Old Bakery Beer Company - Craft Beer Goes Organic

“I have always been into beer,” noted James Rogalsky, Brewmaster for the Old Bakery Beer Company. “My mother-in-law bought a kit for my 21st birthday. The more I got into it, the more interested I got.”

“Beer is a pretty simple process, but it can also be pretty complicated. I had a sociology degree and I didn’t know what I would do with it, so I decided to take the Craft Brewing Science and Engineering Course through The American Brewers Guild in 2012. He had already been working as a bartender at Urban Chestnut Brewing in St. Louis when he started the program. Soon after he started, they moved him into the brewery. His wife (married since 2011), Lauren Pattan was also working as a bartender at UCBC, then got a promotion to become the GM. She was important in opening up their second facility - experience that proved vital to starting up their own brewery. “After about 2 years there, I decided to do my own thing and left in November 2013.”

“My Dad and I had been talking about opening a brewery and we started putting together a plan, but we couldn’t find anything suitable in St. Louis. Everything was either too expensive or too small for our plans. Then my Dad found ‘The Old Bakery Building’ in Alton, which is about 30 minutes north of St. Louis. We were blown away by the character of the building. It was very early 20th century and much bigger than anything in St. Louis. It offered opportunities for expansion,” remembered James.

The young couple had grown up in Alton, and still had both sets of family in the area. “It just felt right.” added Rogalsky. “To be able to be part of a positive change for the town we grew up in - it registered almost immediately that we could help move Alton forward." Alton, like many Midwestern towns, has been left to rust by industrial sell-offs and closures since the 1970’s.

“We did not buy the building. The owner was already in negotiations with another buyer. We talked with him (the potential buyer) , and he bought it knowing he would have an immediate tenant. We started rehabbing the building by March of 2014. That took a lot of work because the building had to be sandblasted to remove old lead paint. It also needed all new electrical, plumbing and HVAC to get it up to code.”

“A brewery is a sizable investment. You have to buy a lot of stainless steel to start: brewing vessels, fermenters, tanks, and kegs. It was very expensive. We bought Criveller brewing equipment from Niagara Falls, NY. They make good mid-grade gear that we could afford. We were brewing by December of 2014.”

“We just brewed beer for a month to get ready, all while continuing work on the restaurant part of the business.” The Old Bakery Beer Company was always going to be a brewpub. Originally it was going to be small- about 2000-5000 square feet, making 100-200 gallons at a time for the bar, but with 18,000 square feet we could supply the restaurant and distribute beer for retail. “A brewpub is necessary for quick sales, and the margin is significantly higher. A pint costs us $.25-$.45 to make. If we sell it as a 5-gallon keg (our highest margin wholesale format), we make $1.40-1.60 per pint. At the bar, we make $5.00 per pint. There is a lot more overhead with a pub, but the margin is much better. We built a 200 seat restaurant with a 2000 square foot private event space,” said James.

“When we first opened, we only sold draft at the restaurant, but by April 2015 we started retail distribution of kegs, and by March of 2016 we were canning beer by using a mobile canning company from Chicago. They came once a month, canned our beer, then packed everything up and left again. This worked well at first, since we couldn’t afford the canning equipment, but by February of 2018 we bought our own canning equipment, so we can now can whenever we want. Our beer is sold through our existing distributors in MO and Illinois. We had a part time sales rep, that we promoted to full time to sell the cans, but we are still working on an overall marketing plan - something that continues to be hard. We don’t have a Marketing background, so we’re learning as we go.”

“Right now we have seven beers in cans, and 17 different beers on tap. Since we opened, we’ve brewed probably 70 different beers. All of them are certified organic. In 2019 we are planning on making 18 different beers. Our best seller is our Citrus Wheat, which is a mashup of an American Wheat and a Belgian Wit. We added lemon peel, orange peel, coriander, and chamomile. It’s made with certified organic soft red winter wheat from a farmer in central Illinois. It is one third of our total sales.”

“The craft beer market has really changed since we opened. After years of 15% growth, in 2017 that growth slowed significantly, and there are still new breweries opening. There is increasing supply, slowing demand and lots of competition. We have sold 1500 barrels each of the past two years. We make 15 barrels at a time two times a week on average. We sell about one third of our production on site, we sell another third in St. Louis, and the final third in Illinois. Distributors are getting picky, but we are reaching out to new areas and trying to make the most out of our existing distributors. There is only so much time in a day, and more sales force is needed for expansion. There are 6500 craft breweries in the US now, but only 30-35 are organic. It helps to differentiate us,” noted James.

“My wife and I believe in organic. We are long-time supporters of CSAs and farmers markets. We are firm believers in local and organic. We wanted to be organic from the start. Organic is still a niche market in the brewing world, most are out west, in the NE and places like Colorado. We are one of a very small group in the Midwest. We are more concerned with the environmental benefits of organic than it being just the opposite of conventional. We actively work with local organic farmers for our supplies. All of our barley and raw grains come from the midwest. Our hops come from Michigan and from the Northwest. We take a lot of pride in organic, it produces a better, cleaner beer.”

For more information about The Old Bakery Beer Company, visit: http://www.oldbakerybeer.com/