The Craft Brewers Association of Canada recently surveyed breweries across the country on how they’re fairing during COVID-19.
One big problem they’re facing is cash flow, with 61 percent of breweries saying they only have cash reserves for three months or less.
Over 300 breweries took part in the survey, including Emily Tipton, co-owner of Boxing Rock Brewery, and the President of the Craft Brewers Association of Nova Scotia.
Tipton tells the Sheldon MacLeod Show, people are still able to move some product, but their high margin streams, or outlets where they make the most money, are from retail sales, and sales from their taproom.
But COVID-19 has closed down both of those streams of revenue.
“Many of us just don’t have enough cash on hand to sorta wait it out, especially those of us who are more highly-dependent on the taproom-type revenue, she says.
The survey also shows that 91 percent of breweries just started operating in the last 10 years.
Tipton says, it’s hard for breweries to have any reserve money when they’re relatively new businesses that have to spend extra money on reinvestment, like big, expensive equipment.
“Ten years is not a lot of time to pay off all the debts associated with buying a lot of very expensive equipment, and then accumulate cash reserves as well.”
Numbers also show about five percent of breweries have closed temporarily, and 14 percent don’t know how long they’ll be able to stay open.
The Craft Brewers Association of Canada also sent their survey findings and results to all of Canada’s Members of Parliament.
In the letter, they remind MPs that local breweries are embraced by the community, keep money in the community, hire local people, and even help out when times are tough, by pointing out the breweries who chipped in to make hand sanitizer.