Opening a Nanobrewery!

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daksin

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Howdy all!

Just had to tell someone that we're actually doing it! The Two Kids Brewing Company is going to be a thing! A nanobrewery thing, in fact, in the vein of Hess and Community Beer Works.

My wife and I have done about as much research on this as can possibly be done, read every thread here and on probrewer.com, and are going to do everything we can to make this happen. We've run the numbers, set reasonable goals, and are very clear about what we want to get out of the brewery.

I hope this won't be construed as advertising- we're just so excited we want to tell everyone. I hope you guys will come by and support us sometime, as the amount of knowledge and expertise that's been shared here has been invaluable not just for brewing tips, but for making the transition.

We're currently looking for a space in San Diego, and once that's settled things will really kick into ultra-high gear. We have a huge support group of friends and family that have been super helpful so far, and we plan on taking advantage of every but of free assistance we can get our hands on. Let us know if you're looking to sell any equipment or materials, have a line on a good space, or know a guy who knows a guy- we'll gladly reciprocate in any way we can.

Wish us luck, and thank you so much from all (two) of us at Two Kids Brewing!
 
A nanobrewery in San Diego? So you found a street that doesn't have one? Just kidding. Good luck!
 
A nanobrewery in San Diego? So you found a street that doesn't have one? Just kidding. Good luck!

We laugh, but it's true. Of course the best spots for these things is right in Miramar, so there are already a few right there, but the community is super collaborative and less competitive than you would think. I think the market still has a lot of room for growth- that is for someone who's willing to put in the work. We'll see!
 
Can't go wrong in SanDiego, good luck.

I certainly hope you're right. So far it seems like San Diego can't brew enough beer to keep up with demand, so we're going to do our part. At the moment, SD is brewing 1bbl of beer for every resident per year. Crazy!
 
Wonderful! I don't think we can ever have too many breweries here. Even better if you do open in the Mira Mar/Mira Mesa area (close to work!).

Can't really help you with anything other than coming in to taste the beers once you are ready :)

Good luck and keep us updated.
 
I certainly hope you're right. So far it seems like San Diego can't brew enough beer to keep up with demand, so we're going to do our part. At the moment, SD is brewing 1bbl of beer for every resident per year. Crazy!
That's all? Deschutes just increased their capacity to 345,000 barrels. Bend, Oregon has a population of around 84,000. Almost all the other local breweries are in the process of expanding too.

SD has room for a lot more beer.
 
That's all? Deschutes just increased their capacity to 345,000 barrels. Bend, Oregon has a population of around 84,000. Almost all the other local breweries are in the process of expanding too.

SD has room for a lot more beer.

Well, most of Deschutes' beer gets consumed outside of Bend (by a huge margine). San Diego has a really big proportion of breweries that pretty much only sell in San Diego.

There is a ton of growth though. The West Coaster (a local beer mag) recently profiled 9 breweries in the process of expanding. Hess, a nano just like us, is moving up to a 30bbl system! Crazy!
 
Best of luck! Keep this thread updated with pictures of your progress!!!

Keep on livin' the dream of a lot of people on this forum!!! :mug:
 
That's all? Deschutes just increased their capacity to 345,000 barrels. Bend, Oregon has a population of around 84,000. Almost all the other local breweries are in the process of expanding too.

SD has room for a lot more beer.

New Glarus (of New Glarus Wisconsin) produces about 100,000 bbls with a population of ~2100

Thats a lot of beer per person! :mug:

Granted its distributed state wide
 
Well, most of Deschutes' beer gets consumed outside of Bend (by a huge margine). San Diego has a really big proportion of breweries that pretty much only sell in San Diego.

There is a ton of growth though. The West Coaster (a local beer mag) recently profiled 9 breweries in the process of expanding. Hess, a nano just like us, is moving up to a 30bbl system! Crazy!
lol, I know man. But it's not like Deschutes is alone. 10 Barrel Brewing is moving up to a 50 barrel system. Larry Sidor formerly of Deschutes, the man behind The Abyss etc., is opening a new brewery, along with a few other new comers. Then there's Boneyard, Bend Brewing Company, Cascade Lakes, Silver Moon, Good Life, etc. The more breweries that come, the better they all seem to do. Beer tourism is catching on too.

You have the benefit of a large local population, we're just a little vacation destination.
 
Best of luck! Keep this thread updated with pictures of your progress!!!

