Kansas’ largest brewery announced Friday, August 24, the suspension of its production brewery, effective August 25. According to an article published August 24 by Brewbound, Tallgrass Brewing Company, based out of Manhattan, Kansas, and the makers of such popular brands as 8-Bit and Buffalo Sweat, has suspended operations indefinitely and laid off approximately 20 employees.
After years of continual and rapid growth year after year since its founding in 2007—peaking in 2015 when the brewery expanded to become a large-scale production brewery—Tallgrass started seeing sales decline in 2016. In 2017, the company started talking with a private equity firm to help them recapitalize, but talks stalled and eventually ceased earlier this year.
With trends shifting toward taproom sales, the brewery’s regional sales model became significantly less effective in a market experiencing booming growth in locally focused craft breweries. When Tallgrass opened in 2017, there were just 1,200 craft breweries in the U.S. Today, there are around 6,600.
“A few short years ago, craft beer drinkers were going to the liquor store to buy their beer. As craft beer became more prolific, people started frequenting their local taproom or brewery instead of buying regional or national craft brands from the liquor store,” Jeff Gill, founder and former CEO of Tallgrass, told MHK Business News. “For a small, regional brewery like Tallgrass, that shift hit us really hard.”
The company and its investors are looking at options to salvage the business, such as bringing on an outside partner, private investors, or selling to a strategic partner, but would be forced to declare bankruptcy should it fail to secure new funding.
Despite the troubles at the production facility, the Tallgrass Tap House, in downtown Manhattan, will remain open. The Tap House is a standalone entity with a license that allows it to exclusively release Tallgrass brands and beers, which its owners say they continue to do in the coming weeks.
This story is still developing, and we will be updating it with any new information as it comes.