When Jack’s Abby Craft Lagers launched in 2011, brewer friends told Founder and Co-owner Jack Hendler that he was out of his mind for opening a craft brewery dedicated exclusively to lagers. “Why would you do that?” they asked. “Craft beer is all about ales. That’s what consumers know and expect.”
Hendler, however, saw opportunity in lager. He considers Jack’s Abby to be part of a “new wave” of breweries that launched around that time, when brewery openings were picking up pace and start-ups were coming to market with a narrower, more niche-based focus to their business plans.
“It’s funny looking back six years later. We thought the market was near saturation in 2011 and, in our opinion, we couldn’t just brew a pale ale, an IPA, and a stout and succeed,” Hendler says. “We saw a lack of craft lagers in the market, and that was our opening to differentiate what we were doing.”
Jack’s Abby, based in Framingham, Massachusetts, is co-owned by brothers Jack, Sam, and Eric Hendler. The brothers grew up working summers in their family’s ice-distribution business, and when Jack started planning Jack’s Abby after working in several breweries and attending the Siebel Institute, it felt natural for Jack’s Abby to be a family business (he even named the brewery after his wife, Abby): Jack would oversee brewing and production, Sam would manage sales and operations, and Eric would be in charge of finance.
Expanded Awareness Calls for Expanded Capacity
Jack has developed the brewery’s portfolio along the lines of traditional and nontraditional lagers. Traditional lagers—including its flagship House Lager, dunkels, and a seasonal Oktoberfest—are made using all German ingredients and brewing practices. Nontraditional lagers—such as Hoponius Union, an India pale lager, and Smoke and Dagger, a black lager—are brewed with American hops and often include adjuncts that would be verboten under Reinheitsgebot. All of Jack’s Abby’s beers are brewed using a decoction-mash technique and ferment and condition for at least four weeks or longer.
When the brewery launched, Jack says it took several years to educate local consumers about the potential of craft lagers, but Jack’s Abby has since established a strong foothold throughout Massachusetts, New England, and into eastern Pennsylvania. Jack’s Abby is particularly strong in the Boston market, and two years ago entered into an agreement to pour its beers at Fenway Stadium.
“Certainly when we opened, there was a lot of confusion as to what we were doing brewing all lagers,” Jack says. “No one associates ale with just one style of beer—they understand that there’s IPA, pale ale, stouts, porters, and a whole mix of different styles within ale—but because so few brewers have focused just on lagers, people interpret the word ‘lager’ to mean commercially available golden light beer.”
“My standpoint has been educating the retailers as well,” say Sam Hendler. “Trying to get retailers out of the mindset that lager is fizzy yellow beer. They might throw on a craft lager just to have something to sell to the people who come in asking for Budweiser, but we want to show them that lagers can be interesting and that there are a lot of people interested in them.”
Person by person and retailer by retailer, the brothers would have people taste their beers and seek to broaden their perception about how versatile a lager beer can be. Jack’s Abby’s portfolio is also designed to strike a balance between approachable beers that will appeal to a wide variety of drinkers and beers interesting enough to appeal to craft consumers.
Their audience has only grown, and very quickly. Jack Hendler says his original ambition was to grow the brewery to about 3,000 barrels over ten years. By the end of 2017, Jack says the brewery is on track to produce about 45,000 barrels of beer. According to stats released by the Brewers Association, this growth places Jack’s Abby among the top 100 regional brewing companies in the nation, as well as among the biggest gainers.
Projecting from this explosive growth rate, the brothers built a new 130,000-square-foot facility in January 2016 with adequate infrastructure to grow to about 125,000 barrels annually. The brewery currently has tank space to produce 50,000 to 60,000 barrels annually. Two 240-barrel fermentors are the latest additions to Jack’s Abby’s collection. The brewery expects to fill them about once a month, most likely with House Lager, which represents more than 5,000 barrels of annual production from those tanks alone. The brothers also created a sister brand earlier this year called Springdale, which will focus on barrel-aged beers, including sour ales, and should be ready for distribution in 2018. But, for now, the emphasis remains squarely on lagers.
Develop Support Systems
Jack’s Abby’s rapid growth rate and the nature of its brewing process have also created some unique logistical challenges. Decoction mashing, lagering, and natural carbonation all take a lot of time and space, and the brewery’s beers require, on average, double the tank time as brewing ales.
“[That] means that every time we need to grow, we need to spend twice the money,” Jack says. “We also deal with a misconception that lager should be cheap. So we need to balance our investments with what we can charge for lager beer, and really the only way to do that is to brew in volume.”
Jack’s Abby’s new 4-vessel, 60-barrel brewhouse is 100 percent automated. Brewers usually have three brews in process at any one time, working in two shifts starting at 4:00 a.m. and ending by 10:00 p.m. four days a week. That translates into a production rate of about 900 barrels a week, Jack says. When new fermentation tanks arrive, brewers can have one filled with beer within three or four days of installation. In the first quarter of 2017, Jack’s Abby produced and packaged 70 percent more beer than it did in the first quarter of the prior year, and the pace is still quickening, with the bulk of profits being reinvested right back into the growing business.
House Lager has proven to be the workhorse that’s driving the most growth and the beer that the brothers are positioning the brewery around. It’s also the beer that takes the longest to make and that’s produced in the greatest volumes.