Keep on livin' the dream of a lot of people on this forum!!! :mug:

Will do! Can't wait to get that lease signed and start moving things in.


Mongrel-
I totally agree- craft beer is up consistently 13-15% every year, even when beer overall is down. There were ~250 brewery openings last year alone, and only 12 closings. I just had a great time the other day talking to Dave of Wet 'n Reckless (another SD nano) and he's only been open for 3 months and broke even 6 weeks ago. His brewery is already making money. I think if we can do this quickly, we can really hit it at the right time. Can't wait to start making beer.
 
Congrats! If you have any questions, let us know. Of course, being in San Diego I'm sure there are others who have more relevant advice for you.
 
Congrats! If you have any questions, let us know. Of course, being in San Diego I'm sure there are others who have more relevant advice for you.

Well, one's not open, one I haven't been to, one is totally off-the-wall, and the other's expanding into a 30bbl system! We've been following CBW very closely- if only we had such an open market to grow into. You guys rock!
 
Good luck. I'm involved with a 1 barrel nanobrewery that open 4 months ago. The biggest problem is staff turnover. Seems people do not want to work for free. . . . Like us. LOL.

Finally after 3 months the owners were able to take a day off after working 7 days a week for 14 weeks.

We were going through about 1barrel a day. Seating for 48 so it's not a big place. Took about 6 weeks to get beer production under control.
 
Good luck. I'm involved with a 1 barrel nanobrewery that open 4 months ago. The biggest problem is staff turnover. Seems people do not want to work for free. . . . Like us. LOL.

Finally after 3 months the owners were able to take a day off after working 7 days a week for 14 weeks.

We were going through about 1barrel a day. Seating for 48 so it's not a big place. Took about 6 weeks to get beer production under control.

Interesting. We don't expect to take any days off for at least a year. Unfortunately due to tasting room requirements in CA, we can't have any seating, but that hasn't seem to have hindered other breweries' business. I'm not too worried about staffing- it's just me and the wife. If some kids want to volunteer to clean up and carbonate kegs on weekends, that's cool with me, but I'm definitely not going to plan on it. Seems like most nanos have a couple of "interns" working for pints, though.
 
Congrats! Im pretty sure I'll never make it out to your place, but I'd like to follow along via the internetz!
 
Good luck and let us know when you expand to a 100 bbl system.

Haha, not for a while, I hope. At that point I'd have to hire someone to show me how to use the system, and I'm not sure I'm there yet. I still want to be a brewer/owner (yea, I know I'm crazy) for as long as I can stand it.


Congrats! Im pretty sure I'll never make it out to your place, but I'd like to follow along via the internetz!

You never know, San Diego isn't a bad place to wind up, and lots of people do without even trying. First pint's on me!

Wonderful! I don't think we can ever have too many breweries here. Even better if you do open in the Mira Mar/Mira Mesa area (close to work!).

Can't really help you with anything other than coming in to taste the beers once you are ready :)

Good luck and keep us updated.

Will do. Where are you working? Have you been to any of the local nanos? I've heard there are a few more opening up, but not in our area.
 
There is a ton of growth though. The West Coaster (a local beer mag) recently profiled 9 breweries in the process of expanding. Hess, a nano just like us, is moving up to a 30bbl system! Crazy!
Funny thing, person after person says that "nano breweries can't work, can't make money, will never be able to pay for expansion, etc. Probrewer.com has hundreds of posts saying how unrealistic people are about the prospects of nanobreweries - yet nano after nano has been succeeding, expanding, and yes - even making money! I appreciate the advice from people with knowledge of the business, but it really seems that they are way off with their grim outlook on the prospect of nanobreweries. Just off the top of my head I could name at least 15 that have done very well, have been profitable faster than expected, and expanded faster than expected - and that's just off the top of my head, I'm sure there are a ton more out there doing well. Of course not every one will be a success, but it seems to me that nanobreweries have a lower failure rate than a lot of startup businesses. If everyone took the advice of the Probrewer.com crowd about absolutely needing to be at least 7-15 barrels right from the start, a lot of the most successful micros in the country (New Belgium, Dogfish, Bell's, New Glarus, and on and on) would have never started up. Don't get me wrong, I am realistic. I know it involves a TON of work, losing money for a good amount of time, working all the time for a while, and all that. But I just think the talk of nanos being "unrealistic" are very much false. It's not that I would choose to go so small at first ideally; it's just the only choice unless you are either rich or willing to take on a gigantic amount of debt. I understand it involves a lot more work and a lot more time and energy spent upgrading and re-upgrading, but it is a way to "test the water" without a huge financial risk. You can always expand a small brewery that is not keeping up with demand. It sure beats going bankrupt because you went deep in debt starting up with a 30 barrel brewhouse and it didn't work out. I know there are a lot of factors that can determine if a brewery is a success or not, but I don't think any brewery has ever failed strictly because their system wasn't big enough (as long as the owner is willing to put in the work)

