Brew-On-Premise (BOP) Business?

Homebrew Talk - Beer, Wine, Mead, & Cider Brewing Discussion Forum

Help Support Homebrew Talk - Beer, Wine, Mead, & Cider Brewing Discussion Forum:

This site may earn a commission from merchant affiliate links, including eBay, Amazon, and others.

LarsonLE

Well-Known Member
Joined
Jan 22, 2011
Messages
177
Reaction score
5
So the past few days I've been thinking about the possibiltiy of opening a BOP. I've read a lot of stories on the internet of these businesses shutting down, as well as there being a handful of ones that are successful. Has anyone been to a BOP, and do you think this business could do well in an area where there are none with a decent sized population?
 
I have been to and happily used two different BOPs here in Chicago. However, sadly niether one is still in business. The second one was opened by two (I think) fellows who had experience in the food business. They also made private label stuff for local restaurants in addition to the BOP function. Based on the fact that they did not stay in business for long, I think it's a very difficult business model...
 
I have been to and happily used two different BOPs here in Chicago. However, sadly niether one is still in business. The second one was opened by two (I think) fellows who had experience in the food business. They also made private label stuff for local restaurants in addition to the BOP function. Based on the fact that they did not stay in business for long, I think it's a very difficult business model...

Yeah... unfortunately that's the case. It just seems like a great, fun idea.

Do you remember the names of those businesses? Also how was the beer you made at the BOP's?
 
If you are talking of a place where new homebrewers brew their own beer using your equipment there are problems.

Within a given area there are only so many potential customers. If a customer finds that he/she really likes brewing they are going to invest in their own equipment and brew at home. Thus, they are no longer a customer. If someone brews and does not really take a shine to it, they are no longer a customer.

Repeat customers are the basis of a good business. This is also what makes BOP a hard business. Maybe the best route would be to make it a sideline of a homebrew supply store.
 
I agree with Kh. I think the best way to do a BOP would be to foster a homebrew culture within the establishment. An example would be to not only have BOP capabilities but to also have a homebrew shop and maybe even a bar or really nice tasting room so that if customers do move on to the next level they can still be apart of the overall culture you provide.
 
We had one in St. Louis many years ago. It didn't last long although it might do better in the current beer scene. But for most people, it's a one shot deal, been there, done that. I think a lot of their business came from people giving it as gifts. That probably doesn't build repeat business.
 
I've not used a BOP but there is one in Alexandria VA (I forget the name and worse a quick google fails to find it!). Anyhow, it was also a micro brewery/brewpub along with BOP.

There is some sense to trying to make it a 2 or 3 focus location instead of just one - ie LHBS +BOP, but this also means you get all the downsides. Some of these thing vary by state. In VA, there is a sperate liscencing for being a LHBS and a BOP and a Brewery (last time I look at this sort of idea). You might be appealing to widely different customer bases. In terms of the BOP, doing extract makes the most sense, because kettle time (one of the things being sold) is longer for AG brewing. In a large portion of the store will be taken up by warehousing fermentors. Which goes to rent of the space. What to do if a beer goes unclaimed, etc.

I was in contact with one of the distributers, and they had a number of the population who homebrewed, and who make wine at home (why be choosy? as a business person your product is little green peices of paper, not beer or wine) Anyhow their back of the envelope numbers were you needed an area population of about 200K with little to no competion for a LHBS to make it and then it would only be about breaking even. Granted this was based on the numbers of people on average who brew or vint at home, and that number may have changed. It also was based on an average amount spent per person (I think $100).

And now I should delete this rather than post since I'm not sure I've addressed the OP's question, but just rambled.

I think a BOP can be done, but it is hard. In the US, Beer is something we buy, or make at home. There isn't a great amount of us who make it outside the house. Same with those kitchens you see where you go there and cook 10 or meals and bring them all home.
 
I would be worried about the profit margin unless you run it along with a LHBS. That and if it isn't much cheaper than commercial beer I wouldn't see much incentive.
 
I have a different take on BOP establishments after talking with CA ABC and some reading on the TTB site. Here is what the TTB says...http://www.ttb.gov/beer/beer-faqs.shtml#b1 The rules regarding BOP though are NOT federal regulations, thus not federal law. I believe what they are instead are TTB "guidelines", which have no legal standing? So if someone was to pay you to do everything brewing related EXCEPT pitching the yeast it would appeart that technically that would be legal. It is usually stated that whoever pitches the yeast brews the beer. I even contacted my state (CA) ABC and they told me that there are no regulations/licenses regarding BOP...they consider it "remote location homebrewing" (their words).
 
sounds like the sort of thing that would only really be sustainable in a ciry, where people don't have the room to brew in their tiny apartments. other than that, you're looking at a nice add on to a brewery/LHBS, I think.
 
LarsonLE said:
Yeah... unfortunately that's the case. It just seems like a great, fun idea.

Do you remember the names of those businesses? Also how was the beer you made at the BOP's?

