A lot of challenges were posed to the drinks world and craft beer scene in 2020. From significantly diminished on-premise consumption and strained distribution to event cancellations and production limitations, breweries were faced with many obstacles in the effort to keep their businesses afloat throughout the pandemic year.
But with challenge and change comes opportunity. Adaptations to business models, regulations and even consumer behavior can impact not only what you have in your glass, but almost as importantly, how you can keep it filled with a wide array of pours.
In this episode, we’re taking a look at what the new year has in store for the independent or craft beer scene. Beer Editor John Holl guides a conversation with Natalie Cilurzo of Russian River Brewing in California, Samantha Lee of Hopewell Brewing in Chicago, and Paul Leone, director of the New York State Brewers Association, about the shifts they’ve seen and encountered, and exactly what it could all mean for the year of beer ahead.
From exciting new releases and sensational seasonals to the hopes of better distribution and even improved direct-to-consumer access, there’s much promise to the year ahead for beer lovers, and that’s something we can all raise a glass to.
Check out this article for more on the beer trends that defined the year that was, as well as our list of the Top 25 Beers of 2020. Looking forward, learn more about the rising style of oenobiers and how they promise to unite wine and beer lovers under one glass, or take a Dry January ride on the non-alcoholic beer bandwagon.
Transcripts are generated using a combination of speech recognition software and human transcribers, and may contain errors. Please check the corresponding audio before quoting.
Lauren Buzzeo 0:09
Hello, and welcome to the Wine Enthusiast Podcast, your serving of wine trends and passionate people beyond the bottle. I’m Lauren Buzzeo, the managing editor at Wine Enthusiast, and in this episode, we’re taking a look at what the new year has in store for the craft beer scene. After so much challenge and change in 2020, there’s a lot to unpack and consider. Beer editor John Holl guides a conversation with Natalie Cilurzo of Russian River Brewing in California, Samantha Lee of Hopewell Brewing in Chicago, and Paul Leone, director of the New York State Brewers Guild about the shifts they’ve seen and encountered over the past year, and exactly what it could all mean for the year of the year ahead. So grab a comfy spot and a cold one, and get ready for an enlightening and informative discussion of all things frothy for 2021.
John Holl 1:04
As we look forward to this year and reflect on what 2020 brought to the beer scene and its lasting impacts, I’m very glad to have this panel of experts, brewery owners and advocates joining us for this episode. Natalie Cilurzo is the co-owner and president of Russian River Brewing Company in California. Paul Leone is executive director of the New York State’s Brewers Association. And Samantha Lee is a cofounder of Hopewell Brewing in Chicago. Thank you all for being here. And Happy New Year to everybody. Here’s to good times ahead. I want to just sort of flip the calendar back just a little bit. And when it comes to the beer industry overall, what do you think 2020 is going to be remembered for? Natalie, let’s start with you out on the West Coast.
Natalie Cilurzo 1:48
Sure. Well, I think 2020 was the year of, you know, business owners, brewery owners in particular having to redefine ourselves and our business models. So I would say just about every brewery in America and probably around the world had to somewhat or completely alter the way they do business, whether it was starting directto consumer, you know, taking on partnerships with food trucks, or caterers or other restaurants in order to keep their doors open due to meal requirements here in California. Or, starting to package for the first time and distribute wholesale. So I think that all breweries no matter what size from the smallest of the small to the biggest of the big really had to pivot and redefine themselves and their businesses this year.
John Holl 2:45
Pivot was one of those 2020 words.
Natalie Cilurzo 2:47
John Holl 2:51
Starting to starting to move east, Samantha, what’s your take on what 2020 beer-wise is going to be remembered for?
Samantha Lee 2:58
I think a lot of what Natalie said rings true for us as well at Hopewell—that pun, I’m sorry for that. But it sometimes slips out.
John Holl 3:06
It’s wordplay, it’s fine. It’s appreciated here.
Samantha Lee 3:11
Yeah, and I think it depends largely on where you sit, whether you’re a consumer, whether you own a hospitality business, like a restaurant or a bar, or if you’re a brewery owner. For us, we saw a lot of deep engagement with the consumer, whether that’s direct to consumer, making different styles that we hadn’t yet played around with. We saw a lot of that in 2020 so far. Just different breweries of our size as well, just not only pivoting their business model, but also what they produce. And that certainly was true for us. I think we saw a lot of experimentation in 2020, just because folks had a little bit more room to play, at least at our scale. And I think we saw a lot of creativity in how folks get information and share details about their offerings to consumers. It’s really been a year where social media has been really important. And it has been for a long time. But I think this year really showed us how people utilize social media these days. And, you know, we’re relying on that, like the instant information. And it’s how we’re certainly getting information across to our customer base. And then seasonals, funny enough, I think, for us at least seasonals—and we’ve noticed this a bit in the market—that consumers are really excited by seasonals. I think there’s something about this pandemic where we’re all sort of stuck at home and not able to do much. The one thing that you can change is what you’re eating and drinking. So we’ve seen a lot of excitement around new offerings and particularly as they pertain to holidays or seasons changing.
