Fireforge and other South Carolina start-up breweries shut out from festivals and special events

“People love free beer. Why ruin the fun?”
— Nicole Cendrowski, VP Arts & Crafts, Fireforge Crafted Beer

Recently, the South Carolina Department of Revenue (SCDOR) and SLED (South Carolina Law Enforcement Division) began to strictly enforce a 20+ year-old state alcohol law that prohibits any producer of beer to sell beer, give free beer, or provide any service to a retailer.

Over the past couple decades, breweries have been donating beer directly to non-profits, festivals, special events and causes they believe in, not knowing that this is actually illegal in this state because it circumvents the wholesale layer in the three-tier-system.

Most states do allow for some level of self-distribution, or give breweries the ability to directly supply retailers with or without limitation. South Carolina is one of 13 remaining states that does not have any provision for self-distribution for the direct sale or donation to retailers.

While donated beer may be a small percentage of the total beer market, this does have a potentially large impact on non-profits, events, festivals, and in our case, start-up breweries. The change in enforcement comes about because SCDOR and SLED consider festivals and special events to be “retailers” and thus subject to the same three-tier-system regulations as stores, bars and restaurants.

Rather than try to explain all the details in this post, Brook Bristow, beverage lawyer and head of the South Carolina Brewer’s Guild, wrote a detailed blog post about the issue. If you run a business that sells alcohol, put on events, or care about craft beer, I highly recommend you read that post.

I will touch on what this means for Fireforge and other South Carolina breweries-in-planning in the foreseeable future.

Impact to a Start-up Small Business

Since Fireforge is not yet a licensed producer of beer, we cannot sell or distribute any of our beer through a wholesaler. (We could possibly contract brew at a licensed producer and distribute it that way, but that’s a story for another time.) Therefore, we can’t give away samples at beer festivals or special events, as all beer needs to be channeled through a wholesaler in South Carolina.

Prior to the change in the enforcement of this law, we were able to pour free samples at festivals, tastings and events as a homebrewer. I brew my beer at home, 10 gallons at a time on the same system I’ve had for the past six years.

I don’t sell my beer or get paid to brew it. However, giving away samples has been a tremendous marketing opportunity for us, allowing us to get our product in people’s hands to build a following prior to our opening.

By working to build a base of potential customers prior to opening, our goal is to have more than just our families in the Fireforge tasting room on opening day. Giving away our product builds our reputation and brand awareness so that we can hit the ground running from Day 1, rather than appearing out of nowhere on the craft beer scene as if we were dropped out of a spaceship.

Imagine the challenge of building a reputation from scratch and trying to get our first customers in the door while we’re already paying rent, utilities and employees. Those first few weeks and months are critical, and starting from zero on Day 1 shortens the runway. It could be perilous to a fledgling small business trying to break into in a very competitive market.

Giving away samples has also been extremely informative market research for us. We’ve been able to validate that people enjoy our beer and that we’re not completely insane for opening a brewery.

If we had not been pouring samples for the past couple years, I would never have guessed that some of our beers, such as Perlin’s Ghost Pepper Pale Ale, Tampanian Devil Guava Tripel and Sunshine of Your Love Cream Ale would have gotten the positive reaction they have.

The feedback we’ve received has been invaluable to know what people really like and what has gotten a lukewarm response. We can start off brewing beer that we already know people like.

What Can We Do About It?

Right now, not much. South Carolina’s beer and alcohol laws are in desperate need of modernization. Restrictive and antiquated laws are a big reason why South Carolina ranks 41st in breweries per capita in the U.S.

The next state legislative session does not begin until January 10, 2017. In the mean time, the state’s craft brewers will be huddling up and planning which are the most pressing and realistic issues to address in the coming year.

We’ve made a lot of progress over the past decade for craft beer in South Carolina, thanks in large part to the support of craft beer fans mobilizing and letting their representatives know what’s important to them. We’ll continue to keep you updated on issues and bills that affect craft beer in our state.

What Does This Mean For Fireforge?

One of our favorite things to do is to serve our beer to people. It’s why we wanted to start a brewery in the first place. We are deeply saddened and frustrated that we do not have a legal outlet to allow people to sample our beer in a public venue.

There is the possibility that we could contract brew or collaborate with other breweries in the area to continue getting our name out there. We are developing some collaboration recipes in conjunction with other breweries and hope to brew those with our comrades soon. Contract brewing is a bit more complicated, and we’re evaluating whether it’s worth it for us to pursue that channel for just a few months before we open.

However, all this is just another challenge that we have the opportunity to overcome. Please continue to keep an eye on us, we’re not going anywhere and your support means so much to us.

Rest assured that we will continue to work our asses off and push as hard as we can to get this brewery open as quickly as possible. We’re making tremendous progress toward securing a location, and we’re getting close to our fundraising goal.

So stay tuned for more news over the coming months, and please continue to support your local breweries and other small businesses. Let’s make this community a wonderful place, fueled by diversity and innovation. We’ll see you around!

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About Brian

I like beer.
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