Ajeet Grover: Inside Toronto’s Common Good Beer Co.

In a industrial corner of Scarborough, Ontario, Common Good Beer Company brews more than 5,000 hectolitres a year and employs about 17 people. It is the only craft brewery in the neighbourhood, and it has been open since 2016. Beer Idiots spoke with president Ajeet Grover about how it got here and why the road ahead is tough.

A host brewery for startups

Common Good Beer began with two founders. Scott White was a passionate homebrewer, and Jamie Mistry was a professional brewmaster who had come from Amsterdam Brewery in Toronto. Their idea was to build a dedicated host brewery for small startups. Craft beer was booming, and new brewpubs and brands could not keep up with demand. In the early days, about 90% of Common Good Beer’s output was contract beer for others.

Grover, a lawyer, first helped with paperwork and the lease. Their Scarborough site was the fourth location they pursued. About two and a half years after opening, he joined as a third partner to grow the brewery’s own brand. Today nearly 70% of production is Common Good’s own beer, though it still brews for other small producers.

Betting on lagers

While competitors chased IPAs and barrel-aged stouts, Common Good saw a gap for high-quality craft lagers. It brews them in a European style: lower gravity, natural ingredients and extended time in the lagering tank.

A shrinking pie

The brewery is growing, but Grover is candid about the pressure. Ontario went from an estimated 75 to 100 licensed breweries when Common Good opened to close to 400 a few years ago, and closures have followed. He estimates the province may have lost 15 to 25% of them.

He points to several causes:

• Grain that cost around CAN $24 to $26 a bag before COVID now runs about $42 to $44, while aluminum, packaging and electricity have also climbed.
• Craft beer consumption is down around 10%, and Grover says the industry “foolishly” assumed craft beer was essential when it is really a nice-to-have.
• Older drinkers are cutting back, fewer 19- to 25-year-olds are coming into craft beer, and non-alcoholic beer, legal cannabis and canned cocktails are competing for attention.

Seasonality adds to the pain. Summer sales can run close to twice winter levels, so the brewery must build capacity for the peak and then fill it all year.

Running it like a business

Common Good’s response is operational discipline. It has signed fixed-price forward contracts for malt, and it uses forward agreements for hops. It also examines yield and packaging losses closely. Grover says breweries that want to stick around must become “really diligent operators”.

Advice for aspiring brewers

Asked what he would tell someone dreaming of a startup, Grover’s joked: “Don’t do it.” But he notes the opportunity in a lot of used brewing equipment on the market. His reasoning is that a craft brewery is a business like any other, and good beer does not sell itself. Sales and marketing matter. If you do start, he suggests thinking small and local, such as a community brewpub, rather than building a large plant for wide distribution. Expansion, he warns, can be deadly.

Even so, he says he is still having fun. Watch the full interview above.

Common Good Beer Co., Toronto, Ontario, Canada