Co-owner of Atco Brewing Company, Shawn Iuliucci, said the closure of his brewery was due to financial struggles amid COVID and inability to expand its distribution footprint in Atco, NJ on Thursday, December 9, 2021. Atco Brewing Company will close at the end of 2021. Dave Hernandez | For NJ Advance MediaDave Hernandez | For NJ Advance Media for NJ.com
Shawn Iuliucci has just under 200 cases of beer and two weeks to get rid of it.
It’s not a problem for the co-owner of Atco Brewing. In fact, he purposefully stocked up for the company’s final days.
“We did that by design,” he said. “We made it all fresh and packaged it with labels and everything. We wanted to say thank you to everybody … We’ve met a lot of people in the last six years.”
Atco Brewing, which first opened in April 2016, held one of its last bittersweet happy hours Thursday night. It wasn’t a secret to the dozen or so patrons who trickled in. The inviting dark mint couch, rustic seating and neon “Open” sign didn’t betray the closure. It was the cleaning products that surrounded the stainless steel fermenters and canning equipment at the center of the tasting room that hinted at what was to come.
“We’re getting everything cleaned up and ready to ship out. As for the beer, we’re confident we won’t have any left soon,” said Iuliucci, before pouring himself a glass.
Prior to the pandemic, the brewery distributed to about 40 businesses, including restaurants, bars and liquor stores. The goal was to increase that figure to 80 in 2020 with the possibility of expanding to another facility the following year.
The pandemic not only made in-person gatherings impossible, which hurt revenue, it also made it difficult to expand the brewery’s distribution footprint.
Atco Brewing is one of three New Jersey breweries closing at the end of 2021, following an industry-changing 20-month period that brought with it the financial strains of the pandemic. But new laws have opened promising avenues for local breweries to make money, such as delivering to customers right at home.
Owner of Atco Brewing Company, Shawn Iuliucci, said the closure was due to financial struggles amid COVID and inability to expand its distribution footprint in Atco, NJ on Thursday, December 9, 2021. Atco Brewing Company will close at the end of 2021.Dave Hernandez | For NJ Advance Media for NJ.com
Raritan Bay Brewing in Keansburg and Human Village Brewing in Pitman will also close. Raritan Bay Brewing ownership did not respond to requests for comment on why they were closing, but Human Village Brewing said its closure was related to property ownership. Fans of Referend Bier Blendery will also see the Pennington brewery move out of state to Kutztown, Pennsylvania.
Mike Kivowitz, founder of New Jersey Craft Beer which partners with 102 breweries in the state, said the COVID-19 pandemic has had a widespread effect on breweries.
But it’s not all been bad news.
Both Readington Brewery & Hop Farm and Newark Local Beer opened in November. A new brewery will also replace Atco Brewing Company, although details have not been announced yet. Behr Brewing in Cape May, Stratosphere Brewing in Mount Holly and Sons of Barley in Woodbury Heights are also expected to announce locations soon.
So while thousands of residents are sad to see a handful of breweries close, the state still hovers around 133 breweries, Kivowitz said.
Brewery owners in Jersey City, Seaside Heights and Franklin said that outside of a brief period during the summer, fewer people are regularly leaving their homes to visit tasting rooms.
Most breweries were able to pivot to home delivery or curbside pick up during the pandemic, but it was made difficult for some due to an ongoing aluminum can shortage. Holding outdoor events — required at the start of the crisis due to restrictions on gatherings — became another option for breweries to keep churning out business, but that required investing in additional equipment at a time when financial losses and staff cuts were already mounting.
Heading into 2022, local brewers said to thrive they need both local support and COVID allowances — like being able to serve in their parking lots without an additional license — to remain in place regardless of the pandemic’s trajectory.
Part-owner of Atco Brewing Company, Jay Varga, pours beer at Atco Brewing Company, in Atco, NJ on Thursday, December 9, 2021. Atco Brewing Company will close at the end of 2021. Dave Hernandez | For NJ Advance MediaDave Hernandez | For NJ Advance Media for NJ.com
For Jeff Greco, owner of Heavy Reel Brewing in Seaside Heights, COVID’s timing couldn’t have been more brutal.
Heavy Reel bought a new space in January 2020 to expand its operations. When the pandemic hit, that plan was put on pause as the borough’s planning board stopped meeting in person and did not hold virtual sessions.
Heavy Reel was not able to open its second larger space until this past June. Paying month-to-month rent at the smaller location while supporting the new space felt untenable, said the brewery owner.
“We had a quarter of a million dollars of equipment in our new location, just collecting dust,” said Greco. “Everybody in the country was kind of in the same boat … We were losing our minds a little bit.”
“So, we focused on home deliveries. That really helped us stay in business,” he said.
When the pandemic first hit, Gov. Phil Murphy deemed liquor stores to be essential businesses, allowing them to remain open, but forcing breweries around New Jersey to close their bars and tasting rooms. At the end of March 2020, he clarified that home delivery was still an option.
