On-Premise Sales Halted in Several States as Bars, Restaurants Shuttered; San Francisco Goes on Lockdown

Governors of several highly populated states ordered that all places of public gathering — including bars, restaurants, gyms and theaters — be shut down to prevent community spread of the coronavirus.

Statewide shutdowns of on-premise consumption at bars and restaurants have been announced in Illinois, Ohio, Washington, New York, New Jersey, Connecticut, Massachusetts, Pennsylvania and Michigan. Restaurants in these states can still sell food for takeout or delivery.

In a press briefing Monday afternoon, President Donald Trump said he is not considering a national curfew or lockdown, but may consider one for “certain hotspots.” He advised people to refrain from gathering in groups larger than 10 and going to bars or restaurants for the next 15 days.

In New York, Gov. Andrew Cuomo announced that the State Liquor Authority would allow licensed establishments to sell alcoholic beverages to-go during the shutdown, which he called “a silver lining.”

“We hope that goes a long way to alleviating any economic hardship,” he said.

California Gov. Gavin Newsom asked bars, nightclubs, brewpubs and wineries to close, but said restaurants could remain open at 50% of their normal capacity.

“We believe that this is a nonessential function in our state, and we believe that it’s appropriate under the circumstances to move in that direction,” he said of non-restaurant drinking establishments during an address on Sunday.

In Newsom’s briefing, he used the term “brewpubs,” which refers to restaurants that brew their own beer onsite, but likely meant brewery tasting rooms, the California Craft Brewers Association (CCBA) pointed out on Twitter.

The CCBA noted that breweries in the state are still open “to continue to manufacture beer, self-distribute beer, conduct off-site sales (to-go orders from the brewery) and deliver beer direct-to-consumers.”

“While we are still seeking clarity, based on the recommendations of the governor regarding restaurant operations, CCBA’s understanding is that brewpubs will be allowed to stay open with the directive to maintain ‘deep social distance’ between patrons and reduce capacity by 50% to accommodate this,” the CCBA said.

Karl Strauss Brewing Company, which operates 10 brewpubs in California, wrote on Facebook that it would be staying open under Newsom’s guidelines.

“It’s our priority to keep things clean and safe for not only you, but our team members as well,” the company wrote. “Beyond that, we happen to have really comfy patios and plenty of indoor seating to make social distancing a little bit more tolerable.”

Stronger measures were enacted in some cities and states. San Francisco Mayor London Breed announced Monday an order to lockdown the city for three weeks starting Tuesday at midnight, with the exception of visiting a doctor or buying groceries, the San Francisco Examiner reported.

New Jersey became the first state in the nation to declare a curfew. Gov. Phil Murphy issued a restriction on travel from 8 p.m. to 5 a.m. for the “foreseeable future,” according to CNN.

For the beer industry as a whole, on-premise sales account for roughly 20% of volume, National Beer Wholesaler Association chief economist Lester Jones said.

“Craft is over indexed to on-premise, so they will take a disproportionate hit,” he added.

Brewers Association (BA) chief economist Bart Watson estimated that 40% of craft beer’s volume flows through the on-premise trade, while about 30% of all beer sold in on-premise accounts is craft.

To help craft brewers prepare for the economic impact of extended closures, Watson published an analysis of the situation on the BA’s website.

“For taprooms and brewpubs, there is some hope that those drops might be partially offset by to-go sales or even delivery,” he wrote. “If your taproom or brewpub is still open, you’re probably thinking about a plan to make your to-go sales program more robust.”

On Monday, the BA opened a survey asking members how the pandemic is affecting their businesses, what they have done in response and what policies they think will most help them in the coming months.

Over the weekend, Watson encouraged breweries without a delivery program to consider adding one.

“Any taproom or brewpub that doesn’t have a to go and/or delivery program formalized and can’t afford to close for a month should be thinking about putting a program in place ASAP,” He tweeted. “These won’t be the last states (CA,MA,OH, and IL right now).”

Massachusetts-based Trillium Brewing debuted an online ordering system for in-store pickup of beer-to-go sales on Sunday. The brewery is shutting down restaurant service at its brewpub in Boston’s Fort Point neighborhood, and will prepare meals from on-hand perishable food for its staff and local non-profits, the company wrote in a post on its website.

In Texas, Houston-based Saint Arnold Brewing has set up drive-through retail sales of beer to go.

“You don’t even have to get out of your car to stock up,” the brewery wrote on Facebook.

Other breweries are offering online orders of gift cards for later use, such as Saint Louis, Missouri-based 2nd Shift Brewing, which is offering a 10% discount on gift cards purchased before April 1. 2nd Shift has closed its taproom for on-premise consumption, but remains open for to-go retail sales, which can be ordered online.

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