Case Study: Neshaminy Creek Brewing Co. | Brewing Industry Guide
logo

Taproom & Brewery

Case Study: Neshaminy Creek Brewing Co.

Pennsylvania’s Neshaminy Creek Brewing Co. has remained flexible in adapting its business plan and operations as needed and has charted a route to sustained growth in the process.


As Pennsylvania legislators have reconsidered and amended the state’s liquor laws in recent years, in many ways becoming more craft friendly, Neshaminy Creek Brewing Co. has capitalized on these unanticipated changes. Its owners have had to move quickly and resourcefully to adapt—several times in just five years of operation—but in doing so have created a more visible presence for the brand in the local community and a broader, more diversified base for the business.

“The laws have changed so much in Pennsylvania,” says Neshaminy Creek Co-owner and Head Brewer Jeremy Myers. “It’s really changed what we’re doing versus the original intent of the brewery.”

While Neshaminy Creek currently operates two locations, including a new full-service restaurant and taproom in a neighboring town, it was originally planned as strictly a production brewery. Its owners applied for a TTB Brewery Notice in November 2010 and began operations on June 1, 2012. However, several months earlier (in late December 2011), Pennsylvania state law was amended to do away with the so-called “case law,” which specified that off-premise distribution of beer could only be sold in quantities of a case or more and only from a licensed distributor. Beer could now be sold in any quantity for off-premise consumption, including single bottles, six-packs, and growler fills.

Neshaminy Creek had already leased an 18,000-square-foot production facility on the edge of an industrial park in Croydon, Pennsylvania, and had no plans to package its beer in bottles or cans at launch or to operate a tasting room. Myers and his partners, Rob Jahn and Steve Capelli, tweaked their plans to include a small tasting room in their new brewery and offer free samples as well as growler fills. Myers’ father, who is also an investor in the business, was most often the one behind the bar pouring beer.

This arrangement worked well for several years as Neshaminy Creek gained more accounts and the business grew. Myers says that the brewery sold about 1,000 barrels in its first seven months, which was promising, given their modest projections.

“When you start off, you want to work from really conservative numbers and always consider worst-case scenarios,” Myers says. “Looking at our original business plan and figuring how much money we had and how much we would need, we figured that if we could make ninety barrels a month, we could stay open for fifteen months before we ran out of money. It’s kind of funny because now we make about 330 barrels a week.”

Neshaminy Creek is on pace to hit 22,000 barrels in production this year, Myers says, which represents a 48 percent increase over last year. The brewery has since grown its distribution footprint to include four states, but another change to state liquor laws—this time a May 2015 update that allowed Pennsylvania breweries to sell any quantity of beer for both on- and off-premise consumption—has also greatly contributed to its growth. This change opened the door for Pennsylvania craft brewers to operate viable tasting rooms, and Neshaminy Creek didn’t waste any time in expanding theirs.

Neshaminy Creek’s taproom now seats 150 people and offers the brewery’s full lineup of beers on draft, as they’re available, as well as packaged beer for to-go sales. Like many craft taprooms, it’s also a family friendly destination that features video games, foosball, and air hockey, as well as regular visits from local food trucks and a host of special events.

“It’s a fun environment, but we really didn’t envision anything like this when we started,” Myers says. “We always joke that we’ve driven a lot of people to Croydon because there wasn’t much going on here anyway. Now especially, on Fridays and Saturdays, we’re so busy in the taproom.”

Neshaminy Creek Borough Brewhouse

Demand has increased at such a rate that, not surprisingly, talk soon turned to expansion. The owners steadily added fermentation tanks to the Croydon brewery but soon realized that they’d need more space. Around that time, Guild Hall Brewing Co., a start-up in nearby Jenkintown, Pennsylvania, went out of business after just five months of operation, and its former location went up for sale.

The large building once housed a Rolls Royce dealership and more recently served as an auction hall for antiques. Guild Hall’s owners had renovated it into a modern brewpub, including a 10-barrel brewhouse and a commercial kitchen, that would more or less offer a turnkey solution to Neshaminy Creek’s needs. “They’d built a beautiful facility, but unfortunately they went out of business,” Myers says. “I think they were undercapitalized and just not ready.”

Neshaminy Creek’s partners purchased the property in early 2017 with the intent of opening a satellite brewery, tasting room, and restaurant. The move would also provide the extra space and capacity they needed and effectively increase Neshaminy Creek’s footprint from 18,000 square feet at the original brewery to more than 60,000 square feet without the need for major construction and added infrastructure. They invested in an upgraded draft system, updated the décor, and opened Neshaminy Creek Borough Brewhouse within two months of closing the deal.

Rather than delay opening by several months while they waited for the approval of a brewing license for the new facility, Neshaminy Creek’s owners took advantage of yet another provision in Pennsylvania liquor law to start serving customers sooner. In Pennsylvania, if a business has a production brewery or a brewpub license, it’s also allowed to operate up to two additional storage facilities, which can be located anywhere in the state. When the law changed to allow on-premise alcohol sales in 2015, that privilege also extended to those storage facilities—meaning that, by designating its Jenkintown location as a storage facility, Neshaminy Creek could ship, store, and sell its beer there, even if it couldn’t yet brew onsite.

