Beer Marketer's Insights - Rogue Production Facility & Taprooms Abruptly Shuttered as Declines and Unpaid Fees Mounted

Rogue Ales & Spirits suddenly shuttered its operations across its 47K sq-ft facility in Newport, OR as well as all of its taproom outposts, The Lincoln Chronicle reported among many other local news outlets. On the Newport facility alone, the company reportedly owes $545K in rent to the Port of Newport and up to $30K in taxes to Lincoln County, and abruptly announced the closure after meeting with Port of Newport officials Friday morn. Rogue had quietly shuttered its 4,800 sq-ft distillery operation recently too, and "the Port agreed last month to re-lease a portion of" the building to a seafood processor called West Coast Seafood. Its taprooms in Newport, Portland, Astoria and West Salem, OR have also "closed until further notice." Rogue's monthly rent on the main building is reportedly $37K. "All they told us is that they will keep three staff members to help properly shut down the brewery" in Newport, Port of Newport executive director Paula Miranda told Lincoln Chronicle Friday morn. Prior to the shutdown, the production facility employed about 60 people. This comes just 3.5 mos after Rogue began partnership with US Beverage to handle sales operations with USB taking on 9 Rogue employees in the process (see Aug 1 issue). Then, prexy Steven Garrett spoke to CBN about "retooling" Rogue for the next 30+ yrs, sounding optimistic about ability to "start scaling again," including a bigger planned push on Dead Guy whiskey and THC/CBD bevs. Unclear at presstime if US Beverage's Uinta Brewing and other contract production partnerships will look to take on Rogue's beer, spirits, CBD and THC bev production going forward.Spread Thin: From 117K Bbls in 2014 to Under 40K Bbls in 2025; "Gradually, Then Suddenly" This announcement appears to have caught a lot of folks off guard and a lot seems to still be in flux amid the closure. Yet while the announcement came abruptly, Rogue's biz challenges have been well documented over the course of the last decade-plus. As one of the older craft brewers in the country, launched in 1988, Rogue rose to 117K bbls in 2014 amid the craft boom, up from just 76K bbls in 2009. Tho unlike most brewers at that time, Rogue had already established its natl footprint, expanding more gradually and owning its status as a poster child for the "mile wide, inch deep" biz model. Back then it was one of the most well-traveled craft brands, relying on home state OR for just 13% of its volume mix. Yet 2014 was its peak volume nationally and sales since cut in more than half, now likely under 40K bbls/yr, CBN estimates. In 2020, Rogue closed its brewpub in the Pearl District of OR followed by closing its tasting room in Independence, OR in 2021, Lincoln Chronicle reminded. Volume's down low-double-digits in natl scans this yr.Net-net, the reported fees owed on rent and taxes in Newport seem to be just the surface. Between the current ownership group, various locations, vendors, lenders and other external pressures, some kind of straw apparently broke the camel's back on Friday. There's no word if there are plans to file for bankruptcy at presstime. But as one astute reader reminded CBN, referencing a famous Ernest Hemingway quote from The Sun Also Rises, when asked how he went bankrupt, the character replied that there were "two ways. Gradually, then suddenly."Natl Expansion Didn't Pan Out for Most in Craftland Rogue joins a running list of unfortunate craft casualties among those who built national distribution at the expense of local depth. Cos like Green Flash, Anchor and 21st Amendment ultimately couldn't survive the weight of excess capacity and declining sales, with Green Flash and Anchor selling to other cos as shells of their former selves while 21A shuttered. Others like Abita and Full Sail repurposed their companies into sizable contract production outfits after selling to private equity. Craft Brew Alliance's Widmer and Redhook retrenched distribution before selling to AB and then to Tilray. The list goes on and on. Only a handful of truly natl craft brands remain and even fewer are still growin'. Almost everyone who spent big $$ to expand its capacity and/or add entirely new facilities have since sold their companies and/or declined in sales. Rogue's more gradual expansion differs from most of the pack, but ultimately co became spread too thin as declines mounted.OR Craft Scene Hits Keep Comin'; Still a Top Craft Mkt; Rogue's Notoriety Rogue is far from the only closure in Oregon, Lincoln Chronicle noted separately. OR lost nearly 75 breweries, taproom or brewpubs since the pandemic, according to its tally. It's still one of the top craft markets in the country, but craft sales have fallen closer to ~20 share of beer retail $$ statewide and ~30 share beer $$ in Portland. And tho it was never biggest in its home mkts, Rogue is one of the most widely known brewers from the PacNW on a natl scale. Despite its dwindling size, Rogue made a name for itself thru its nationwide expansion and craft cred as a trailblazer. Its Maibock-style flagship brew Dead Guy ale and distinct branding with skeleton imagery remains a referential beer for many who entered the space for generations. But these are different times. How might Rogue live on from here?

Rogue Production Facility & Taprooms Abruptly Shuttered as Declines and Unpaid Fees Mounted

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