Not one of those small, 50,000 barrel pre-Prohibition breweries, but one that had the potential for greatness. It was a brewery that started big and remained there for most of its 91 years. Its 77-acre property at Cranston, Rhode Island, held 29 buildings, 660,000 square feet of parking space for 1,000 cars, a small airstrip, a seven-acre pond, and 40 acres of undeveloped land. Its survival during Prohibition is as remarkable as the years of acquisitions and expansion that followed. This, of course, is the story of the Narragansett Brewing Company. The final chapter was written last October with the start of a $2.9 million demolition project that continued into this year.
" Hi Neighbor, have a 'Gansett.'" That catchy singsong slogan hasn't been heard on local radio stations since the Narragansett Brewery at Cranston, Rhode Island, closed its doors on July 31, 1981. The song was not revived when Falstaff reopened the old plant - or appeared to reopen it - in January 1983. Earlier this year, the tired, decayed buildings that once housed a great company disappeared under the blade of bulldozers. Brewing history started at the site in 1888 when these six local businessmen organized the Narragansett Brewing Company: John H. Fehlberg, Augustus F. Borchandt, Herman G. Possner, George M. Gerhard, Constand A. Moeller, and Jacob Wirth. George Wilhelm, formerly of Berlin, Germany, was the first brewmaster. With an authorized capitalization of $120,000 to $150,000 and funds from Fehlberg`s successful Butterine (a predecessor of margarine), a brick brewing house was built and the first beer produced in December 1890 using "pure artisan water." The local newspaper declared "The quality of the new product is excellent." The company was incorporated in January 1891.
The Narragansett Brewing company was situated on New Depot Avenue, Cranston Street and Garfield Avenue, outside the city of Providence, and alongside the tracks of the then New York, New Haven & Hartford Railroad. A spur track ran onto the property which also connected to the Rhode Island Company's trolley freight service. This convenience permitted quick shipping of incoming raw materials and outgoing beer.
In its first 20 years, the company invested $4 million to build about 30 buildings on its property. They included a large artificial ice plant, two cold storage basements, engine and boiler rooms, a barn and stable; blacksmith, paint and carpenter shops, cooperage and bottling departments. The ice plant enjoyed a large retail business with local residents and businesses. The brewery was also the only one in the area to ship in its own cars, with 75 horses, 45 wagons of various types, and electrically propelled and gasoline trucks. It also owned 25 refrigerator cars of improved design for shipping to distant points.
Business was good in that first decade. A work force of 150 men were busy in the brewery and shops or delivering lager and ales to customers. In 1891, the company brewed 27,997 barrels. Output was up to 114,182 barrels by 1901. In 1909, it was 207,992 barrels and, by the end of the next year, Narragansett's sales amounted to 225,000 barrels. The brewery stood firmly on the company's guarantee of pure ingredients, absolute cleanliness of manufacture and perfection of brew in every drop. Ninety percent of the barrels were sold in this country, mostly in the New England States. The other ten percent was exported to the West Indies, Turkey, Egypt and Panama.
In 1914, the company installed what was said to be the largest and undoubtedly the most modern and hygienic bottling plant in New England. At the end of tours, visitors were invited to the Bierstube Room on the second floor of the new bottling plant. Furnished in mission tile and decorated harmoniously with fittings of Dutch and German designs; no cozier or more comfortable Dutch Room can be imagined. A high built-in icebox held samples of Narragansett's choice products. A fireplace on one side of the room added a suggestion of comfort for cold days. During its first 23 years, the Narragansett Brewing Company grew from modest beginnings to the largest lager beer brewery in New England. Its growth from the start was steady; its progressive management and the excellent quality of its products made the company an industry leader. The brewery's capacity was up to 400,000 barrels in 1913. The officers at that time were Constand A. Moeller, president; vice-president John H. Fehlberg, treasurer Jos. H. Gerard, brewmaster Otto Henn, and plant manager Emil Schierholz.