Neshaminy Creek Borough Brewhouse opened with twenty beers on draft, packaged beer to go, and a recently installed crowler machine in place of growler fills. The restaurant recently started offering dinner service—which resulted in an immediate 60 percent jump in sales, Myers says—and plans to introduce its lunch menu soon.

“Not that we didn’t think food would be an integral part of what we wanted to do, but it’s even more so than we thought,” he says. “It’s working out really well. Not only are we excited to start brewing in the next month or so, but the reception has been overwhelmingly positive.”

The owners leased a truck to make package deliveries to the new facility twice a week and hired a general manager with extensive experience running bars and restaurants.

“We didn’t want to draw ourselves—the three main owners—away from the Croydon facility,” Myers says. “We have a lot of responsibilities there, and it didn’t make sense to take us away from that. It’s been a huge relief and a weight off of our shoulders.”

The biggest learning curve so far has been forecasting how much beer they need to service the new location. “We go through a lot more beer there than we thought we were going to,” Myers says.

Balancing the Equation

The bulk of Neshaminy Creek’s production centers on two flagship brands—its County Line IPA and The Shape of Hops to Come, a double IPA that debuted as a seasonal release and is now offered year-round. Neshaminy Creek also brews five other year-round beers—including its Churchville Lager, a Vienna-style lager that won the brewery a gold medal at the 2013 Great American Beer Festival.

Neshaminy Creek also includes several seasonal releases in its Flood Water Seasonal Series, as well as semi-annual offerings and a wide variety of limited-release barrel-aged and sour beers. Myers is looking forward to getting the 10-barrel system brewhouse in Jenkintown up and running so that he can make smaller batches of some of Neshaminy Creek’s other brands while freeing up production space and time for the brewery’s top-sellers.
“So much of our production now centers on County Line and The Shape of Hops to Come,” Myers says. “We’re brewing twenty-two to twenty-four times a week, and we’re lucky if we’re at a 4- or 5-day inventory on those beers.

“We’re also juggling four yeast strains—five soon—and keeping those other beers going when so much of your production is based on your hoppy offerings, which use the same yeast strain anyway, is really tough,” he says. “We’re always trying to work with high-count, high-viability pitches, and we schedule our production based on that, but it’s becoming increasingly hard.”

Neshaminy Creek employs a full-time lab manager and “yeast wrangler” and will soon expand from its current 15-barrel, direct-fire 2-vessel brewhouse to a 4-vessel system, “so that we never have to worry about pitching quantities of at least two different yeast strains,” Myers says.

The new dedicated mash tun and pre-heat burn-off vessel from Pioneer Tank & Vessel Co. should also allow brewers to increase production to between thirty-two to thirty-six brews a week.

“We have the tank space and capacity to do it,” Myers says.

The size and setup of Neshaminy Creek’s brewhouse—which includes twenty-nine fermentors of various sizes, a 1.5-barrel pilot system in Croydon, and, soon, the 10-barrel system and four 7-barrel fermentors and six 7-barrel brite tanks in Jenkinton—allows a great degree flexibility in terms of batch sizes and production schedules for core and one-off beers. It also allows Myers to more precisely dial in the volume of certain brands based on previous sales and needs of its retailers.

“We don’t have to ship 200 to 400 half-barrels to market and wonder if it’s going to sell or not,” he says. “We can kick out, say, twenty halves and know that it’s going to sell.” Neshaminy Creek also uses its 1.5-barrel pilot system to develop new recipes and special releases for its taproom, as well as to send to some of its larger accounts.

“We do that as a ‘thank you’ as well as kind of a test to see what beers are going to do well and what the reaction is from people in the market,” Myers says. Likewise, Neshaminy Creek can also easily ramp up production on its core brands and new brands that show potential.

“We’re working on satisfying both sides of that equation,” he says.

Myers says he can eventually see Neshaminy Creek expanding into one or two more states, but only if the brewery’s capacity can adequately supply those states and they can place representation in each of those markets. Neshaminy Creek also enjoyed a recent boost when its wholesaler in Philadelphia was recently purchased by a larger operation.

“They’re putting a lot of their weight behind us, and they’ve really gotten after it,” Myers says. “The idea is to saturate our home market as much as possible and grow there. Even though the Philadelphia market is already a very saturated market, we still feel there’s a lot of room to grow, and we take a lot of our cues from some of the other breweries, like Yards and Tröegs, and how they’ve been able to continue to grow here. “They paved the way, and there’s no way we could have been able to do what we’ve done in such a short period without having brewers like that lead the charge.”

And while operating two large tasting rooms and a restaurant wasn’t Myers’ original intention when he and his partners founded Neshaminy Creek, pursuing and capitalizing on those developments as they arose has been a key to their success.

“I really didn’t get into brewing to do that, but of course, when given the opportunity or when the idea starts to take off, you’ve got to with it,” Myers says. “It’s been a wild ride.”

Tom Wilmes January 02, 2018

LATEST ISSUE