Beer brewer's dream is soon to be a reality
ST. LOUIS POST-DISPATCH
06/05/2009
FERGUSON -- Inside the gutted building -- yards from a bar, newly renovated lofts and a cookie bakery -- Ray Hill was working and planning his next big move.
Hill is a brewer. That's the constant in a winding career path that includes homebrewing and inking an improbable alliance with Anheuser-Busch, America's biggest brewer.
Hill is unique because of his trip through the spectrum of brewing. First, he converted a hobby into a business. Then, he got the behemoth brewer to give a little guy a chance. Now, he's back to being the little guy taking a chance on his own.
Out from under A-B's wing, Hill is planning to open a little brewery and restaurant -- Ray Hill's BrewHouse -- later this year. For now, his project is a seven-days-a-week endeavor. Kettles have to be polished, tanks have to be moved and materials have to be ordered.
"I've cashed out my retirement savings plan, so I've got to make this work," Hill said recently while giving a tour of the building. The site is on a corner of South Florissant Road, one of the main drags through Ferguson, a city of 22,406.
In recent months, there has been an undeniable proliferation of brewpubs in the St. Louis region, said Mike Sweeney, who runs the STLhops.com blog.
"An amazing amount of beer has come into the area recently, and people have really responded," said Sweeney. But in this economy -- in which sales of craft beers are slowing -- one question is whether the area has "enough people to support all these things," Sweeney said.
Little brewers don't have an easy go of it. According to the Colorado-based Brewers Association, 61 brewpubs opened last year across the nation, but 42 closed. Sales of beer at brewpubs slumped 2 percent. Microbreweries, which don't get involved in serving food, apparently did better, with 13 percent sales growth and only nine closures versus 53 openings.
In any case, Hill doesn't seem worried. He says his brewery will be able to make a dozen varieties of beer, including pecan ale and American pilsner. The primary focus at first will be to build up the business around St. Louis, selling three-quarters of the company's beer to wholesalers. Hill has agreements with three local A-B wholesalers for that purpose, including Grey Eagle Distributors in St. Louis County.
"He's a success story in the St. Louis area," said David Berkbigler, brand development manager at Grey Eagle. Berkbigler said he brings Hill to beer samplings to showcase his beer knowledge. It's a strong selling point for local retailers.
"I love doing samplings with Ray," said Berkbigler. Potential clients are "just blown away by the fact that Ray is right there."
Hill's experience cooperating in a joint venture with Anheuser-Busch suddenly made him more attractive to banks he approached for loans. With the imprimatur of Anheuser-Busch, "They're more interested now," Hill said. "I'm more interesting to talk to."
The city of Ferguson chipped in $250,000 in financial assistance for the project, according to City Manager John Shaw. "We're very excited about it," said Shaw. "We think it's going to be a draw for the area."
Hill has come a long way since he started brewing beer in his kitchen, basement and garage. He discovered small-batch beer-making in 1998 on a business trip to Denver. Then a computer specialist with the Department of the Interior, Hill started making beer part time, fermenting it in his basement and churning out 10-gallon batches. Friends liked his concoctions, and he hoped the hobby could become a viable business.
But the major challenge was finding the right brewer to make the beer -- a search that sent Hill bouncing from Pennsylvania to New York. Another hurdle was getting solid financial backing.
Hill swung for the fences. He approached Anheuser-Busch in 2005, hoping for help in getting his fledgling venture off the ground. Friends and advisers said he was crazy, but doors started opening. Hill secured a meeting with Doug Muhleman, A-B's top brewing executive. Brewmasters liked his beer samples.
For the first time, Anheuser-Busch agreed to brew an entrepreneur's beer -- Ray Hill's American Pilsner, a recipe Hill devised as a home brewer. For America's biggest beer maker, it was a bid for the attention of image-conscious, trendy urban professionals. Ray Hill's pilsner would be one of A-B's answers to imported beers. For Hill, it was a shot at the big time.
The partnership helped grow a homebrew into a regional beer. Still, Hill found himself struggling to change the attitudes of many craft beer lovers across the country. Hill's pilsner would get dismissed as an Anheuser-Busch product, rather than a homegrown craft brew.
"People in the beer industry would look at my beer and say, 'Oh, that's an A-B product,'" Hill said. "And I was like, 'No! It's mine. I started it in my kitchen and garage.'"
Hill's responsibility for promoting his beer took him to Kansas City and Washington, as well as events in St. Louis. The hours were long, the travel constant, and the sales pretty modest -- 11,000 cases, or 800 barrels, a year, about what A-B's St. Louis brewery could make in a half-hour.
"It took a lot of my time," Hill said. "You've got to build your brand. It's all about persistence."
Things changed fast at Anheuser-Busch late last year. Belgian brewer InBev made its play for Anheuser-Busch in June. By October, A-B's board had accepted the buyout offer, and A-B shareholders were weeks away from signing off.
As uncertainty built, Hill told A-B he would be happy to do his own thing. In October, they decided to part ways.
"Ray Hill makes a great beer and we were glad to support his start in the business," Andy Goeler, vice president of A-B's international, craft and specialty group, said in a statement. "It's been a pleasure to work so closely with Ray, who has a passion for brewing and his business."
At least at the beginning, Hill plans to make his beer alone. Striking out independently will help him attain more credibility, he said. Plus, it's more fun.
"I'm OK with doing my own thing, to kind of show the world I can."
