Owners of the first and sixth breweries in Asheville talk getting started, the recession, and Asheville beer. Angeli Wright/


ASHEVILLE - In his graffiti-covered second brewery, perched on the ever-moving boundary of the River Arts District, Tim Schaller recalled how he became the successful owner of two beer businesses.

He launched the first just as the rest of the country was dipping its toe into the roiling waters of a turbulent economic crisis.

"There was a lot of luck involved," he said. There was offering community space at a time when people craved comfort. "But it's mainly just: make good beer."

Schaller opened The Wedge in 2008 as the sixth brewery in Asheville. Now, 10 years later, the Wedge is one of nearly 30 breweries in the city.

The local brewery scene, which draws more than half a million tourists annually, is proof craft breweries are built to weather financial storms. But while craft breweries are recession resistant, Schaller offered, they're not bulletproof.

"Some people struggled, and some people continue to struggle," he said. "What looks on the outside like this is an easy ride, a lot of people have to work hard to make it happen ... there's a lot of different models to this."

Staking a claim in the River Arts District a decade ago was a leap. The model was still unproven, the area still gritty.

At the time Schaller and business partner John Payne founded the Wedge, its dusty lot next to the train tracks might as well have been the Wild West. (Payne died two days before the brewery opened.)

Schaller was then the president of the Montford Neighbors Association. "When I told my neighbors where I was going, they were like, 'We never go down there,' and I was like, 'Great!'"

Schaller wanted a "little-D democratic bar," with not much of a scene to speak of. There were a dozen seats, no plans for food or entertainment. "My business plan was not what I got."

It became instead part of a build-it-and-they-will-come lot of breweries in an economic era that was hardly kind to other businesses. People were feeling the pinch. But they still craved entertainment despite — or perhaps because of — their woes.

"The downturn just made more people want to have a cheaper way to have entertainment," Schaller said. 

"It used to be the neighborhood bar was going away, and brewers have become the neighborhood bar," he added. "It's not necessarily cheap, but it's cheaper than a lot of things to go out and have an evening."

MORE: French Broad River Brewing expands, displacing Toy Boat Community Arts Space

Still, even within the beer industry, certain sectors were failing. 

Big breweries were starting to go flat during the recession, the Associated Press reported in 2009.

For example, the mammoth SABMiller PLC, the London-based brewer of Grolsch, Miller Genuine Draft and Peroni Nastro Azzurro lagers, reported lager volumes fell 1 percent in the three-month period that ended Dec. 31, compared with the same period a year earlier, because of the economy.

"Consumer demand has been affected by the current global economic slowdown, and has continued to weaken in many of the group's markets," the company said in its quarterly trading update.

But craft brewing was a different story, with Time Magazine reporting retail sales up by 11 percent in the first half of 2008.

MORE: Trademark complaints filed by Bell's against Jackson County's Innovation Brewing dismissed

Sales at Delaware's Dogfish Head Brewery were up 45 percent in January 2009, Adam Lambert, vice president of sales for the brewery, told the magazine. "Beer is recession resistant," he said.

"Beer is an affordable luxury," Highland Brewing Company President Leah Wong said last week. Wong is the daughter of Oscar Wong, who founded Asheville's first brewery almost a quarter-century ago in a downtown basement.

"It's something people can justify buying, no matter where they are in their lives, and where the economy is," she added. "That really enabled breweries to make it through the recession."

Just before the recession hit, Highland was moving out of what Wong called the "hamster tunnels" below Barley's to a warehouse on the east side of town. It was rough, in disrepair, with trees growing through the floor and asbestos in the walls. 

"We had the brewhouse area and people starting just showing up to see us," Wong said. "We didn't really plan on that, so it was interesting to start making space for people to come see us, and figuring out where can they use the restroom? And can they bring their dogs? And where would we put a band?" 

That warm gathering spot would serve them well, she said, as would beer's versatility. There are multiple ways for customers to experience beer, whether it's at a brewery, at a different bar, or even at home with bottles and cans.

Other businesses could learn from craft brewing's versatility, as well as the way it seems to instill brand loyalty in its customers.  

"We have the luxury of folks being interested in who's behind the beer, and I take that as a huge compliment, she said. "It's not just a commodity, it's really a story around every brand."

People root for breweries like they root for sports teams, Wong said. "They feel a part of it, and that's such a great experience not every consumable product can offer."

With so many other teams, however, there's a drive to get that story out in a fresh way. In February, Asheville's first brewery will make public its rebranding efforts, which include a new logo, taproom look and packaging.

The new look was crafted with input from surveys, employees and longtime customers. Highland has many of the latter. Wong said its effort to be a good neighbor since the beginning, has helped Highland — and local craft beer as a whole — thrive.

"I think a lot of Asheville's welcoming approach to beer has something to do with how Highland started, and the statements we made early on: Let's be a good neighbor. Let's make Asheville proud of us, let's make Asheville proud that we're here. I think people thought, 'Maybe breweries are good neighbors,' and it kind of opened the road to more folks coming in." 

Asheville's craft beer boom continues to this day, said Anne Fitten Glenn, whose latest book, "Western North Carolina Beer: An Intoxicating History," is slated for a fall release. 

