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Love of local brew fuels rapid rise of Cincy's beer market









Cincinnati is thirsty for craft beer. In fact, so much so that local brewers are having trouble keeping up with demand.
 
Even as the number of microbreweries in Cincinnati enters double digits, the city’s beer entrepreneurs continue to be challenged—in a good way—by Cincinnati's love of local brew.
 
MadTree Brewing Company has grown nearly 400 percent since opening in 2013 and continues to thrive.
 
"Knowing what I know now, I certainly would have done things a little bit different," says owner Brady Duncan. "In our original business plan estimates, we underestimated it so much that our monthly estimate is now like an average Saturday night."
 
Upon opening, the brewery sold all the beer it could make, and after a deal with the Reds, MadTree spread itself thin—although Duncan expects to see more craft beer at Great American Ball Park this year.
 
Much like MadTree, Fifty West faced an unexpected influx of customers upon opening.
 
"When we actually opened the doors [in November 2012], the crowd kept coming, and it kept getting bigger, and bigger, and bigger," says Bobby Slattery, who runs Fifty West's business operations. 
 
Once Fifty West opened its restaurant, its customer base increased even more.
 
"I'll never forget sitting in a room with Blake and Whit and we were doing the beer count, and the next thing you know we're doing the math and we go, 'We're going to be out of beer. We're going to be a microbrewery and you walk in the door and we're not going to have any beer available because everybody drank it all," Slattery says.
 
To keep up with the demand, Fifty West doubled production capacity.
 
And with Rhinegeist, it's the same story.
 
"We're only in our eighth month, and we're brewing right now at the rate we thought we'd be brewing about three and half to four years into the business," says Rhinegeist co-founder Bob Bonder.
 
From houses to taprooms
In the brewing industry, success tends to come from humble beginnings.
 
Scott LaFollette, Blank Slate proprietor, fell in love with home brewing in college and immediately began making plans to start a brewery.
 
After nearly 10 years of studying the industry, LaFollette brought his craft to the market in 2012. He ran his self-funded operation alone for the first year, then hired Blank Slate's first part-time employee about six months ago.
 
Likewise, Fifty West brewers Whit Hesser and Blake Horsburgh—the latter of whom worked at Rivertown for a year and had acquired his associate's degree in brewing technology from Siebel Institute—began brewing in their Terrace Park garage, and later approached Slattery when deciding to expand from a household project.
 
"I told Whit, 'Make me some beer, I'm not going to drink it. I'm going to take it to the two guys I know that know the most about beer,'" Slattery said. "I took it to Ed [Vinson], who runs the beer department up at Jungle Jim's, and then Jay Ashmore, who owns Dutch's."
 
They began noticing bars and restaurants were stocking more craft beers on tap.
 
"Everybody wanted to hear the word 'local,'" Slattery says. "They wanted to hear that their vegetables were coming from a local garden, their chickens they were eating were coming from an organic farm that was just over the hill."
 
Similarly, Madtree began in Duncan's basement. Duncan and brewers Jeff Hunt and Kenny McNutt home brewed on Fridays and Saturdays for a year, and then spent the next eight months working out a business plan.
 
Creating the perfect brew
With all of the different beers on the market, Fifty West considers consistency the most important aspect of the brewing process.
 
"Blake and I taste beers every day," says Fifty West brewer Max Fram. "We sit down and look at all the characteristics of a beer that we want to create. You reverse engineer these beers."
 
For Rhinegeist, creating a flavor profile means sitting down and blind tasting beers once a week. The mystery eliminates brand bias and helps focus on subtler notes.
 
"We'd set it all up, label the bottoms of the glasses, mix them all up so nobody knew what was what, and then we'd taste all of the beers and talk about what we liked, what we didn't like, then rate them," Bonder says.
 
While consistency is important when building a relationship with the local market, freedom to experiment with recipes allows local brewers to maintain diversity in their taprooms. 

For Fifty West, educating the public about the flavor spectrum helps when deciding what to keep brewing.
 
"When you walk in, you're going to have 10 to 15 different styles of beer that not only will you be able to figure out for yourself what you like, but from that, we took that customer feedback to kind of help us grow," Slattery says. 
 
Much of the education occurs outside of the taproom, too.
 
"Through social media, we have a voice and we can compete," Slattery says. "Now, if you want to become a beer expert, you can get on the internet and go to RateBeer or Untappd or BeerAdvocate and really look up what beers are highly rated and go to the store and buy them."
 
An open industry
To those unfamiliar with the craft beer industry, discussing ingredients or business advice with competitors might seem like a poor business strategy, but collaboration among local brewers is common.
 
"There's over 2,500 breweries in the United States, and most everybody is willing to give their advice and time of day to help you out," Horsburgh says. "It's been convenient to just call a local brewer and ask them their process or ask them the way they do things."
 
While local breweries still compete with one another, the passion to create good beer and the sense that a rising tide lifts all ships spurs their sense of openness.
 
"You have to look at it as a six-share—so six out of every 100 beers bought nationally are craft beers," Duncan says. "We're all playing in a very small pond, and I think we all kind of have the same mission."
 
Not only do local brewers seek advice from other brewers—and sometimes even brew together—but they also reach out to distributors.
 
"Before we even had money, we were sitting down and talking to distributors," Duncan says. "Four out of the five distributors [we spoke with] were willing to talk to us, and I got a lot of good data from that."
 
Startup challenges
Opening a brewery isn't easy—just finding the capital can prove difficult.
 
"We got turned down by several banks," Duncan says. "They said, 'You don't have experience,' even though we were basically securing a loan with probably five times the equity that we were asking for."
 
Then brewers must undergo a permitting process, which many find convoluted and time-consuming.
 
"Every brewery [has issues]," Duncan says. "The whole process cost us thousands of dollars and probably a month or two of time."
 
Finding equipment poses another challenge—an expensive one, too.
 
"If you order it new, it actually takes longer to get than used," Slattery says. "So used equipment is really hot right now."
 
Even after opening a brewery, problems continue to surface, like securing enough premium hops—especially for IPAs.
 
"There's just not enough of them being grown," Bonder says. "Before we even opened, we signed a contract for over $100,000 worth of hops."
 
Despite technical challenges, just staying focused can prove enduring.
 
"It's such a fun industry to be in, and I love just stepping back and enjoying it, but [it's a challenge] to keep up with the crazy demand here in Cincinnati. It's a thirsty city that drinks a hell of a lot of beer," Bonder says.
 
But ultimately, a brewery's chance of survival depends on balancing these challenges.
 
"You have to master your craft and be business-savvy at the same time," Duncan says. "I think you'll see businesses that don't put those things together won't succeed, and I think that's one of the reasons we've been successful."
 
What's next
With a growing demand for craft brews, popular consensus suggests the number of breweries will continue to increase.
 
"It seems like a lot of demand for craft, but I still think it's just scratching surface of where it's going to be," Bonder says. "A lot of analysts believe craft is going to pick up more and more of the beer industry, until maybe it plateaus in that 30-40 percent range."
 
More competition presents both advantages and disadvantages for brewers.
 
"The good is, I think more breweries is better, as long as they're making good beer," Duncan says. "But you see a lot of people getting into it that just want to make beer and sell it, and the beer ends up being pretty subpar."

Yet competition also spurs innovation, and that’s evident in the vast range of beer options that have proliferated everywhere in recent years. As the market grows, many brewers are focused on just making enough beer to keep their fans happy.
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