Advice to sell home brew??

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bassguitarfishing

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I've been brewing now for almost ten years. I've gained countless friends and students during this time. I have always played with the idea of selling my beer locally, but lately it has been everyone who tastes my beer that plays with the idea, and I'm getting sick of hearing it. Many of these people are business professionals who want to be involved. I have everyone from current resturant owners to CPAs.

I don't plan on making tons of money or turing it into a big business. All I want is to get my beer into some local pubs that have been asking for it, legally. Recently, I have spent countless hours going through all the government forms and regulations, getting lost. Does anyone know of a good and organized place I can find this information for California, USA; website or book, or whatever. I just want to draw up a good business plan and understand the process before I approach the people I want to partner with.

Please don't give me the "don't do it" advice. I've read through all of that already. And again, I don't plan on becoming the next Sam Adams, I just want my beer available outside my home. Any experianced and constructive advice is also appriciated.

Thanks,
n8
 
There pretty much is no legal way to sell homebrew straight from the home. That being said, it is possible in some areas to open up a nano-brewery in some locations, making small batches and selling it to a few pubs, etc... You also might find a small microbrewerey that would be open to you using their equipment to brew your beer. As far as the specifics, I can't help much. It's going to involve quite a bit of time, money, and research which you have already looked into.
 
I don't remember the titles but I have read threads on this site that list specifically the hurdles that need to be cleared for licensing in California.

It read like a How To on how to sell beer legally in CA.

The issue that real brewers have I think is thinking too small. It is very difficult to stay viable at less than, say, 1000 barrels / year. So if you are prepared to do 20 bbls per week I say go for it.
 
It would be cool if you could convince a couple pubs to carry a very, very limited edition beer every now and again.

  • Bill it as a "Small Batch Craft Brew" of the week.
  • First come first serve.
  • Just one or two dedicated taps.
  • Two cornies per beer..when it runs out...it runs out.
  • You pop in on Sunday morning with this weeks' selections.
 
Also, when you get up and running, let us know where you're beer is so we can go support. Where abouts in CA are you?
 
It would be cool if you could convince a couple pubs to carry a very, very limited edition beer every now and again.

  • Bill it as a "Small Batch Craft Brew" of the week.
  • First come first serve.
  • Just one or two dedicated taps.
  • Two cornies per beer..when it runs out...it runs out.
  • You pop in on Sunday morning with this weeks' selections.

I had that same thought, so I asked a local place and the owner told me that if an inspector came in and he doesn't have proper "documentation from a licensed distributor" they could shut him down. This may not be true, but sounded like he didn't even want to take a chance.

Don't get me wrong, I would love to see some homebrew in a bar, but there are health codes and crap here in Cali that places freak out about. How does the bar keep know you are not trying to poison people with your brew?
 
Check this guy out...local home brewer for years. Won some awards and started limited bottling in 22oz. and kegs. Pretty good distribution in the last couple years at Safeway, Raley's, and several liquor stores and gas stations. Really nice guy also, and if you call or email I bet he'd be willing to chat with you about the process of going from homebrew -> nano brew.

Feather River Brewing Company
 
There's a ton to consider. You cannot brew out of your garage. The FDA will want to inspect your setup, and it needs to be a freestanding building that is zoned for business and that will meet safety regulations.

You need a business license.

You need a microbrew license. These seem to be reasonably cheap in CA, but dependent on location, it might be difficult to obtain.

You'll need to figure out where to legally acquire kegs, and you'll need a keg washer. Remember that ball locks aren't going to fly in a bar.

There's potential that you'll need to work with a distributor. Some places have contracts that forbid them from buying direct from a brewer, and some places have laws that limit that as well. California allows self-distribution, so that's a plus.

If you plan to bottle anything, be ready to fight for label approval. You MUST have an approved label in order to sell beer, and that includes approved artwork, warnings, and you have to apply for the UPC code. A bottling line will probably be necessary to make up for the volume you'd need to deal with all this.

Insurance will be necessary. If you're selling anything consumable, people could come after you with a variety of potential lawsuits, regardless of quality. Additionally, if you have anyone working with you, you'll need to consider safety and insurance for that as well.

