Craft Brew Alliance Ceases Restaurant Operations at Widmer Brewpub

Craft Brew Alliance made good on last week’s promise to revisit its brewpub strategy, yesterday announcing plans to shift away from a restaurant-focused brewpub model at the Widmer Brothers brewery in Portland, Oregon.

In a post on the brand’s Facebook page, CBA said it would eliminate its full-service kitchen to make way for expanded small-batch brewing capabilities inside of a recently built 10-barrel innovation brewery that opened about 15 months ago.

Speaking to Brewbound, Derek Hahm, CBA’s vice president of sales and brewpubs, said the move would impact at least half of the 40 employees who worked at the Widmer brewpub.

“The number is still moving, but we will need about 10-15 people to stay on for the new concept,” he said.

Brewpub employees were notified of the decision to move away from food sales as a focus of the retail establishment on Sunday, he added.

The decision comes as foot traffic to its pubs has declined and as labor costs have risen, Hahm said.

It’s also the fourth time since 2014 that CBA has altered its strategy for the location, which opened in 1996. Last August, the company moved its pilot brewing operations into a space behind the pub, and built a fishbowl-style viewing window so patrons could watch the brewing process. In 2015, the company began altering its menu to reflect more modern dining trends, and in 2014 it remodeled the location to include more draft handles and a new seating configuration.

But none of those changes could reverse declining brewpub sales, which were down 4.9 percent through the first nine months of 2017.

“It’s been hard,” Hahm said of finding the right formula. “The marketplace is inundated with brewery taprooms, and the restaurant business is taking a hit. Minimum wage is increasing, guest counts are declining and the cost of goods and what goes into running restaurant is increasing.”

Pressed on why CBA didn’t cut out food sales sooner, chief marketing officer Ken Kunze said an ongoing capacity expansion effort in Portland, coupled with projects in Hawaii, where it is building a new Kona Brewing facility, and in Seattle, where it recently opened the Redhook Brewlab, limited what the company was able to execute.

“We tried making some different changes to keep moving while staying focused on the beer,” he said. “The food for us, in Portland, is playing less and less of a role. We are trying to reorient what we do for consumers, and in some ways food was getting in the way of that.”

The pub will still serve “light snacks,” according to Hahm, but refocus its efforts on providing customers with more of a “tasting room” experience that “connects better to the brand and the community.”

“The plan is to open up the pilot brewery, so it is not behind the glass or a wall,” Hahm said. “We will also be moving our retail store, adding a barrel room and elevating our tours.”

CBA is also looking into the feasibility of packaging small-batch beers for expanded distribution outside of the taproom, Hahm added.

The exact cost of the remodel is not yet known, but the company expects to construction to be complete by the second quarter of 2018.

CBA has no immediate plans to shift away from food sales at its Portsmouth, New Hampshire, brewery location, Hahm added, and it will continue to operate a brewpub at its Woodinville, Washington brewery that ceased brewing operations in July and is currently for sale.

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