Beer is Scott Ebert’s business. As the head of the “beverages practice” at accounting and advisory firm Baker Tilly, Ebert has developed a knack for how to help companies, whether a large distributor or a new brewery that grew from a home-brewing operation in someone’s basement. The Minneapolis office of Baker Tilly houses the national beverage practice in which the firm focuses on craft breweries, wineries, cideries, distilleries and distributors. Minnesota has around 130 breweries, Ebert said. The state is more conservative than others in terms of their regulations that pertain to alcohol. But with the state Senate and the House recently passing bills to lift the ban on Sunday liquor sales, Minnesota is on its way to becoming more progressive. Excerpts from an interview:
Q: Did you ever think you would live to see the day when you can buy beer at a Minnesota liquor store on a Sunday?
A: No. There’s so many different individual factions of this that I just didn’t think they would ever have the ability to get it approved. If you look at some of the points of view coming from rural Minnesota and municipalities that still have municipal liquor stores, they think it’s an increased cost and not going to increase volume. So it’s an onus on them as opposed to an opportunity to make additional sales. If you look at some of the metro or big box stores, you are not seeing that because they are fully staffed. So I think that’s where some of that opposition comes from.
Q: Do you think removing the Sunday sales ban hurts anybody in a business sense?
A: What does it likely hurt at the retail level is the independent liquor store to a certain extent. The bill does not say “thou shall be open from 10 to 6 every Sunday.” The bill says you can be open. So make your own decision whether you want to be open or not, like any retailer, whether it’s clothing or electronics. You decide what hours you are open. If I want to go out as an individual and I ran out of vodka for Bloody Marys on Sunday and I normally have my favorite local liquor store that I go to and they decide they are not open on Sunday, well then I’m going to Lunds, who is going to be open and I’m going to buy it at a Lunds liquor store. So if they don’t open, then it is going to put them at a competitive disadvantage in those types of situations. But I don’t see how it puts them at any other competitive disadvantage any worse than where they were before. Because if I like Joe who runs Joe’s Liquor, and I always go in to buy everything from Joe, I’m still going to do it. But just occasionally, if I’m out, I’m going to buy it from somewhere else. … I think the bill is more for the taxpayers or the consumers just in terms of flexibility and ease of use. I think as you get toward the borders it helps the retailers. So if you are out in Stillwater or Lake Elmo, well, with Wisconsin having Sunday sales you might have drove across the river over to Hudson and bought some liquor and came back. Now you can go to your local liquor store.
Q: In the last few years, several cities, including Minneapolis and St. Paul, started to allow breweries to sell growlers on Sunday. How has that impacted their businesses?
A: I think those are totally different. Sunday growler sales have helped the brewers in two ways. A, they can sell the product and B), it does bring traffic into the brewery on Sundays. Generally speaking, people don’t just go in, fill a growler and leave. Generally speaking, they have a beer while they get the growlers filled. There is both the on-premise sale and the carry-out. It certainly had a benefit for the brewers. … They are trying to get a bill into the Senate and the House that will increase the amount of barrelage for self-distribution as well as allow the brewers to sell packaged goods out of their taprooms.
Q: What other regulatory changes would help some of your local craft beer clients?
A: In Minnesota a brewpub is somebody who can sell beer, wine and spirits. But if they are a brewery, they can’t distribute their packaged goods in Minnesota. And then there’s the second side of that, the breweries that have a taproom. If I’m a brewery that has a taproom, I can’t sell anybody else’s malted beverage. I can’t even have a guest tap. … Both factions would like to see that change. … The second is to have multi-locations for a taproom. In Minnesota, I can only have one taproom. … Surly has its facilities still in its old brewery but it had to close that taproom to open its new taproom. … Lastly, the ability to compete without the use of the third tier, or the distributors, to a large volume. Today it’s roughly 20,000 barrels. They would like to see that number increase so they can self-distribute.
Q: Do you think there is still room in the local market to support more breweries?
A: If it’s somebody who is looking to put in a small brewery and a taproom and 90 percent of everything that they make is going to be sold through the taproom and it’s a local neighborhood thing, I think there is still plenty of room for that, particularly in rural Minnesota. … The ability for new ones to get into full distribution mode is really, really hard.