You'll need to figure out the cost effectiveness of getting supplies, where to store them, and what potential yeast banks you'll be using.

The problem with selling homebrew is that you'll never be able to make enough in your garage to offset the cost. If it were even legal to do so.
 
+1 on Feather River Brewing, Roger is a great guy. I think that 10 gallon setup at a brewpub is a spiffy idea as well.
 
My friends keep asking me how much it would cost to make a batch of "________" and that they would pay for it. I figure that so long as they give me money, and I go and buy the ingredients with that money and "donate" my time, thats its pretty much as legal as it can be.

To this point though, beginning a nano-brewery is something that I think we all toy with around here, the legalities though are such that they remind me of a famous quote, " Walls are not erected to keep us from doing what we want to do, they are there to keep those out who do not have the drive and the ambition to scale that wall."

The other day my brother sampled one of my beers, looked at me, and said, "You're retarded, why don't you go to school and become a brewmaster instead of working that crappy job you have? This is the best beer I have ever had." Well... time and money prevent me from doing what I really want.

To the OP, hope that you find a way to realize your dream. And let us know if you do. :D
 
The problem with selling homebrew is that you'll never be able to make enough in your garage to offset the cost. If it were even legal to do so.
I've never specifically looked at commercial brewing at home, but I don't think it's possible. Health codes don't allow you to cook foods for public consumption in home kitchens, so I doubt you'll be able to brew commercially at home.

Here's a list of permits/licenses you'll need:
ATF license (from the Feds)
ABC Type 23 license (from the State of CA)
Health permit for your brewing facility (from your County)
Business license (from your City, or from the County if you're in an unincorporated area)
You might need a conditional use permit from your City, depending on the zoning

There are specialized companies out there that will help you with ABC licenses but I don't know many of them that are experienced with Type 23 licenses. If you need a name/number of a company, let me know and I'll dig up their card at work.
 
The AHA/Brewers Association website Craft Brewing

has alot of info on turning pro.

Not going to say don't do it but the idea of just making 5 extra gallons a week and selling it through the one cool bar in you're hometown is a non-starter.

You have to think of it starting a small business (business plan, financing, etc.) with the extra hassle of the particular regulator issues.

Around here the guy from Seattle "Naked City Brewery" just went pro. (or is about to) he might be a good resource.

Sam Calagione wrote a book on his starting up that I've heard a number of Craft Brewers praise for not only giving them pointers but inspiring them as well.

The BN has had a couple of old shows with guys who've made the leap that are informative.

From what I've read and heard on podcasts a large majority of Craft Brewers were homw brewers first including Jim Koch so it can be done.

But did the OP just want help on Cali regs. If so Brewers Association is the way to go.

Rudeboy
 
I thought as long as your place of business didn't look like a business from the outside you could have a "home office". Sure you would have to have a separate building because of health codes but why couldn't it be on your property? Other thing is most brewers don't start with bottling as it costs too much in time and money that's usually something to aspire to when your successful so I don't know if you would need a label initially. I have been thinking about doing this for some time now, I think I would just rent a space in some industrial park and then if it doesn't work out I don't have to eat the cost of a new structure. Here in Oregon we can't self distribute so for me that is something that is a big hurdle as it would be very expensive to have a distribution company deliver 20 kegs of beer a week. Alternatively I have been thinking of opening a pizza joint or something and just selling on premise.
 
Here in Oregon we can't self distribute so for me that is something that is a big hurdle as it would be very expensive to have a distribution company deliver 20 kegs of beer a week. Alternatively I have been thinking of opening a pizza joint or something and just selling on premise.

I don't think that will get you around the self-distribution issue. I know here in GA a restaraunt/bar/whatever has to have documented proof that all their beer came from a licensed distributor. GA != OR though, so YMMV.
 
Where are you in CA? There's a U-Brew place in Huntington Beach called Brewbakers that does precisely what you're working on doing.. they might be able to give you some pointers.
 
