D.G. Yuengling & Son, Inc.

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D.G. Yuengling & Son, Inc.

5th and Mahantongo Sts.
Pottsville, Pennsylvania 17901
U.S.A.
Telephone: (570) 622-4141
Fax: (570) 622-4011
Web site: http://www.yuengling.com

Private Company
Founded: 1829 as Eagle Brewery
Employees: 64
NAIC: 312120 Beer; Breweries

D.G. Yuengling & Son, Inc. is officially registered as America’s Oldest Brewery. Located in the center of mountainous Pottsville, Pennsylvania, Yuengling (pronounced yin-ling) has been brewing beer since 1829. Traditionally passed down from father to son, the company has been family-owned for five generations. Yuengling was founded in 1829 by David G. Yuengling, a German immigrant, and is now run by Dick Yuengling, Jr., David’s great-great grandson. Once a struggling regional beer, Yuengling has established itself as a popular, highquality, affordable beer. The company brews five brands of beer: Yuengling Premium, Lord Chesterfield Ale, Dark Brewed Porter, Tradition Lager, and Original Black and Tan. To meet the great demand for its beer, in 1998 Yuengling purchased a former Stroh brewery in Tampa, Florida, and broke ground on a new $50 million brewery in St. Claire, Pennsylvania, near the original brewery in Pottsville, Pennsylvania. In 1999, Yuengling was ranked the eighth largest brewery in the United States; by the end of 2000, the company expected to have sold nearly 800,000 barrels of beer. Yuengling also offers tours of its historical brewery and its Yuengling Museum and Gift Shop. Nearly 50,000 visitors tour its facilities each year.

The Eagle Brewery in 1829

D.G. Yuengling & Son, Inc. began in 1829 when David G. Yuengling, an immigrant from Wurtenburg, Germany, opened a brewery on Centre Street in Pottsville, Pennsylvania. He named his new business the Eagle Brewery, “to identify with the qualities of strength and pride, symbolic of the American eagle.” Years later, when his son joined him in the family business, he changed the company’s name to D.G. Yuengling & Son, Inc.

In 1831 a fire destroyed the plant and Yuengling built a new brewery on Mahantongo Street on the side of a mountain. At the time many small breweries were built in similar locations so tunnels could be dug in the rock. These tunnels provided natural cool temperatures suitable for aging and fermenting beer.

Pottsville itself was an ideal location for a brewery. The water was soft and clean, and it lacked the mineral taste of the water in many cities. Pottsville also had an abundance of beer drinkers. Thousands of German immigrants like Yuengling had settled in southeastern Pennsylvania, creating a unique community. “Unlike other parts of the country where the locals preferred to drink whiskey, rum and hard cider, the Germans of this area showed a distinct preference for beer,” reported Ale Street News. Pottsville also had access to railroads, so it could easily ship its beer to nearby Reading and Philadelphia. The company was an instant success, and Yuengling beer became a popular regional beer.

Prohibition in 1919

The late 1800s and early 1900s were difficult years for Yuengling. In 1899, Frederick Yuengling passed away at the age of 51. After his death, his son Frank took over the company. Then in 1919, the Eighteenth Amendment was ratified, which enacted a call for the national prohibition of alcohol. Nearly 400 breweries were forced out of business. Yuengling adapted to Prohibition by producing three different “near beers,” malt beverages with less than .05 percent alcohol. Its near beers were successful, but the company still struggled.

When Prohibition ended in 1933, the company celebrated by producing a brand called Winner Beer. “We introduced Winner Beer as a salute to the repeal of Prohibition in 1933. Then to show our appreciation, we shipped a truckload to President Roosevelt at the White House,” said Frank Yuengling.

While the company believed its troubles to be in the past, it suffered further disaster in the 1950s when area steel, coal, and railroad industries collapsed. The disaster forced many locals to quickly relocate. This meant trouble for Yuengling, since it was losing many of its loyal, local customers. Almost overnight, Pottsville’s population dwindled. In the years that followed, Yuengling struggled to make its beer appealing to younger drinkers in the area—and this was no easy feat. Yuengling beer was sitting on Pennsylvania tavern tables when General Custer was leading cavalry charges on the battleground at Gettysburg. This rich history caused many younger drinkers to shun the beer. They associated the brand with old-timers, the coal miners and mill workers who once lived in the area, and wanted to distance themselves from this image.