Then came the aluminum can shortage, or “candemic,” as some industry experts have dubbed it.
The Ball Corporation, the largest manufacturer of metal beverage containers in the world, told investors last fall that it was short 10 billion cans. In an earning’s call from earlier this year, Ball Corporation President Daniel Fisher said the company expects that “demand (will continue) to outstrip supply well into 2023.”
“The can shortage can be even more impactful going forward, although Ball Corp. is trying to get companies of all sizes to purchase cooperatively to make it easier for everyone. There’s also the ongoing labor shortage,” said Kivowitz.
While Kivowitz began New Jersey Craft Beer as an event listing service in 2010, it has since expanded as a resource for breweries to connect, host events and post about job openings. Kivowitz noted that many of these businesses, which can start as hobbyists experimenting with home brew recipes, have leaned on each other throughout some of the difficulties of the past two years.
Atco Brewing Company, in Atco, NJ on Thursday, December 9, 2021. Owner of Atco Brewing Company, Shawn Iuliucci, said his businesses will close at the end of 2021 due to financial struggles amid COVID and inability to expand its distribution footprint. Dave Hernandez | For NJ Advance MediaDave Hernandez | For NJ Advance Media for NJ.com
COVID-19 impacted 902 Brewing Company’s ability to serve at its Jersey City taproom, host local events and introduce new beers, said Donald Vogt, the company’s chief financial officer.
Vogt said 2022 will be about remaining nimble.
While 902 Brewing continues to service about 160 liquor stores in the region, the number of restaurants it partners with decreased from 120 pre-COVID to about 100 now. In some cases, the decrease was due to restaurants closing, he said.
“In the summer when things fully opened back up for a period of time we did above and beyond our projections, so that helped, but since and with the new omicron variant, fewer customers are willing to leave their homes,” said Vogt. “At one point, we cut back on buying equipment just because we didn’t know where this was going. Everybody’s been playing it by ear and that’s no way to run a business.”
Colby Janisch, head of production operations, said that while out in Hoboken — the birthplace of 902 Brewing — he has also seen the number of bar patrons dwindle.
“If there’s nobody drinking beer on tap at bars, we’re not selling them more beer. So, it becomes a mutual struggle,” said Janisch. “This used to be a festive time of year. Now, it’s like, ‘Let’s stay in and make sure we’re safe for Christmas.’”
While COVID has not made things dire for his Sussex County business, Muckraker Beermaker owner Tom Troncone said it has certainly been challenging.”There’s an extra challenge being the northernmost brewery in New Jersey, not a heavy population center,” said Troncone. “That said, I’m confident we’ll be fine.”
Troncone, a former NJ Advance Media editor who started his own brewery in 2019, said it’s helped to be able to extend Muckraker Beermaker’s serving areas outdoors under a temporary allowance by the state.
The ability to serve outside which the state renewed in January, has been key to keeping steady business for many breweries, said Brewers Guild of New Jersey executive director Eric Orlando.
Over two dozen microbreweries and brewpubs, which produce about 75% of the craft beer brewed in New Jersey, make up the guild, Orlando said. The organization is focused on changing state laws and policies to help breweries thrive.
A new law, signed in February, made it possible for breweries in the state to sell and serve their beers in unlicensed outdoor areas adjacent to the primary location — including unlicensed parking lots on their property. Breweries, many of which have used tents and space heaters to maintain these spaces, want to see this continue beyond November 2022 when the law is set to expire, Orlando said.
Another lucrative aspect of that law, he added, was allowing breweries to sell packaged craft beverages at seasonal farmers’ markets.
Last May, breweries were allowed to temporarily offer home delivery but another proposed law introduced in June, would make it permanent, including allowing restaurants to add “cocktails to go” to their menus. Moreover, additional legislation first proposed in January, would give tax relief to businesses for equipment purchased to pivot during the pandemic.
In late 2009 when Orlando began working with leaders in the industry he said there were about three dozen breweries in the Garden State, a small number largely attributed to the limited retail channels they had access to. The business model COVID has made possible — being able to easily serve outdoors without additional licensing and expanding home delivery — could be the next iteration of how they grow even more, he said.
“From speaking to breweries, outdoor spaces have worked and the ability to home deliver beer has become a revenue stream that they foresee continuing going forward,” Orlando said. “Folks buying habits have changed, their drinking habits have changed, so it’d be a shame if those things went away because the pandemic goes away.”
Part-owner of Atco Brewing Company, Jay Varga, pours beer at Atco Brewing Company, in Atco, NJ on Thursday, December 9, 2021. Atco Brewing Company will close at the end of 2021. Dave Hernandez | For NJ Advance MediaDave Hernandez | For NJ Advance Media for NJ.com
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Steven Rodas may be reached at srodas@njadvancemedia.com. Follow him @stevenrodasnj.
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