SPRINGDALE -- Jesse Core, one of the originals on the Arkansas brewery scene, has learned one vital lesson during his nearly 15 years in the business -- don't get over your skis.
He stared Core Brewing and Distilling in 2010 on the strength of his beer offerings, began significant multi-state distribution of his suds, went into the pub business -- eventually operating 10 locations scattered around the state -- got out of the pub business just before covid-19 shut the nation down, and was a first mover in the state's seltzer business.
These days, Scarlet Letter Beverage Company and its variety of seltzers and canned cocktails is his primary revenue generator -- but that's allowed Core to refocus on his beer, producing it in smaller quantities but with an eye on quality and aimed at taprooms and bars, rather than for large scale retail sales.
In 2021, Arkansas' brewers produced 50,509 barrels of beer, seltzer and other adult beverages, according to the most recent information provided by the Alcoholic Beverage Control Division of the Arkansas Department of Finance and Administration; that's up by 33% when compared with 38,066 barrels in 2020, and beats 2019's record year of 40,819 barrels by 25%.
Core Brewing was Arkansas' second-largest brewer in 2021, producing 8,878 barrels, up 185% from 3,117 barrels the year earlier. A barrel contains 31 gallons of beer.
Jesse Core said the company faced significant challenges over the years, but after he had opened 10 brew pubs across the state he realized he'd overextended badly and gotten away from his early vision as a brewer.
"We were 29 minutes from going out of business," Core said. "I hated those pubs, they were so stressful."
While he agreed the pubs dotted around the state did help the Core brand and raised the company's profile, he contends -- looking back -- they were a bad business decision. First, they weren't what he got in the business to do in the first place; second, they were costly to run; and third, he ended up in direct competition with the very people he was trying to sell his beer to in the first place -- bars and restaurants.
He said the decision to close eight of those pubs in 2019 was at the time terribly painful, but then in early 2020 covid-19 hit the United States.
The move made it look like Core had a crystal ball -- dumping the pubs before state and local governments shut down nearly everything, particularly bars and pubs, to deal with a pandemic. But Core was clear: it was simply dumb luck.
"Covid changed everything, it was hard for some people -- but it was great for us," Core said. "It allowed us to go back to what we were really good at -- partnerships with entities like the University of Arkansas, Sam's Club and XNA and to our product."
Since the company's inception, Core has worked with the University of Arkansas with the goal to develop programs to teach brewing skills and develop new brewing talent for the region. The UA's Proficiency in Brewing Science Certificate Program which began in 2020 has acted as an impetus for students moving into the industry and bringing their skills to the market. Core employs several himself.
The collaboration with the UA also allowed Core to work with Scott Osborn, a UA professor in Biological and Agricultural Engineering -- and entrepreneur in his own right -- who developed the Carbo-Rock-It.
Core said the device's rapid carbonation technology has been a complete game-changer for his company. Osborn said Core's support and the chance to work out the particulars of the device in a real-world setting was a key component in creating the technology.
Osborn said Core is an entrepreneur at heart, willing to take risks when necessary, able to spot when an idea isn't working and abandoning it when push comes to shove, and always willing to help others by sharing his experience. He said Core's involvement in the UA programs gives students not only an experienced mentor who knows how the brewing world works, but it also provides them with invaluable hands on experience.
Core's work with XNA comes through a partnership with Paradies Lagardere, which operates the airport's restaurants. The deal took years to finalize but Core said it was vital for the brand, and besides the company's taproom at its Springdale brewery, is the only pub remaining in its portfolio.
He said in 2022, Sam's Club's beer and private label teams approached Core and the result was the creation of a Members Mark Hard Seltzer that's now offered nationwide.
"Our plant was built to be able to capitalize on new trends and when Scarlet Letter started taking off, we just held on," Core said.
In 2023, Arkansas had 49 craft breweries of various sizes in operation -- up from six in 2011 -- according to the Brewer's Association, a national craft brewing group. The state's craft brewing industry ranks 37th nationally with an economic impact of $458 million.
Tony Guinn, a brewer and co-owner of Gravity BrewWorks in Big Flat in Baxter County and the former president of the Arkansas Brewers Guild, said the landscape has changed in the state in recent years and while some breweries remain focused on getting larger and producing more suds, others have settled in and are concentrating on quality and serving a devoted but smaller community.
"People realized that drinking locally was a good idea," Guinn wrote in response to emailed questions. "And as tourism realized that people travel for beer -- there have been lots of 'ale trails,' beer tours, etc; not just in Arkansas but across the country. That high tide rose all of our ships."
Core said when he started in the brewing industry in Arkansas the barriers to entering the market were few. He said capital was readily available and that resulted in lots of brewers jumping into the market, adding confusion to the marketplace as the industry began to take its first steps.
"When I entered the market it was the Wild West," Core said.
He said most folks get into brewing because they love to brew beer, they love the community that's developed around beer brands and taprooms, and because they have a deep desire to provide their customers with wonderful brews. The reality is different, he said, and is one where businesses face the challenges of scaling, dealing with distributors who have a lot of power and slugging it out with competitors for retail shelf space.
Nowadays, he said, the Arkansas beer landscape has evolved with most producers well entrenched in their respective niches, from those who produce and distribute a significant amount of beer to those who intentionally keep their production levels lower to better serve a particular client base or produce a particular type of beer.
"I'm bullish about Arkansas' craft beer future," Core said. "The industry is maturing and returning to making great product. Folks don't want to be big. They love their craft and producing a great product. It gives them staying power locally and nationally."
Core's advice to new brewers and his peers is simple: do what you do best, focus on quality and take care of the customers who love your product. Be mindful of the market, be mindful of waste and be mindful of innovation, he said. And remember -- the scarcity model is a thing.
"Go deeper, not wider," Core said.
Jesse Core (right), founder and owner of Core Brewing/Scarlet Letter Beverage Company, explains the operation of a can-filling machine Tuesday, Aug. 22, 2023, alongside production manager Ben Lowell at the brewery in Springdale. Visit nwaonline.com/photo for today's photo gallery. (NWA Democrat-Gazette/Andy Shupe)