John Holl 4:56
Yeah, definitely. Last year with Oktoberfest beers, I feel like there’s quite a few more on this year just simply because—or last year because there was a more people had time to make lagers properly, which was nice. But I think very much what you were saying. And then certainly towards the end of the year last year with some of the big seasonal holiday releases, certainly did gangbusters. I want to talk about consumer preferences in a minute. But first, Paul, I’m curious from your standpoint, running a Brewers Guild, what’s going to stand out 2020 wise for you?
Paul Leone 5:32
Boy, I think the first word that came to mind was survival. And if I can use a baseball analogy, I think breweries were thrown a nearly impossible to hit curveball in 2020. And those that adjusted in the batter’s box, got through it, and those that didn’t, you know, are still struggling a bit. And I am, you know, just like all the Brewers Guilds around the country, we all had to adjust and we all had to find a way. It’s inspirational to see how breweries adjusted, you know, that entrepreneurial spirit, especially here in New York, and a lot of other states as well. They just, this is their business, they found a way. And, you know, from a state guild perspective, you know, our job was to help them find that way. You know, even if we can tip the pitch for them, you know, some way or another, to help them through this. That was our job, our job was going from, you know, raising money through beer festivals and marketing to how do we help our members get through this, you know, and here we are, and we’re still fighting the fight. But you know, there is a way out, we see a way out. So survival really is kind of the first word that popped into my head,
John Holl 6:49
Are their example examples that you’ve seen from some of your member breweries of people who really rose to the occasion who were able to hit that pitch and almost come out of this a little bit stronger?
Paul Leone 7:00
Here in New York. And, you know, we and a lot of other states, we were able to do things like we shipping delivery, home delivery and curbside pickup, which wasn’t legal for most breweries before the pandemic. And so we were given those tools by the governor’s office early on, and breweries were deemed essential at the very beginning, so they were never fully closed down. And, you know, New York is a really big state. And so, you know, shipping was new to a lot of the breweries that had to figure that piece out. And then delivery. So delivery literally saved many breweries in New York City. You know, I mean, they have 8 million customers. And so they, they found a way and they’re still finding a way and, you know, breweries have just been able to adjust through shut down, opening up a little, having a great summer back to shutting down again. Any opportunity we can give them to, to sell their product, then they took advantage of it, and most breweries did.
John Holl 8:06
Yeah, my conversations with so many brewers across the country last year, usually wound up at some point in the conversation with somebody saying, I never thought I would have ever have to do X as a brewery owner. I’m curious, Natalie or Samantha, were there any things that going into the beginning of last year, the beginning of 2020, that were so foreign to you, or that were never on your radar? That you never thought you’d have to do as a brewery owner that, all of a sudden, you had to do to survive?
Natalie Cilurzo 8:40
Yeah, I never thought I’d have to furlough 142 employees in the same day. That was that was definitely something that was definitely never, never ever on our radar, you know, you think of a failing business that has to do something like that. So I would say that one struck me as probably the never ever thing. The other thing that that was not really on our radar, more because it wasn’t something that we felt that we needed to do, and we didn’t really have the desire to do it, was direct to consumer. But when we had to shut down both of our pubs, which was 50% of our total company revenue, back in March—you know, 50% of our revenue disappeared in a day, which isn’t, you know, bad compared to smaller breweries like Samantha’s and you know, thousands of other breweries around the country where 100% of their revenue was direct to consumer right over the bar in their small tap rooms and stuff. And so we were able to adjust pretty quickly to start putting all of our beer into cans and bottles and do a direct to consumer. And so in California, it was already legal to ship inter-state to customers throughout the state of California. As you know, it’s pretty illegal to ship out of state. But what we have 40 million people in the state of California and so we had a pretty big audience of beer lovers already. And so when we started shipping direct to consumer online, it was a hit, like right out of the gate, and it saved our butts. Because we were kind of freaking out about not being able to pay, you know, our bills, especially here after building a beautiful brewery with four loan payments every month. So yeah, I would say those are my top two things, the furloughing all those people, which we had to do again last week because outdoor dining shut down. But this time, it was only 42 employees, and then the direct to consumer, which ended up saving us.
John Holl 10:53
Samantha, what about you?
