How to Start a Brewery That Won’t Be Overshadowed by Established Local Distilleries
[This article was written by Hannah Whittenly.]
If you have always dreamed of starting your own craft beer brewery, now might be the right time to begin. In 2017, craft beer sales now account for 12.7 percent of the total beer sales in the United States. Let us examine some of the things that you need to consider to make this dream a reality.
Many microbreweries started out as hobbyists who perfected their craft at home. Brewing beer at home is relatively inexpensive, but scaling it up into a business is a different story. Startup capital is one of the main barriers to entry that keeps local microbreweries safe. Even a small 31 gallon barrel costs approximately $100,000. This can produce about 320 12-ounce beers. You will need to find companies that specialize in the individual pieces of equipment that you need for your beer. One thing that you may need to consider getting, for example, are stainless steel wire mesh baskets for straining purposes, like those from Newark Wire.
There are many different financing options available such as small business loans, equity loans, and borrowing money from relatives. One of the things to consider when looking for financing is whether you should get the cheapest equipment possible, or buy equipment that will last if your brewery becomes a success and you want to increase the volume. Some financing options, such as traditional banks may not finance used equipment and require you to buy new.
The Slow Road to Growth
Due to the expense involved in financing, it can be quite some time until you see profit from your enterprise. In the beginning, much of your earnings will go towards paying off financing and reinvestment for expansion. Keeping up with costs as you grow can be a challenge, but be patient. Keep track of everything and look for progress. As you see even the littlest amount of growth, you’ll be motivated and be able to see the larger picture—a future where there will eventually be profit.
Leveraging Your Uniqueness
To compete with established microbreweries, you will need to find your own voice in the market. Understanding what sets your craft beer apart from the competition is the first key to success. Choosing a neighborhood that has the right character could also give your brewery an advantage.
Now is the right time to begin considering starting your own craft brewery. If this has been your dream, the market is ripe for expansion and to take advantage of market growth. Perhaps it is time to turn that dream into a business plan.
Hannah Whittenly is a freelance writer and mother of two from Sacramento, CA. She enjoys kayaking and reading books by the lake.