The more breweries that come, the better they all seem to do. Beer tourism is catching on too.
Very true. It's not like some other businesses where you don't want to be located near any competitors. In craft brewing, being located near another popular brewery is actually beneficial to you. Beer enthusiasts are not brand loyal, they want to try everything. And if you're close to a brewery that already draws people, they'll probably try yours too. For instance, I have thrown around the idea of a nano in my hometown of Kalamazoo (the home of Bell's and soon the new Arcadia location). Some people say "you'll never be able to compete with Bell's". But I think differently: I wouldn't be trying to compete with them. Think about it: with 2 popular and well-known breweries in town, Kalamazoo is already a destination for beer people. And I'm thinking that they will also be excited to try out another brewery while they are here. After all, they aren't coming to Bell's because they only will drink Bell's beer, they are coming because they like craft beer and Bell's makes good stuff. But those same people would also support other breweries in town as well, as long as the product is good.

Anyways, good luck to all you out there who are making the jump and giving the pro brewing world a try. I wish you nothing but success.
 
Thanks so much for your support. I couldn't agree more. You know what? I'm 25- I can afford to fail bigtime. It's not something I want to do, and certainly not something I'm planning on, but it won't be the end of the world. That's extraordinarily freeing- my wife is my business partner and I have no kids to support. Just cats.

It's all about low barrier to entry. I would imagine we're going to hit a plateau here when a lot of nanos start going under or the owners get tired of working 80 hour weeks to break even. Hopefully we'll still be young when that happens and can ride it out. If I can make the money I'm making now (not much, but enough), but do it making beer and selling it to my friends and neighbors, that's what I'm going to do.

I was told my entire life that I should do what I love to do and the rest will work itself out. Instead, got my degree in an interesting field and did some interesting work, but everything's a job unless you love it. Until now, "do what you love" has been more of a platitude, but I'm going to treat it like a dare.
 
I was told my entire life that I should do what I love to do and the rest will work itself out. Instead, got my degree in an interesting field and did some interesting work, but everything's a job unless you love it. Until now, "do what you love" has been more of a platitude, but I'm going to treat it like a dare.

I like what you are saying here.

I wish you and your wife the best of business and good fortune. Just remember that brewing isn't a hobby now, it's your career. You can't wake up in the morning and not brew because you don't feel like it, you have to no matter what. But there are worse things to wake up and do then making beer. :mug:
 
Haha, many thanks! So true about not brewing because I don't feel like it. Until now, though, I've only ever wanted to brew when I couldn't and not the other way round. Hopefully that's a long way off!
 
Just a heads up about working with your partner as a business partner. It may seem cool now, but spending 24 hours with them for a couple years pays a tole on the relationship. I have done this and it isn't easy, and we are not together anymore.

Just something to ponder over. Best of luck.
 
I have seriously crunched the numbers and have to say that the best way to make a nano work is to have a tap room. Without it....it seems to be a losing deal. Just not enough rate of return if you aren't selling the beer directly to customers. Selling wholesale to bars and restaurants sounds easy until you are running around delivering/picking up kegs, trying to get/keep tap space, and most importantly collecting what is legally owed to you. It has been pretty well documented that selling beer wholesale operates on razor thin margins. Let's say you are able to sell 1/6 keg for 75 bucks, which is pretty high. By the time you factor in ALL of your costs you might make 30-40 bucks....maybe? If you run a 1bbl nano multiply that by 6 and you will make a whopping 180-240 dollars per barrel. Of course it all changes if you are able to open a tap room....but that has even more start up costs.
 
Just a heads up about working with your partner as a business partner. It may seem cool now, but spending 24 hours with them for a couple years pays a tole on the relationship. I have done this and it isn't easy, and we are not together anymore.

Just something to ponder over. Best of luck.