Samantha Lee 10:56
So we similarly we lost 50% of our revenue, because a lot of our business is really selling draft to bars and restaurants and about that. We built our business on that, with the assumption and the belief that having a strong draft presence in your local market is really important. You know, people make good memories having draft beer at their favorite bar. So that’s how we really built our business. And we’re so thankful that we bought our canning line two years ago, you know, businesses like ours who don’t have that really, really, really struggled. I didn’t realize that going into our fifth year, we’re turning five in February, that we would be scrambling so much, honestly, to figure out how to avoid certain contingencies. And so we honestly are here with our doors, you know, so to speak, open, because we received the PPP loan, because we received an economic injury disaster loan, we got a city grant, we got another city loan. So those four things are why we have people employed at all. I think, you know, we pivoted and we hustled, but those were so small and incremental that we really needed the government assistance, and I didn’t think that that would happen, you know, obviously, that’s not something that you ever think will happen or planned for. But we were really optimistic about our 2020. We had plans, we had hiring plans, we had all these ideas on what maybe a second location could look like, maybe a different retail component. But instead, we’re very much in a maintenance, and hopefully resiliency in 2021 mode. That’s totally unexpected, not something we love to do, and having tough conversations with our landlord. But ultimately, those are really great, because I think when you’re in a bad relationship with your landlord, as a small business, that can really be the end of you. We’ve seen that a lot in Chicago. A lot of restaurants and bars having to close for that reason. Breweries also getting into some really tough situations for that reason. So, you know, these are not the the worries that I thought we would have, you know, turning turning five soon.
John Holl 13:30
You know, Chicago is such a great beer drinking city to begin with. And your original model of serving the bars of a major metropolitan area made sense. Given the closures, given the uncertainty, I mean, there’s a vaccine being rolled out. People I think, are being cautiously optimistic and hopeful that at some point we can get back to some sort of life as it were. What’s your sense from talking with folks around Chicago, in the hospitality industry of when things might not feel like they did in 2019? Or can they ever again,
Samantha Lee 14:12
Just from conversations with folks, anecdotally, it seems that people feel comfortable about honestly fall 2021. Summer, you know, we can expect people to receive vaccines, thankfully, and I know a handful of people who work in healthcare who’ve received vaccines, and I’m just I’m so excited that that’s happening. But in terms of safety, right, we’ll probably enter phased openings of bars and restaurants, similar to what we saw in the summer, where people had phased approaches. Hopefully in a new administration, it’s a little bit more cohesive about how the entire country does it just because you know, borders are porous people travel, people go on road trips, people are from other places. So hopefully there’s sort of a shared understanding of what those procedures are. And but, you know, I guess the way I think about it is like, well, when am I going to the next wedding? Probably the fall. So we’re crossing our fingers, the stimulus bill that just passed, I’m hoping that that buys everyone a little bit more time. And it’s hopeful. But I think, you know, I tend to be a little bit pessimistic when it comes to these things. So at least I’m trying to prepare for a worst case scenario. And for us, that would be not being able to reopen until late summer. And just, I’d like for our business to reflect that. So that our projections and our planning—that’s how we’re planning at least is that we’re not opening until late summer.
John Holl 16:01
Paul, what are you projecting to your members right now about what this year could bring?
Paul Leone 16:09
I think right now, we’re mentally, you know, trying to prepare them that things are still not great, and that things are probably going to get worse before they get better, without sounding doom and gloom about it, but realistic. But we’re really trying to be as encouraging as possible. I worry a lot about the breweries in this state and everything they’ve gone through, just their mental state, through all of this. What they must be going through. I mean, Natalie, mentioning, like, having to lay off, you know, all of those people like that. But you know, in the brewing industry, and I’m sure Samantha as well, like, you love these people, they’re just not employees. And they love you, like, you know, I mean, these are like family. And so, you know, breweries have gone through so much. And so right now, we’re just, you know, trying to be there for them, always have been, you know. You pick up the phone and call me sort of thing, don’t worry about an email or any of that and be as responsive as possible, because they need that. And so we’re basically saying, you know, just a few more months, and, you know, the sun will start coming out a little bit. And we will get through this just hang on a little bit longer. And then that moves over to some of the legislative action that we plan to take to help them along, as well. So we’re trying to be as encouraging as possible, but as realistic as possible, as well, so they can plan better. And, you know, canning, the can shortage is still another issue. And for those that shut down, you know, as we saw earlier, packaged product is what sells, that’s all they have to sell. So, you know, just trying to stay on top of everything for them, the more that we can think about for them and have answers to their questions, I think that the better they’ll be prepared to get through this. But right now, we don’t want everybody to say, ‘Hey, this is over just yet just a few more months.’
