SMBs

Tapping Sudsy Success on Main Street

Store front businesses are on a run and seemingly picking up steam. With a 2.1 percent growth in Q4 2016, those merchants who line the main streets and side streets of America are anything but slowing down, according to the hot-off-the-presses Q1 PYMNTS.com Store Front Index™. Find more than 6,600 data points that map the sectors that are winning and losing, plus Cayla Marvil, cofounder of Lamplighter Brewing Co., shares her Main Street suds success story, in the Index.

Nestled between a row of condos and multi-family homes in Cambridge, Mass., 284 Broadway is a red brick warehouse, which was once a neighborhood auto repair shop.

The repair shop, Metric Systems, is now gone — although the name lives on. These days, Metric Systems is a mildly salted, Gose-style beer with notes of coriander, produced by Lamplighter Brewing Company, the building’s new occupant.

Since its opening in late September 2016, the brewery has fast become a go-to rendezvous spot for Cambridge’s beer aficionados, who at busy times are willing to wait outside for entry into Lamplighter’s boisterous tap room — a somewhat small yet comfortable space furnished with high-top wooden counters, teal-accented drapes and vibrant yellow upholstery.

Lamplighter’s fast-growing popularity reflects the burgeoning appetite for craft beer and the improving state of storefront businesses in the U.S. And, behind the scenes, the brewery’s story is that of an exacting journey of finding Main Street success.

PYMNTS caught up with Cayla Marvil, Lamplighter’s co-founder, to talk about the challenges that curb the process of setting up shop, the lessons learned along the way and the rewards of being a bustling neighborhood brewery.

The Long, Sometimes Frosty, Road to Success

When co-founders’ AC Jones and Marvil set out to pursue their dream, their idea was to create beer that would distinguish Lamplighter from other local breweries where IPAs abound.

“We wanted to make beer that was a little funkier and a little different, and we thought Cambridge would embrace that kind of different and unique taste,” Marvil said.

And while the vision of appealing to a mature palate was clear to Marvil and Jones, when it came to actualizing their business idea, the strenuous process would take them down a long, winding road that started with mapping out the scale of their operation before finding the right real estate.

“We wanted to start fairly large because if you are small, it’s really hard to grow as you just don’t have the capital coming in,” Marvil said. At the same time, she added, “we didn’t want to go too big and shoot ourselves in the foot.”

After two years of searching, the auto shop location on Broadway seemed to fit the bill. The 10,000-square-foot facility was large enough to fit six ceiling-high steel brewing barrels, with enough room left over to build out a tap room.

And though leasing the facility in itself was far from a clear-cut experience, Marvil said, little did she and Jones know that seeking a license and a zoning permit was going to be such a challenge.

“Everybody told us, (count on) twice the time and twice the money,” Marvil recalled. “We were like, nah, we will do it differently.”

As it turned out, the process still took quite a long time and a lot of money, she said.

While getting a license was a fairly straightforward process, one of the biggest challenges impeding progress was getting the building rezoned, Marvil said.

The City of Cambridge mandates the establishment of a brewing facility in a “heavy industrial” district, but Lamplighter’s location at 284 Broadway was classified as a “Business A” zoning district. That meant that the facility could be used for a host of businesses, just not brewing.

What followed was a long, drawn-out process to seek approval for a zoning variance. The team spent two months getting the business’ floor plan, elevations and application ready and then another two months to get on the docket for a zoning hearing meeting.

In total, it took almost nine months, Marvil recalled. Seeking an approval meant canvassing the neighborhood — writing to neighboring residents detailing their business plan, speaking with them to resolve their concerns — and then using their input to further carve up Lamplighter’s operation.

“That was a really scary period of time because we had leased the building and we weren’t entirely sure if the project that we built out was even going to happen in that building. Luckily, it did.”

In the end, “almost the entire neighborhood came out and stood behind us,” she said.

After an arduous construction and zoning approval process, which took almost 18 months, in September 2016, the brewery finally began selling beer in growlers as it wrapped tap room construction. Two months later, Lamplighter was fully operational.

Growing Thirst for Suds

Year over year, Americans have become thirstier for craft beer. And with that thirst, microbreweries have seemingly been popping up around the country like hopped-up hop plants. According to the Brewers Association, there were around 4,100 breweries operating in the U.S. as of December 2015. With an estimated two new breweries now opening every day, the number of American breweries stands at an all-time high.

The rapid proliferation of micro-suds has been most evident in cities like Burlington, Vt., Denver, Colo., Portland, Ore. and Portland, Maine, where craft breweries are seemingly on almost every street corner like coffee shops, Marvil pointed out.

In Massachusetts, however, the craft beer market is far from reaching a saturation point, she said. The state’s website, Mass.Gov, estimates there are 116 craft breweries in Massachusetts, with 25 of them located in the Greater Boston area.

While the number is climbing, Marvil is confident the competition is healthy for the category. “In Cambridge, if anything, we help each other because it brings tourism to the area and encourages people to buy more local and look at what the craft options are in the store,” she said.

As for Lamplighter, staying competitive in the space has meant focusing on producing a distinct beer that consumers appreciate.

And if they like it, they will tell others. Marvil says that the brewery’s popularity has spread more through word-of-mouth than any other medium.

“We pretty early on decided that we didn’t want to spend money on any traditional forms of advertising,” she said. “In today’s day and age, everyone’s on Facebook, Instagram and Twitter, and it’s much easier to reach people that way than pay for advertising.”

More than anything, the agonizingly long time it took to open the brewery turned out to be a blessing in disguise, she said, considering the construction caught the attention of passersby and built buzz. “People would say, ‘What’s this place that’s not freaking open?’ And then we finally did. So they were like, ‘Oh, yay!’”

Tapping into Tap Room Success

Five months since the opening of its tap room, the constant influx of visitors and their drinking preferences has helped the company better understand changing demands to inform its beer production.

“We can now look at the breakdown and say, ‘Hey, 90 percent of people buy IPAs — we’d better crank out an IPA again.’ We are definitely looking at those numbers,” Marvil said. When Lamplighter first opened, she said, the brewery would often run out of certain beers.

“For a week, we had three beers on tap, and we were like, ‘Crap, what were we thinking?’” she said. “But you know, people were forgiving.”

In the years to come, while the brewery is aiming to boost its distribution for growth, it’s also looking into expanding the size of its tap room by nearly 1,000 square feet by utilizing the back-room space it had previously envisioned for expanding its brewing capacity.

Doing that, of course, means again breaking through approval red tape.

“I think we all have a little PTSD from the last time,” Marvil said. “But yeah, it will be less tricky because we now know everybody, we know the process, but still we have to convince all our neighbors of this specific idea.”

Nonetheless, the growing demand for Lamplighter’s craft beer has more than offset the pain. And, with all the support from the neighborhood, Marvil said, the micro-brewing business couldn’t be in a better place.

To download the analysis, please click below…

About the Index

The PYMNTS Store Front Index™ provides a quarter-by-quarter indexing of the health of a subset of small businesses in the United States.

Specifically, the index focuses on “storefronts,” or the shops that line the main and side streets of our local communities.

To compile the index, we used data from the Quarterly Census of Employment and Wages provided by the U.S. Bureau of Labor Statistics.

All told, more than 10 million data records covering the number of establishments, employees and total wages are used to develop the index. The index is calculated as a weighted average of three factors: number of locations, number of employees and total wages paid for select industries.

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