The first was Chicago Brew on Premise and the second was at an old firehouse on Clybourn, can't remember the name. The beer at the first was not good and it closed quickly. The beer at the second was terrific. We had a blast brewing at the second, the kids would make root beer when we made beer.
 
The only way I can see this working is if it's in a brewshop with the extra room or a brewpub with extra room.
That would make the brew your own a draw to the primary business. If the brew your own customers took up home brewing and you had a brew shop, you would make money setting them up and selling them supplies.
Think of the profit potential from one batch of beer. Then think of the time ( with you coaching them ) to brew and the time that you have the beer there fermenting. You tie up a lot of retail space for a little cash.

MAYBE if you could hook up with a homebrew shop that had room. It would be a draw to their store. I don't know of many homebrew shops with the extra space though.
 
I think anyone of us could use our existing "brewery" to do a BOP...depending on your state law of course. Lets say someone wants a special beer for a party, wedding, or just to have around. They could hire you for your brewing skills and buy the ingredients through you. You could do all the "work"....they would just have to pitch the yeast so that it is technically "their beer". You could then ferment and bottle/keg it for them. Like I said though you would have to check with your state laws but on a federal level I believe that is well within the homebrewing law.
 
I think anyone of us could use our existing "brewery" to do a BOP...depending on your state law of course. Lets say someone wants a special beer for a party, wedding, or just to have around. They could hire you for your brewing skills and buy the ingredients through you. You could do all the "work"....they would just have to pitch the yeast so that it is technically "their beer". You could then ferment and bottle/keg it for them. Like I said though you would have to check with your state laws but on a federal level I believe that is well within the homebrewing law.

I think you are going to have to meet commercial kitchen requirements. Not sure that that entails or what it would be state by state.
I'm also not sure how this would apply to brewing since it's not cooking food, but it is comsumed.... Hmmm...

I've got friends that make and sell BBQ sauce. They use the kitchen at the VFW or something like that to be in compliance. I should say they use it enough to claim that's where it all comes from.
 
The biggest issue with bop is customers. Like many said tying it in with another business is ideal. A LHBS would introduce people to brewing then buy from you. A nano or micro brewery would allow you to make money from brewing. I would also add from an economic standpoint making bulk wort and split that into batches.
 
This has me thinking about the BOP place I started. I made a couple visits, made good beer, had a good time. But it was over 200 bucks a visit for the brewing and bar tab. Plus the drive home was a bit too far to be that buzzed. The other thing, you made 6 cases at a time. I like a little variety. The cost and batch size was just too much. So I began making from home. No drive, costs are low and the beer of the house isn't $5 a pint.
 
It is usually stated that whoever pitches the yeast brews the beer. I even contacted my state (CA) ABC and they told me that there are no regulations/licenses regarding BOP...they consider it "remote location homebrewing" (their words).
That would limit the homebrew to 100-200 gallons per location. What percentage of your allocated gallons would you be willing to sacrifice? Also, depending on the wording at the state level, it may limit it to a residence and not a business location.
 
That would limit the homebrew to 100-200 gallons per location. What percentage of your allocated gallons would you be willing to sacrifice? Also, depending on the wording at the state level, it may limit it to a residence and not a business location.

The customer is the person with the 100-200 limit, since they are the one's brewing the beer.
 
The customer is the person with the 100-200 limit, since they are the one's brewing the beer.

Exactly! It is the customers beer since they are pitching the yeast. My point is that there are NO federal regulations regarding brew on premise (BOP) operations. There are some guidelines but I don't believe that those are enforceable.
 
Guidelines tend to be under the discretion of the person reading them, and thus are sudo enforcable. You might be legally right, but after 500K in legal defense, can your new business handle that? and the 'Who pitches' comment could get a BOP proprieter in serious trouble if he (or his employee) screws that up.
 
Guidelines tend to be under the discretion of the person reading them, and thus are sudo enforcable. You might be legally right, but after 500K in legal defense, can your new business handle that? and the 'Who pitches' comment could get a BOP proprieter in serious trouble if he (or his employee) screws that up.

I can see your point but....pretty hard to charge someone without a law or regulation to back it up. In fact I don't think you can legally charge someone with a crime without stating the law/regulation that was violated. I am not talking so much about a proprieter of a BOP but rather any one of us who brewed beer for a friend and charged them for ingredients/ingredients/expertise. Of course I am assuming that someone else pitched the yeast.
 
Do Your Brew here in Colorado has a BOP in addition to his homebrew store. He is now expanding and plans on adding a small brewery on site. So I think it is possible to have a viable BOP you just need to combine it with something else.
 
nsrooen said:
Do Your Brew here in Colorado has a BOP in addition to his homebrew store. He is now expanding and plans on adding a small brewery on site. So I think it is possible to have a viable BOP you just need to combine it with something else.

OOPS iPhone sent before I was done so now I'll finish...
I would think the BOP would be a good addition to the store. It would give a novice a chance to try brewing. Then if they like brewing the store can sell equipment and ingredients.

Some one may also use the BOP if for some reason it wan inconvenient to brew at home.

BOP on it's own?? See my previous reply.
 
Back
Top