John Holl 18:06
You know, Natalie, I’m curious from your standpoint of losing 50% of the business through the through the two pubs, and people coming in and drinking there. But you’ve been able to ramp up what you’ve been putting out in cans and bottles, and you have a new beer club that’s out there that will be getting beer to people, and you’ve been able to have your beer on more shelves than previous. Is that something that will continue, do you think, through 2021? Or if you’re able to reopen the pubs, do you pull back on some of the some of the things that you implemented out of necessity?
Natalie Cilurzo 18:44
No, I don’t think so. I think that we were really lucky because we were already in a position where we’re already packaging, we’re already distributing wholesale. And we were able to just shift, you know, basically, revenue streams. So wholesale sales went up pretty quickly with craft beer, for those of us who are already distributing just because of the pantry loading that was going on at the time. So we’re super grateful for that. You know, we’re starting to see a dip in in that right now. I think people are running out of unemployment money. Maybe they’re getting back to work. They’re not drinking as much. Maybe they just don’t have any more room in their fridge, I’m not sure. Probably all these things.
John Holl 19:29
That’s where I’m at all three of those right now.
Natalie Cilurzo 19:31
Yeah, right. Exactly. You know, there’s a lot of—what’s the joke? I think it’s the COVID 20 everybody’s talking about. You know, they put on 20 pounds during shelter in place and so they’re like, ‘Okay, I need to cut back on my beer intake.” But I think we’re pretty happy with with the way we now have different buckets of revenue streams, and I feel like it’s safer that way. So, you know, we’re pretty setup. So in the event that something happens with direct to consumer, for example, and all of a sudden, you know, we weren’t able to ship beer direct to consumer for a while, we would still have wholesale, and our pubs and then if something were to happen, you know, again with the pubs and at least we would have these these other two channels. So I’m pretty happy with the way things are going. And I feel a little more diversified, if you will. And like, we don’t have all of our eggs in one basket. I was actually thinking, I think I was thinking yesterday—so Vinny, and I finished building our new brewery here in Windsor just two years ago. It’s been a really interesting two years with wildfires and evacuations andfloods.
John Holl 20:43
You’re not very far from Napa.
Natalie Cilurzo 20:47
Yeah, we had another fire. Well, yeah, we have fires every year, we evacuated almost every year, we almost burned down last year. That was horrible. But, you know, if this pandemic had happened before, Vinny and I were able to finish building our new brewery, we would be in way worse shape, because 74% of our revenue in 2017 came from our downtown Santa Rosa brew pub. And the rest of it was through wholesale distribution. And that’s all we had. And we were a much smaller company at the time. And we weren’t packaging very much beer. And our bottling line at the time was pretty darn slow. And so we would not have been able to make the adjustments we did so quickly, to basically just save ourselves. And so I just I was just thinking about this this week, and how lucky we are with the timing of this. But how so many other breweries were just not lucky. And we’ve been there we’ve been that size we’ve been—I don’t know how many barrels Samantha makes, but I know she’s pretty small, and just having to shut down that retail, that higher margin component of your business, when you’re really relying on that to pay the bills is really stressful. But yeah, I’m just feeling pretty lucky these days, that we were able to adjust in 2020. And like some of the changes that we made, which we will continue to do in 2021.
John Holl 22:23
I think practicing gratitude is one of those things that in and around hospitality, even with how bleak it is, if you can find some things to be grateful for that’s a nice thing to to hang your hat on. Samantha, early on, in this show you mentioned exploration, and then Natalie was just talking about being diversified in the company offerings. But I’m curious as to consumer preferences. And because you were dealing with the public on a daily basis over your bar for the four years before this pandemic, and then certainly over the last 10 months or so. Did you see a shift in what your regulars were looking for? Or what maybe even the casual beer consumer was looking for during the pandemic beer-wise?
Samantha Lee 23:21
Yeah, yeah, sure. So our business, because we we built it on draft and selling it really at the standby bars that you go to on a weekly basis in the city, that means we sold a lot of our First Pils and Ride or Die Pale Ale, those are two of our flagships. We still sell a lot of those beers, but for the folks who are shopping, you know, either through our store or through their mom and pop liquor stores around town, they are, it seems to us, looking for something new and different. Whether that’s seasonal, whether that’s hoppy, whether that’s you know, the stout of the season, we’ve been releasing more new beers now than we ever imagined. I mean, I should have counted this before hopping on this podcast with you all but I mean, I think we’re releasing a new beer at least one each week, sometimes two. So our brew house is extremely busy. We’re not putting out as much volume as we anticipated, but we’re doing so many turns. Our canning line is just running nonstop. We are thankfully taking a week off coming up soon. We all need it. But yeah, it seems that you know, whatever is new is really doing well, basically. We put out a winter lager recently, sort of in the vein of a Vienna lager, and it went gangbusters. That was maybe the surprise of the season for us. It’s a style that always does pretty well on draft for us in the tap room. It’s a good tap room beer, it’s a good beer bar beer. But to see it fly off the shelves like that was really fun and interesting. But that also happens with our, you know, we put out a West Coast-style IPA, we’re doing hazy IPAs for the first time ever. It’s always popular and, you know, it’s hard to tell if it’s because happy is always popular, or because it’s new and interesting. And people are sort of treating their refrigerators like a craft bar.
