Despite Surge In Alcohol Sales, Some North Texas Distilleries Still Struggling To Survive
See full CBS DFW article by Jason Allen here.
FORT WORTH (CBSDFW.COM) – When hand sanitizer disappeared from store shelves in March, distillers quickly shifted from filling barrels with whiskey to filling bottles with the alcohol solution.
As that work tails off though, even as alcohol sales surge at liquor stores and online, small distillers may struggle to survive the extended shutdown.
A letter signed by dozens of state representatives this week sent to Gov. Greg Abbott said Texas distillers have seen an 80% revenue loss since virus mitigation efforts began.
Most small distillers see more than half their revenue come from their tasting rooms, tours and bottle sales from their distillery, according to Todd Gregory, who is on the board of directors for the Texas Distilled Spirits Association.
Those all closed in mid-March with everything else.
Gregory’s own BlackEyed Distilling in Fort Worth is about to be closed for the ninth-straight weekend, and he’s not selling any bottles of vodka to-go.
“If we aren’t selling those, we don’t have any other revenue,” he said.
A survey from the Distilled Spirits Council found 42% of distillers didn’t anticipate being able to sustain their business longer than three months.
While alcohol sales data from Nielsen found sales up 27% in stores in April and more than doubled online, it also found buyers leaning toward larger package sizes and larger brands.
Many small Texas distillers don’t even have their products distributed in stores, Gregory explained.
In addition, Texas law limits distillers to selling someone a maximum of two bottles every 30 days — directly from the distillery.
The letter to Abbott urged him to wave the restriction, which might be enough to allow some businesses to stay open and make sales.
“They can come to the distillery and buy four bottles, or buy eight bottles,” Gregory said. “So it’s worth us staying open to have a $100 ticket, right?”
Gregory and Tony Formby at Acre Distilling in Fort Worth both said shipping restrictions have also impacted their revenue.
“We get asked, daily,” Formby said about shipping to other states.
He said he expects his business to survive but be substantially changed even when he is allowed to reopen. Group tasting, tours and large crowds from the nearby convention center will likely be gone.
He’s looking at adding more outdoor opportunities for customers and has started working directly with store owners again, including offering hand sanitizer with a purchase to make his product stand out along with the big labels.
“So we have to up our game and to get the public to know our brands better, and get them to know they can get them at the liquor store,” he said.
Location Mentioned: Acre Distillery