I thought as long as your place of business didn't look like a business from the outside you could have a "home office". Sure you would have to have a separate building because of health codes but why couldn't it be on your property? Other thing is most brewers don't start with bottling as it costs too much in time and money that's usually something to aspire to when your successful so I don't know if you would need a label initially. I have been thinking about doing this for some time now, I think I would just rent a space in some industrial park and then if it doesn't work out I don't have to eat the cost of a new structure. Here in Oregon we can't self distribute so for me that is something that is a big hurdle as it would be very expensive to have a distribution company deliver 20 kegs of beer a week. Alternatively I have been thinking of opening a pizza joint or something and just selling on premise.[/QUOTE

I can remember what publication I read it in, but anything to be brewed for public sale can't be brewed in a dwelling. You also have to have the proper commericial zoning.

to the OP if you haven't already try...

Welcome to TTBGov
California ABC - Homepage
 
I thought as long as your place of business didn't look like a business from the outside you could have a "home office". Sure you would have to have a separate building because of health codes but why couldn't it be on your property? Other thing is most brewers don't start with bottling as it costs too much in time and money that's usually something to aspire to when your successful so I don't know if you would need a label initially. I have been thinking about doing this for some time now, I think I would just rent a space in some industrial park and then if it doesn't work out I don't have to eat the cost of a new structure. Here in Oregon we can't self distribute so for me that is something that is a big hurdle as it would be very expensive to have a distribution company deliver 20 kegs of beer a week. Alternatively I have been thinking of opening a pizza joint or something and just selling on premise.[/QUOTE

I can remember what publication I read it in, but anything to be brewed for public sale can't be brewed in a dwelling. You also have to have the proper commericial zoning.

to the OP if you haven't already try...

Welcome to TTBGov
California ABC - Homepage

There's a guy in PA that has a pico brewery basically in his garage. It's all set up for being a brewery and nothing else, but it can be done.

Although anything less than about 200bbl/yr as a brewpub(food) and 1000 for a micro is hardly profitable.
 
I honestly think the brewing your beer at a microbrewery is one of the better options. We have a local microbrewery that's heavily involved in our homebrew club and they do contract brewing. You may want to look into contract brewers in your area. They also have a tap in their tasting room reserved for donated brews from the homebrew club. I don't know if they sell them or just sample them out though.
 
There's a guy in PA that has a pico brewery basically in his garage. It's all set up for being a brewery and nothing else, but it can be done.

Although anything less than about 200bbl/yr as a brewpub(food) and 1000 for a micro is hardly profitable.

It may very well be a California thing

It could also be that a garage is not considered part of the dwelling. Anyhow, here is the link, see section 25.21.....

Electronic Code of Federal Regulations:
 
There was a recent article in BYO or Zymurgy about three different nano-breweries basically running 15.5G or slightly larger brew systems. In all cases I think these fellas were basically running a small brew pub and serving on site. Even with all the breweries and brewpubs out there, depending on location I think it would be totally feasible to actually run a sucessful small scale brewery. The biggest hurdles are the legal aspects and then the equipment/start-up costs. On that scale, in order to be profitable it would be a full time job. Anticipate brewing multiple batches in a single day every day of the week.

I wish the OP luck in getting started, and hope that he finds the success he is looking for.
 
There's a guy in PA that has a pico brewery basically in his garage. It's all set up for being a brewery and nothing else, but it can be done.

It may very well be a California thing

It could also be that a garage is not considered part of the dwelling.
It's a California thing.
Section 114015(2) of the CA Retail Food Code specifically says that foods prepared in a private home may not be used or offered for sale in a food facility.

farmbrewernw said:
I thought as long as your place of business didn't look like a business from the outside you could have a "home office". Sure you would have to have a separate building because of health codes but why couldn't it be on your property?
A lot of cities will allow mixed uses and you can have a "commercial" brewing facility on the same property your house is in, but it's quite different than converting your garage into the "commercial" brewing facility.
 