Yeah. Paul, in talking to your members, did you start to glean off any sort of consumer trends that happened during the first months of COVID? Or the first year of COVID?
Paul Leone 26:02
You know, consumer trends? Yeah, everybody was buying packaged beer, for sure. In terms of styles, you know, I think I’ll echo a little bit of what Samantha just said. The lighter styles. were flying off the shelves. And I think a lot of breweries were also finding time to collaborate with each other that had never gotten together just to come up with something new and different. But it really seemed like everybody, consumers were just like, what can I try? What’s new? And, you know, with shipping, being allowed direct to consumer, which had never been allowed before, it opened up the market, to a lot of breweries and people were ordering things from breweries that they couldn’t get beer from. And so, tastes got really wide and varied. Of course, you know, being here in New York, the hazy IPA is always the winner when it comes to, you know, the most beer sold. But the lighter styles, definitely lower alcohol, where a lot of people workers consuming a lot of beer, a lot of that style of beer.
John Holl 27:11
One of the biggest stories last year, in 2020 and that will continue, I think, is the American political landscape. And when I first started covering beer, maybe about 20 years or so ago, I remember people saying the three things you never talked about at the bar are sex, politics and religion. And these days, it seems like it’s nearly impossible not to talk about politics and, in fact, many breweries have taken political stances, many breweries have entered into the political arena. And because that’s just what this world, you know, calls for these days. Natalie, I know your your brewery in 2020 put out a Pliny for President IPA, which got a lot of attention and most people with a fractured two-party system would have been eager to to vote for your beer for the highest office in the land. But I’m sort of curious, and Paul, certainly in New York State. New York saw a lot of protests over the summer after the murder of George Floyd. Buffalo was a hotspot for a lot of of the various social justice protests that were happening. And breweries were getting involved. Beer is a unifier in a lot of ways. Beer doesn’t know politics, it doesn’t know sex, it doesn’t know religion or creeds. What’s the role that beer is playing in our national political conversation or even our local political conversation? And, Samantha, I’ll start with you just because I know that your brewery has been, and your tap room has been, a place where people can gather and talk about these things.
Samantha Lee 28:50
Yeah. I think one of the ways that we think about our place in current politics is in what sphere do we hold power as a company? We employ people, you know, we have 10 employees, but we do employ people. And we sell to other businesses. We have a somewhat of a platform. So in those realms where we do have power, how are we using that power? How are we choosing to support workers if we claim to love our employees and rely on them, then we need to be sure that we do that through providing health insurance, that they have a living wage—better than a living wage—things like that, where these are the areas that we can enact change that we can actually participate. In terms of culture and politics, the three of us so Steven, my husband, and then our good friend, Jonathan, are progressive and our small business is just a reflection of our personal politics. You know, we don’t try to be anything we’re not. We’re not a nonprofit. But we do try to elevate the the social justice organizations that do important work in our communities. So whether that’s through collecting pantry items, whether that’s through donating our profits to an organization, our goal whenever we’re engaging in politics and in social justice, is not to elevate our own voice in this movement, but it’s to rather really highlight the organizations that do the work and make sure that our followers, the people who who do trust us and trust our voice, that they divert the resources to those organizations. And we know that that’s not for everyone. And maybe that’s the benefit for us of 1) being in Chicago and 2) being a small business. You know, we’re not like a multi-billion dollar corporation that has, you know, that relies on the entire country. We have sort of the privilege of really being able to cultivate our community. And that’s been a really rewarding thing for me personally. But yeah, that’s just our approach. And it’s not always right for everyone. We’ve gotten this question a lot, basically, since we’ve opened up of how do you how do you handle this? Like, what happens if your customer base doesn’t like your political stance? And honestly, this has happened to maybe once or twice, and in these times where it is very fractured and, in our opinion, there’s one side that is exclusionary and hateful, right? And that’s the side that we, we don’t need to be on?
