Posts by Michelle McGrath

Virtual Listening Tour: May 12-15
We’re hitting the virtual road! Please join the board of the American Cider Association for a listening tour next month. What you can expect: 

• Program & resource updates from Executive Director Michelle McGrath, including the legislative & compliance landscape for cider and COVID-19 pandemic updates
• Virtual Listening Session led by Michelle with your Regional Board Chair
• Informative Guest Speakers

We hope you’ll join us with your questions and comments on the national landscape for cider and the American Cider Association’s involvement. Please note that to keep this meeting productive, we are limiting the meeting to pre-registered participants and a password is required (received upon registration).

LINKS TO REGISTER CAN BE FOUND BELOW

–>Tuesday, May 12: American Cider Association Virtual Listening Tour: Eastern Region

–>Tuesday, May 12: American Cider Association Virtual Listening Tour: Midwest Region

–>Wednesday, May 13: American Cider Association Virtual Listening Tour: Southern Region

–>Wednesday, May 13: American Cider Association Virtual Listening Tour: Mountain West Region

–>Thursday, May 14: American Cider Association Virtual Listening Tour: Pacific Coast Region

–>Friday, May 15: American Cider Association Virtual Listening Tour: Northwest Region

P.S. Have questions you’d like to send in advance? We’d love to hear them! Let us know what you’re thinking.

Urge Congress to Approve Economic Relief from COVID-19 for Craft Beverage Alcohol Producers

Members of the Craft Beverage Coalition representing the nation’s brewers, distillers, vintners, cidermakers and mead producers are hosting a “Call to Action” on Wednesday, April 22 to urge Congress to provide much needed economic support for the industry.  As a result of “stay at home” orders issued by state officials, craft producers are struggling to stay afloat as they take innovative steps to keep the doors open, including curbside pickup and local delivery options as well as the production of hand sanitizers and disinfectant sprays.  The CARES Act provided initial relief, but much more must be done.  The coalition is asking Congress to provide more economic relief so that businesses can weather this crisis, return to normal operations once the crisis is over, and continue supporting jobs and state economies across the country while providing consumers with their favorite products to enjoy responsibly. 

The Coalition is asking Congress to take the following actions:

• Suspend all federal excise tax obligations on domestic and imported alcohol products, effective January 1, 2020, through December 31, 2020 so producers can dedicate scarce resources to payroll and other operating costs.

•  Enact a permanent extension of the Craft Beverage Modernization and Tax Reform Act (H.R. 1175/S. 362), which now has bipartisan support from 74 senators and 343 representatives and would provide certainty amidst economic instability.

• Approve additional funding to support no- and low-interest loan and grant programs administered by the Department of the Treasury and Small Business Administration, including the Paycheck Protection Program and Economic Injury Disaster Loans. 

• Authorize the Department of the Treasury to create a Workforce Stabilization Fund for the hospitality and travel sectors that will allow distilleries, breweries, wineries, and cideries to keep workers employed, maintain operations, and meet financial obligations. 

• Create temporary tax incentives that encourage consumers to return to on-premise dining and drinking establishments when public health officials determine it’s safe.  Examples include reinstating the expanded business entertainment tax deduction and creating a new, temporary travel tax credit equal to 50% of any expense for meals, lodging, recreation, transportation, or entertainment while traveling away from home within the U.S.

• Encourage the Administration to work with our trading partners to simultaneously suspend tariffs on beer, wine, and distilled spirits products and our supply chain partners. 

Join the Call to Action and help craft producers seek much needed economic relief.

There’s a lot of information (and a lot of MISSING information) regarding stimulus funds currently. Here are a few new pieces of info to know:

+According to the SBA, lenders supporting PPP loans “must make the first disbursement of the loan no later than 10 calendar days after the loan is approved.” Read more

+The Treasury is expected to start dispersing stimulus checks by April 10 Read more

+The government is releasing informing guidelines on many of the SBA resources on what seems like a rolling basis. Although the good news is that “EIDL Loan advances will start to be distributed this week,” the SBA has released at least in some places that the advances are for “$1000 per employee up to $10,000 max.” This is different than what was previously said.

