Experts weigh in on whether craft brew industry in trouble
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Hey there, time traveller!
This article was published 22/02/2018 (2226 days ago), so information in it may no longer be current.
Peg Beer Co., the city’s first brew pub to open since Manitoba’s liquor laws were overhauled in recent years, remains closed. However, the news shouldn’t be taken as a sign of distress for the local craft brew industry, a provincial association spokesman says.
Earlier this week, a sign went up on the door of the Exchange District establishment pub saying, “Closed until further notice.”
A Facebook post on Peg Beer’s webpage Thursday said, “We are currently closed. Once we are able to provide further info, we will. Thank you for your support and understanding.”
Nicole Barry, Peg’s owner, could not be reached for comment.
John Heim, a spokesman for the Manitoba Brewers Association and president of the craft brewery and Winnipeg taproom Torque Brewing, said he doesn’t know what happened to Peg — but it doesn’t point to anything being wrong with the craft beer business.
“The local beer business was $10.7 million out of $330 million in 2016, and in 2017, it is just over $15 million,” Heim said.
“I think the local industry is a good-news story. But, in any business, you have some that make it and some who don’t, and the craft beer industry is no different.
“It’s just disappointing to see anybody in any business struggle.”
According to Manitoba Court of Queen’s Bench records, there were signs Peg Beer Co. — which opened in April 2016 — was in trouble months before it closed its 125 Pacific Ave. location.
A lawsuit filed against Peg Beer in August by Mondo Foods Company asked the courts for permission to get back $5,090 Mondo said it was owed through a garnishment order.
The lawsuit was later discontinued.
In November, the Workers Compensation Board of Manitoba came after both Peg Beer and Barry for $4,293 and $3,293, respectively.
In December, a small-claims filing by food distributor Pratt’s Ltd. sought more than $12,000 from Peg and Barry.
In December 2016, Manitoba’s Tory leadership scrapped the previous government’s promised $5-million fund to support the craft beer business in the province, before any loans were handed out.
The fund was to be established to give low-interest loans of up to $250,000 for the purchase of equipment.
Heim said Torque — before the former NDP program was even announced — had its own partners and loans together to open for business.
“The program was a payback loan over some time, with low interest rates or no interest, but it never happened,” Heim said.
“It would have been nice to have, but we didn’t expect a handout.”
In a statement Friday, Tom Lindsey, the NDP’s critic for Crown services, said, “The low-interest loan program would have helped small businesses get off the ground, stay financially viable, and give people jobs throughout the province.
“Cancelling it didn’t make sense then, and it doesn’t make sense today. When it was cancelled, we heard small businesses express their concerns that it would make things harder for them, and that they felt the rug was being pulled out from under them.
“The Pallister government didn’t listen then, and they’re still not listening today.”
In a statement, Growth, Enterprise and Trade Minister Blaine Pedersen said “We know there are some great local brewing companies here in the province.
“We want to see them build and grow their business, and access new markets to sell their product. Manitoba Liquor & Lotteries can provide markup breaks for small producers, which is money that can be reinvested in local businesses.”
Pederson also said the Canadian Free Trade Agreement, which came into effect last summer, set up an Alcoholic Beverages Working Group made up of federal, provincial and territorial officials.
“The working group is tasked with identifying specific opportunities to reduce barriers and further enhance trade in alcoholic beverages within Canada,” he said, adding the group’s recommendations are supposed to be in by July 1.While there’s nothing wrong with the brew-pub model, said Tim Hudek, owner of One Great City Brewing Company in Winnipeg, he agreed the loss of the loan program was a blow to the fledgling industry.
“The model works because by not having to buy beer from a supplier, you are making it yourself,” Hudek said.
“But it has been a little bit tough.
“We had a commitment from the government for a loan, and it didn’t go through. People had already bought the equipment, so they had their original debt and then nobody got the loan.”
As well, Hudek said the government also changed the rules that would have had the industry pay taxes based on 50 cents for every litre of beer sold, moving instead to a percentage of sales.
kevin.rollason@freepress.mb.ca
Kevin Rollason
Reporter
Kevin Rollason is one of the more versatile reporters at the Winnipeg Free Press. Whether it is covering city hall, the law courts, or general reporting, Rollason can be counted on to not only answer the 5 Ws — Who, What, When, Where and Why — but to do it in an interesting and accessible way for readers.
History
Updated on Saturday, February 24, 2018 11:01 AM CST: Adds comment from the government.