The main competition for the Narragansett Brewery in Rhode Island was the James Hanley Brewery, one of the famous names in New England's ale history, located on Fountain Street in Providence. Another competitor in the lager market was the American Brewing Company established in 1891. In 1896, James Hanley bought that brewery and changed its name to the Providence Brewing Company. It was located at the intersection of Harris Avenue and Eagle Street in Providence.
From 1914-1920, as the country entered World War I and Congress and Americas debated the merits of prohibition, the three largest Rhode Island breweries worked hard to survive. When prohibition did arrive, the Rights of Charter granted by the state in 1919, allowed them to manufacture and sell lager beer and malt liquor (commercially called ale), as long as they did not violate interstate commerce, foreign trade and dealing with the Indians. Their products were to be sold on their premises at no more than five gallons at a time. The main claim was that malt liquors containing more than half of 1 percent of alcohol by volume and beer at 2.75% were non-intoxicating.
Prohibition - Beer Becomes Medicine.
In November 1921, the Commissioner of Internal Revenue in Washington granted breweries in Rhode Island and eight other states permits to manufacture, bottle, and sell malt liquors for medicinal purposes. Sales could be in a quantity of one gallon with a doctor's prescription. This, and the sale of ice, helped Narragansett stay in business during the dry years. But, profits lagged considerably following ratification of the eighteenth amendment in 1921, and Narragansett was in an unstable financial condition toward the end of Prohibition. Many other breweries, unable to adapt to near beer and nonalcoholic products, failed. Among them was the Providence Brewing Company.
In 1931, near Prohibition's end, the Narragansett Brewing Company approached Rudolf F. Haffenreffer, Jr. to ask for help in financing modernization of the brewery and in managing the company. Haffenreffer later assumed control as president and chairman of the board for the Narragansett Brewing Company. Haffenreffer was no stranger to the brewing business. His father, Rudolf, Sr., established his first brewery in Boston in 1870. (Samuel Adams is brewed there today), and he managed the firm until his death on March 8,1929. He turned the business over to his two sons. Rudolf Jr. and Theodore. After repeal, the Haffenreffers would operate three different breweries in Boston.
Around this time, the Narragansett Brewing Co. switched to the city water system. Service was connected on April 20, 1933, and provided by the Scituate Reservoir which billed itself as among the world's finest water sources. Government tests showed Scituate water has very little taste of its own. Narragansett began canning beer in June 1936 and was first brewer to do so in large volume.
There was a practical side to Rudolf Haffenreffer that shined in marketing. He used his interest in cigar-store Indians as an opportunity to promote Narragansett. A cartoon designed by Theodore Geisel (the famous Dr. Seuss), a Dartmouth College acquaintance of his sons, soon appeared showing Chief 'Gansett, an angular wooden Indian on a base with wheels, offering a frothy glass of 'Gansett beer.
The Heffenreffer family genealogy for the years of World War II (1939-1945) lists Rudolf III, age 37, and Carl, age 33, but shows no military service, although four cousins did serve. There is no record at this time what the brewery did for the war effort, or if the production of beer was considered an essential industry which kept the brewers out the military service.
Post-War Success and Prosperity
Narragansett launched a massive advertising campaign after World War II, starting with its "Hi Neighbor" slogan appearing on billboards, newspapers, magazines and bus and trolley cards. The brewery sponsored the 1951 Boston Braves (later the Red Sox) with Curt Gowdy as the game announcer on radio and later television.
A 1955 survey found that Gansett was the number one choice of consumers and New England's largest selling beer. While Narragansett was enjoying its greatest popularity, the Croft Brewing Co. in Boston was in trouble. A bad batch of ale left the brewery; many faithful drinkers said goodbye to Coft! According to the story, the company purchased a new paint product to line its aging tanks. Residue from the paint was in the beer. Croft never fully recovered from the mistake. In 1952, Narragansett stepped in, bought the brewery, operated it as a branch for one year, then closed the Croft plant. Narragansett continued to brew Croft brands from its Cranston brewery.
