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Financial aid needed as craft distillers ‘barely hanging on’

Craft distilleries in the US are “barely hanging on” and face “severe financial hardship” unless immediate help is made available, the Distilled Spirits Council of the US (Discus) has warned.

Two-thirds of US craft distillers believe they won’t be able to sustain their businesses for more than six months without financial help

Discus conducted a survey across 118 distilleries across 35 US states and the District of Columbia.

Key findings from the survey included on average, distilleries reported a 64% drop in sales.

Chris Swonger, president and CEO of the Discus, said: “This survey provides a snapshot of the very real and devastating impacts of Covid-19 on small distilleries across the country.

“After putting their blood, sweat and tears into building the distillery of their dreams, these craft distillers are barely hanging on and need immediate economic relief to keep their businesses running.

“For many towns, keeping the local distillery open is vital to tourism and the economic vitality of the surrounding community.”

Of those questioned for the survey, two-thirds do not believe they will be able to sustain their businesses for more than six months, 42% do not foresee being able to sustain their businesses for more than three months and 21% do not anticipate being able to sustain their businesses for more than three to six months.

Economic climate ‘dire’

The survey also found that approximately 43% of distillery employees have been laid off or furloughed since the start of the Covid-19 pandemic. The average distillery that took part in the survey had nearly 14 staff members before the pandemic but was found to have let go almost six employees.

Erik Owens, president of the American Distilling Institute, said: “There’s no way to sugar coat this news – the economic climate for the craft distilling industry is dire.

“Thankfully, many state governments have relaxed regulations to provide distilleries some flexibility with their business models. This certainly helps, but we have a long way to go to get the once vibrant craft distilling sector back to booming again.”

The distilled spirits sector has written to the Senate and House leadership urging Congress to provide extra financial relief for distilleries impacted by Covid-19.

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