This is certainly something we have considered 100%. We have made this relationship work over both long distance and close proximity for over 10 years (jesus, has it been that long?). We've been married in the eyes of the law for two now.

Honestly, I wish business partners of my past were more like her, and I imagine she feels the same way. If the brewery starts to affect our relationship (negatively), we'll trash it faster than spent grain.
 
I have seriously crunched the numbers and have to say that the best way to make a nano work is to have a tap room. Without it....it seems to be a losing deal. Just not enough rate of return if you aren't selling the beer directly to customers. Selling wholesale to bars and restaurants sounds easy until you are running around delivering/picking up kegs, trying to get/keep tap space, and most importantly collecting what is legally owed to you. It has been pretty well documented that selling beer wholesale operates on razor thin margins. Let's say you are able to sell 1/6 keg for 75 bucks, which is pretty high. By the time you factor in ALL of your costs you might make 30-40 bucks....maybe? If you run a 1bbl nano multiply that by 6 and you will make a whopping 180-240 dollars per barrel. Of course it all changes if you are able to open a tap room....but that has even more start up costs.

Absolutely true about selling to bars vs selling in the tap room. It's a very simple calculation to do. Conventional wisdom says a keg (15.5 gal) of good craft beer sells for $150 to a bar, which must then triple its investment to make money.

If I sell that keg directly to the public at CHEAP pint prices, there are 110 US pints or 100 imperial pints (16.9 ounces or 500mL- an "honest pint" if you're into that sort of thing) at $4.00 apiece, even if that's expensive IIPA, I can make at around 3X (or more) the profit on that keg selling it in my taproom vs to a bar. In case you care, that INCLUDES shrinkage- that is to say foam and overpour.

The taproom makes the nano feasible, at least in California. Selling dollar tasters makes it even MORE profitable.
 
Thanks so much for your support. I couldn't agree more. You know what? I'm 25- I can afford to fail bigtime. It's not something I want to do, and certainly not something I'm planning on, but it won't be the end of the world. That's extraordinarily freeing- my wife is my business partner and I have no kids to support. Just cats.

It's all about low barrier to entry. I would imagine we're going to hit a plateau here when a lot of nanos start going under or the owners get tired of working 80 hour weeks to break even. Hopefully we'll still be young when that happens and can ride it out. If I can make the money I'm making now (not much, but enough), but do it making beer and selling it to my friends and neighbors, that's what I'm going to do.

I was told my entire life that I should do what I love to do and the rest will work itself out. Instead, got my degree in an interesting field and did some interesting work, but everything's a job unless you love it. Until now, "do what you love" has been more of a platitude, but I'm going to treat it like a dare.

This post is great. Good luck brother!
 
Hey man, congrats. I'm also 25 and starting a nano soon. Finishing my control panel for my system before I take it live on Kickstarter in a month. What beers do you plan on having on tap year-round?

Absolutely agree on the tasting room aspect, that's all mine is. I won't be selling wholesale for a long time. In fact, I want to sell directly to the consumer whenever possible. I randomly met Sam Calagione last Saturday at a bar in NYC. He is a very nice guy and I got to chat with him for a bit. His DFH alehouses, basically brew-pub type concepts that don't brew on premise, are money-making machines. That's the direction I want to go.
 
Hey man, congrats. I'm also 25 and starting a nano soon. Finishing my control panel for my system before I take it live on Kickstarter in a month. What beers do you plan on having on tap year-round?

Absolutely agree on the tasting room aspect, that's all mine is. I won't be selling wholesale for a long time. In fact, I want to sell directly to the consumer whenever possible. I randomly met Sam Calagione last Saturday at a bar in NYC. He is a very nice guy and I got to chat with him for a bit. His DFH alehouses, basically brew-pub type concepts that don't brew on premise, are money-making machines. That's the direction I want to go.

Awesome- we'll see how it goes. I'm keeping my day job, for now, as they say. We're going to have an Ordinary Bitter, a Cream Ale, a Cali Common, and a Chocolate Stout as our core beers at launch. We're debating about the IPA, but that will probably be on all the time too. Basically super flavorful, easy drinking, unintimidating session beers. Some of the cores will have bigger versions (an ESB and an Imperial Common which is awesome, for example), and I'm a farmhouse nut so we'll probably have a saison, Biere de garde, or sour on tap year round too- basically a ton of rotating small releases.
 
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