I recently participated as a panelist at the “Advocacy – Why it is Essential Now More than Ever” discussion during the BC Craft Brewers Conference in October. Representing federal issues alongside Mark von Shellwitz (Restaurants Canada), Mark Hicken (Canadian Alliance for Responsible Drinking), and Ken Beattie (BC Guild), allowed me to shed light on the critical advocacy priorities of the Canadian Craft Brewers Association (CCBA).
I’ll also examine some challenges we face, national trends impacting our industry, and the strategies being employed to foster growth and resilience.
Advocacy Priorities: A Call for Federal Excise Tax Modernization and Opposition to Proposed Low Risk Drinking Guidelines
The CCBA’s top advocacy priorities echo the urgent need for change and clarification in federal policies:
- Federal Excise Tax Modernization: Advocating for a progressive tax structure that eases the burden on Canada’s smaller breweries. Our proposal includes dramatically reducing tax rates for these breweries, expanding the current top tier from 75,000 HL to 500,000 HL, and eliminating the escalator. This approach is crucial for fostering innovation and sustainability within the craft beer community.
- Opposition to Restrictive Guidelines: We vehemently oppose the CCSA’s study findings recommending Canadians consume no more than two drinks per week and related Bills S-254 and M-61 calling for warning labels on alcohol packaging, including craft beer. While we support efforts to address problem and underage drinking, we stand firm against non-fact-based and ineffective regulations that just add stifling administrative and cost burdens to our industry.
National Trends: Navigating Challenges, Embracing Opportunities
Financial hurdles are continuing to pose challenges to growth and expansion for Canada’s craft brewing industry. These include high capital costs and interest rates, ballooning operating and input costs, and of course, the looming CEBA loan repayment deadline.
The craft beer landscape is also increasingly competitive, with small and large breweries vying for market share and competition extending beyond craft beer to other beverages with and without alcohol as consumer drinking habits evolve.
Regulatory challenges including labeling, traceability, market access, distribution and taxation policies are also contributing to financial and administrative burden, making compliance both expensive and time-consuming.
Despite these challenges, according to market.us, the global craft beer market is projected to grow at a compounded annual rate of 10.6% over the next decade. This growth is being fueled by hospitality and beer tourism, featuring tours, tastings, and engaging events along with favourable consumer trends. Low-alcohol beers are appealing to a growing health-conscious consumer segment and the “drink local” sentiment remains robust, with consumers continuing to actively seek out local craft beer and neighborhood breweries over mainstream alternatives.
Cross-Canada Perspective: Strategies for Success
From coast to coast, craft brewers capitalizing on identified opportunities for success will continue to thrive. Opportunities include:
- Quality and Diversification: Brewing consistently high quality and award-winning beer (congratulations to the recent Canada Beer Cup 2023 award recipients!) and diversifying product offerings and expanding into other craft alcohol segments, such as seltzers, spirits, wine, and cider.
- Differentiation and Branding: Crafting innovative strategies to stand out in a crowded market and exploring tourism, events, strategic partnerships, exports, and localized marketing.
- The Power of Storytelling: Leveraging the power of storytelling to connect with consumers and build brand loyalty in unique, memorable, and authentic ways.
- Federal Advocacy and Collaboration: Getting support from the CCBA in federal advocacy and in collaboration with other industry sectors, such as the CCBA’s recent partnership with Cider Canada in opposing changes to Canada’s low risk drinking guidelines and our support alongside fifteen other groups for providing unbiased information and education that encourages responsible drinking and reduces harmful drinking, found here: CARD.
The craft beer industry in Canada faces challenges, but with a resilient spirit, strategic innovation, and collaborative advocacy efforts, we are well-positioned to overcome hurdles. As we navigate the ever-evolving landscape, the CCBA remains dedicated to supporting our members, fostering growth, and preserving the unique and vibrant culture of craft brewing in Canada.
Cheers to a thriving Canadian craft beer future!
Executive Director, Canadian Craft Brewers Association