Author Topic: Starting a brewery  (Read 8183 times)

Offline newrocset

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Re: Starting a brewery
« Reply #75 on: April 06, 2013, 04:40:23 PM »
Thanks for the responses.  This all came about at an event to promote my wife's business.  We sell small batch beer kits and a vendor told me he is looking for a brewer for a restaurant/brew pub that he wants to open this fall.  He has a business plan and investor and is currently looking for a space.  I will meet with him next week to explore further and give him an idea on how much floor space will be needed for a brewery in the restaurant.  Here are my thoughts:
1.  Beer will be served only at the brew pub.  It will not be packaged for distribution.  I would like to serve it directly from the bright tanks, but will probably need to keg for storage purposes.
2.  I will need an assistant or two.  Hopefully someone who knows brewing, but being in a college town, maybe I'll get an engineering or chemistry major that is hungry for a cool side job.
3.  I don't know commercial equipment, but I'm positive I will learn it pretty fast.  Hopefully we will secure a space and system so I can start learning it while I do the paperwork to make my brews legal.
4.  Sales projections are unknown as of today, but I'm guessing it will be pretty busy during football season...at least I hope so!
5.  I want to start with 4 low point ales on tap.  I'm guessing I can brew each one on the first of my 7 days off.  The question is how much do I want to brew?  If I can get away with a system smaller than 7 barrels, I will, I'm just worried about keeping up with the demand.  I also have scattered days off throughout the month where I can attend to operations.
6.  There is no way I will quit my day job unless the brew pub becomes incredibly lucrative...a 2 hour round trip commute won't kill me if it's a path to recognize my goals...I'm not getting any younger!
7.  My long term plan is to open another brew pub in my home city and a off-premises brewery between the 2 cities.  This will allow me to brew high point beer and distribute off-site.

This is basics of what I'm planning.  Any input is appreciated as there is a lot of knowledge and talent in this forum!
Have a Kolsch and a smile!

Offline tschmidlin

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Re: Starting a brewery
« Reply #76 on: April 06, 2013, 06:01:18 PM »
1.  Kegging for storage is not a good plan if you can serve from brights.  Kegging a little for long term aging is fine.

2.  I think you are under estimating how much work there is and the amount of training and supervision people need.

3.  If the paperwork isn't done, you cannot legally make beer.

4.  It will be good to be busy, but that's a lot of beer you need to make.  With 125 seats, how many beers per seat per day do you think you'll sell?  1?  3?  10?  Do some math - for example let's make up some numbers . . . if you will be open for 8 hours a day, and seats turn over every 1 hour, and the average patron drinks 1 pint, that works out to 125*8*1*1, or 1000 pints per day.  That's roughly 4 bbls of beer per day, 30 days in a month means 120 bbls of beer per month.  On a 7 bbl system you need to brew 18 batches per month to have enough beer.  Each batch takes 2 weeks, so you need 9 fermenters to handle that amount.  7 bbl of beer is a huge amount from a homebrew perspective, from a professional perspective it is tiny.  Maybe my numbers are wrong, maybe you'll only sell half that - you still need 9 batches per month, and 5 fermenters.  The amount of beer you will sell to get away with 4 @ 7 bbl batches per month works out to ~231 pints per day.  That's less than 2 per seat, which makes me question why you would make beer there in the first place, you're not making enough money on beer to justify the space and expense.

5.  You think you can brew 4 batches in one day?  Or am I reading that wrong?  Just consider how much power it will take to heat enough water fast enough to do 4@ 7 bbl batches in one day.  Are you planning on brewing with extract?  Because milling takes time, mashing takes time, transfers take time, boiling, chilling, etc.  Problems also take time, and there are usually problems of one sort or another.  Equipment breaks or doesn't perform as expected, etc.  And if you are brewing 4 batches in one day you need 4 fermenters, which takes up space, and hopefully once they are done they won't sit empty until the following month.

6.  Until you start driving the 2 hours per day for 2 hours worth of work and start to hate it.  And if you are looking for incredibly lucrative work, a brewpub is not your best bet.

7.  It's good to have goals, I hope you achieve them.

I'm not trying to dissuade you, just trying to give you a realistic point of view so you can make a good decision.  I think Sean is right, a 7 bbl system for a 125 seat place is a full time+ job if the place is going to be successful selling beer.
Tom Schmidlin

Offline klickitat jim

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Re: Starting a brewery
« Reply #77 on: April 06, 2013, 07:02:55 PM »
This is a great thread. It seems to me that working in a commercial brewery would be the first step. No out lay and a great way to see if you like it as a job.

