Crafty brewers try to get ahead of the trends

6/16/2013 1:45 PM
By Associated Press

INDIANAPOLIS (AP) — Indiana's craft beer industry continues to entice new brewers to try their hand at selling unique brews, but the crowded market is proving more difficult to tap.

Walk into just about any bar or restaurant around town, and the tap space seems full after the boom of the past four years. Want something refreshingly hoppy? Try Triton's Railsplitter, Flat 12's Half Cycle and just about anything from Three Floyds. How about a light-tasting beer? You've got Sun King's Sunlight Cream Ale, Fountain Square's Workingman's Pilsner and Upland's Wheat. In the mood for something darker? There's Crown Brewing's Crown Brown, Oaken Barrel's Snake-Pit Porter and Barley Island's Brass Knuckles Oatmeal Stout.

Bars are adding taps to accommodate more choices — the once aptly named craft brewhouse Twenty Tap in Broad Ripple now boasts 38 handles — but there's still only so much room behind the bar. With about 60 Indiana craft breweries already saturating the market, triple the number from four years ago, breaking into the scene is only getting tougher.

Just ask the area's newest brewers.

Ray Kamstra opened Indiana City Brewing Co. two weeks ago Downtown. Twin brothers Shane and Michael Pearson and friend Bill Ballinger opened Shelbyville-based Daredevil Brewing Co. in January.

Each brewery began peddling their products more than a year ago. Just like door-to-door salesmen showing off their latest gadgets, Kamstra and the Shelbyville trio have been bellying up to bars and pulling out growlers of strange brews for the owners and managers to sample. It took patience and persistence — and more than a little drinking — but the two brewery's taps are sprouting at local joints.

Solidifying deals over suds aside, opening a brewery comes down to having a solid business plan, brewers say. They build personal relationships with customers, brand their products well, maintain quality control and, perhaps most significantly, test the mark by starting small. Neither Indiana City nor Daredevil wanted to start with debt and too much beer — even good beer — to sell.

It's really competitive," Shane Pearson said. "There are only so many taps. Having a good beer is the entry stakes. But it's not just about getting on tap, it's about staying on tap."

Daredevil counted on the success of a single beer, Lift Off IPA, to launch the business. The bars gave the brew a chance. The customers responded, ordering up pints all over Indianapolis. Lift Off so far is staying on tap, and the successful blend is helping Daredevil launch a series of seasonal beers.

"We make a high-quality product in Lift Off, and it sells the seasonals," Pearson said.

Unlike Daredevil, Indiana City Brewing opened a tasting room. But to get the word out, getting on tap throughout the city will be key. Kamstra's business plan is to start small and sell out. He's on tap at four bars near the brewery on Shelby Street north of Fountain Square. The limited number of bars serving the drinks — and good reviews — has created a buzz.

"There is a greater demand than what we've been able to put out there so far," he said.

Craft beer aficionados think breweries such as Indiana City and Daredevil can survive with the right business plans. Jake Koeneman blogs about the craft beer industry for Hoosier Beer Geek, and he thinks there is still room in the market for good, consistent brewers.

"The issue that we've had, and the concern we've had about this craft beer bubble that people talk about, it's not that Indiana can't sustain it," he said. "It's making sure we have quality that continues to come out."

The days of serving only traditional beers like Miller Lite and Bud Light appear over.

Only 44 breweries dotted the country by the end of the 1970s, and there wasn't much flavor to go around. The nationwide craft beer explosion began in the 1990s, bringing along more daring styles of beer. By 2012, more than 2,400 breweries operated in the U.S., the highest total since the 1880s, according to the Brewers Association.

Craft brewing continues to grab a larger market share. The craft industry grew 17 percent by sales from 2011 to 2012 in the United States, compared with about 1 percent for the overall beer industry.

In Central Indiana, that trend has not gone unnoticed by bars and restaurants.

Daniel Jones opened Chatham Tap in 2007 on Mass Ave., a couple of years before the craft beer renaissance exploded in Indiana. But even then he noticed the regular beers weren't selling. Back then, the answer was in imports or regional brews such as Harp, Guinness, Blue Moon and Sierra Nevada Pale Ale.

Now he sells a full lineup of Hoosier brews at two Chatham Tap locations and Ralston's on Mass Ave. And some days it seems every craft brewer wants a tap.

But Jones has to be selective.