There was a recent article in BYO or Zymurgy about three different nano-breweries basically running 15.5G or slightly larger brew systems. In all cases I think these fellas were basically running a small brew pub and serving on site. Even with all the breweries and brewpubs out there, depending on location I think it would be totally feasible to actually run a sucessful small scale brewery. The biggest hurdles are the legal aspects and then the equipment/start-up costs. On that scale, in order to be profitable it would be a full time job. Anticipate brewing multiple batches in a single day every day of the week.

I wish the OP luck in getting started, and hope that he finds the success he is looking for.

But you'll never ever make much at all. Be lucky to break even and be even more lucky to be in business in 3 years. Financially it's ****ing stupid. I've looked in to it. Came up with round figures, and unless you want no life and to make jack **** for take home, it doesn't work.

I mean you can make more working 40hrs a week minimum wage than 80 hours a week in a pico brewery.
 
What about a Co-Op Micro/Pico Brewery in a zoned facility? I'm in LA also and would love to get something like this going too. One day... a pseudo retirement... I see plenty of catering and other odd businesses in commercial buildings (one next to my Gym next to a car biz and other odd stuff including a small porn movie biz). So the licensing and food questions are surmountable.

I see one big issue would be the volume as stated and cracking a door on the liqueur distribution folks. Bars like restaurants want & need steady reliable supply (my assumption on bars - researched on restaurants) - since customers expect consistency, not surprises.

The other issue is probably more around getting a license - at least I hear serving licenses are very tough, but maybe to brew & sell maybe not. Hell CA GOV needs the $$$ (fees & taxes) - the time may be ripe to start such a business!

Hope you post back some more info on how your quest is going.
 
I only read the first post, but I'm looking into this as well. You definitely need a commercial location that is properly zoned, a license, and you have to go through an inspection or two. Oakland is going to be a real *****.
 
Anticipate brewing multiple batches in a single day every day of the week.

I've wondered about this. Isn't your production volume limited by your fermentation/brighting capacity? Especially if you plan to not filter or pasteurize. And would states require pasteurization because if so, then there goes the specialness of most homebrews.

I mean in my house right now I could brew 30 gallons in one day and get them into a fermenter. But then I would not be able to brew for a few weeks if I wanted to age my beer properly.

So my question is, how do breweries get around this limitation? Do they have 21 sets of fermentation tanks?
 
Beer doesn't go bad the day it's finished. I would have to assume that breweries brew a big enough batch to cover their anticipated demand while the next batch is being made.
 
I've wondered about this. Isn't your production volume limited by your fermentation/brighting capacity? Especially if you plan to not filter or pasteurize. And would states require pasteurization because if so, then there goes the specialness of most homebrews.

I mean in my house right now I could brew 30 gallons in one day and get them into a fermenter. But then I would not be able to brew for a few weeks if I wanted to age my beer properly.

So my question is, how do breweries get around this limitation? Do they have 21 sets of fermentation tanks?

No, they brew on a larger scale. We've lately been fermenting in my conical and sanke kegs. Generally about 12-20 gallon batches.

Shorten your time of fermentation with a high pitching rate, plenty of nutrients, low alcohol beer, etc.

You can use finings to clear the beer and dumping the yeast in the conical is key. Pasteurization is not required...the only reason a lot of breweries do this is to kill their yeast. If you are bottling, you do not bottle condition. You condition and carbonete in a keg or bright tank and then transfer to kegs through a filter.

Generally smaller breweries do 1-2 batches a day. Figure you are brewing 5 days a week and you've got yourself about 8 different beers every week, which would require 16 fermenters if they went through 2 weeks of fermentation.

But you are right that you would need to buy more equipment. Good thing sanke kegs are fairly easy to come by if you have the right connections (and no, i'm not talking illegal.)

You cannot really make any money (especially considering your time) if you are brewing 5 gallon batches.
 
But you'll never ever make much at all. Be lucky to break even and be even more lucky to be in business in 3 years. Financially it's ****ing stupid. I've looked in to it. Came up with round figures, and unless you want no life and to make jack **** for take home, it doesn't work.

I mean you can make more working 40hrs a week minimum wage than 80 hours a week in a pico brewery.

