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Old 04-04-2009, 04:50 AM   #1
silvervan83
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Default So... How much would it cost?

A friend of mine is bought a bar. He is refurbishing it and getting ready to open this summer. I brew beer.

I would love to be able to have some beers on tap at his bar but I can't produce enough quantity with what I have now to get everyone in Renton (suburb of Seattle) drunk.

I am going to ask my parents for some sort of loan/investment in a small, starter brewery to supply this bar with 2 or 3 beers consitantly....

I'm having a meeting with my parents tomorrow so whats the number I should throw out there? 10k ? 15k? 20k? We're talking about leasing a small space, and getting equipment and grains for a 30 barrel system.

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Old 04-04-2009, 05:18 AM   #2
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Originally Posted by silvervan83 View Post
I'm having a meeting with my parents tomorrow so whats the number I should throw out there? 10k ? 15k? 20k? We're talking about leasing a small space, and getting equipment and grains for a 30 barrel system.
30BBL? or do you mean 3BBL? If you mean 30 barrel you're looking at 250K minimum. Take a look at the Probrewer classifieds for pricing ideas.

Seriously if you haven't researched enough to even know a ballpark number of investment you are in no shape to be requesting financing. Do your homework to get a realistic number and then if it's still your thing approach your parents. It's a dream for some people but it's still a pipedream.
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Old 04-04-2009, 05:22 AM   #3
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ballpark - $250,000 and get a lawyer + accountant.

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Old 04-04-2009, 05:49 AM   #4
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Ask them for 150K. This is for a shoestring budget. Then pray that your friend is able to sell enough of your beer and you are able to do just in time inventory management to keep your ingredient inventory and cash flow balanced.

Really 30 BBL is probably more than necessary to keep three taps rolling but I would say a minimum size of 7 BBL might do to minimize initial investment. Any smaller and your keg unit cost will make your beer pretty expensive for your friend to buy. Will he sign some sort of tap ownership contract with you? Also, if you are not purchasing a defunct brewery with requisite facilities then figure at least 50K for refitting a facility in which to brew. This will also take several months to prepare and get properly licensed.

To be safe you should probably secure 250K so that you have some running capital to last until you are covering your nut consistently.

Also, you might not want to throw 250K behind the success of your friend's bar. What if it goes out of business in a year (like most) and you have recouped only 10% or less of your initial investment?

I have 22 customers with the biggest representing about 24% of my business. That customer alone makes me nervous because if I lost it I my running profit would be nearly eliminated. If I had only one customer, well, nevermind I don't even want to think about that situation.

Kudos for having parents willing to bankroll such a flyer. Make sure they are okay with writing off a couple hundred grand. (I don't mean that you will fail but that they should be able to weather the hit in the extremely unlikely case that you do fail.)

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Old 04-04-2009, 09:20 AM   #5
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Keep in mind there are tons of licensing issues as well as equipment. Do your homework.

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Old 04-04-2009, 02:12 PM   #6
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30 barrel is a fairly large setup for a microbrewery. Most of the locals are in the 4-7 barrel range, and some are one barrel. You can probably get a used 1-3 barrel system and do all of the licensing for 30K.

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Old 04-04-2009, 04:37 PM   #7
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Quote:
Originally Posted by silvervan83 View Post
A friend of mine is bought a bar. He is refurbishing it and getting ready to open this summer. I brew beer.
Keep in mind nobody's trying to rain on your parade here---it's a common question and who among us that has dreamed of going pro has come across this situation?

Reality: average start-up time for a brewpub is 18-24 months. Good information in dontman's post.

Another Brewpub Startup Post... - ProBrewer Interactive

The Brewers Association's Guide to Starting Your Own Brewery

Optionally, you could try having your beer contract-brewed by a local brewery and having it on tap at your friend's bar, but you're talking money there as well (although not quite as much). That's how Pete's Brewing Co. got started.

Good luck!
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Old 04-06-2009, 09:43 PM   #8
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Keep in mind there are tons of licensing issues as well as equipment. Do your homework.
exactly! Nebraska only allows breweries that are in a brewpub environment. They're trying to change that as lawmakers think a few breweries would help the economy/labor needs of the state.
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Old 04-06-2009, 09:54 PM   #9
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It takes more money than you might think. However if you have access to that money and the backing of someone, you might be in the right place.

Good luck, and if it doesn't work out you can still brew for yourself.

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Old 04-06-2009, 11:05 PM   #10
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Quote:
Originally Posted by FireBrewer View Post

Reality: average start-up time for a brewpub is 18-24 months. Good information in dontman's post.

Another Brewpub Startup Post... - ProBrewer Interactive


Good luck!
So, I was reading through this post and decided to check out their website. It looks like they started business in spring of '08 and I see that the recent post on their blog, someone bought them out and the owner is not too happy making a post in very sarcastic writing but so funny too.

You have to read this.

BLOGTAIL - FREETAIL BREWING CO.

Freetail Brewing Co. sold to MacroBev, Inc.
After months of negotiation, MacroBev, a Luxembourg-based beverage conglomerate, has announced the successful acquisition of Freetail Brewing Co. with operational control of the independently owned brewpub formally switching hands on April 31, 2009. Freetail expands MacroBev’s line-up of craft brands it eventually hopes to erode and discontinue.
MacroBev CEO Carlos Sloof-Lipra said in a prepared statement that the industry giant would cut costs by automating Freetail’s 15-barrel brewery, eliminating two brewer positions; and revamping the menu to use pre-manufactured pizzas and frozen alco-popsicles from its subsidiary, GloboCorp. “In these times of economic uncertainty, consumers want to know their product is made to the highest industrial manufacturing standards. Locally grown and fresh ingredients present a degree financial hardship and uncertainty that we seek to eliminate in a systematic and efficient approach,” said Sloof-Lipra.
Freetail Founder and CEO Scott Metzger was unable to comment as part of a non-competition and gag-order clause included in the deal. Sources close to Metzger, however, say he is extremely distraught at what he characterized as another notch in the belt for foreign-owned corporate giants in the battle to crush the American dream.

Torpor Porter on tap – please come get rid of it.
Torpor Porter has made its official return to the Freetail line up, and MacroBev marketing executives are encouraging customers to come drink it in order to make way for their lineup of mass-produced light lagers.
“Customers simply do not want artisan, full-flavored brews in this economy,” said MacroBev Associate Vice Executive Director of Marketing and Consumer Research Eliot Doucher. “Through our research we have found that consumers want to drink bland, watery and insipid brews dictated to them via clever marketing campaigns.”
Doucher hinted at the release of an Imperial series of American Light Lagers which will be highlighted in their “Crunkability” ad campaigns running nationwide.
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