John Holl 31:58
It’s a difficult needle to thread, I think for businesses, because even for small businesses, or businesses of any size, like you don’t want to lose customers, and you want people to believe in your product. And, you know, I’m sort of curious, because Pliny for President, when you put that out, wasn’t necessarily a political statement. But I know some people sort of took it that way.
Natalie Cilurzo 32:21
Yeah, you know, it’s funny, I’m Pliny runs for president every four years. And so this is the fourth time Pliny’s run for president. It’s always been a tongue-in-cheek, just kind of fun way to draw attention to an election. And it’s just something fun that we like to do every year. We certainly don’t ask people to throw their vote away and write Pliny in—this year in particular. Yeah, so we did make that clear, like, ‘Hey, you know, this is just a joke. This is just for fun, people.’ We kind of feel like we needed to bring a little extra levity to a rather dark and stressful year. And so Vinny and I had already decided we were going to brew a beer called Pliny for President in 2020 before the pandemic hit. And then, you know, when it became very clear that nothing was opening up anytime soon, we thought, well, you know, what, we better brew this beer, and we better start shipping it out to people because A) we don’t know if and when we’re ever going to reopen and B) we think that people will really like it. And we think it’s fun. And so that’s really—it wasn’t a political statement in any way. I mean, Pliny runs for the keg party. You know, his running mate is Blind Pig. You know, his platform is hop care for everyone. So it’s just a joke. It’s just for fun.
Samantha Lee 33:52
And it’s delicious. We got the package, we loved it.
John Holl 33:59
Natalie Cilurzo 33:59
Yes, thank you. It is delicious. It was so popular. It’s double dry hopped Pliny the Elder. And so it’s basically Pliny the Elder, but double dry hopped, and it ended up being a really good beer. And so it was so popular people were so excited about it. We got so many nice emails and comments on social media and just people just like, thank you so much, this was like a bright spot in a very dark time in my life. And it was fun. And so I think it just accomplished what we set out to do. And it also drew a lot of attention to a very important election year, not just with the president, but we had a lot of very important initiatives and local measures and stuff here in California and I think it did what we had intended it to do. And it was just for fun. And Pliny will run again in the next four years.
John Holl 34:55
Paul, from your standpoint, though, politics is such a part of the job that you have as an executive director of a state Brewers Guild. And it’s working with state legislatures, it’s working with local municipalities, in some cases, for the betterment of your brewery members. And 2020, you mentioned this earlier, you know, we started to see shipping, we started to see curbside pickup, direct to consumer, a lot of the laws that were in place in 2019 were temporarily suspended to help breweries, which were then deemed essential businesses, survive and keep their doors open. And New York is not alone in this, we saw multiple other states around the country. Multiple other states around the country do the same thing. And as you think about 2021, and if we’re thinking fall or winter, or when the vaccine is out and things start to return to quote-unquote normal, it’s going to be hard to put some of that toothpaste back in the tube, because you’ve seen that it worked, right? And a lot of the changes that happened, local guilds are trying to make these now permanent, right, and working with state legislators to do that?
Paul Leone 36:20
Yeah, direct to consumer is not just a New York thing. And there are several states that have it already. And I know here in New York, we fully plan on pursuing direct to consumer for our breweries in our state. I also know it’s going to be a national initiative with the Brewers Association as well. New York state as well as many other states benefited from direct to consumer. And I think in this day and age, you know, we should be able to have that. It’s certainly not going to cut into the wholesalers bottom line, you know, but with that said, you know, we understand the wholesalers concerns, at least here in New York state. We do we do value them. They are good partners to to many breweries, but you know, direct to consumer, we need to have that tough conversation of how do we make it palatable for them and for the breweries in our state. So that conversation is coming in New York, and I think in many other states, as well. Breweries really adjusted to direct consumer on a dime, they turned on a dime, and they figured it out. To now tell them after they’ve lost, you know, 60% of their on-premise accounts, and they’ve lost so much in so many other ways that they can no longer do direct to consumer is wrong. You just can’t put that genie back in the bottle. You just can’t at this point. It would be unfair to do that. So it’s certainly a battle we’re ready to have here in New York State. We hope that it’s not a battle—we hope to have that great partner conversation with the wholesalers in the state and we can come to an agreement, one way or another for our breweries.
John Holl 38:04
Samantha, Natalie, in your respective states—Illinois, California—have there been changes that you’re hoping to see become permanent? Temporary suspensions that you hope to see become permanent?
Samantha Lee 38:17
We can start West Coast. I like that.