In 1960, Yuengling hired N. Ray Norbert as head brewmas-ter. Hiring Norbert was a good move, for he quickly earned a reputation for meticulous brewing. In an article in the Pottsville Republican and Evening Herald, Norbert compared brewing beer to manufacturing cars. “It can be a model T or a Cadillac,” he said. “It has four wheels and a steering wheel, but everything in between is different.”

The company changed hands again in 1963 when Frank Yuengling passed away. Yuengling was 86 and had managed the brewery as president and chairman of the board for 64 years. After his death his two sons, Richard (Dick) L. and F. Dohrman Yuengling, took the company’s reigns.

In the 1960s and the 1970s the Pennsylvania legislature succumbed to pressure from large, national breweries and repealed laws that protected small breweries. Many of the smaller breweries were either swallowed up by larger breweries or forced to declare bankruptcy. Yuengling seemed destined for a similar fate—until Dick Yuengling, Jr., stepped in.

Reorganization in the 1980s

Dick Yuengling, Jr., left his own beer-distribution business to help his ailing father manage the brewery. The younger Yuengling vowed not to be the Yuengling who would close down the brewery. Instead he planned to restructure the company and capture much-needed market share. The timing was certainly right for Yuengling’s revival: Micro breweries were growing in popularity, regional pride was rising, and sales for top national brands had dipped slightly. The Philadelphia Inquirer reported that “it was a time when micro breweries, brew pubs, and home brewers were reintroducing porters, ales, and gourmet brews to the nation’s 84 million beer drinkers.” “Somebody had to develop or find that taste,” Yuengling said. “I attribute that to people who got into the home brewing, and other small breweries like we are, that started putting out wheat and gourmet beers. And that’s where we fit in, because we’ve been brewing porter and ale here since the brewery started 166 years ago.”

Yuengling invested all of the company’s earnings into new equipment and asked Norbert and the company’s other brewers to develop several new brands of Yuengling beer.

Yuengling also believed the company needed a new image. His distributors urged him to hire David Casinelli, whose father Anthony worked for L & M. Beverages Co., Yuengling’s Philadelphia distributor. Yuengling made Casinelli the vice-president of marketing and sales, and later promoted him to executive vice-president.

Casinelli wanted to remake the company’s image starting with the labels on its beer. He and Yuengling designed new sophisticated labels that emphasized the beer’s regional appeal. The new labels even included a historic eagle, which was designed by founder David Yuengling for the original Eagle Brewery. Casinelli launched an aggressive marketing campaign that focused on the company’s foothold in Pennsylvania’s history.

Said Yuengling in the Wall Street Journal: “I don’t even want to know how much it cost. But David made me do things that built a new image for our brands.”

The company switched to more aggressive wholesalers along its eastern seaboard territory. In addition, unlike many competitors who were cutting prices to gain market share, Yuengling raised the price of its beer to above-premium levels and pushed it in high-end markets such as Philadelphia’s historic district and Penn’s Landing.

Casinelli also cross-marketed Yuengling beer with other campaigns that focused on tourism and Pennsylvania’s history. “He worked with a concessionaire at the Philly airport to build displays that promoted the historical significance of the nation’s oldest brewery,” reported the Wall Street Journal. He also launched campaigns to increase the beer’s appeal among younger drinkers, who were steering away from large, national brands in a search of beer with unique flavor.

Casinelli’s efforts proved worthwhile. Sales rose from approximately 127,000 barrels in 1986 to 230,000 barrels in 1993. (One barrel is equal to roughly 360, 12-ounce servings of beer.)

