US brewer Lagunitas unexpectedly closes community bar in Portland

USA | After three years of providing a free event space and beer for local charities, the Heineken-owned Lagunitas brewery shuttered its Community Room in Portland, Oregon, at the end of October 2019, forcing dozens of non-profit organisations to relocate their fundraising parties.

The bar was part of Lagunitas’ network of charitable taprooms across the United States. Non-profit organisations can rent the taprooms for their fundraising events free of charge, including free beer plus a small staff. The Portland community room has been a popular spot, hosting almost 300 events each year. Lagunitas still runs five other similar spaces in Seattle, Chicago, and its hometown of Petaluma, California, all of which shall remain open.

It was the website newbeerscholl.com, which first broke the news on 23 October. Lagunitas Brewing opened its Portland “Community Room” in 2016, before the brewery was fully sold to Heineken in May 2017. Allegedly, the community room was closed without notice, all employees were let go with a severance, and nearly 40 charity events were cancelled.

The website goodbeerhunting.com suspects that Heineken needs to cut costs at Lagunitas, whose domestic sales have been under pressure for some time. In 2016, Lagunitas’ portfolio of beers grew 20.5 percent in volume sales in the off-premise, which slowed to 10 percent in 2017 and 1.8 percent in 2018. The website suspects that Lagunitas may struggle to stay even in 2019.

As Lagunitas’ focus has shifted to international markets, where most of the growth shall come from in the next few years, Heineken has been forced to take a long hard look at its numbers. There was a 12 percent staff reduction in 2018. Heineken even had to move some production of its Newcastle Brown Ale to Lagunitas’ Petaluma and Chicago breweries to help fill capacity.

We are not sure if the Portland community room was a big loss maker. But if Heineken is following in the footsteps of AB-InBev, which is notorious for stinting even on pencils for its employees, Lagunitas’ people could be in for another rude awakening.