Chemung County's Upstate Brewing opening its third taproom. This one is in Penn Yan.

Upstate, founded in 2011, will utilize its farm brewery license to open another "branch office."

Stop if you read this here before (actually, don’t stop, keep reading): Beer is friggin’ weird right now.

Just a few years ago, every brewery was poised for growth as the market was growing by double digits. Now, people aren’t drinking as much beer. (Aside: You should follow my buddy, Bryan Roth, on Twitter and his ongoing “nobody likes beer anymore” thread.)

For Mark Neumann, founder and owner of Chemung County’s Upstate Brewing, it isn’t “nobody likes beer anymore,” it’s “let me sell all my beer in-house, so I can control the market, prices, and margins.” Distribution is a tough game to play. Limited shelf space, more competitors, yada yada yada.

With the assistance of the New York state farm brewery license, Neumann and Upstate are set to open their third taproom. The original, opened in 2011, is on the Horseheads/Elmira border. The next one came at the base of Seneca Lake in Watkins Glen, Schuyler County. Watkins Glen opened in early 2023.

The next one, if all goes according to plan and all approvals (both state and local) are granted, will be in Penn Yan, Yates County, right along the Keuka Lake Outlet. It’ll be located at 130 Water St. in the village of Penn Yan and occupy about 1,200 square feet with another 500 square feet available as an outdoor patio. He hopes to open in June.

Photo: A mock-up shows an Upstate Brewing sign on the proposed site of its next location (or branch office) near Keuka Lake in Penn Yan.

“The driving force is wanting to sell beer ourselves,” Neumann said. “Distribution is just brutal. We don’t make any money. It’s so much work, it’s so frustrating at every possible level. It’s not sustainable and it’s never been a money-maker for us. It has just been a necessary evil.

“Now that we have the means and we’ve managed to get Watkins working, and I’m comfortable with the whole thing, it didn’t make sense not to try to have another location. “

By holding a farm brewery license, NYS craft breweries are empowered to sell other beers, wines, and spirits produced in the state in their tasting, as well as open auxiliary taprooms (also known as branch offices).

With Upstate Brewing FLX open in downtown Watkins Glen, Neumann feels Penn Yan (Upstate Brewing QKA) is the perfect opportunity and outlet for his beer. It makes sense for a number of reasons:

1. Geographically, it’s in the same direction as Watkins Glen (roughly 30 minutes north of that spot). Neumann believes that will ease deliveries.

2. Upstate never made money through distribution. Now, it will control everything. (Neumann said the current brewing system in Chemung County isn’t maxed out yet and can support another taproom.)

3. Penn Yan is a different client base. “It’s a different customer base while being as close to home as possible.”

4. Neumann likes the space inside the former Birkett Mills warehouse. (Part of the property has already been converted into apartments.)

5. Penn Yan supports craft beer. It is already home to Laurentide Beer (located just 0.3 miles away), Abandon Brewing, LyonSmith Brewing, Seneca Stag Brewing, Climbing Bines Hop Farm & Brewery, and Relative Risk Brewing. (All of these spots aren’t in the village but have Penn Yan mailing addresses.)

Photo: A view of the Birkett Landing complex from the other side of the Keuka Lake Outlet.

Upstate’s new location was previously a wine bar and then a pub. Penn Yan, really all of Yates County, is the geographic center of the Finger Lakes. It also provides easier access to Upstate beer for folks from the Rochester area. Merchandise sales also buoyed the Watkins Glen opening, Neumann said. Upstate also saw really positive numbers from selling other alcoholic beverages.

“It’s not just the ability to sell beer ourselves, it’s the ability to round that out by selling other stuff,” Neumann said.

It’s not hard to imagine or envision other regional breweries following this branch office model. Other Half is the obvious example. But we’ve also seen it with places like Mortalis and Frequentem. So it should be fascinating to watch which breweries pull back a bit from distribution and focus on supplying a secondary (or tertiary) taproom.

With this trajectory does Neumann expect to open other Upstate branch offices? Probably not, especially since the brewery is maxed out in Elmira. There is no more room to add any fermenters to its existing 10-barrel system. So without opening a new production facility, Neumann doesn’t see the possibility to add a fourth taproom.

“Having everything an hour away from the brewery is awesome,” Neumann said.