Rudolf Heffenreffer, Jr. died in Bristol RI on October 9, 1954. Rudolf 4th joined the company in 1960 becoming the fourth generation of the family to operate the brewery following his father and President Rudolf 3rd. In 1957, long-time rival James Hanley Brewing Company succumbed to the relentless pressure from the national and larger regional brewers and sold out to Narragansett. Narragansett closed the brewery, and became the sole remaining brewery in the state.
In 1959, the company celebrated brewing one million barrels for the first time. To commemorate the occasion each employee was presented with a gold-plated bottle of Narragansett Beer. In May 1961, the brewery negotiated a five-year lease contract with G. Krueger Brewing Company of Newark, New Jersey. Krueger Ambassador beer would be distributed in New England through the Narragansett plant, and Krueger would distribute Narragansett brands in New York.
On November 29, 1961, following an all-time sales record of over one million barrels, Governor John A. Notte, Jr. drove a golden bung into a 31 gallon barrel during a noon ceremony at the brewery. Three years later the original Haffenreffer & Co. brewery in Boston was closed by cousin T.C. (Ted) Haffenreffer Jr., who explained, "We could see the handwriting on the wall, there was no competing against Anheuser-Busch, Schlitz, Pabst, and Miller." Narragansett at Cranston took over production of their brewing lines.
The company employed 850 workers by 1965. Narragansett's organization was unique in the beer business. It was a well-managed and a great place to work from Mr. Haffenreffer down to the guy that swept the floor. The brewery provided steady pay, good benefits, genuine friendships, and free beer. Employees were not only allowed to drink during the workday; it was encouraged. Anyone caught drinking a soda would be quickly handed a beer. Asking for a draft in a bar in the area would automatically bring a Narragansett. If you wanted another brand, you would ask quietly for fear of bringing the wrath of local drinkers.
Employees also promoted the home-town brewery. If a worker spotted someone drinking a Heineken in a bar, he would ask, "Why would you want to keep someone working in Holland instead of the people in your own neighborhood?" The same line was used for any other competing, and out of state, brand. The brewery supported local charities, as did the Heffenreffer family, and sponsored an annual Oktoberfest celebration. Gansett boasted that it was a Rhode Island beer, brewed by Rhode Islanders, in a plant owned by Rhode Islanders, the Haffenreffers of Bristol.
Falstaff - "The Price Was Right"
Carl Haffenreffer could only say, "The Price Was Right". In a merger through acquisition deal, he sold the business to Falstaff for $17 million in cash and $2 million in Falstaff common stocks on July 15,1965. It was announced that no changes were contemplated with personal or employment policies at the brewery . The Narragansett brand would be retained and actively promoted in New England. The brewery would operate as a wholly-owned subsidiary of Falstaff under the present Haffenreffer management. In making the purchase, Falstaff said it was attracted by the Haffenreffer's background as brewers, their excellent technicians, the good management in depth at the top and middle levels, and their fine network of wholesale distributors throughout the northeast.
After the sale, R. F. Haffenreffer, 3rd, retired and Carl Haffenreffer took over as president. He retired on May 1, 1968.
The sale to Falstaff brought anti-trust action by the government in a court battle that started two days before the sale and lasted through October 1974. The case, United States verses Falstaff, charged violation of section seven of the Clayton Antitrust Act. The government said the deal violated the prohibition against acquisition by an interstate firm of another firm in the same line of interstate commerce, if the acquisition would reduce or threaten to reduce competition. Justice Department attorneys contended that Falstaff could have shipped into the New England market from its other breweries, or could have built its own brewery in New England, instead of acquiring the region's largest brewery.
Carl Haffenreffer gave his reasons for sale at hearings in 1970. He testified that Narragansett's management began to explore the possibility of disposing of the Cranston brewery as early as 1956 or 1957. The alternatives facing the company then was to acquire additional breweries, merge with other brewers, or be acquired by a larger firm. "A capacity of two to three million barrels a year was necessary to be viable, unless we could broaden our base, break out of the New England market, we were going to be choked off by larger breweries with wider distribution," he said. "Eighty-five percent of Narragansett's stock was owned by members of the Haffenreffer and Moeller (remember the founding six) families, and it was not healthy to have so much of the families resources in one basket, in view of the outlook in the beer industry."