“Because the beer had to sit in tanks that much longer and with the growth of that beer, on day one in the new brewery we had to invest in another 10,000 barrels worth of capacity,” Jack says. “We’re just in a constant state of construction. We’ve had at least two contractors in our building every single week since I can remember. But we knew we would need a lot of space if we were going to grow this brand.”
Says Sam Hendler, “We are doing some things that aren’t as efficient, but we believe in the brand and the importance of those steps, and we’re making the most efficient system we can with those constraints. We make most decisions around what is going to work well in the market and what is going to sell well, and then we build an efficient production operation around that. That’s an advantage of being a brewer-owned operation.”
Those quality-first systems and investments also extend to the brewery’s quality-control standards, which have greatly expanded with the build-out of the new brewery. Jack’s Abby now employs three full-time quality-control members, two in in the lab and one in packaging. Yeast management is of particular importance for an all-lager brewery because yeast can be repitched only so many times before it degrades. House Lager takes eight days to ferment, for example, and brewers won’t repitch the yeast after ten days, which leaves a two-day window in which to propagate and pitch viable yeast from batch to batch.
Start at Home, Grow Slowly
The company’s distribution strategy also centers on fundamentals—namely serving its home market. Jack’s Abby distributes the majority of its beer within a 30-mile radius of its brewery and most of that to the cities of Boston and Worcester. “With more and more breweries opening, the further you go, the harder it is to sell beer,” Jack says. “It’s going to take a really strong brand to be able to send beer hundreds of miles away from the brewery, and you can only do that if you’re really strong in your home market.”
When Jack’s Abby does enter new markets, its strategy is to expand in concentric circles from that core base and build market share strategically and sustainably with a slow-drip approach.
“We don’t put every SKU in [a new] state, have a giant opening, and try to sell every beer into every single account,” Sam says. “We go in with House Lager, Hoponius Union, and maybe some seasonals—three brands—get them to a sustainable point, and then add one. Build that, and then add one more. A year later, we’re still introducing core brands into a market like New Hampshire, which has grown into our third-largest market in a year.” Jack’s Abby staffs representatives in every market and works with eleven distribution partners throughout the Northeast. These distribution relationships are particularly valuable in navigating the often disparate and changing liquor laws in each state. Massachusetts, for instance, traditionally has very little chain presence, Sam says, and the brewery initially shied away from states that were chain heavy. It’s recently become more comfortable with the process and how to work with chain buyers. Pennsylvania has also been a challenge, as liquor laws there have changed dramatically over the past several years.
“When we’re trying to be so focused and targeted in growing our business and a market that’s 300 miles away starts making major changes in the way the system works, it’s that much more challenging to adapt quickly and know what moves you need to make,” Sam says. “Every case of growth we can achieve in Massachusetts, we feel we have the tools to hang onto it. Every case of growth we achieve in somewhere like Pennsylvania, we feel is somewhat tenuous. To go another state further, we feel would be even more tenuous.”
Sometimes Bittersweet Transitions
To better serve both its home and farther-flung markets, Jack’s Abby has recently transitioned from bottles to cans for all of its multipack offerings. It’s a move driven by both across-the-board consumer trends and logical gains in both production and shipping.
“Cans are pulling better and are easier for the whole system. We can ship more at a time to wholesalers, and they’re just a great package,” Sam says. “When you combine them with the fact that they actually sell better, it’s a slam dunk.”
The brewery also recently introduced 15-packs of canned House Lager, the entry point to the brand for most consumers and the brand Sam says represents the “future of the brewery.”
“We personally love that beer, and we’re going to do everything we can to put that beer in people’s hands,” he says. “The 15-pack is an aggressive way to put that out there at a great price point.”
As the brewery continues to expand and refine its processes, its staff has, of course, also grown. Jack’s Abby employed twenty-five people two years ago and before the build-out of the new brewery; it currently employs 115 people.
“It’s been a real challenge, from an HR and a delegation perspective,” Jack says of building an effective team. Expanding and broadening the culture while retaining the family ethos and core values has also been a learning experience. “When we opened, it was just my two brothers and me. Our families pitched in to help, but we had no paid employees for at least a year. We did everything,” he says. “So now giving up some of the things and being able to let go of certain things has been a challenge at times.”
Jack isn’t as hands-on with brewing, cellaring, and packaging and has moved into a managerial role, for instance, while Sam’s focus has shifted from days spent in the field making sales calls to overseeing the brewery’s sales and distribution strategy. It’s been bittersweet for the brothers to shepherd their brewery into the next stages of its development, and yet it’s a necessary component of Jack’s Abby’s growth to transition their roles toward a broader scope while entrusting others with day-to-day operations. “That’s part of the reason I started the brewery—I love the brewing process and the production area—and now it’s become a completely different job than it was just a few years ago,” Jack says. “Even though it’s a family business, it’s not about the brother’s anymore. It’s a much bigger picture.
“But it’s amazing how much better we do things now that people who actually know what they’re doing are doing things,” he says. “It used to be ‘just get it done,’ and now we’re trying to get things done right.”
A critical element that’s carried through all stages of Jack’s Abby’s development is a spirit of camaraderie and leaning on each other to achieve common goals, even as the “family” has grown.
Says Sam, “We were raised in a family business. It’s what we know and that’s the experience we continue to draw from. It’s who we are. We were the ice guys, and now we’re the beer guys.”