV (alcohol by volume) is a big deal to health-conscious millennials.
  • CBD Beers are emerging – as legal cannabis spreads across the US – so does CBD beer.
  • Sours Enjoy Wide Appeal – they’ve become diverse and appeal to a wide spread of demographics
  • Barrel aged beers have become niche – look for them in 4-packs of cans, or single-format 12-oz. bottles. Or even single-format cans.

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