Where Are They Now? Follow Up with Back East Brewing Company Owner Tony Karlowicz
Innovation Destination Hartford Website Curator Nan Price caught up with Owner Tony Karlowicz to find out what’s been brewing.
NAN PRICE: Give us a little update, what’s new since we last spoke?
TONY KARLOWICZ: Back East is continuing to grow and do well. We started an expansion this year, which will be finished in early January. This will almost triple our capacity.
We’re also rebranding our core beers with new can designs and we’ll be introducing several new beers in 2019. We fluctuate with about 20 in rotation and we haven’t been able to keep up with demand, so the expansion will help.
Right now, we have 12 tanks and we’re adding eight much larger tanks. Typical startups begin with a handful of tanks. We started with three then expanded to six, eight, 12, and now we’ll have 20.
NAN: Have you experienced any major pivots since we featured your story?
TONY: One major change has been having the taproom. Taprooms have grown explosively. I would be shocked if you told me a new brewery wasn’t relying heavily on their taproom.
When we started, we had taproom for samples and tours. Now most tap rooms function as full bars. That’s being driven by what consumers want. It’s become a culture.
NAN: Back East was early to market with the craft brewery trend. Where do you see it going?
TONY: Right, we were the seventh brewery to launch in Connecticut. I believe there are more than 70 breweries now, with another 30 or so on the drawing board.
The market is obviously is more competitive, but Back East has managed to stay on top. Connecticut Magazine named us Best Brewery in 2017, and we’ve also won “Best Locally Brewed Beer” in the 2018 the CTNOW Best of Hartford Readers’ Poll.
NAN: How do you continue to stay relevant in this type of competitive market?
TONY: It’s challenging because the market is continually changing. It is important for breweries to listen and respond to what their customers want. When we opened, we had one IPA in our lineup. Since then, we’ve released almost 10 different IPAs or double IPAs.
The huge growth in the number of breweries (as well as the maturing of the craft beer industry), has definitely made things exciting!
I try to stay current on the Brewers Association trends and forecasts, which say the brewery failure rates are historically low, but we’ve also never seen this type of growth rate. Some breweries will inevitably close due to competition and market saturation (despite the historically low failure rate).
Back East has been able to stay relevant because we have a skilled team that’s committed to putting out a quality product. Surprisingly, that’s not always the case with all breweries. We try to continually innovate. It’s certainly become harder for established breweries to stay relevant with so many options out there.
The good thing is, with more attention on the industry, craft beer is no longer just for the eccentric beer drinker. It has become mainstream. More high-profile Connecticut breweries, like Two Roads Brewing Co., have helped absolutely the industry.
NAN: You’re seven years post-startup, tell us a little about your entrepreneurial journey. What lessons have you learned?
TONY: I wouldn’t call myself an “entrepreneur.” I think of an entrepreneur as starting a business because they see an opportunity to make money. I started Back East because I wanted to be in this industry and create a career doing something I enjoy.
The biggest lesson I’ve learned is not being afraid to go with an idea. When we started, I knew there was a good chance of us being successful. The market wasn’t as saturated back then.
NAN: Anything you wish you’d done differently?
TONY: I wish we had started at a bigger size. Growing is difficult, expensive, and takes a lot of work. We started with low budget but, looking back, it would’ve been better to start with a larger system.
One thing we’ve done well is to make sure our production layout is set up so we can continue to add capacity and grow. So, when we’re adding equipment, we’re thinking about what comes next. We purposely chose this building in Bloomfield because there was space to grow. A lot of our equipment is oversized, so each time we expand we’re not replacing everything. A good example is our canning line, which we added during our last expansion.
NAN: From my conversations with other Connecticut breweries, I’ve learned there’s a lot of mentorship and collaboration.
TONY: There is, and it’s nice to help others. We’ve gotten calls from others who are starting out asking general how-to questions about things like tax forms. We also trade ingredients and share ideas with other breweries, including Thomas Hooker Brewery across town in Bloomfield. Some breweries do collaborate for brews. We haven’t yet, but we’ve talked to several other breweries about doing something like that.
NAN: How are you marketing?
TONY: We rely on social media and we have an active, good following. Social media is a good thing for small businesses. The traditional ways of adverting and marketing are expensive and not really necessary for our customers.
NAN: Are your customers mostly repeat or people who want to try new craft beers?
TONY: We have both—new customers trying our beer for the first time and our loyal following.
NAN: Where do you see the entrepreneurial landscape heading in Connecticut?
TONY: Entrepreneurs are a scrappy bunch. No matter what happens with Connecticut’s economic landscape, which remains to be seen, entrepreneurs are always ready to get out there and shake things up.
I do think it’s a bad time to start a brewery in Connecticut. The market is oversaturated. There are two macro trends: Craft beer growth is slowing and beer consumption in total is declining (losing ground to wine and spirits). Craft beer’s piece of the pie is growing, but the pie is getting smaller.
NAN: How does that affect Back East Brewery?
TONY: We’ve been brewing different styles of beer and working on bringing attention to the industry. I’m on the board of the Connecticut Brewers Guild. Part of our goal is to market Connecticut breweries to help us stay competitive with other out-of-state breweries and help us stay competitive with other beverages (i.e., wine and spirits).
NAN: What’s next for Back East Brewing?
TONY: Our main goal is to grow our distribution. We currently distribute our beer in Connecticut and western Massachusetts. With our expansion, we’re hoping most of our growth will be in Connecticut—we see room for us to grow here.
We’ll probably grow in Massachusetts as well. We don’t have a specific timeline. It depends on how much more we can grow in Connecticut, which should always be the primary focus. It’s our home market, and you always want to be successful in your home market.