Brewing for Festivals

On July 30, 2008, the Michigan Senate passed a couple bills that change the rules for brewpubs in Michigan (slightly). Under the current (well, now old) rules, brewpubs could not take their beer to beer festivals because the Liquor Control Code does not permit companies with a brewpub license to sell their beer off premise. It has to be sold at the licensed property for consumption on or off premise. The new law allows a non-profit (such as Michigan Brewers Guild) to obtain a special license that will permit brewpubs to sell off premise at beer festivals.

This may seem like a somewhat obscure rule, but it should actually make a substantial difference to brew pubs when it comes to building their brand. It will have an impact in a couple different ways: first, it will give brewpubs easy access to a substantial and very targeted audience - passionate, craft beer drinkers; second, it gives brewpubs more control over their product (more on this in a moment); and finally, it should give more access to competitions for brewpubs as well.

Some of you may be thinking that you've seen brewpubs at festivals and won competitions. That's true. But, under the old rules, brewpubs had to have their beers contract brewed at a microbrewery (a different license) to participate in festivals. This means that their beer was not brewed on their equipment by their brewers. Basically, this took away control of their own product for festivals - imagine a winning beer that wasn't actually brewed by the brewer at the brewery! Crazy.

I did discover that there is another license that brewpubs could have purchased prior to this rule to be able sell product off premise:

"The LCC application form for a special license for on-premises consumption, however, indicates that beer may be purchased by the licensee from either a licensed wholesaler or a specially designated merchant (SDM) (a person licensed to sell beer and/or wine at retail for consumption off the licensed premises). Apparently, some brewpubs have an SDM license for the retail sale of beer in addition to their brewpub license."

I am not familar with this license, but my guess is that expensive (and of course, would require new packaging equipment to take advantage of it).

While retail sale is an entirely different animal than a brewpub, the access to beer festivals is a substantially improved law for those brewpubs looking to increase their profile with consumer advocates.