Not going to disagree there. Realistically though, most commercial brewers work far more than 40 hours a week. Between work at the brewery and attending trade conferences, seminars, and other events they put in some hours. The only reason you do something like that is because you love it, not because you plan on getting rich.
 
Check this site out. I used to hang out there when I was spending a lot of time planning my Brewpub (which is still a goal, just a little far off). It has a lot of great info, especially on buying brewing equipment (new or used) and also has a forum where you can ask the pros who have done it before.

ProBrewer.com: An Online Resource Serving The Beer Industry

*The site is a little cumbersome to use at first, but after a while you will get the hang of navigating it*
 
No, . . .

Generally smaller breweries do 1-2 batches a day. Figure you are brewing 5 days a week and you've got yourself about 8 different beers every week, which would require 16 fermenters if they went through 2 weeks of fermentation.

I am not the OP and I am not planning to go commercial.

You answer no but the other line says "yes"

My question was whether commercial brewers have many different fermenters and you confirm my suspicion by saying that they would have 16.

So if you are a brewer working with a 1 bbl system you would need in the neighborhood of 16 1 bbl fermenters. That was kind of the point of my post. What garage could ever house 16 1 bbl fermenters plus kegs plus brewing equipment plus all of the other ancillary equipment. Or even 16 Sanke fermenters.

I think a lot of dreamers imagine being able to take their 5 or 10 gallon batches down to the local pub for resale. Those pubs are paying what? between $60 and $100 for their kegs filled with BMC or even commercial craft beer? I actually don't know what they are paying but I do know that as a manufacturer you never want the cost of your raw materials to exceed 20% of your selling price. Let's say they would be willing to pay you $200 for that filled keg. In that case you would need to be able to fill that keg for maybe $50. That is really hard to do unless you are filling 20 of them at once and enjoying major economies of scale.

Your competitors are, since they are filling 50 or a 100 or 10000 at a time. And there is no way to sell you beer for $10 a glass alongside the Sierra Nevada that is selling for $4.50

The real money in this is for the retailer filling the glass.
 
You cannot really make any money (especially considering your time) if you are brewing 5 gallon batches.

You can't make money making 1bbl at a time, let alone 5 gallons.

You might squeak by with 5bbl batches and working your ass off. 7+ would be more ideal starting.

I mean at 1 bbl, you can make roughly 100bbl a year depending on the number of fermenters you have. At that point you would never become profitable as a business.
 
Start a brew pub and sell it by the glass and sell food too. That is the only way you can make it work on a small scale. Your markup that way can be 300% rather than 20%. It's a very feasible idea. No different than a coffee shop making money (other than the obvious labor and government regulation). If you can get past all the regualtion you can probably make a decent living.
 
Start a brew pub and sell it by the glass and sell food too. That is the only way you can make it work on a small scale. Your markup that way can be 300% rather than 20%. It's a very feasible idea. No different than a coffee shop making money (other than the obvious labor and government regulation). If you can get past all the regualtion you can probably make a decent living.

True - but the investment is substantially more and the risk is probably even higher. You're taking on two facets of a tough business at once, plus employee issues and working capital for the food and other goods. I've spent more than 15 years dreaming, planning, wishing I could do a restaurant (and at times a BP), but have never built up the $$ to dive in and realize the dream. Too conservative I guess - that's a very tough gig...
 
Alright, I won't tell you "don't do it." I'll tell you this, though: Do it right.

Find a microbrewery in your state, and talk to them. Find out what you have to do to make a legal, wholesale brewery in your state. It varies wildly from state to state, so you have to check on it. The guys running the brewery should know, since they've had to go through all that red tape.

Typically, microbrewery guys are very helpful to other brewers. If you find some guys that aren't, move on to the next brewery. Really, you probably ought to check with more than one brewery, anyhow. If you can't find more than one brewery in your state, that ought to tell you something (i.e., be very careful).

If you are in Texas, I will be happy to introduce you do some commercial brewers that can point you in the right direction. If you are in another state, I may be able to, but I don't know until I know your home state.

You can always try to stay under the radar, but that only works until it doesn't.


TL
 
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