The Beer Market is Rough—Even for Monks
A couple of weeks ago, America’s only Trappist brewery posted a brief, abrupt entry on their Facebook page. Just 74 words and three sentences long, it contained the following startling announcement: “After more than a year of consultation and reflection, the monks of St. Joseph’s Abbey have come to the sad conclusion that brewing is not a viable industry for us and that it is time to close the Spencer Brewery.”
One of seven Trappist breweries that launched between 2011 and 2018, the Massachusetts monks launched their project in 2013-’14. It coincided with an international explosion in breweries, and came at the moment craft brewing matured in the US. At the time of launch, the US had “just” 4,000 breweries. In the next five years it would more than double—right before a two-year pandemic arrived. In one way it’s not surprising that the monks found competition unexpectedly rough. Yet monks seemed to be insulated by their unique draw, so the news did surprise many—including me. In recent days, more reporting has emerged that show precisely where the trouble lay, and there may be lessons in the Spencer story.
The first article to catch my eye contained speculation that the reason for failure was a shift in tastes. “We saw ourselves as brewing in the Catholic tradition,” Father William Dingwall, director of the brewery told reporter John W Miller. “Belgium had the established brands, and that was the model we were following.” The article blames a shift away from Belgian styles on the huge popularity of IPAs. No doubt those were serious headwinds. Belgian beers collapsed in the 2010s, and breweries like Ommegang also saw sales drop.
But anyone who knew the brewery was aware that they adapted pretty early on. They brewed lagers, a seasonal pumpkin ale, a stout, and even IPAs, and had started to add these styles as early as 2015. Of course, that created a catch-22. Trappist ales had such massive currency when the brothers were planning the brewery precisely because they made strong, special beers. Commercial breweries made “abbey ales,” but the cachet of actual monks making wine-like 10% beers captured customers’ imagination in a way no regular brewery could. Expanding their offerings gave them a bridge to the styles people were buying, but it cut against the mystique of monastic brewing. There’s less romance in a monastic pilsner, somehow, than a bubbling chalice of golden tripel.
Miller, the reporter I quoted above, wrote a profile of the former head brewer at Spencer back in 2019. In that piece he identifies other decisions that made the whole project a lot more challenging. To begin with, the monks decided to take on debt to fund an expensive new brewery. Here’s how Miller described it:
“The brewery lies beyond the chapel and cloisters, a boxy factory adjacent to a tranquil pond. The monastery will not disclose the cost of operations, but it is very modern, with automated machines that require only a handful of workers. Everything is top-of-the-line. Bottling lines come from Italy, brewing gear from Germany.”
The photo at the top of the post gives you some sense of the expense—it’s quite a brewery. In order to service the debt and fund the monastery, the business plan called for the monks to build to annual production of 10,000 barrels a year. In both pieces, Miller described that as a paltry figure, but he’s not an industry writer and doesn’t realize how hard it is to build that kind of volume. (Somebody should have told him that 10k barrels amounts to 3.3 million 12-ounce bottles.) Here’s the interesting thing, though. The monks were actually selling a lot of beer: before Covid they’d built their volume up to about 5,000 barrels. Miller helpfully reports that they had annual revenues of $1.5 million, which is pretty good if you’re not servicing a lot of debt.
Even more surprising, the monks rejected the idea of a tasting room. The decision to do so caused controversy within the monastery. “The community … is split on the issue,” he wrote. “‘I’m not a drinker,’ said Father Vincent Rogers, a monk from California who oversees finances at the monastery. ‘A tasting room is more than I would be comfortable with.’” Of course, beer sold in a tasting room is far more profitable than draft beer sold to a distributor. The monks wanted a place of quiet, but that decision hamstrung their enterprise. Indeed, that discord seems to have gotten fairly serious. Voting to close the brewery caused the longtime champion of the project, Father Isaac Keeley, to quit his post. Father Dingwall stepped in to wind things down when Keeley refused.
I had never followed Spencer closely, and much of this was a surprise to me. In Oregon, the Benedictine Mt. Angel Abbey, an hour south of Portland, started a similar project around the same time. The champion of that project, Father Martin Grassel, took a very different approach. An avid homebrewer, he slowly introduced the brothers to the notion. Once the monks had decided to pursue the idea, Grassel partnered with the Food Sciences department at Oregon State and local breweries to work on further recipe development. As plans for the brewery complex slowly took place, they launched the product line by contracting with different breweries in the four years before they built the brewery. Unlike Spencer, the monks were keen to get people to the monastery as part of their mission, and they couldn’t think of a better inducement than a pint of beer. When they did erect a new building for the brewery, the tasting room was a signature feature. Finally, Father Martin, now the head brewer, never intended to sell a lot of beer. They can make the project pencil out with a few hundred barrels. I reached to find out how things were going, but haven’t heard back yet. Nevertheless, he was featured in a recent broadcast, and everything seems to be going along swimmingly.
With any new business, you have to start with a game plan and a series of assumptions and projections. In the early teens, monasteries had every reason to think they would find a healthy audience: Belgian beer was popular, and the beers of the Belgian monasteries were some of the most-prized in the world. Because of their unique value proposition (beer made by monks!), monastic beers have often had built-in audiences commercial breweries lack.
I think all of that still applies, but the advantage monastic breweries enjoy is weaker now than it was a decade ago. Spencer couldn’t have known that when they started their project. In retrospect, however, it’s easy to see how the brothers of St. Joseph’s might have made different decisions in 2013 that would have made the brewery a profitable business.