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Business Observer Friday, Mar. 29, 2019 3 weeks ago

Regional craft brewery taps into hidden pent-up demand

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Fort Myers Brewing was the first brewery and taproom in Southwest Florida. After going through two five-year business plans in six years business is still hopping.
by: Andrew Warfield Lee-Collier Editor

Just a few days removed from celebrating its sixth anniversary, Fort Myers Brewing co-owner and brewmaster Rob Whyte contemplates, only for a split second, his long-term goal. 

“World domination,” he says jokingly. Mostly anyway. 

And who can blame him? What began as a hobby in his native southern California, Whyte, 47 and his wife, Jen, 41, have since built into a powerhouse.

That includes going from weekend brewing in converted old dairy tanks into Southwest Florida’s largest independent brewery and taproom, their 20,000-square-foot facility tucked in the back row of a set of industrial buildings in the Gateway development in eastern Fort Myers. Now  producing some 12,000 barrels of brew per year — or 372,000 gallons — the Whytes have a long-term goal of 30,000 to 50,000 barrels.

That’s a long way from their 500-barrel annual capacity when they opened Fort Myers Brewing in 1,500 square feet, including taproom and brewery, in 2013. Not only were they new to the region, so was their concept. The idea of brewing and serving beer on-site in a business park was so foreign Lee County’s zoning code had to first be amended to allow it.

With limited expectations, both Whytes planned to keep their day jobs — Rob a software engineer and Jen in the nonprofit world — for at least a decade. That plan lasted only one year. Other strategies were short-lived, too, as the initial five-year plan was rewritten after surpassing its goals in six months. 

While they declined to disclose revenues, Jen says Fort Myers Brewing has increased production by more than 1,000% since opening. Today, Fort Myers Brewing beers are poured in 561 bars and restaurants, and are available in 195 retail outlets including grocery, package and convenience stores, from Publix to Total Wine.

Rob and Jet Whyte started Fort Myers Brewing with a 500-barrel annual capacity. The operation now produces more than 12,000 barrels per year. JimJett.com photo

“I must confess at that time I never thought we would open,” says Jen. “I thought this would be a great hobby for Rob, and if we didn't open we'd figure it out.”

Turns out they tapped into pent-up demand, when recession-weary patrons found their way to what seemed an unlikely location in a mostly empty industrial park in foreclosure. After moving to their home in the Gateway community from California in 2011, the Whytes spent two years studying the market, purchasing their initial equipment and convincing Lee County planning and zoning staff that, indeed, breweries and taprooms do thrive in similar settings elsewhere.

“They looked through the zoning code and determined they could do an administrative amendment,” says Rob. “We wrote them a check for $1,200 and we got the zoning changed.” And in the process, they paved the way for nearly 20 independent brewers and taprooms now in Lee County, pioneering the industry in the area.

With approval in hand, the Whytes signed a lease, rented their space for $500 per month, began brewing and promoting the venture only with yard signs scattered around Gateway. On opening day, they drove through Gateway placing directional signs on corners, developing, quite literally, an immediate following.

“I asked Rob, ‘How many people do you think will show up today?’ And he said, ‘Maybe 20,’” recalls Jen. “As we started putting the signs out people started following us. We got here and there was a train of people following us. We were only open from noon to 6 and we had a line all day.”

Two days later the Whytes ordered more fermenting tanks and began upgrading the brew system, launching what has been a delicate, six-year balancing act between fermenting capacity, keg storage, canning for retail sales, product shelf life, state regulations, distribution challenges and the vagaries of seasonality. Along the way, they've won accolades in state and national beer competitions, building a reputation for crafting a quality product.

“Florida is such a segmented state that unless you are in the industry you probably have never heard of Fort Myers Brewing if you don’t live there,” says Florida Brewers Guild Executive Director Sean Nordquist. “Their business is a really good model for somebody looking to get into the industry. They’re also showing a commitment to an area that had not previously been a craft beer spot. If someone told me seven years ago there would be this great brewery in Fort Myers, I would have laughed at them.”

Best laid plans

The Whytes have their focus set on expanding their Southwest Florida footprint perhaps through strategic geographic growth, taking their product to markets where their seasonal customers live the rest of the year, or even an additional location in the region.

“We’re almost at capacity in our space right now, so we have big decisions to make.” Jen Whyte, Fort Myers Brewing

None come without significant challenges, not the least distribution. Craft breweries are not permitted by state law to self-distribute, leaving them subject to the whims of distributorships, rights to which are segmented by region. Before they can fight for shelf space in grocery stores or taps in bars and restaurants, breweries must find distributors willing to deliver their product, a distinct disadvantage against big name brands.

