North Austin News

AUSTIN – Breweries in Austin closed their taprooms to the public in response to the coronavirus pandemic, and some fear they’ll never reopen their doors.

Brewery owners initially sought clarification on near identical stay-at-home orders issued on March 24 by Travis County Judge Sarah Eckhardt and Austin Mayor Steve Adler that only allow essential businesses to remain open. While the official order lists liquor stores and restaurants that serve takeout and/or delivery orders, it does not specifically list breweries.

So far, local breweries still can sell to-go beer to the public, as do restaurants that serve food. Owners worry that won’t be enough to save their businesses, and have laid off employees to cut costs as revenues drop.

| Austin American-Statesman photo

Austin Beerworks so far has fought the trend of layoffs. Money from to-go sales have been adequate to fund payroll and employee health insurance, co-owner Michael Graham told the Austin American-Statesman.

In the first week after the taprooms closed, sales exceeded expectations. Customers got to order and pay online.

But Graham worries this level of to-go sales might end soon.

“I think we’re cashing in on a lot of goodwill, and people are going out of their way to support local right now, just because (what’s happening) is so novel and fresh and new, and I don’t think that’s a sustained sale,” Graham told the Statesman.

Breweries still must pay rent, taxes, the cost of brewing supplies and other expenses. Breweries across Texas and the nation are in much the same situation. The Brewers Association conducted a national survey that found 98.9% of responding craft breweries have felt the effects of the coronavirus pandemic.

“I think this is the biggest challenge to the American craft brewing industry since Prohibition,” Caroline Wallace, deputy director of the Texas Craft Brewers Guild, told the Statesman. “There will be a devastating economic impact.”

Texas breweries haven’t even hit the first anniversary of the state allowing to-go beer sales from their taprooms. Now many of them rely on the sales to stay in business.

At Austin Beerworks, to-go beer accounted for 20% of taproom sales leading up to the closing order. Sales of cans, crowlers and merchandise like hats and T-shirts for the North Austin brewery make up 15 to 20% of its revenue with 5% of its sales volume.

To-go sales, including sales at grocery and convenience stores, exceeded expectations after the taproom closed.

“I think we’re in a better position than most to survive it, but it’s still a tight, scary situation,” he told the Statesman.

Austin residents could find Austin Beerworks craft brews at bars and restaurants. Today they can only buy it at grocery and convenience stores that stock it or from the taproom to go. The brewery set up online ordering of to go beer alongside its merchandise sales. Beer sales are available for pick-up from a drive through tent on site.

Brewpubs emphasize taproom sales to a greater extent and will see sales drop significantly, Vallhonrat said to the Statesman. The Texas Craft Brewer Guild wants to help out its members who must keep taproom doors shut. Texas Gov. Gregg Abbott ordered all bars and restaurants shut until April 3. But Austin’s emergency pandemic orders keep local breweries, bars and restaurants closed until May 1.

The guild lobbies for an excise tax suspension and an excise tax credit for dumped inventory. The guild also wants Texas to let breweries temporarily deliver and ship their beers. An online petition to support delivery and shipping for the more than 360 breweries in the state whose taprooms had to shut their doors had more than 13,500 signatures by March 28.

Those changes could make the difference in whether some breweries reopen in May or close permanently this year.

The Brewer’s Table, Jester King and the latest brewpub, Hopsquad, face difficult times.

In East Austin, the Brewer’s Table at first tried to-go orders for a limited food menu, crowlers of beer and bottles of wine. Founder Jake Maddux told the Statesman he laid off half his kitchen staff and the entire front-of-house staff with the shift. The few remaining employees cooked and boxed up meals for customers for about a week before Maddux ended food service. He’s the only person left now to sell crowlers, growler refills and kegs.

“We are on the edge of disaster. I’m just hoping something happens that helps us survive,” Maddux said. “Hopefully, we can get some sort of relief on our mixed beverage taxes, which would be very helpful.”

Jester King laid off staff soon after the closure order. Co-owner Jeff Stuffings said on-site sales make up 77% of the brewpub’s revenue. Jester King continues to sell to-go beer, pizza and other food items.

“Rather than trying to grow our business by increasing our beer production volume year over year, we’ve chosen to grow the on-site experience by purchasing land and adding a restaurant, farm, inn, and private event hall,” Stuffings wrote on a blog posted on Jester King’s website.

Plans were for Jester King Hall, a 200-person private events venue, to have its first full year of operations in 2020. Instead weddings and other events have been postponed or canceled even before the closure order.

Stuffings said Jester King’s insurance company denied coverage for the pandemic. He wasn’t sure if the bank would give them some relief or foreclose.