Within a matter of weeks, a handful of breweries in southeastern Wisconsin, along with several breweries across the country, announced planned closures or major changes to their operations. While the beverage manufacturing industry is now three years removed from the COVID-19 pandemic, several brewery owners say they’re still navigating long-term challenges like inflation and shifting
Within a matter of weeks, a handful of breweries in southeastern Wisconsin, along with several breweries across the country, announced planned closures or major changes to their operations.
While the beverage manufacturing industry is now three years removed from the COVID-19 pandemic, several brewery owners say they’re still navigating long-term challenges like inflation and shifting consumer habits.
Those challenges have caused many breweries to throw in the towel. Beer production decreased 5.1% across the country in 2023, according to data from the Brewers Association. In 2023, 288 taprooms opened in the U.S. while there were 168 closings. Microbreweries saw 92 closings and 40 openings in 2023.
After eight years in operation, the owners of Milwaukee-based Lost Valley Cider Co. announced in June the pending closure of the business.
Lost Valley Cider, located at 408 W. Florida St. in the Brix Apartment Lofts building, opened in 2016. The concept was brought to life by the father-daughter team of Stuart and Chandra Rudolph. The duo initially began brewing beer at home as a hobby, but Chandra later switched to brewing cider after being diagnosed with celiac disease.
Lost Valley’s first lease renewal came up right at the start of the pandemic, and the Rudolphs decided to keep the business running for another three years.
“Unfortunately, we haven’t seen the return of business that we had prior to the pandemic,” said Chandra Rudolph. “Cost of goods have gone up. People don’t go out to bars as much anymore, and we don’t have a food program, which might have helped us stay in the game a little longer.”
Between 2016 and 2019, Lost Valley saw continued growth. But since the pandemic, fewer customers and fewer sales meant the cost of doing business was simply too high, Rudolph explained. Lost Valley originally opened with the goal of offering a global sampling of products – another thing the pandemic made difficult.
“They’re not importing those ciders anymore because the cost of shipping is too expensive,” she said. “We also lost a lot of our West Coast ciders.”
While the Rudolphs considered moving to a new location, they didn’t believe they would be able to pull off the same concept more efficiently elsewhere.
“We're not shiny and new anymore," said Rudolph. "I would say most places have cider. There are even some breweries that make ciders. I feel like Lost Valley had a really good run."
Company Brewing, which was located at the corner of North Fratney and East Center streets in Milwaukee’s Riverwest neighborhood, also announced its closure suddenly in May.
[caption id="attachment_593613" align="aligncenter" width="1024"] Company Brewing's building in Milwaukee's Riverwest neighborhood.[/caption]
“After nine incredible years, we have made the decision to close our doors, effective immediately,” according to an announcement made on the brewery’s Facebook page.
While the owners of Company Brewing declined to speak to BizTimes, bankruptcy documents filed just before the closure announcement show the business had between $100,000 and $500,000 of assets and $1.95 million in liabilities.
The brewery has between one and 49 creditors, among the largest being the U.S. Small Business Administration, which is owed $832,298 from issued loans. Company Brewing filed for Chapter 7 bankruptcy, which means its assets will be liquidated.
The bankruptcy documents were filed on behalf of George Bregar, the founder and head brewer of the shuttered Company Brewing.
A silver lining
One local brewery, Public Craft Brewing Co. in Kenosha, was able to find a solution that’s kept it from completely shutting down. In May, Lakefront Brewery in Milwaukee announced its intent to buy the Kenosha business.
Public was part of the Wisconsin craft beer boom that occurred between 2012 and 2015. The brewery opened its first location at 716 S. 58th St. in downtown Kenosha more than a decade ago.
“I was kind of in that wave of breweries that included a lot of homebrewers with a dream,” said Matt Geary, founder and president of Public. “Kenosha was the third or fourth biggest city in the state, but it didn’t have a brewery for over a decade. The opportunity was there.”
Geary bootstrapped the business and was able to open Public Craft Brewing with the help of a crowdfunding campaign.
In 2020, the brewery moved a few doors down to a more spacious building at 628 58th St., the site of a former department store that was renovated for $5 million by Witico Development Corp.
The move expanded the brewery’s production capacity five times. Public’s footprint includes a taproom and kitchen on the first floor of the historic building.
“As we started to grow sales and distribution, we were getting to the point where we were brewing multiple times a day and we were out of space,” said Geary. “We either needed to double down and expand or we would have had to pull back and idle where we were.”
The expansion project was already underway when the pandemic shut down the entire country for weeks. While Geary decided it was best to continue, several other development projects that had been slated to begin in the city’s downtown area were canceled. Those projects would have brought in additional foot traffic, Geary said.
“We ultimately never got to do a full grand opening of the new space,” he said.
Nearly four years after moving into a newly expanded space, business at Public hasn’t returned to its anticipated levels, causing an “untenable financial situation.”
“We chalked a lot of it up to people’s habits have just changed,” said Geary. “When you spend that much time doing something differently, those consumer habits haven’t changed back.”
Another factor contributing to the decision to sell Public is a lack of leadership on the restaurant side of the business. Geary explained it had become obvious that there would be another change in leadership for the restaurant, but there wasn’t an immediate successor in place. With the restaurant driving the bulk of the taproom’s business, Geary said it was inevitable that Public would need to find help.
Public’s leadership team reached out to several breweries in the region to gauge their interest in buying the business. Geary was surprised to learn that Lakefront Brewery was inquiring about the sale of Public.
“The biggest thing I’ve seen hasn’t been changes but just support,” said Geary. “(Lakefront has) enough resources to get things done.”
While he’s unsure what his future title will be, Geary will remain involved with Public for the foreseeable future. The Public Craft Brewing Co. name is not expected to change once the sale to Lakefront Brewery is closed.