"Freedom is temporary unless you are also Brave!" - Patriot


Offline newrocset

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Re: Starting a brewery
« Reply #78 on: April 06, 2013, 09:08:44 PM »
What if I got a 7 barrel system, brewed one house beer, then supplemented with a craft beer menu?

Doing the math gives me 57 pints/day with one brew session per month.  I could get away with one fermenter and one bright tank, right?  We would not be making much money on the house brew, but it would create a draw, which is really what we are going after.  I think this would make us less dependent on the brewing side of the restaurant, cut our costs on ingredients and labor, and help us focus more on quality rather than quantity.  Sound like a decent business model?

Also, I discovered I would have a 90 minute commute rather than 1 hour...yikes! :o...however it would still be worth it if I got to practice on professional equipment and became a licensed brewer - as long as I only need to make the commute every few days, I'd be quite happy.
Have a Kolsch and a smile!

Offline klickitat jim

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Re: Starting a brewery
« Reply #79 on: April 06, 2013, 09:48:40 PM »
Might be interesting from a customer point of view to release one a month, like first Fridays, there till its gone. Different style each month. Maybe to fit the season. It would make me want to arrange date night to go try the new one.

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Offline tschmidlin

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Re: Starting a brewery
« Reply #80 on: April 06, 2013, 11:43:23 PM »
What if I got a 7 barrel system, brewed one house beer, then supplemented with a craft beer menu?

Doing the math gives me 57 pints/day with one brew session per month.  I could get away with one fermenter and one bright tank, right?  We would not be making much money on the house brew, but it would create a draw, which is really what we are going after.  I think this would make us less dependent on the brewing side of the restaurant, cut our costs on ingredients and labor, and help us focus more on quality rather than quantity.  Sound like a decent business model?

Also, I discovered I would have a 90 minute commute rather than 1 hour...yikes! :o...however it would still be worth it if I got to practice on professional equipment and became a licensed brewer - as long as I only need to make the commute every few days, I'd be quite happy.
Supplementing with other beer is good as long as you are legally allowed to do it under your license.  With one fermenter and one bright you could do two batches per month, a much better use of space.  Your fermenter needs to be a uni tank, otherwise you can't carbonate in it, and then you ave to wait for the beer to carb in the bright.

But keep in mind, you will make less money selling other people's beer than selling your own, even if you are making 7 bbl batches.  Unless you are getting the equipment dirt cheap somewhere, you won't make your money back on the brewing gear for a very very long time making/selling one batch per month, especially with all of the additional space required, licensing, taxes, etc, not just the fees but the time spent managing that stuff.

I don't think a brewery doing one beer a month is much of an additional draw compared to just serving good craft beer.  If you left out the brewery you could add a bunch of seating and sell more stuff, assuming the place fills.  It depends on what else is in the area, you know better than I do.

Re: becoming a licensed brewer . . . what is that?  You don't need a license to make beer, the brewery needs a license to sell it.

Personally I think it's a terrible idea, but then I really hate commuting.  If this place was 15 minutes from your house I'd say go for it.  But with 3 hours of driving to do anything?  No, not for me.
Tom Schmidlin

Offline nateo

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Re: Starting a brewery
« Reply #81 on: April 07, 2013, 05:58:19 AM »
Personally I think it's a terrible idea

That's really all that needs to be said. I completely agree.

Edit: I guess I should say why I agree. If you want to thrive in life, you need more than a passing familiarity with your core subject. It takes mastery to be successful. Mastery means throwing yourself at something completely, not half-assing it. I've heard the rule-of-thumb is that it takes 10,000 hours of experience to achieve mastery. You can do the math on that to figure out how long it'd take to get there, if you only do it part-time.

Some people can do the bare minimum and scrape by, but if you go that route, you're really counting more on luck than anything else. I don't like to gamble, so that's not a route I'd take.

If, however, you just want to play with professional equipment: take the job, play with the sweet gear, don't invest any of your own money, and enjoy it for the 3-4, maybe 6, tops, months the brewery stays in business.
« Last Edit: April 07, 2013, 08:47:33 AM by nateo »
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Offline newrocset

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Re: Starting a brewery
« Reply #82 on: April 07, 2013, 05:22:37 PM »
I'm not doing this so I can fart around, and play with professional equipment, but I would like to learn how to use it.  I realize the seriousness of it, the risk, the hard work, the learning curve, and the dedication needed to make this work....It would be a helluva lot easier for me to sit back with a sweet homebrew system and play with that all day, but I know that I have the ability to do something more.

