Of the Empire State’s 416 breweries, 152 responded to the survey conducted between April 3 and April 15. New York has been the epicenter of the COVID-19 pandemic in the U.S., with nearly 300,000 cases and 17,000 deaths. Gov. Andrew Cuomo was among the first governors to mandate a statewide shutdown of on-premise sales at bars and restaurants shutdowns on March 16.
On Sunday, Cuomo announced that the order will likely extend beyond its planned expiration date of May 15, but he said some regions of the state could see a relaxation of restrictions based on infection rates, Reuters reported.
Statewide, breweries have laid off or furloughed 65% of their full-time employees and 86% of part-time employees. Unemployment rates are higher in the eastern half of the state; nearly all part-time employees at breweries in the association’s Northeast (96%) and Hudson Valley (97%) regions have been furloughed or laid off.
In New York City, which has been hardest hit by the novel coronavirus, 55% of survey respondents said they have ceased operations. However, only 5% of the city’s breweries participated in the survey.
In the Finger Lakes region, which had the highest survey response rate, 25% of breweries have stopped operating entirely.
Almost three quarters of New York brewers (72%) have received loans from the Paycheck Protection Program (PPP) and 63% have received Economic Injury Disaster Loans (EIDL) from the Small Business Administration, according to the survey.
As breweries nationwide have lost taproom draft sales, they’ve pivoted to offer to-go sales, curbside pickups and home delivery. In New York, 37% of breweries are offering to-go sales, a quarter are offering curbside pickup and 8% are offering home delivery. Twenty percent are selling beer through their distribution network.
In Rochester, Roc Brewing founder and NYSBA board member Chris Spinelli said his brewery’s off-premise sales are up, but not enough to compensate for the loss of taproom and distributed draft sales. The company’s overall sales have declined 70%.
Roc has scheduled an extra canning run to package beer to sell into off-premise retailers.
“They’re flying through Wegmans at a really good pull rate, so we’re really lucky in that sense,” he said.
Roc began offering to-go sales from its taproom on April 11 after nearly a month of being shut down. Before the COVID-19 pandemic, Roc’s business split about 60% in its taproom and 40% through distribution.
“When we reopened for to-go sales, we started to do a nice volume, so we’re starting to take some kegs from our distributor back and putting them as to-go sales,” Spinelli said. “As long as sales are good, we’ll keep doing it, but we’re definitely down. We haven’t brewed a beer for almost a month.”
Spinelli estimated that Roc has been selling about a third as much as it normally would, and nearly all part-time employees have been furloughed. Roc has received a PPP loan, as 81% of the NYSBA’s western region has, but Spinelli said EIDL money would help his business even more.
“That’d be huge, because a lot of us are burning through cash really fast,” he said. “Even if you add in the PPP, then I’ve got to push some people back on staff, right? Well, I’m paying them to do either nothing or do something, which then means I’m still burning some of my other cash reserves. We need something to consolidate some of our debts.”
Roc announced an expansion project in February to add an on-site restaurant and renovate its current taproom that was originally planned to occur in two phases. However, with the on-premise shut down, Spinelli decided to consolidate the construction work.
“We’ve gutted our taproom and we’re doing it all as one big project right now,” he said and added he expects work to be completed in June.
In the NYSBA survey, the four most common requests for government assistance were:
- State and federal tax relief or deferment,
- More loans with no or low interest and loan forgiveness,
- Grants or other relief for paying utilities, rent or mortgages,
- Waiving of license renewal fees and State Liquor Authority label requirements.
Last year, 423 craft breweries operated in New York, third to California and Colorado, according to national trade group the Brewers Association. Together, New York’s breweries, which produced 1.3 million barrels in 2019, employed 20,000 workers and generated $5.4 billion in economic impact.
“The overall consensus shows that all regions of New York state have been significantly impacted by this pandemic,” the survey said. “Without more aid from local, state and federal government, this industry may face a severe decline.”