By Noah Rothstein
Throughout the pandemic, America’s consumption of beer and alcohol has remained steady in the aggregate. Alcohol consumption spiked as consumers were confined to their homes, leading to massive sales but forcing the industry to pivot to new packaging and distribution.
Liquor stores and grocery stores, which were categorized as “essential businesses” and allowed to operate during lockdowns, saw alcohol sales spike during the pandemic. Booze-delivery services like Drizly more than tripled their sales. Beer producers and distributors scrambled to divert their product into the proper packaging and onto the right shelves. All the while, beer spoiled in kegs in bars and restaurants due to the lockdowns and capacity restrictions.
Total alcohol consumption in America has been steady for years, including last year, says Lester Jones, the chief economist for the National Beer Wholesalers Association. What has changed, though, is virtually everything else about drinking.
Swirling beneath the stable consumption rate was all the cultural and logistical chaos that has defined American life in the past 15 months: Supply chains broke down at the exact moment that everyone’s lives changed.
Americans had to change both where they were looking for alcohol and which kinds of alcohol they drank during the pandemic. In 2019, a little more than half of America’s beer budget was spent “on-premises” in places like restaurants, bars, and stadiums. The rest of beer sales happen “off-premises” in grocery stores, liquor stores, and gas stations.
During the first wave of the pandemic, the bottom fell out of on-premises sales. Jones stated that for about four weeks last spring, keg sales in the United States went negative, meaning more keg beer was spoiling at retailers than was being sold to them fresh.
This shift in alcohol consumption forced brewers to pivot as quickly as possible to meet the demand. For many producers, planning the types and amounts of beer they will brew starts six months to a year in advance.
A significant part of planning for brewers is securing contracts for cans and glass bottles. Unfortunately, every beverage company in the country wanted to send more product to grocery stores during the pandemic, contributing to an aluminum-can shortage that won’t abate any time soon.
People’s first-choice beers may have been unavailable at the grocery store, forcing many to settle for their second or third choice.
“People have tended to go toward the products they understand and know,” Joe Gold, a lead distributor at Chesapeake Beverage, said. “The experimental beers that were there, or that brewers were trying to come out with, they just got kind of pushed to the side.”
Craft brewers finished 2020 with sales down 8%, while macro brewers such as Anheuser-Busch and Molson Coors had a strong year. For the first time in his career, Gold said he found expired Budweiser in the stockroom of a liquor store—not because people weren’t buying it, but because the cases had been misplaced behind a supply of craft brews that hadn’t been touched.
Now that lockdowns are lifting, drinking trends are changing once again. NielsenIQ’s for the last week of May saw the country’s average bar and restaurant sales increase almost 30% over the same week in 2019. Matt Crompton, a director of client services for NielsenIQ’s alcohol-industry business, said that the average bar or restaurant fills about 5% more orders than it did in 2019. Still, those orders are, on average, 24% more expensive.
