The COVID-19 has immensely impacted the worldwide beer industry, according to a recent article. Now that bars and restaurants are closed, and breweries are forced to suspend their operations, the industry behind the very drink that is supposed to bring people together is on the brink of collapse.

Among those companies suffering from declining sales, it is the independent beermakers that are on the losing end since they are mostly dependent on sales through draft beers in pubs, restaurants, and bars.

According to a recent report, 50 percent of Mexican artisanal beer producers would be on the brink of bankruptcy if contingency measures would continue for another three months. Additionally, local media has reported that 25 percent of artisanal brewers had already shut all operations by April 5.

In their statement by ACERMEX, Mexico's association of breweries announced that its members have dropped by 76.8 percent on average sales since the start of the crisis, which amounts to a 50.5 percent contraction in revenue expectation for this year in comparison to 2019. Before the crisis, the association forecasted that the artisanal beer sector would contribute a one percent share of the Mexican beer sector by 2021. However, this estimate has been reduced to 0.5 to 0.25 percent.

Even the global beer manufacturer Corona beer brand has recorded a drop in sales due to its name-association with the coronavirus, according to an article published by Latin Post.

Constellation Brands, producers of Corona Beer, identified a drop of stock of eight percent in March, its lowest level in two years.

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Even in the U.S.,  beermaker groups such as Colorado-based Brewers Association reported a drop in sales by 75 percent and forecasted that many independent beer brewers would close.

Beer Industry Experiences Marketing Shift

While pubs and restaurants are closed, many brewers have resorted to other platforms to sell their beer.

According to the Colorado-based Brewers Association, some brewers have reported record online sales numbers, and despite the crisis, some were able to post positive sales figures.

The online sales and home delivery strategy, however, is not an option for every brewery because it favors larger brewers over microbrewers, as they tend to have a more reliable distribution network and more capital to make the transition, the association said.

Meanwhile, some bars in the U.S. have maintained the option of picking up a beverage. But clearly, this is not enough to keep many independent brewers afloat.

Over the last year, the purchase of alcoholic beverages through online channels has grown steadily and is seen to even grow faster as a result of the current circumstances. What explains this increase is the fact that younger generations have been turning to online means to purchase their beverage over the last few years.

While independent brewers face possible bankruptcy, they could quickly become prey for larger brewers. On the other hand, larger companies could take advantage of the crisis to outmaneuver independent brands with their craft beers. In the plight of brewers amid the COVID-19 crisis, only the fittest ones will remain standing.