[anthony]

Ironically, I have been looking at these numbers quite closely as our tasting room where we planned to sell 4, 8, and 16oz samples of the beer has come under quite a bit of attack by local residents.

In our market, with my overhead (rent, utilities, etc.), using the standard sixtel pricing in our area, I would need to wholesale 500 barrels per year to break even. That is a lot of brewing on any system less than 10 barrels. That is self-distributed of course, if I had to use a distributor, it would be more.

[denny]

Ironically, I have been looking at these numbers quite closely as our tasting room where we planned to sell 4, 8, and 16oz samples of the beer has come under quite a bit of attack by local residents.

In our market, with my overhead (rent, utilities, etc.), using the standard sixtel pricing in our area, I would need to wholesale 500 barrels per year to break even. That is a lot of brewing on any system less than 10 barrels. That is self-distributed of course, if I had to use a distributor, it would be more.

Not to mention that's just breaking even.  I can't imagine you wouldn't want a return on your investment and effort.


Sent from my iPad using Tapatalk HD

[a10t2]

I would need to wholesale 500 barrels per year to break even. That is a lot of brewing on any system less than 10 barrels.

That wouldn't be an unusual pace (3.2 brews/week) even on a 3 bbl system. On a 7 bbl or 10 hL system it would be positively leisurely.

[jeffy]

Nobody seems to mention the fact that brewers tend to give away a sizeable amount of their "product" at festivals, dinners and other marketing events.  I think you need to figure some of that into the estimates, too.

[Thirsty_Monk]

I would need to wholesale 500 barrels per year to break even. That is a lot of brewing on any system less than 10 barrels.

That wouldn't be an unusual pace (3.2 brews/week) even on a 3 bbl system. On a 7 bbl or 10 hL system it would be positively leisurely.

Self distribution takes a lot of time.
I have hard time maintaining 250 BBL/year self distributing.
Unlike in brewpub where people come to you.

[majorvices]

We've actually stopped giving away beer for most events unless there is some serious recompense. We make the festivals pay now, too. It doesn't make sense for the fest to make out like a bank heist while the brewery is only there under the guise of "marketing their product". Without the diverse breweries pedaling (often times) their rare and special beer, the festivals have no attraction. It isn't the fests offering marketing for the breweries - it's the other way 'round. So why would we give them free beer? Screw 'em if they don't wanna pay for it.

Now, charity may be a different case, but even then a discount is normally what we offer.

[a10t2]

Self distribution takes a lot of time.
I have hard time maintaining 250 BBL/year self distributing.

That's a good point; I wasn't thinking about one man operations.

Obviously there would be a lot of specific market factors to consider, but my intuition is that for all but the smallest of nanos it makes financial sense to pay an employee (near) minimum wage to do distribution. Skilled vs. unskilled labor and all that.

[majorvices]

It's not worth it to me to self distribute. Our distributor does a much better job distributing our product, plus we are all over the state. Who has time to drive a twelve hour round trip every week or two, plus clean lines (our distributor does that) plus grab empty kegs, etc? Not me. I'd rather be brewing.

Oh, also, there's the refrigerated trick I don't have to buy. Plus I can unload my product on them and they can hold it in their ginormous cold room. And they send me a check or two every month - no collecting from several different sources.

They do a hell of a lot for us, print banners or posters for free, go in halves on glass ware, clean lines, deliver tap handles, etc., etc.

Distribution is one headache I don't want to have to worry about.

[hopfenundmalz]

Refrigerated trick? 

[hopfenundmalz]

Ironically, I have been looking at these numbers quite closely as our tasting room where we planned to sell 4, 8, and 16oz samples of the beer has come under quite a bit of attack by local residents.

In our market, with my overhead (rent, utilities, etc.), using the standard sixtel pricing in our area, I would need to wholesale 500 barrels per year to break even. That is a lot of brewing on any system less than 10 barrels. That is self-distributed of course, if I had to use a distributor, it would be more.

Dark Horse here in MI made 9300 barrels last year with a 7 bbl system.  Not a nano, but you can be making a lot of beer with a system of modest size.

[a10t2]

It's not worth it to me to self distribute.

Yeah, but you're a tall kid in a very shallow pool, Keith. Most micros would kill to get that kind of attention from a distributor.

[Thirsty_Monk]

It's not worth it to me to self distribute.

Yeah, but you're a tall kid in a very shallow pool, Keith. Most micros would kill to get that kind of attention from a distributor.

Then that is flattering for me.
I have a distributors stopping by every now and then.
I am still reluctant but the day might be getting closer when I will go with one of them.

I still think that self distribution is very important for start ups.
Part of it is necessity and part of it is marketing and brand building.

[majorvices]

It's not worth it to me to self distribute.

Yeah, but you're a tall kid in a very shallow pool, Keith. Most micros would kill to get that kind of attention from a distributor.

No, not necessarily. Our distributor does help us out a lot. Our beer makes them money. Maybe other breweries don't understand the power they wield. OTOH we are not in the same market as many other regions. Not a tight market, competition wise. For now any way.

[majorvices]

Wait, maybe that's what you meant by tall kid shallow pool. My bad. 

[tschmidlin]

Dark Horse here in MI made 9300 barrels last year with a 7 bbl system.  Not a nano, but you can be making a lot of beer with a system of modest size.

You might want to check those numbers Jeff - that works out to brewing more than 3 times per day, every single day of the year.