Mainers stocked up on liquor in the early weeks of the pandemic, but sales data suggest the rest of 2020 remained largely in line with previous years.
Heading into December, wholesale gross sales for the state’s liquor operation showed a rise of 9.3 percent over the same nine-month stretch of 2019, according to state data. The previous five years showed an average annual growth of about 7 percent.
“It doesn’t seem like people are drinking any more or less,” said Janine Kerr, a manager at Bow Street Beverage in Portland. “It’s just that a lot of people are drinking at home instead of going out.”
As for craft beer, production dropped for the first time in more than a decade, but most breweries in Maine are still plugging along.
Nationally, total alcohol sales are up 20.8 percent since the 52-week period ending Feb. 29, according to the national research firm Nielsen. Sales of spirits for off-site consumption spiked 29.5 percent, followed by wine at 21.9 percent. Sales of beer, flavored malt beverages and hard cider were up 17.1 percent.
A report from late September suggested that adults 30 and over were consuming alcohol at a rate 14 percent higher in 2020 than in the previous year.
Back in the spring, retail sales of liquor in Maine jumped nearly 19 percent in the aftermath of the stay-at-home order issued on March 31 by Gov. Janet Mills.
As the year wore on, and fewer people patronized bars and restaurants in order to slow the spread of the coronavirus, stores that sell alcohol saw more traffic.
Kerr, at Bow Street Beverage, said the retail side of her operation “has been much, much busier and the wholesale, which depends on bars and restaurants, has been much, much slower.”
Kyle O’Connor, manager of Old Port Spirits & Cigars in Portland, said that even with the drop in wholesale business, overall sales have been higher in 2020 than in 2019. Early in the pandemic, he said, patrons bought bulk-value items such as boxed wine and 30-packs of beer.
“The larger formats were selling a whole lot more,” he said. “During the second half of the year, I don’t know if it was because of the stimulus or the fact that people are getting back a little bit to normalcy, but they are spreading out and buying a variety of things.”
Even before the pandemic, O’Connor’s establishment used a delivery service called Drizly. During the 2019 holiday season, a typical day would bring three or four deliveries. This year, on the Wednesday before Christmas, there were 55.
Because of the reduced operations and outright closures of bars and restaurants, more alcohol is being purchased at the retail level.
“It is a more profitable year for liquor stores,” O’Connor said. “There is more at-home consumption.”
The biggest year-over-year jumps in liquor sales, according to state data, came in June (18.4 percent) and September (17.5). The other months of the pandemic showed single-digit increases except for March (15.9) and April (14.8).
Robert Denton, the owner of Oak Hill Beverage in Scarborough, said he noticed a significant increase in sales, visits and the average sale amount per customer until a seasonal adjustment in September. The absence of Canadian tourists and a drop in leaf peepers made for lighter traffic, but Denton said sales were still higher than in the previous September.
He also said sales of both wine and beer were up significantly across the board, and through August he had sold 20,000 more bottles of wine than over the same stretch in 2019.
“The last quarter of the year remains seasonally strong and sales/visits increases (are) wildly up (year-over-year),” Denton wrote in an e-mail response to a reporter’s question. “People really want to support a locally owned small business and also have a safer, less-crowded shopping experience, and they appreciate that we are on the floor answering questions.”
The production side of the equation is less rosy. Maine Beer Co. in Freeport, now in its 11th year of operation, had planned to increase its 2019 output of 25,000 barrels by another roughly 2,000 barrels this year.
Instead, because of the pandemic, the company is finishing up this year at about 20,000 barrels, “which we feel good about considering the challenges,” said Ann Marisic, director of marketing and communications.
Marisic also said the product mix changed considerably from last year (70 percent draft and 30 percent bottled) to this year (55 percent draft, 45 percent bottled). The reduced demand for draft beer was a result of indoor establishments being forced to close or limit service to help slow the spread of the coronavirus.
A full beer barrel contains 31 gallons. The state imposes a 35 cent excise tax on each gallon produced in Maine. The federal government taxes by the larger container, and since 2017 has been charging $3.50 per barrel. That fee was scheduled to revert back to its previous level of $7 per barrel on Jan. 1, but Congress included a provision in the latest coronavirus relief bill called the Craft Beverage Modernization and Tax Reform Act that made the lower tax rate permanent.
“That’s really helpful because any brewer that’s opened in the past two years has never paid $7 per barrel,” said Sean Sullivan, president of the Maine Brewers’ Guild. “We’re estimating that’s about $1.25 million that will be kept here in state for brewers to invest in their businesses.”
Sullivan said he knows of only two Maine breweries that have gone out of business during the pandemic, one in Biddeford (Nuts & Bolts) and one in Lincolnville (Andrew’s). The state currently has 156 licensed breweries, although some have multiple locations, each with its own individual license.
In terms of beer brewed in Maine and sold in Maine, Sullivan said 2020 showed the first drop (by roughly 20 percent) after an unceasing climb since 2009. The market share (percentage of all beer sold in the state that is brewed in Maine) was 14.4 percent last year, and Sullivan predicts it will dip slightly to 13.7 percent this year. Five years ago it was 9.5 percent, and a decade ago it was 6.2 percent.
Brewers selling beer in grocery stores have seen sales rise, Sullivan said, while those operating in smaller towns where the only beer is sold from tasting rooms have seen community support for deliveries or curbside pickup.
“The winter is definitely going to be challenging for the majority of our members,” he said. “The one plus side here is they’ve had a number of months to figure out how to operate and balance production with demand.”