Brewers are bringing fewer new products to market amid coronavirus concerns and a slowing economy, according to Sovos ShipCompliant label registration data for the months of April and May 2020, indicating these producers are doubling down on their existing product lines.
Overall, producers and wholesalers in the beer, wine and spirits business registered 16,164 products through Sovos ShipCompliant’s Product Registration Online (PRO) system, while many bars, retailers and tasting rooms remained closed due to stay-at-home orders. This represents a drop of 2% over February and March and a 0.3% decrease year-over-year.
However, brewers felt the decline most sharply with 43.4% fewer new product registrations in April and May compared to the same time last year.
“The closure of tasting rooms beginning in mid-March left many industry producers struggling to make ends meet. Breweries, in particular, appear to have rallied around their core products rather than investing in seasonal or limited releases, as a way to cut costs,” said Larry Cormier, vice president, general manager of Sovos ShipCompliant. “Craft beer innovation takes place in the taproom. With limited retail shelf space, many newer brewers focus on taproom sales rather than traditional distribution. So when tasting rooms closed, the newest and smallest brewers took the biggest hit.”
Carbonated wine, hard seltzers and spirits less affected
In recent years, hard seltzers have skyrocketed in popularity with more than 203 new labels registered at the federal level since 2016. These products, along with premixed wine coolers, make up nearly 60% of all malt beverages registered in 2020 – compared to 40% last year. However, registrations of special malts are only down 15.7% year-over-year, compared to 43% for the overall malt category, indicating sustained momentum in this category despite the coronavirus.
Carbonated wine as a category is also bucking the downward registration trend. Product registrations for carbonated wine soared in the past two months, up an astounding 33 times over the same period last year. By comparison, sparkling wine decreased by 2%, red table and rose wines saw a 13% increase, and table white wines grew by 11%.
Spirits are also doing relatively well with an overall 38% increase year over year. Registrations for rum, gin, tequila and whiskey products are up 240%, 120%, 40% and 25% whereas registrations for vodka products are down 12%, respectively.
Sovos ShipCompliant offers the industry’s most advanced system for electronic brand registrations for beer, wine and spirits. The Sovos ShipCompliant Product Registration Online (PRO) system is available in more than 20% of the county, including Arkansas, Colorado, Illinois, Kentucky, Louisiana, Minnesota, New Mexico, New York, Oklahoma, South Carolina, and South Dakota.
Using PRO’s online submission and approval system, manufacturers and wholesalers typically see their approval wait times drop from weeks to hours in many cases, expediting their ability to introduce new beer, wine and spirits products into the marketplace.
To learn more about Sovos ShipCompliant’s solution for product registrations, visit www.sovos.com/shipcompliant/.
About Sovos ShipCompliant
ShipCompliant has been the leader in automated alcohol beverage compliance tools for more than 15 years, providing a full suite of cloud-based solutions to wineries, breweries, distilleries, importers, distributors and retailers to ensure they meet all federal and state regulations for direct-to-consumer and three-tier distribution. ShipCompliant’s solutions reduce risk, lessen the burden of compliance, accelerate bringing products to market, and enable revenue growth. With 60 partner integrations and growing, ShipCompliant leads a robust ecosystem of technology partnerships, enabling powerful complementary solutions. For more information, please visit Sovos.com/ShipCompliant.
Chris Shattuck on behalf of Sovos ShipCompliant
Press releases are generated outside of Spirited magazine and the information contained does not necessarily reflect the opinion of Spirited or its parent company, Sonoma Media Investments.