I posted on this forum because I am trying to conduct serious research on this and I value the feedback.  I have read each and every post on this forum in my effort to develop an understanding of what it takes to make a good thing happen for me and the craft brewing community in my state.  In fact brewpubs suck in Oklahoma, point blank.  They are limited to serving 3.2 beer so they constantly try to make a stylistically high point point beer into a low point beer and it never works.  I would like to change that by showcasing the wonderful low point beers that are available amongst the styles.  Hopefully the laws here will change, but right now we gotta work with what we got.

It would be great to able to ditch my job to be a professional brewer.  I can't afford to that now, but I can educate myself.  I apologize for my ignorance re: equipment and methods of a professional brewery, but again, that's why I'm here.

I really, really appreciate the feedback I am receiving and I take your comments seriously.  It's really helping clear up some issues I was foggy on and helping me see those avenues of research that I have failed to see before.  So if it's Okay with others, I will continue to post ideas and questions in an effort to receive some valuable constructive criticism  ;)
Have a Kolsch and a smile!

Offline klickitat jim

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Re: Starting a brewery
« Reply #83 on: April 07, 2013, 05:49:53 PM »
Fine by me. Its good to see you still want to do it after being told you can't or shouldn't. All things worth doing are impossible or impractical.

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Offline denny

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Starting a brewery
« Reply #84 on: April 07, 2013, 05:57:36 PM »
What if I got a 7 barrel system, brewed one house beer, then supplemented with a craft beer menu?

Doing the math gives me 57 pints/day with one brew session per month.  I could get away with one fermenter and one bright tank, right?  We would not be making much money on the house brew, but it would create a draw, which is really what we are going after.  I think this would make us less dependent on the brewing side of the restaurant, cut our costs on ingredients and labor, and help us focus more on quality rather than quantity.  Sound like a decent business model?

Also, I discovered I would have a 90 minute commute rather than 1 hour...yikes! :o...however it would still be worth it if I got to practice on professional equipment and became a licensed brewer - as long as I only need to make the commute every few days, I'd be quite happy.

I think you're fooling yourself is you think having one house beer will be a draw.
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Offline nateo

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Re: Starting a brewery
« Reply #85 on: April 07, 2013, 06:46:40 PM »
All things worth doing are impossible or impractical.

No, plenty of successful businesses have detailed, feasible plans. But plenty of failed businesses were impossible or impractical. It's not an exact correlation, but like I said, I wouldn't spend any of my own money on it.

I don't want to sounds like I'm exclusively being a downer. I'd be happy to provide detailed feedback when you get to the capital and operating budgeting stage. "Business" is a technical skill, just like brewing, and I'm always happy to share my skills with others.
« Last Edit: April 07, 2013, 06:51:29 PM by nateo »
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Offline majorvices

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Starting a brewery
« Reply #86 on: April 07, 2013, 07:40:06 PM »
All I'll add is, after opening a brewery in 2010 and doing this full (plus) time since, it's way more work than you think it will be. If you love brewing it's also totally worth it. But to make it work you really need to give up your day job and dedicate yourself 100%. Quite simply, anything else just won't work.
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Offline anthony

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Re: Starting a brewery
« Reply #87 on: April 07, 2013, 07:47:08 PM »
I would also think long and hard about dedicating 100+% of yourself to something like this without some form of ownership to not only give you incentive but to insulate yourself against strange choices management might make in a vacuum otherwise.

Also, you mention that this person has a business plan but no sales projections. I'm sorry but that isn't a business plan.

Offline nateo

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Re: Starting a brewery
« Reply #88 on: April 07, 2013, 08:09:17 PM »
Also, you mention that this person has a business plan but no sales projections. I'm sorry but that isn't a business plan.

Agreed. You can't even begin to evaluate whether it's a good idea or not to start any project until you have a good idea of what your revenue will be.
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Offline Thirsty_Monk

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Re: Starting a brewery
« Reply #89 on: April 07, 2013, 08:22:07 PM »
I have been reading this for a few days and I will add my 2 cents to it.

Operating 7 BBL brewery is a full time job.
You need to brew more then one beer.
More beers you have more tanks you need.
You can fit brewing equipment, fermenters, cooler... into 1000 sq ft space. You also need to have additional space for supply like grain, hops, kegs...

Brewpubs are mostly where people go to eat. If you have 125 seats how much beer you will sell a week?
You need to have your sales analysis or at least to understand local market. If you are still not sure excise tax records are public. Check the close by brewpubs how much are they selling. I think in well run brewpub can sell 15 to 30 BBL a month.
Remember. Brewpubs make their money on food.

Now the hard questions you have to answer to yourself.
Who are you partnering with?
Do they have restaurant experience?
Are they willing to spend $0.5 mils on brewing equipment (may be more)?
Why just not to get someone else beer and forget the cost of initial investment and ongoing expense?

And again it is a full time job.

Good luck.
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