Yankee Brew News Archive

East Meets West: An Interview with Redhook CEO Paul Shipman

Originally Published: 03/95

By: Kerry J. Byrne

Paul Shipman, CEO of the Redhook Ale Brewery of Seattle, was in Boston in January to officially announce his plans to build a brewery in New England. I got a chance to sit down and talk with him before a tasting of his company's products at Boston's Mercury Bar.

Redhook has joined into a distribution alliance with Anheuser-Busch and will build a $25 million brewery in Portsmouth, New Hampshire. The plans call for a 100,000 square foot brewery, a brewpub, and a beer garden. Construction begins in the spring of 1995, with the summer of 1996 slated as the completion date.

Redhook produces Ballard Bitter, Redhook ESB, Blackhook Porter, Wheathook Ale and Winterhook Christmas Ale.

YBN: Tell me a little bit about the history of the Redhook Ale Brewery.

PS: I can tell you we got started in Seattle in 1982. The first microbrewery in Portland wasn't open until 1984. So there was a period of time where we were selling as much beer in Portland as in Seattle. Now, since then Portland seems to have taken off. We don't sell any more beer in Portland now than we did in 1984. That is a market that is unique in the dominance of the local brewers. In Northern California and in Seattle micros from all over participate in the market.

That's what we expect to be the case as we go around the country.

YBN: I think that's what you'll find here in New England. There's a lot of local breweries but people still want to drink what is being made elsewhere, too.

PS: We can tell that there is some excitement about Redhook coming.

YBN: Tell me about yourself and your background and how you got involved in the beer industry.

PS: I was in the wine business working for Chateau Ste. Michelle. I wanted to start my own winery. The guy who was to become my partner, Gordon Bowker, he said 'why don't we start a brewery instead.' So it wasn't my idea, but it was one that appealed to me right away. So we went out and we were the first microbrewer in the Pacific Northwest. We started with a 20-barrel brewery in the Bowden, Washington area. That brewery went from 1982 to 1988. Then we sold all the equipment to a group in Western Samoa.

YBN: Western Samoa?

PS: Yeah, that's another story. It's a long one but a good one. Anyway, then in '88 we built a brewery in Fremont which continues to operate and is our draft brewery now in the Northwest. In '94 we had just completed our brewery in Woodinville, Washington, which takes our capacity up over 300,000 barrels when everything is filled out.

YBN: Technically a micro is one that brews under 15,000 barrels per year, so it's been awhile since you were a micro.

PS: It's been a while, it's been a while since we were under 15,000 barrels. What I think is the important distinction about what makes a specialty brewery is batch size. Our batches our 50 and 100 barrels. I think that ultimately that's what distinguishes the specialty breweries - those who make the beers in individual small quantities and can make small brands that are unique.

YBN: Who is your brewer and how long has he been with you?

PS: Al Tripling is our brewer and Al has been with us since '86.

I have had three brewmasters. My first two have each gone their own ways and started their own brewpubs.

YBN: Where is the new brewery going to be located?

PS: It's the old Pease Air Force Base and we're at the entrance right off the Spaulding Turnpike. We view that as the crossroads of New England. We wanted to be in northern New England. We looked at Massachusetts, New Hampshire, Vermont and Maine. We wanted the brewery to be in a place that people who lived in New England would know where it was. We wanted the brewery to make sense. But we also wanted a place where we'd have enough space that the brewery would work as a nice place to visit and where we'd have also room to grow.

YBN: How large will the facility be?

PS: It will be located on 24 acres. The ultimate capacity will be about 250,000 barrels, maybe up to 300,000.

YBN: So it will be similar to what you're doing out West.

PS: There's gonna be a lot of similarities with the Woodinville brewery.

YBN: Why New Hampshire?

PS: There were a number of factors that helped us to focus in on New Hampshire. One of them, which was important to me, was the history of ales in Portsmouth. It was a real ale town. So there's a historical context.

YBN: All of New England was an ale area.

PS: Yes, but that was a real hot bed. That Frank Jones Brewing Company, that was a big deal. In fact the brewery that we're building is about the same size as the one he had, 250,000 barrels.

We actually looked at the Frank Jones site, but it was an engineering challenge beyond our desires.

YBN: There's quite a bit there now, with Smuttynose and the Portsmouth Brewing Company.

PS: We saw the success of the local specialty brewers as being a very positive thing. And we coexist and we thrive together with other specialty brewers in Seattle. We're very compatible with that. Some specialty brewers specialize in being very small, and that's fine, it makes sense for them. We like the breweries to be a little bit bigger. We have different orientation in terms of size.