Mr. Haffenreffer added, "It would have been very difficult, if not impossible, for an outsider to come into New England and develop its own distribution system. And building a brewery of at least one million barrels capacity would have been a tremendous expense." Falstaff had no distribution facilities in New England and was not selling in New England, and Narragansett was not selling outside New England in any significant quantity, so that neither was a competitive threat to the other. Nearly a decade after the sale, in October 1974, Falstaff finally won the right to purchase the Narragansett Brewery.
The future of the Narragansett plant became uncertain after giant Anheuser-Busch opened a new state-of-the-art brewery just 100 miles away in New Hampshire. Gansett lager and porter were being produced in a facility that remained turn-of-the-century in an outdated plant with obsolete equipment. Compared to its new neighbor in New Hampshire, Narragansett was still brewing the old-fashioned way.
Falstaff's purchase of the Ballantine brands in 1972 brought new hope to Cranston. By April 3, the first barrels of Ballantine were shipped from Rhode Island. The brewery was now producing at its rated limit of 1.7 million barrels a year with fewer, but more efficient workers, than eight years before. This brought new sales, new jobs, and more overtime at the aging plant. The plant's 580 employees were working around the clock, seven days a week. The 19 different labels produced in Cranston gave a history of the mergers and acquisitions that marked Falstaff and its successor General Brewing Co. Labels bore the brand and brewery names for such lagers as Narragansett, Hanley, Krueger, Haffenreffer, Boh, Ballantine, Bohack, Munich, and Falstaff. Ales were Croft, Pickwick, Bavarian, Ballantine, Boston Light, BB Stock, and India Pale. Also Krueger Pilsener, Haffenreffer Malt Liquor, Dresden, Bavarian (dark), Bock, and Porter. The brands were all different as government inspectors visited regularly to insure that the brewery was not just putting different labels on the same beer.
The need to update the state's only brewery was obvious to everyone. From 1972-75, the State of Rhode Island offered to help finance a new plant. News reports said that "company officials did not respond in a positive way."
Enter Beer Baron Kalmanovitz
Multi-millionaire Paul Kalmanovitz obtained majority control of Narragansett's parent corporation, the Falstaff Brewing Co., on April 28, 1975. The San Francisco brewer and businessman bought the brewery for an undisclosed amount. Soon after the purchase Falstaff's corporate headquarters moved from St. Louis to San Francisco, and many of the firm's officers were fired in the process. The Securities and Exchange Commission investigated the takeover of Falstaff to determine if adequate disclosure was made to shareholders. As a result, Falstaff stock was barred from trading and removed from the New York Stock Exchange. It later moved to NASDAQ, the over-the-counter exchange. Falstaff executives and stockholders, contending Kalmanovitz misrepresented his intentions, filed a number of other suits over the takeover. Workers also got into the foray with work stoppages at Cranston and other Falstaff plants. Union employees called it a company lockout; Falstaff (now part of the Kalmanovitz's S&P Corporation and the General Brewing Co.) called it a strike.
Two months after the takeover, the brewery asked the city of Cranston for $723,000 in tax relief saying that considering the obsolescence of the buildings, the property was overtaxed. Two real estate companies controlled by Kalmanovitz, through his S & P Company and the Keller Street Development Company, bought 41 acres near the Cranston plant from Falstaff for $2.9 million in November 1980. Property taxes on the brewery and its land was $315,382, so the General Assembly offered tax relief by exempting the first 100,000 barrels of beer produced by Narragansett from the alcoholic beverage tax. This break saved the brewery about $200,000 a year. The brewery's energy bill was $2.8 million in 1980. Ninety-five percent of the energy was used to produce beer, not for heating and lighting.