Natalie Cilurzo 38:22
We’ll start on the west, you know, we’re very lucky craft brewers are very lucky in the state of California and we we have a lot of privileges. We are allowed to do direct to consumer, we’re also allowed to self distribute, as well as use third party wholesalers. We are able to have brew pubs. We’re able to sell packaged beer and you know, draft beer over the bar to consumers. And so we were very fortunate within the state of California. I would say that some of the things that the Department of ABC here in California relaxed a lot of restrictions like most, you know, state alcohol associations did. And so I think just by them allowing us to be able to buy beer back from closed accounts, letting restaurants and bars sell packaged beer, wine and cocktails to go, delivery of alcohol, things like that, I think, really helped the retail side of things not necessarily us but but certainly many of our accounts, which then helps us as well. So I would say that retailers are probably going to go after keeping some of those privileges. I’m not sure that the ABC will be too hot on the idea of cocktail delivery or cocktails to go but they might allow some other other things like being able to sell packaged beer and wine to go and stuff like that. So I would definitely see that as something that the retailers and bars and restaurants are going to want to stick around. As far as direct to consumer, I totally agree with Paul. There was a lot of genies left out of the bottle in 2020. But I would say in 2021, you’re gonna see direct to consumer restrictions throughout the nation start to relax a lot more. And something that the wine industry started a long, long time ago—they are so far ahead of us and I think we can catch up pretty quickly. You can buy wine—most of the wineries are here in the state of California. But most wineries are able to direct ship out of state into most states throughout the United States. But breweries can’t. There’s only about 10 states that we’re allowed to direct ship to and California is not one of them. So I would think that we would probably go after legislation to remove that restriction so that California could be a state that breweries could ship into. And we just need to do that state by state by state in order to lift these rules so that we can start to ship throughout the United States interstate. Intrastate is so important. And I know like New York, I really hope that you guys get to keep that that privilege, because that’s key for the small brewers. Us larger brewers, and we’re not a huge brewery, but we distribute a lot of beer. And so, you know, it’s really important to us, but it’s not a make or break. We’re not going to go out of business if we weren’t able to sell direct to consumer. But there are so many breweries that literally would have gone out of business in 2020 if they were not able to adjust their businesses and go direct to consumer. So I think that’s a really, really important topic that’s going to be talked about throughout 2021 for sure.
John Holl 41:45
What about locally for you, Samantha?
Samantha Lee 41:48
Yeah, so we are not able actually to ship beer in Illinois at the moment. We can’t even get wine delivered, I believe. And so that’s definitely one of the things that my business partner Jonathan, who sits on our guild here in Illinois on the board, and so he’s been really—
Paul Leone 42:13
It’s a great Guild.
Samantha Lee 42:14
It’s a great Guild, yes. I actually was just reading the guild letter this morning.
Paul Leone 42:19
California and Illinois, yeah, amazing.
Samantha Lee 42:22
Yeah. So we’ve really leaned on them heavily during this time just to like parse through legislation for us and help us figure out what can we do? What are we allowed to do? So that’s one of the big pieces that we would love to see here in Illinois is the direct consumer shipping. We get asked about it all the time. And it would be amazing, like Natalie said, if state by state, we could offer that to folks across the country. And similarly here, we do have some relaxed rules around cocktail to go and growler fills to go that kind of thing. From our retail partners, which again, like when they do well, we do well. So we’re hopeful that they’re able to continue to do those kinds of things moving forward. And we offer home delivery now, so that was one of the things that the ILCC, the Illinois Liquor Control Commission, relaxed. We as a small brewery can do home deliveries. Other breweries can too, even if you are with a wholesaler, which we we self distribute in the state. So that’s been, you know, a small part of our business. But as it gets cold out, people do rely on it. It’s a nice offering for folks, especially if they’re unable to shop in person. So that’s something that I I imagine it will get lifted. It seems that that’s not something that will last beyond the pandemic, but it’s a nice offering, and we’d love to continue to offer it for folks. But we’ll see. I’m not overly optimistic about it. But I am hoping that some of the rules around to go alcohol for retailers are relaxed.
John Holl 44:11
Being mindful of the time here and asking you to look into your crystal ball, as hazy as an IPA as it might be, I’m curious what 2021 holds aside from what we’ve already talked about and mentioned. What would you like to see, or what would you like to see accomplished this year? And, Paul, I’ll start with you on the East Coast and then we’ll work our way West.
Paul Leone 44:38
What would we like to see accomplished in 2021?
John Holl 44:40
Yeah, that we haven’t already talked about. What’s a good goal?