"We don't want to put five Indianapolis breweries on that have the same types of beer," he said.

Jones will let local breweries have a shot. But he wants a variety. And, hey, if the beer doesn't sell, it's business.

"If we go through a keg in a week, that would be considered good," he said. "Our best sellers, like Sun King, we'll go through two or more kegs in a week. But if we've had a keg on for more than two weeks that hasn't run dry, the mob has spoken."

It's gotten so that folks look at the beer menu as closely as the food menu when choosing where to go. While the tap space is limited, bars and restaurants have found they need the right mix of beers to stay competitive.

Don Kelly, 24, McCordsville, never drank craft beer until Triton brewery opened in Lawrence near his home in 2010. Now he's put down the Bud Light, and craft beer is among the first thing he looks for when choosing a restaurant.

"I think it's definitely a culture shift," he said. "Craft beer is really taking off. I can't remember the last time I had a non-craft beer."

A risk to craft brewers is overconfidence. Success starts in small doses and doesn't guarantee long-term results.

Kamstra spent a year talking with bartenders and owners before he opened his brewery. They had a warning he took to heart: Don't oversell what he could do.

So, like Daredevil, he started small. He is selling out everything he is brewing to a limited number of establishments. Those bar owners, he said, don't want to worry about whether the brewery can produce enough kegs to fill orders or whether the quality of the beer will be consistent keg to keg. Starting small helps with quality control.

He is counting on gradually growing the business.

"Because we're not trying to be on tap all over the place," he said, "we're not struggling with it."

The city's powerhouse brewer, Sun King, started small, too. And after only four years, Sun King is producing 15,000 barrels of beer annually, the largest brewer in the city and second largest in the state.

But co-owner Omar Robinson says Sun King markets to bars and restaurants now more than ever before. With so many breweries opening in Indiana, and more coming in from out of state, he can't rely upon past success to keep his market share.

"I'll give you a good example," he said. "Oskar Blues will be coming to this state before the end of the year ... and I will lose some business. Let's say Osiris (Sun King's pale ale) is going to run out somewhere when that happens, and the owner says, 'Well, I'll give Oskar Blues a try.' "

Oskar Blues, based in Colorado, produces nearly 60,000 barrels a year and is expanding throughout the nation

So Sun King sends out a large sales force to ensure its three staples, Sunlight, Wee Mac and Osiris, and its seasonals are on tap at bars. And Sun King's reps still bring growlers around for bar owners to sample and Sun King signs for them to hang up on the walls.

But success still comes down to brewing consistently good beers.

"The first requirement to stay on tap is to have really good quality beer," Robinson said. "That's the way you have got to get taps, and that's the way you've got to keep them."

The Pearsons and Ballenger have their Lift Off IPA on many a tap, but that doesn't stop them from making the rounds, pitching their beer and maintaining their ties to taverns.

Michael Pearson brought MacNivens a new style of tap handle one recent evening and stayed to chat with the bartenders and have a few pints. As in many bars throughout the area, the bartenders know him on sight.

The time spent is worth it to Pearson. After all, this isn't a hobby. It's an investment.

Shane Pearson said it can cost $10,000 to $20,000 to start a small brewing and tasting room. A larger production brewery can cost from $500,000 to $1.5 million in startup costs.

They don't want failure to leave a bitter taste.

Like the guys at Daredevil, Kamstra of Indiana City Brewing still makes his bar-hopping rounds.

Wally Bolinger, owner of Red Lion Grog House in Fountain Square, says Kamstra is a regular who worked persistently to earn a tap there.

Bolinger just expanded from eight to 12 taps at his watering hole, and he needs the beer sales to pour quickly from each line. It's only going to get more competitive for the brewers, he said.

"Ray comes in here a lot," Bolinger said. "He's such a nice guy, and he started up all on his own with a passion for it. He won me over with his personality."

But that only goes so far. Indiana City beer is selling. And it will have to keep selling to stay on tap.

Kamstra said he has a conservative growth strategy, and he's encouraged that it's working four weeks in.

"We'll see where the tide takes us."

___

Information from: The Indianapolis Star, http://www.indystar.com


Is the EPA being unrealistic in its timeline to reduce farm runoff into the Chesapeake Bay?

  • Yes
  • No
  • Unsure

User Submitted Photos

View photos      Submit your photos

11/23/2014 | Last Updated: 3:15 PM