Craft Brewers Feel Effects Of Government Shutdown

Craft brewers in America could soon be feeling the pinch the federal government shutdown is having on many sectors.  And, the reason is that the shutdown and closed the United States Alcohol and Tobacco Tax and Trade Bureau (TTB), which is one part of the Treasure Department, and is accountable for approving any new labels, recipes and breweries.

What does this mean for stores that offer beer?  For now, stores have more than enough beer to offer consumers. However, with the shutdown, there could be significant delays in this industry where customers want a steady supply of seasonal and inventive beers.

According to Karbach’s Marketing Chief David Graham, they have yet to see an issue but the shutdown could produce a chain reaction.  Graham said the company has received a nod for every one of its labels through the end of 2013, meaning they haven’t seen any significant impact from the federal government’s shutdown.

However, Brian Royo from No Label said the shutdown has held up approval for two labels – Perpetual Peace and Storm Cellar – but doesn’t think the shutdown is going to hurt the business.

However, there are others who are feeling the pinch from the shutdown. According to Mike Brenner of Milwaukee, he was attempting to open a craft brewer by year’s end. However, his application to have a tasting room is being held up along with plans to file paperwork on four labels. He said it may lose around $8,000 each month he has to delay his opening.

Brenner said it’s been his dream to open a brewery, finding investors to help him get going. He said his dream is on hold because of the fighting in Washington. He said bad economy or not, people drink anytime.

The TTB will not process any new applications but will process the taxes on current permit holders.

Brewers Association Director Paul Gatza said the shutdown could be regarded as indefinitely stopping business for any company that didn’t have paperwork submitted by mid-August.  The association represents close to 2,000 brewers around the U.S.

Now, industry giants like Anheuser-Busch and MillerCoors is unlikely to feel the effects of the shutdown, allowing them to continue making their products.  The shutdown is a big problem for craft brewers who generate odd flavors and seasonal beers.  Craft brewers said before the shutdown, the TTB took up to 75 days to process and approve applications. With the shutdown, craft brewers could wait even longer.

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Posted by on Oct 13 2013. Filed under Business, New. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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