Sunday, August 7, 2016

What's up with all these World of Beer closings?


Here in Florida, the craft beer-friendly chain World of Beer, is a rather ubiquitous sight. They’re headquartered in Tampa and have spread across the country with about 75 locations currently open in the USA. For better or worse, it’s a pretty standard chain restaurant which means it’s family-friendly, has a palatable food menu, a cool design, and they all look and operate the same no matter where you go.
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Original photo credit: thefuj.com

I had never heard of the chain until they opened a location in my hometown of Albany, New York back in the summer of 2014. I was a bit perplexed at the time since Albany has a great craft beer scene with plenty of locally-owned establishments. I didn’t think a chain like WOB could survive there (especially in a damn mall). And it turns out I was right, as that location closed its doors just a couple weeks ago with no signs of re-opening anytime soon.

I’m neither surprised nor saddened by this news. I went there a few times and the experience ranged from horrible to merely mediocre. I’d imagine that was a pretty common experience by their customer base and probably explains why that WOB is no longer in business.

I didn’t think much of it until I read this post by Bill Dowd. He made mention of the fact that the Albany closing is just one of many WOB locations to close in the last few years. I decided to dig and little deeper and was astonished to discover that at least twenty World of Beer locations have shuttered in the last few years! The vast majority of which have come in the last 18 months alone.
While researching this post I noticed some recurring themes:
  • Locations that only served beer, but didn’t have a kitchen tended to close.
  • Some locations started out as WOB franchises, but the local franchise owner[s] decided to “break the chain” and re-opened as their own independent pub or restaurant.
  • Many franchise owners claimed they would simply move their taverns to a better location and the closing was only temporary.
  • A handful of locations did not survive an entire year in business. The most shocking example of this is the WOB in Manhattan’s Chelsea neighborhood which took nearly two years to open and then shuttered after only seven months in business! WTF?!
  • A few closings were blamed on in-fighting between franchise co-owners, and disputes with property owners and municipalities over what can and cannot be served (i.e. beer but not liquor).
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original photo credit: columbusunderground.com

* Bar only, no kitchen.
# Reported to be re-opening elsewhere (whether they actually did is another story).
+ WOB franchisee re-opened location as their own independent businesses.
  • Little information available.

Albany, NY: Opened 6/2014. Closed 7/2016.
#Ann Arbor, MI: Opened 7/2013. Closed 7/2015.
Austin, TX: Opened 3/2015. Closed 2/2016. (11 months!)
*Columbus, OH: Opened 10/2011. Closed 11/2015.
#Dallas, TX: Opened 1/2013. Closed 7/2015.
Denver, CO: Opened 9/2014. Closed 2/2016.
Jacksonville Beach, FL: Opened 2/2015. Closed 10/2015 (8 months!)
*Lakewood, OH: Opened 3/2013. Closed 12/2014.
*Land O Lakes, FL: Opened 2/2011. Closed 12/2014.
*Milwaukee, WI: Opened 2012. Closed 10/2014.
New Orleans, LA: Opened 12/2014. Closed 7/2016.
*Palm Beach, FL: Opened 3/2011. Closed 6/2016.
+Port Orange, FL: Opened 2012. Closed 7/2016.
+Seattle, WA (Capitol Hill): Opened 11/2013. Closed 12/2014.
+Seattle, WA (Renton): Opened 4/2013. Closed 12/2015.
*St. Petersburg, FL (downtown): Opened 2011. Closed 6/2016.
*St. Petersburg, FL (4th Street North): Opened 11/2009. Closed 10/2012.
Tampa Palms, FL: Opened 11/2009. Closed 4/2013.

Closings by year:
2016: 8 (thus far)
2015: 6
2014: 4
2013: 1
2012: 1

original photo credit: bizjournals.com
original photo credit: bizjournals.com

It’s possible that even more stores closed than I was able to find, but let’s put these numbers into perspective. I counted 75 currently open WOBs and eight more “coming soon” locations on their website. So if 20 locations have closed, that accounts for about 25% of their total chain! Imagine if a quarter of all Walmarts closed, or McDonald’s, or Publix, etc. Wouldn’t that be a major news story? Wouldn’t that have investors panicking? Why have no beer industry journalists written about this?

To be fair, I’m no mathematician, so I’ll admit that my 25% number may not be entirely accurate.
Since it’s not like the chain had 80 locations and now they only have 60. World of Beer seems to be growing at a pretty healthy rate and are probably opening taverns at a greater rate than they are closing them. I say “probably” because their website doesn’t list the opening dates of their pubs and my requests for that information have gone unanswered. Still, any way you slice it, a good number of WOB locations have indeed closed in the last few years. This of course begs the question – why?
Is there something inherently flawed in WOB’s business plan? Is this indicative of a “craft beer bubble” starting to pop? Are craft beer drinkers such hipsters that they won’t patronize a chain? Is WOB simply picking the wrong locations in which to do business? Is this all just a series of individual locations closing and not indicative of a larger problem or trend?

I’m not privy to any inside information, so all I can do is speculate like anyone else. However, I feel like I’ve only scratched the surface.

So I’ll turn it over to you. What do you think is behind all these World of Beer closings?
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