+Farmers do qualify for PPP loans, but as of today, they do not qualify for EIDL loans. We are advocating for farmers to qualify for EIDL loans and for specialty crop support in the USDA earmarked stimulus funds of the CARES ACt. To learn more about what resources are available to farm-based businesses, check out our webinar with Penn State Extension on Monday, April 13.

+Congress is struggling to find a path forward for a bipartisan proposal that would expand the Paycheck Protection Program (PPP). It is recognized by both parties that expanding the program is necessary.

The TTB announced on March 31 that they will postpone excise tax filing and payment due dates for 90 days. The full announcement and details of their plan can be read in their newsletter.

The craft beverage coalition, which the American Cider Association is proud to support, asked for excise tax relief in a joint letter on March 19.

In the announcement, the TTB acknowledged that the alcohol industry is hurting due to the COVID-19 pandemic.

“The Alcohol and Tobacco Tax and Trade Bureau (TTB) recognizes that businesses that we regulate are being severely impacted by COVID-19.  To assist these businesses during this period, we are postponing several filing and payment due dates for 90-days where the original due date falls on or after March 1, 2020, through July 1, 2020.”

The American Cider Association applauds the TTB for responding to the needs of the industry during this time.

The US Senate just passed the CARES Act, or what is commonly known as the Phase III COVID-19 economic stimulus package. The bill includes many things (here is a good summary), but 3 things in particular will help the cider industry.

• It puts cash directly in the pockets of most Americans
• It extends unemployment and expands it to include sole proprietors and contractors
• It funds small business loans to cover payroll support, mortgage payments, insurance premiums and other debt obligations. Loans used for these qualified purposes may be forgiven

We are working around the clock to address the challenges you are facing due to the COVID-19 pandemic. Our goal is to remove barriers that will make it difficult for cideries to continue operating as normally as possible as soon as possible. We’ve been working with regulators and lobbying Congress to get you the relief that you need.

It’s believed that an additional stimulus package may come together in a couple months to address certain specific industry needs, hopefully including ours. We have champions and political power because we create manufacturing jobs and agriculture is core to our being. We are Main Street. 

It’s no secret that shopping patterns have dramatically changed since it became clear that the Corona virus was here. The subject of endless memes, grocery shelves–especially the toilet paper section–are picked clean as people stock up for the long haul. According to Nielsen’s off-premise sales data, consumers are also stocking up on cider.

Off-premise sales in the channels measured by Nielsen show cider retail sales up 22% for the week ending on March 14 compared to the week ending on March 7. Other segments of beverage alcohol also saw increases.

Changing Retail Landscape

American Cider Association members across the country have seen sometimes dramatic changes in how their customers are buying cider. Offering local delivery has earned more dollars than previously average taproom earnings for many smaller cideries. It will be interesting to speak with online retailers to see how e-commerce shopping patterns change for cider in the coming weeks.

In an average year, on-premise sales account for roughly 60% of cider’s total sales according to Nielsen CGA (compared to 40% for beer as estimated by the Brewer’s Association). This 60/40 breakdown of on-/off-premise sales for cider doesn’t include cidery taproom or independent retailer sales. Still, it’s safe to say we will see a dramatic shift in on-premise’s dominance in cider’s marketshare in the coming weeks. Expect to see business model adaptions to continue and include curbside, delivery and online retail.

The American Cider Association joined trade groups for wine, spirits, beer and mead in requesting the following support for the beverage alcohol community during the Covid-19 Pandemic:

Expand Unemployment Insurance

Suspend Payroll taxes

Provide federal excise tax relief

Provide Robust no- and low-interest loan assistance

Create an industry stabilization fund

Maintain an open commercial border

Seek the suspension of tariffs on beverage alcohol and their suppliers

You can view the letter here.

