Craft beer industry faces uncertain future

Picture: iStock

Many breweries have experienced record losses and 63% have retrenched staff in the last two months.

A recent survey conducted by the Craft Brewers Association of South Africa (CBASA) has revealed that only 10% of South African craft brewers believe they will be able to continue trading in the near future if restrictions on the trade of alcohol continue.

Seven breweries also permanently closed down and retrenched all their staff in June.

Of the 100 breweries surveyed, more than 50% said their sales have decreased by 60-100% since lockdown began, 24% said that sales decreased by 90-100% and 87% said they can’t meet monthly expenses.

These figures indicate that the future of craft beer is uncertain, especially after government imposed a ban on the sale of alcohol for nine weeks on 27 March. Under level 3, the sale and purchase of alcohol have been permitted since 1 July, but strict regulations remain a problem for traders.

The record losses have resulted in breweries calling on government for assistance, but some won’t ever be able to bounce back.

The industry has recorded alarming losses and has called on government to help give them a fighting chance of survival.

CBASA chairperson Wendy Pienaar said: “Our sector already lost 15% of South African craft breweries and 68% of those still trading have a negative outlook for the sustainability of their businesses going forward.”

According to Pienaar, 63% of craft breweries and brewpubs retrenched staff in May and June. Of these, 70% retrenched more than half of their staff, while eight breweries retrenched all of their workers.

Last month it was reported that wine producers in the valleys of the Western Cape were also concerned that the industry would struggle to bounce back.

Wines of South Africa spokeswoman Maryna Calow voiced her fear that approximately 18,000 jobs could be lost and as many as 80 wine cellars could shut down permanently.

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