Support an increase to the self-distribution limit for craft breweries in Michigan

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Michigan breweries, distributors, retailers and most important of all, craft beer enthusiasts,

If you represent a Michigan micro brewery, distributor, or retailer, in addition to this petition, please add your name here to track.

Otherwise, if you're a supporter of Michigan craft beer, read on and consider signing!

We are seeking your support to open a dialog with the Michigan Brewers Guild and ultimately, Michigan legislature, to increase the self-distribution limit for breweries in Michigan from 1,000 barrels to 30,000 barrels, and to change the limit from a production basis to only include beer sold directly to retailers.

What is self-distribution?

It's the ability to sell and deliver beer that we produce. Seems like that should be a given, right? Unfortunately, in Michigan, it's not.⠀

Here are the facts.

  • Of the states that allow self-distribution, no limit is lower than Michigan's 1,000 barrels
  • Michigan has the fifth most breweries in the U.S.
  • The top four states have self-distribution limits of 60,000 barrels, with the exception of Colorado who allows ~10,000 barrels (300,000 gallons)
  • Every Great Lake state, with the exception of Michigan, has a limit of 10,000 barrels or more
  • In 2018, only five Michigan breweries produced more than 30,000 barrels, and only Founders and Bells produced more than 50,000 barrels
  • 99% of Michigan craft breweries produced under 30,000 barrels in 2018, our proposed limit

What does this mean?

Unlike independent craft breweries in our surrounding states, Michigan craft brewers are only able to sell and deliver a small volume of beer directly to retailers. Because this limit is so low, the upfront cost of kegs, delivery vehicles, and a sales team do not justify the short-term benefit derived from self-distribution. Instead, we have two choices. Do not distribute our beer or sign with a distributor. In most cases, Michigan breweries choose to not distribute their beer and when they do, it's an uphill battle creating enough scale to justify the margin paid to a distributor.

Not only does this hurt Michigan breweries, as it removes a potential revenue stream and marketing opportunity, but it also hurts consumers as it limits access to local, Michigan craft beer.

Now to the nitty-gritty.

We are proposing the following change to the definition of a "qualified micro brewer" in Section 436.1203 of the Michigan Liquor Control Code.

Original Code

"Qualified micro brewer" means a micro brewer that produces in total less than 1,000 barrels of beer per year. In determining the 1,000-barrel threshold, all brands and labels of a micro brewer, whether brewed in this state or outside this state, must be combined.

Proposed Change

"Qualified micro brewer" means a micro brewer that sells in total less than 30,000 barrels of beer per year to retailers. In determining the 30,000-barrel threshold, all brands and labels of a micro brewer, whether brewed in this state or outside this state, must be combined.

By signing this petition, you are showing your support in modernizing Michigan law to match our neighboring states and improve the beer economy in our great state.

Thank you for your support!

Cheers,

Dayne and the team from Eastern Market Brewing Co