Paul Leone 44:45
I would love to see, you know, in New York State anyway, we were afraid of that 20% loss breweries, maybe more. We’ve been really holding steady. We’ve actually seen, you know, close to 20 open in New York State during this. And so I think for 2021, I’m really hoping that breweries can just hang on. That’s our hope right now is that they can just hang on and get through this. And that legislatively, we can make the changes that we need to that they can just keep on keepin on, you know. And that’s what I’m hoping, you know, they’ve been through so much breweries all around the country so much, and for them to go out in the homestretch just doesn’t seem fair. So that’s our hope for 2021 is that we can still be there for them any way they need us, and we can we can help them legislatively, or as a guild continue to give them the information they need to get through this.
John Holl 45:45
Samantha, what about you?
Samantha Lee 45:47
Yeah, I’m going to echo a lot of that. I’m not hoping for really more than more than surviving the rest of 2021, or, you know, making it to the end of 2021. And thinking, Oh, we made it. And again, I would love to see our peers in the industry continue to survive. No one’s thriving right now. But when folks lose jobs, when folks lose their businesses, it hurts each time we hear about it. And, you know, I live three blocks away from Hopewell, and I walk up and down the street, you know, a couple times a day. I see the different signs that restaurants and bars are closed or are not going to reopen. And so that’s, you know, not just breweries, but I hope that extends to all small businesses and seeing some relief for the workers who keep these businesses running. I mean, that’s something that I would love to see out of 2021. That we don’t lose the people who keep all of these industries going. I hope that we keep everyone on our staff. That’s, you know, 2021, I hope to see, by the end of this year that we have everyone with us, and that we can look back on it and shed a tear and then keep moving forward. But that’s definitely the mentality we’ve got right now.
John Holl 47:20
That’ll you able to take us out on a positive note.
Natalie Cilurzo 47:23
Yeah, for sure. I mean, 2021 is about hope, you know, we we ended 2020 with the vaccine. It sounds like we may all know people who were vaccinated already and I just feel like we have a lot of hope for 2021. I would like to see stability. I think these openings and closings and openings and closings, is very tiresome and I would really like to see more stability within not just the nation, but within the states and also down to the municipality level. It is almost harder for businesses to open and close repeatedly, and having to staff up and then lay everybody off, and then staff up again. And then for breweries in particular, you know we make beer. And beer, you can’t just turn on a faucet. You have to plan production, you have to plan distribution, you have to plan for, you know, how many beers you’re going to have on tap in your tap room. It’s really complicated. It’s not like we can just call a supplier and say, okay, guess what I’m reopening again on Monday, can you have all of these things delivered to me by Friday, and then have the weekend to prepare. We don’t have that luxury. And so I’d really like to see more stability. And I’d really like to see local governments having more regard to businesses and how difficult it is for us to operate with all of this uncertainty. And this basically this yo-yo that I feel like we’re all hanging out at the end of and I really like to see that. And I really want to see more reopening of businesses that maybe were struggling and thought they weren’t going to make it, but I really hope that many of those businesses can just hang on just a little bit longer. And I really want to see people get back to work and I know people are just tired of being unemployed and tired of the uncertainty. And so those are kind of the things that I would like to see accomplished sooner than later in 2021. But I think we’re getting there. I feel like there’s hope on the horizon. 2021 has to be a better year than 2020.
Paul Leone 49:50
John Holl 49:50
Natalie Cilurzo of Russian River Brewing, Samantha Lee of Hopewell Brewing in Chicago and Paul Leone of the New York State Brewers Association—my thanks to you for coming on and sharing your perspective and talking beer in 2021.
Natalie Cilurzo 50:05
Thank you for having me.
Paul Leone 50:06
Thanks, Natalie. Thanks, Samantha.
Natalie Cilurzo 50:08
Nice to chat with you guys.
Samantha Lee 50:09
Yeah, nice to chat with you.
Lauren Buzzeo 50:14
While there was a lot of chaos to the drinks world and craft beer in 2020, it sounds like there was also some industry evolution that happened as a result, that should impact not only what you have in your glass for the year ahead, but almost as importantly, how you can keep it filled with a wide array, of course, from exciting new releases and sensational seasonals to the hopes of better distribution and even improved direct to consumer access. There’s so much promise for the year ahead for independent or craft beer lovers. And that’s something that we can all raise a glass to. Subscribe to the Wine Enthusiast Podcast on iTunes, Google Podcasts, Stitcher, or wherever you find Podcasts. If you like today’s episode, we’d love to read your review and hear what you think. And hey, why not tell your wine and beer loving friends to check us out too. You can also drop us a line at email@example.com. For more wine reviews, recipes guides, deep dives and stories, visit Wine Enthusiast online at winemag.com and connect with us on Instagram, Facebook and Twitter @WineEnthusiast. The Wine Enthusiast Podcast is produced by Lauren Buzzeo and Jenny Groza. Until next episode, cheers.