The Difference Between a Brewpub and a MicrobreweryAdded by Hawley Troxell in Articles & Publications, Wine, Brew, Spirits Law on July 24, 2013
You may have occasionally wondered to yourself, “What is the difference between a brewpub and a microbrewery?” In Idaho, the answer is not much. Both allow small beer makers in Idaho to reach consumers directly in ways they otherwise could not. In Idaho, the two differ in that a microbrewery is simply the place where the beer is made, while a brewpub is a restaurant or bar where the microbrewery can sell drinks directly to customers.
Some states impose a three-layer system on their beer makers. In those states, breweries can only sell beer to wholesalers, who then sell to the retailers. Retailers, such as bars, restaurants, and grocery stores, then sell the products to consumers. This system does not really apply to Idaho breweries. As noted in a previous post, breweries in Idaho can be their own wholesalers because they are permitted to sell to retailers. But what about the last leg of the trip? Can Idaho breweries ever sell their beer directly to the person who drinks it?
In some cases, yes. Perhaps recognizing that its tiered system could make it difficult for small breweries to compete with established brands, Idaho allows manufacturers making less than 30,000 barrels of beer per year to sell beer directly to consumers right at the brewery. Establishments such as these are most accurately be described as “microbreweries,” at least in Idaho.
And, fortunately for Idaho brewers, state law also allows them to get a brewpub license. At a brewpub, a microbrewery can sell its products (made offsite) to be consumed right there, along with food or even beer from other breweries.
Brewpubs are naturally a fantastic way for a brewery to market its beer to new customers who may not be willing to make a trip to a brewery just to taste beer, but who may be willing to try a new restaurant closer to home. Because the brewery is not actually manufacturing beer onsite, it may be possible to put the brewpub in a more accessible location to attract more people. It is also much easier for breweries to develop their own identity by designing the brewpub to reflect their branding and style. What better way to hook people on your beer than by giving them the ideal place to relax and take it in?
For help understanding Idaho’s beer regulations or with growing your beer business, please contact our Wine, Brew, Spirits Group at 208.344.6000.
More Tax Law Blog Posts
- 01/04/18—Idaho Wine Commission: Come As You Are
- 02/18/15—Idaho Statesman features article “Why Idaho should ease retail limits on breweries”
- 02/10/15—Which Breweries Can Open Brew Pubs?
- 01/16/15—Public Beer Sampling Now Permitted
- 12/29/14—Why Bars and Restaurants Mark Their Tap Handles