The association is pursuing additional efforts to support state level relief policies including ease of shipping. Cideries can help us identify opportunities for relief by taking our brief impact survey.

We are in unprecedented times. We know you are facing economic uncertainty. As your association, we are here to listen to your challenges, and get help on its way in whatever capacity we can. Here are a few things we’re doing to help.

Provide an informational hub specific to our industry’s needs: We’ve launched our Covid-19 resource page. We’ll be updating this daily to help you access useful information. 

Connect you to your peers to share challenges and solutions:We have launched a Facebook group for peer to peer networking with fellow members. We will also be monitoring our website’s forum. If there was ever a time to need to connect, now is it. Members can click here to request to join the Facebook group.

Unify our voice for our specific needs: The beverage alcohol community, including the American Cider Association, is working hard to advocate for solutions to relieve the impact of closures and lost jobs. Cider is absolutely an economic driver and that’s a story that is easy to tell. The beverage alcohol community is having early conversations about delayed excise taxes and other paths to help all our members keep their doors open in the long run. How has Covid impacted your business? What form of relief would help during this difficult time? Please take our 7-question survey to help us craft the message of urgency and need to Congress and the TTB. 

Look to the future: It’s hard to think about much else than this crazy situation right now. Nevertheless, the American Cider Association is working hard to find ways to help our industry weather this storm, including keeping our eye on the future of the industry. Our long-term goals to grow a diverse and successful industry haven’t changed, and we won’t lose sight of them even as we focus on short term support. We are planning to host virtual town halls for all of our regions in May. You can sign up now, forget about them for a few weeks, and then join us for updates on our next 3-year strategic plan, including our compliance camp project to provide members with comprehensive resources on topics like excise taxes, labeling, franchise law and licenses. These town halls are open to all cideries—regardless of your membership status. Stay tuned for official dates and registration links. 

We’ll be back with more resources to support you on a rolling basis over the next few weeks. Thank you for being a member so we can harness this industry’s collective power to do what it needs to thrive. In the coming days, check on your cider industry peers and friends. We promise to do the same. Cider IS stronger together.

According to our partners at Nielsen, 2017 ended with soaring regional cider brand growth yet slight overall negative off-premise cider sales from the year before. Two year laters, annual total off-premise sales for 2019 were 6% higher than at the end of 2017. In a world where year over year or quarter over quarter is the easiest number to grab, important nuances sometimes get left behind.

For example, hard seltzer grew over 200% last year. You know what else grew over 200% last year? Rosé cider offerings from regional brands.

So before anybody starts citing “total cider sales” as being on a slight decline for 2019, make sure you point out the continued double digit growth (several years counting now) for regional and local cider brands. There are success stories for national brands too. We are not represented by one number and cider is finding sustainable growth.

More data is available for you. Nielsen trends and webinars are complimentary benefits to all American Cider Association members. The data is broken down by 24 regional markets for off-premise and on-premise details are also provided. It’s further broken down by packaging and flavor and national/regional brands. Nielsen also shares quarterly reports highlighting trends. Webinars, CiderCon presentations (including Nielsen’s), data and more can all be found after logging into our website with your active account.

We know that Nielsen data doesn’t take everyone’s sales into account, but we also know it does tend to reveal major trends. To complement Nielsen data, we are working to create new partnerships for your benefit with nontraditional data sources.

Our friends at Vinoshipper are a great example of the potential stories we can tell with alternative data (you can find Vinoshipper’s CiderCon presentation on our membership website after logging in). Their cider sales increased 10% last year. That’s direct to consumer cider sales!

My point? CIDER IS STILL GROWING and that’s the story we have to be sharing.

P.S. Have you sent your UPCs to Nielsen? ALL OF THEM? Please make sure you are being counted! Contact Nielsen to submit your labels.