Normally, a brewer in Maine’s fast-growing craft beer industry would be unhappy to merely equal last year’s sales. But this is no normal year.
That’s just what Lewiston-based Baxter Brewing Co. is aiming for this year, despite initial pandemic-related layoffs, curtailed business hours and less space for customers. The brewer — which produced 19,500 barrels of beer last year, making it Maine’s fourth-largest craft beer producer — is on track to produce 20,000 barrels this year.
“We’re in a good position to be able to continue each month to grab back what we’ve lost,” Jenn Lever, the company’s president, said. “It won’t be a year of growth for us, but to be flat will be quite an accomplishment.”
Baxter is one of the more fortunate Maine craft brewers in an industry that has been hamstrung by pandemic-related restrictions. Sales are over $4 million, said Lever, who took over as Baxter’s president last September from founder Luke Livingston, who left to pursue other interests. His choices, however, set the company up well to weather the pandemic.
It already was selling some beer at grocery store chains, which is one of the few growth areas in beer sales now. It was the first brewery in Maine to sell canned beer, making it easier to transition to curbside sales. It also had a large patio at its restaurant in the Bates Mill Complex in Lewiston when outdoor dining was once again permitted.
Overall, the pandemic has been hard on Maine’s craft brewers, which had been growing steadily in size and number over the past five years. An economic impact study released last fall found that the beer industry and related activities contribute $2 billion to Maine’s economy each year and nearly 16,000 jobs. Another study focused on craft brewers found that breweries and related activities contributed $260 million to the Maine economy in 2017, up from $225 million in 2016.
Pandemic-related restrictions largely halted that growth because taprooms had to close, forcing those businesses to sell curbside or by home delivery. When restaurants reopened, brewers with restaurant licenses like Baxter, which serve food along with alcohol, could also reopen indoors. But most brewers were left to bootstrap outdoor spaces to serve customers.
Nationally, total craft beer production declined 10 percent in the first six months of this year, according to Bart Watson, chief economist at the Brewers Association in Boulder, Colorado. That’s a loss of 1.26 million barrels compared to last year or more than $1.5 billion in retail value. Total craft retail sales were about $29 billion in 2019, he said.
Watson said brewers that weren’t selling much in grocery stores before the pandemic likely are down much more than the negative 10 percent industry average.
At least one brewery, 2-year-old Nuts & Bolts Brewing in Biddeford, closed for good in July, but Sean Sullivan, executive director of the Maine Brewers’ Guild, said Maine brewers on the whole are “hanging in there,” buoyed to some extent by tourism in the late summer.
“But many are only doing just enough business to stay afloat, and most have drastically changed their business model to prioritize beers to go and packaged beer,” he said. “This is not to sugarcoat. It is still tough times for most Maine brewers.”
Even Baxter has faced challenges. Early in the pandemic it laid off 14 people, or about half of its staff, though it has since rehired them plus new sales and packaging workers to total 32 employees. Lever said she wanted to make sure her team could get a jump on filing for unemployment. In June, Baxter’s management team did a lot of packing and other odd jobs.
Baxter’s business was down 18 percent in July. A major reason was that because pandemic rules only allowed seating of 50 people outside and 50 inside, less than one-third of the 350 the pub normally can accommodate outside and inside. But the brewery still managed to continue closing the revenue gap, and was down only 11 percent going into August, Lever said.
Baxter has opened its pub, where it serves meals and drinks, from Wednesday through Saturday, but has decreased its hours and isn’t serving lunch. Lever said it is difficult to get staff because of the extra $600 federal bonus those on unemployment had been getting. Another factor is worker’s uncertainty about whether their child’s school would be open.
The company also lost some money on events that were canceled. Lever is still working out a strategy for the cold weather, but said Baxter is fortunate to have 5,000 square feet of indoor pub space.
While Lever expects pandemic conditions to alter her business until the spring of 2022, she is already planning for the next five years, with a goal to have 25 percent of sales overseas. She said Baxter is working with an exporter to target Vietnam, Japan, Brazil, England and Hong Kong.
“The biggest challenge for me is just kind of constantly revisiting ‘am I doing enough, am I doing the right thing,’” she said. “I feel good that we’ve had incredible transparency throughout the organization, but it certainly has kept me up at night.”