YBN: When did Anheuser-Busch come into play in all this?

PS: I went down to St. Louis in October of '93, and I told the people at Anheuser-Busch that Redhook wanted to expand and ultimately serve the entire United States, and that we would like to work with them in such a way that we could be distributed by Anheuser-Busch in all markets that we enter, including the company-owned operations. The people at Anheuser-Busch told me they had already been looking at the category and that they were going to be involved in the category, knew about Redhook, and were very interested.

So, we came to an agreement which was completed in October of '94 and now we have an alliance. Wherever we go, in all new markets, we are distributed through the Anheuser-Busch system.

YBN: Is this an effort to get into just the New England area or an effort to reach the entire East Coast?

PS: It's a little of everything. We're starting the brewery in New England because we feel that New England is really the focus of this category on the East Coast right now, but ultimately we would like to serve the entire East Coast.

YBN: Is it going to be done just from this one new plant?

PS: Initially from this brewery, no question, then, you know, it looks like we'll have to build more breweries after this. But I sort of build 'em one brewery at a time.

YBN: There's a British influence in your beers. Is this something you're going to continue to do out here?

PS: No question about it. When we build the brewery, the brewery will be autonomous in terms of brewing. We will make all the beers that we make (in Washington), but the brewmaster here will be making special beers for the New England area.

YBN: Who will the brewmaster be?

PS: We're still recruiting.

YBN: When will the new plant open?

PS: It's gonna take about a year to build once we start construction.

YBN: What are you waiting on?

PS: A couple of things. The final permitting. The weather. It's tricky, I tell ya, because if we miss this window - you know, you can only do construction in certain times in New England, this is a tricky place. People don't just sort of casually decide they're going to do business in New England.

You really have to want to do business in New England because of the weather and so we want to begin construction with the spring thaw.

We have made the full permit applications and it's a little bit easier for us because we already built a brewery like this in Woodinville, so we're familiar with all the latest permitting applications. There's a lot to it, I tell ya.

YBN: One thing that's of interest to me is are you going to try to do your cask-conditioned product here?

PS: Absolutely, no question about it. We are really interested in that type of product.

One of the things we do when we make beers is we like to experiment with different malts, as well as with different hops. A lot of people experiment with different hopping levels and different hops. When we make our Christmas beer, that has custom malts in it. When we get it malted we have them malt 155,000 barrels to our specs. It's a big deal.

YBN: What is it about the New England consumer that influenced your decision to build here?

PS: The first thing we wanted to know is would the people of New England be open-minded to the beers of the West Coast because of their style and everything like that. So we had to make a judgement, and we concluded that consumers in New England were really turned on about the variety of beers and that they were gonna be not only open-minded but they were going to be great consumers of the product and really interested in it. And that their expectations of quality would be very, very high.

YBN: I've seen people from this area go into restaurants or pubs and not drink anything if all they have is Budweiser. The safety valve we have up here is that everyone has Sam Adams.

PS: That's sort of made it possible to have the beginning of variety. We think that, ultimately, people who are enthusiasts want to know that the beer is made at a specialty brewery, and it's not just a specialty beer. The enthusiasts category really understands the relationship between the brewery and the beer.

We compete with Sam Adams, you know.

YBN: That's why I brought them up.

PS: You know, do people in Boston know that he (Jim Koch) doesn't make the beer in Boston?

YBN: I don't think so. People in the industry do, but maybe not the general public. One of their brewers told me that all their beers, at at least one point during the year, are brewed at the Boston plant, but it's primarily an experimental facility.

PS: I've got a thing from Jim Koch in Beverage World Periscope in which he says it [the Boston plant] is strictly R&D. So I think he's starting to come open about it, which is a reflection, because I think that people are entitled to know where the beer comes from. At Redhook we make all of our own beer at our own breweries.

With our agreement with Anheuser-Busch - just in case there is any question about this - we are independent. Anheuser-Busch is an investor in our company, they've got 25 percent of the stock, they're held to that. I manage the company. We make our own beer, in our own way, and we market it in our own way, using Anheuser-Busch wholesalers exclusively. There is great communication between the companies, but we are specialty brewers and I think that we are not some kind of a front for Anheuser-Busch.

YBN: One of my concerns is that they're gonna send their brewers in and use your plant.

PS: That won't happen. It's two companies. It's a distinctive relationship.