What are beer consumers thinking right now, and other stuff too

Read time approx 4 min.

Just Tapped

Tomorrow we flip the calendar and start a new month. Actually, does anyone do that anymore? Do people still use old-fashioned wall calendars? Does anyone under the age of 30 even know what a wall calendar is? Whatever the case, let’s take a gander at what consumers are thinking as we head into September. We have some other news too.

September Impacting On-Premise

Holiday weekends are thirsty weekends. NFL football also fosters beer drinking. It is no surprise that those two factors are expected to impact consumer spending habits in the near future. But loan forbearance? Huh?

A recent report from CGA, a trusted market research and data analysis firm, provides some insight into the month of September. As reported by Brewbound, the report provides a look into what consumers are thinking in terms of on-premise consumption in the coming month. CGA's report focused on three factors that are driving consumer thinking right now: Labor Day Weekend, the NFL season kickoff, and student loan debt.

Labor Day - Over a third of the consumers surveyed by CGA (36%) said they plan to visit on-premise establishments for Labor Day. The number balloons to 49% for the 21-34 age group. Of those respondents, 53% say they plan to drink beer. That's good

The NFL - The NFL season kicks off on Thursday, September 7th. About half of the consumers surveyed said they plan to watch the season's kickoff game at home, but 14% said they plan to watch it at a bar or restaurant. That number (14%) swells to 20% when talking about consumers between the ages of 35-54. Of those likely on-premise drinkers, 61% say they plan to drink beer. That's good.

Student Loan Debt - By virtue of the Coronavirus Aid, Relief and Economic Security Act (CARES Act), student loan payments have been on hold since 2020. That period of forbearance expires on September 1st, meaning folks will need to start making payments again. Of the consumers CGA surveyed, more than 25% said they or their partner/spouse will have to restart payments because of the expiration of the CARES Act. That number increases to 50% when including only 21-34 year olds.

Of those impacted, 67% said they agree with the statement that the end of the forbearance period will have a “negative impact on my current disposable household income” and said that they expect to reduce their visits to restaurants and bars. Likewise, 67% said they expect to spend less and make “a conscious decision to visit cheaper (lower cost) bars and restaurants.” About a third said they intend to buy fewer drinks but will drink "the same quality I drink now."

The takeaway? The end of the forbearance period is expected to impact discretionary spending for a lot of beer consumers. There's nothing we can do about it, but it is still good to know what consumers are thinking and what kind of pressures they're facing right now.

A Brewery Golf Course?

We've talked a lot about breweries opening second or third taprooms. We've quoted smart people who've talked about the need to create new craft beer occasions. We've discussed the need for innovation and creativity. This bit of news encompasses all of that. Tree House Brewing (Massachusetts) bought a country club last year with the intention of creating a new kind of craft beer destination. The Course at Tree House is now open in Tewksbury, Massachusetts.

Each of the nine holes on the course is named after one of Tree House Brewing's beers. The clubhouse's pro shop is packed with bags, balls, shirts, and hats branded with the Tree House logo. It's every bit the typical little golf course, but it is also a brewery taproom. It's a new kind of craft beer destination. Read more about it here.

My Oh My, What a Lovely BPI!

The Beer Purchasers Index (BPI) for August provides some happy news. Although the number still shows that wholesaler craft beer ordering is in a state of contraction, the month's BPI shows continued improvement. The number for August 2023 is 14 points higher than August 2022, so we've got that goin' for us.

The craft beer BPI keeps creeping back up towards the magic number of 50. Remember that a number greater than 50 shows expansion (more wholesale orders) and a number less than 50 shows contraction (fewer orders). Think of it as an optimism meter. Bigger number, more orders placed, and greater optimism about anticipated craft beer sales in the coming month. Learn more about the BPI here.

Say What

Regarding last week's news about Elysian Brewing's employees voting to join a union and our curiosity about craft beer and unionization in general…

daryldeans21@... wrote: “I’m sure we’re going to be having the same problems with craft breweries here in Canada pertaining to unions. The problem I foresee is with the increase in wages. The increased wages will be passed on to the consumer. If the quality isn’t there then the consumer won’t pay the higher prices which could lead to the closure of breweries.”

Higher production cost is often passed on to consumers, true. As for higher wages leading to lower quality and brewery closures? That seems like a pessimistic leap.

This week's Taster Tray was composed by Kendall Jones.