To help promote its historic theme, in 1991 Yuengling began offering tours of its historic brewery along with its Yuengling Museum and Gift Shop. Yuengling’s onsite museum featured memorabilia and artifacts from the pre-Civil War era. “The museum contains some amazing items we found in closets and drawers, items that hadn’t been seen in a quarter century or more,” said Dick Yuengling. “We found the diary that my great-great grandfather brought from Germany when he founded the brewery.”

Company Perspectives:

Under Dick Yuengling’s guidance, Yuengling beer has gone from a small regional brand to a well-known and sought-after entity, but that’s not surprising. Throughout the company’s storied history, the Yuengling family’s commitment to its customers, determination and forward thinking have been the sources of its ongoing success.

Included in the tour was the brew house “where grain hops and water are mixed in huge ancient copper kettles, fermentation tanks, grain storage areas, and shipping docks.” The bottling plant was a major attraction. “You get to go right down on the factory floor so you’re only a few feet away from the bottles as they zip through the washing, filling, labeling, capping and packing station,” reported Money magazine.

A Shortage in the 1990s

By the 1990s, Yuengling had become successful—too successful. Its sales had far exceeded its expectations. The demand for its beer was so high that it could not fill all of its orders. It was forced to cut back on its advertising. The shortage in Yuengling beer also led to a public relations crisis. Rural Pennsylvanian’s, Yuengling’s most fervent customers, were furious about the beer shortage. They felt betrayed and accused the company of shipping too many barrels of beer to areas outside of Schuylkill County.

Yuengling listened to its customers. It stopped shipping beer to districts in Maine, Massachusetts, and Rhode Island and concentrated on meeting the demand in Pennsylvania. It also sold its beer locally at lower-than-normal prices.

By 1997, the “brewery was running around the clock and was still unable to meet demand,” according to an article in the Gainesville Sun. “With only 150 people producing some 600,000 barrels of beer a year in a brewery designed to produce only 200,000 the risk of overproduction can run high.”

The company had to chart a new course: it could sell out or expand its facilities. Yuengling initially tried to expand the existing brewery, but this was difficult because the brewery was built on a mountainside. It added new storage and holding tanks, increased its refrigeration, and updated its electrical system. While the expansions and upgrades helped, the company was still unable to satisfy the demand for its beer.

In 1998, the company purchased a former Stroh brewery in Tampa, Florida. In addition to increasing production, the 1.6-million barrel facility opened up new markets for Yuengling.

Around the same time, Yuengling broke ground on a new $50 million brewery in nearby St. Claire. The company hoped that between the new brewery and the old brewery it could produce enough beer to satisfy its customers.

A Bright Future

The beer market promised to remain extremely competitive. In 2000 giants Anheuser-Busch, Miller Brewing, and Coors controlled 80 percent of the market. Over 500 smaller breweries battled fiercely for the remaining market share. Despite the odds, however, Yuengling continued to thrive as it entered the new millennium. In Dick Yuengling’s own words, “Yuengling is a survivor.”

Principal Competitors

Adolph Coors Company; Anheuser-Busch Companies, Inc.; Boston Beer Company, Inc.; The Gambrinus Company; Miller Brewing Company;

Key Dates:

1829:: German immigrant David G. Yuengling founds the Eagle Brewery in Pottsville, Pennsylvania.
1831:: A fire destroys the Eagle Brewery and a new brewery is built on Mahantongo Street in Pottsville.
1873:: Yuengling changes the name of the brewery to D.G. Yuengling and Son, Inc. when his son Frederick joins the business.
1919:: The 18th Amendment is ratified, making it illegal to sell alcohol.
1933:: Prohibition ends and Yuengling starts producing alcoholic beer once again.
1960:: Frank Yuengling, Frederick’s son, hires N. Ray Norbert as brewmaster.
1963:: Frank Yuengling dies; his sons, Richard L. and F. Dohrman Yuengling, take over the brewery.
1985:: Richard L. Yuengling, Jr., buys the company from his father.
1991:: The Yuengling Museum and Gift Shop opens.
1996:: Yuengling goes online.
1998:: Yuengling breaks ground on a second brewery in Pennsylvania and buys a former Stroh brewery in Tampa, Florida.