"We've had a crazy awesome 2017 in terms of the local economy, despite the odds, and that could definitely continue," she said. 

More: Bottoms up! Asheville ranks as top US city for beer drinkers

The key, of course, is good beer. "Especially with how educated the customer base is now, you won't do well for very long otherwise."

But a stout base of beer tourists goes a long way, too. 

In 2012, visitors to Asheville were more likely than the average U.S. traveler to engage in culinary and brewery experiences, according to data provided to the Citizen Times by Explore Asheville. Still, beer did not register yet as a top-tier motivator, which has since changed significantly.

"One in four travelers to Asheville enters a brewery, which is no surprise," said Dodie Stephens, director of communications for Explore Asheville. "You can look in any direction, and you have plenty of fabulous options."

But beer, she continued, has moved from not even registering on the list of travel motivators to mingling in the upper echelons, along with the Biltmore Estate and the mountains. "That speaks to the amazing efforts of the breweries, and the marketing efforts of the community as a whole."

Asheville sees about 3.8 million overnight visitors annually, with 14 percent naming breweries as primary reasons for their visit, according to a recent advertising effectiveness study.

The Economic Development Coalition for Asheville-Buncombe County reports growth in the local brewing sector at 750 percent over the last decade. 

Now there are nearly 30 breweries within Asheville city limits, with more in the works. There are 38 in Buncombe County, and 74 in Western North Carolina, including a Rutherfordton brewery opening this week, according to Glenn, who uses a 23-county map including all the mountainous counties of North Carolina. 

More: Woodfin's developing riverfront lures its first brewery

But is there trouble brewing for beer? 

The novelty of new breweries certainly seems to have worn off. 

"In 2008, a huge crew of people would go to the opening of any brewery," Glenn said. "It was a very exciting new business at the time. I just don't see that happening as much anymore."

And while breweries seem to be recession resistant, they aren't invincible.

"I think it's interesting that when my first book was published in 2012, none of the breweries had closed yet — they were all on a path of expansion," Glenn said.

Since then, she noted, Craggie Brewing has closed, making way for Hi-Wire to launch its beer program on the South Slope. Altamont in West Asheville sold to UpCountry. Basic Brewing in Hendersonville closed. Blind Squirrel closed its Burnsville taproom, though its Plumtree location remains open.

And Heinzelmannchen in Sylva closed, with brewmaster Dieter Kuhn heading to the soon-to-open Whiteside Brewing in Cashiers. 

"One thing people don't realize about even small breweries is the amount of capital it takes," Glenn said.

Add to that a crowded market, and it's getting harder to stay competitive all the time. 

But it's not impossible, and some breweries continue to grow at an impressive pace. 

Founded in 2012, Hi-Wire Brewing made about 1,500 barrels in its first year. Last year, it made 15,000.

The economic downturn was an epiphanic moment for Adam Charnack, the brewery's  co-owner, who used to finance and build affordable housing. The economic shift mandated a career change for the home brewing beer aficionado, and that willingness to adapt has followed Charnack ever since.

The best breweries constantly experiment and innovate, he said. "With the modern economy, things change so much quicker than they used to. If you made, say, shoes 75 years ago, you could make the same shoe and be fine. Now people need a brand-new, awesome thing often."

What's more, he said, it's important to cater to as many people as possible. "We appeal to day-in, day-out beer buyers and then craft aficionados as well. You have to have a diversified consumer base to be successful."

Brad Casanova, one of the owners of Archetype Brewing, echoed Charnack's focus on adaptability in an email.

Casanova is a fan of the book "Who Moved My Cheese," a motivational business fable with a message of how to cope positively with change.

"It doesn't get simpler than this message: what might have worked before won't work in the future," he said.

"Apple has reinvented themselves repeatedly over the last few decades and they are dominating," he added. "You have to adapt and differentiate to truly be successful."

Casanova said his brewery has taken a different route with its emphasis on Belgian styles and a new barrel program, which utilizes mixed fermentation.  

"These two styles aren't typically attempted at such a young brewery age, but we knew we needed to stand out and it has worked," he said. "We just released a barrel-aged Brett Saison in the dead of winter and we are rockin' it."

Schaller, who serves on the Mountain Bizworks credit committee, also noted Archetype's efforts to appeal to the family-rich West Asheville demographic.

But Schaller worries about other newcomers to the crowded Asheville brewery scene. "If they have good product and good business plan, they'll make it — but I'm not convinced everyone will make it."

That's because Schaller thinks the next downturn is the one to worry about. "This can't go on forever," he said.

He said starting any business right now is like building a brewery in a floodplain. He's done that twice now. "It's not if, it's when. At some point something will happen.

"You can sit there and be nervous about it and gear up for it every day," or you can grow smart and carry less debt. "People are not going to stop coming to Asheville," he said.

But if the bubble bursts, he thinks retail shelf space could get a bit crowded.

As for new breweries looking to plant roots? There might be more fertile ground to till elsewhere. "In a lot of places in the country, there's room. Not everyone has 30 breweries in their town."

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