Is a Second Location Right for Your Brewery?

bear republic

The first step in expansion is knowing if you need to.

Even larger craft beer facilities mull those prospects over by the day, looking to gain advantage in an increasingly larger marketplace.

At Bear Republic, the 44th largest craft brewery in the country, is opening a new tasting room closer to the San Francisco area to help increase its customer base in Rohnert Park, California beginning in 2017.

Brewmaster Richard Norgrove said Bear Republic’s new taproom will help shatter what is quickly becoming a glass ceiling — not just for his brewers, but also service staff.

“We are always trying to create the next plateau,” he said. “Our [taproom] General Manager gets to hand pick and select his crew. I have brewers we are interviewing right now by letting them go down to the pub and be creative.

“Who is going to be flying the new starship? They are given a certain level of autonomy, but it’s also going to be a creative outlet for us.”

For Smuttynose Brewing, its latest expansion came in the fall of 2013 to help the brewery expand beyond the Northeast, the original plan was for the new location in Hampton, New Hampshire to be a relocation.

Instead, it evolved into a second main location that is larger and more efficient while letting the first facility become its “Smuttlab” while doing additional contract brewing.


The new facility also helped with growth and public interaction while adding a place for patrons to eat while looking to gain LEED Gold certification (which it eventually did), said Smuttynose’s public relations manager JT Thompson.

“That adds an extra set of complexities for the intersection of design, functionality and sustainability,” he said. “There are a lot of decisions to make in a hybrid project that combines greenfield construction elements and relocation/repurpose of existing buildings.”

Bear Republic opened its original location in Cloverdale, California when brewpubs were full-scale restaurants. Times have changed, Norgrove said.

A warehouse setting with kegs and a food truck out back suits some consumers fine. That can cut costs off the top.

“That model didn’t exist when we started,” he said. “It allows you to reinvent and reinvigorate your brand.

“We learned from the first brewpub over the first 20 years and so a lot of things we dislike we can learn from and the things we like we can incorporate into the new brewpub.”

Is there a formula for knowing when a brewery is getting to big for its britches? Not really said Norgrove.

“It’s up to the individual,” he said. “There is more profit in a pint that you can put in front of someone compared to the packaged product. I don’t know what the magic number is. It’s what you think you can manage.”

Thompson said Smuttynose began to see the writing on the wall around 25-30,000 barrels.

“Through wise management of facilities and process, we were able to do 43,000 in the same space before our new home was ready,” he noted. “We made a a few expansions to the facility, optimized schedules and a few other things to keep things going, but we did have to delay entering a few markets because of capacity considerations.”

He added for breweries looking to make a decision should never be embarrassed to ask a question, even if some vendors are more expensive because they’ve got a track record,

“It may well be worth the money,” he said. “I’d suggest making sure you know what you want, but also WHY you want it. Having a clear justification for everything makes your myriad decisions much easier to sort, especially when you hit a value engineering situation.”

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