“The only way to grow to that next level is by expanding your market because you're not going to sell 30,000 barrels in Southwest Florida,” says Nordquist. “If you can get distribution into larger areas like the Tampa Bay, Orlando or Miami area you can, but with that comes a whole new set of headaches because you have to work with different distributors, you need local salespeople and you have to demonstrate you can meet that increased demand.”

Fort Myers Brewing’s updated business plan was literally written on napkins on a Key West Express boat ride out of Fort Myers. The Whytes were on their way to visit a bar in Key West, the first outside of Southwest Florida to tap their kegs. On the way, Jen started scribbling the new five-year plan.

“I still have the photos of it that I took with my phone because I didn't want to lose our new business plan,” says Jen. “We opened with really conservative ideas of how this would go. We thought we would keep our day jobs forever, or at least for 10 to 15 years. We wanted to be successful, but we didn't think it would take off the way it did. From day one it's been amazing.”

Slowly and deliberately, the Whytes acquired space as they added more and larger fermenting tanks. They own 11 units in their building and rent one other. They are also on their third brewing system, a high-tech model that can brew 90 barrels at any one time, output limited only by fermenting and storage capacity.

“It’s about two weeks from grain to glass,” says Rob, who wrote  the software that controls the brewing process. A math major, Jen schedules the brewing, calculating all the variables from the first scoop of grain to the pull of the tap or the crack of the can tab.

“Jen is a master at predicting what beer needs to go when and where,” says Rob. “In October she did our planning for January through March and she was only off by about 50 cases of beer. At the beginning of the month she will send an email to the brewers to tell them what has to go out this month.”

Starting with one employee, Fort Myers Brewing now employs 15 full-time and two part-time, three of them brewers. Its beers can be found on tap throughout Lee, Collier and Charlotte counties. The brewery added a cannery two years ago and has secured shelf space in Publix, Winn-Dixie, Whole Foods and Total Wine stores in the region. It hosts food truck rallies every Thursday, turning the taproom and parking lot into a tailgate party with regular attendance upwards of 500. 

That’s why Rob insisted on a location in the back of the complex, says Jen, which allows them to close the parking lot outside the tap room without impeding access for other tenants, and roll in food trucks to create an outdoor party environment.

“It's like a giant tailgate party … all the time,” Rob says.

The taproom, having doubled in size since opening and with large garage doors blending the indoors with the outdoors, is operating at capacity most of the week. The Whytes say they can increase business at their in-house bar, but only Sundays and Mondays when they are slowest.

“It's way beyond what we thought,” says Rob of the growth. “After we had to redo our business plan, we realized it was going to be bigger, but it's still bigger than we ever thought it would be."

Fierce loyalty

Although bar and restaurant customers have grown accustomed to finding Fort Myers Brewing’s beers on tap in Southwest Florida, its location remains a mystery to most. On Daniels Parkway, tens of thousands of vehicles pass daily within a quarter-mile of the brewery and taproom, only a small sign pointing toward its location.

“It became part of our story, and we still have people walk in and say, ‘I don't know how anybody finds you,’” says Jen. “On a Thursday night we will say, ‘Look around. All these people found us.’ We became a hidden gem.”

The taproom is at capacity most nights, particularly in season.

“We really could expand it again if we had more parking,” says Jen. “We’re just out of space.”

Committed to their Gateway location — there are roughly 8,000 homes in the immediate vicinity — they are considering a second taproom, but even that is subject to tight state regulations. A taproom must also have a brewery on-site, and that brewery must produce the same quantity that would be delivered to it from the primary brewery, which is necessary to maintain variety. That also means more brewers and more servers on staff.

“Our strategy has been to focus on our back yard,” says Rob. “We have saturated Lee County, and we have some accounts in Collier and Charlotte. We have expanded slowly. We've been smart about it so far. It's been a real slow, real intentional outward growth. The people in Fort Myers know us the best, so you have to build that brand recognition slowly going outward.”

Nordquist says he would welcome Fort Myers Brewing in the Tampa Bay market, where he lives and works. 

“They are always busy at Fort Myers Brewing and their customers are fiercely loyal,” he says. “They took a chance on an area that didn’t have anything remotely like it. They are setting a standard not only for a successful business model, but also for making a really good product.”

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