Microbrewery Startup

So as I'm sure many of you have dreamed about in the past..I am strongly considering starting up a microbrewery sometime down the road. I haven't been doing this for too long but have a huge passion for it. I have a really good business partner if we decided to go through with it. I live in South Carolina where there are not many compared to other states. Anybody have any words of wisdom or advice other than don't do it? Lol. Would a brew pub or just a straight bottling brewery be the way to go?

Talk to a lawyer.

A small brew pub would probably provide the highest profit margins. Small craft brewing requires a certain amount of volume to turn a reasonable profit. With a brew pub you can make greater profits on beer sales by selling directly to the clients.

A kegging operation is better than a bottling line. You can move beers faster with less risk of spoilage.

I know a professional brewer who makes small volumes of beer and turns a very modest profit.

Good luck. Make a good burger...good hand cut fries, a few salads and some fried appetizers, combine that with some tasty beer and you just might win. If your business partner will invest the capital without great expectations I'd say go for it.

Yeah I like the idea of a brew pub and selling directly but it is a lot more capital intense and requires hiring more people. Although my wife and I do have restaurant experience so it very well could be a possibility

The reason I would suggest a brew pub is because you are experienced in small volumes of beer. Stepping it up to a several barrel system would be good.

Yes the food service takes experience and lots of management. My suggestion would be to shop around for square footage pricing. Look into all the local permit issues you might encounter.

The most difficult encounters you will have is boiler and plumbing permits. Setting up a steam brewing system can really add up. Fire inspections etc...Believe it or not the bond and insurance for making beer is not all that bad. Construction permits are much more tedious.

Good luck, I plan on the very beginning stages of that next year. In south Carolina no less, after I'm out of brew school.

Where are you located?

Read this guy's thread:
https://www.homebrewtalk.com/f14/i-went-pro-what-actually-takes-do-so-386476/

It's a pretty good read and give you a feel for just how much red tape you have to sift through before you can even start brewing in your space. Develop a solid business plan and get a lawyer.

That's awesome! I am out of Florence as of right now. I work in Hartsville. Not sure what area we are thinking just quite yet. I wonder if The state of sc is a tough place to do it or not with alcohol laws and all of that.

Yeah I read the I went pro and what it actually takes. What really surprised me about that was that it was a nano brewery system and its near impossible to turn a profit with it. I don't know why do all that work knowing you won't make any money in return. Seems it would be smarter to just go right to a 7bbl or 15bbl system. But if you have a nano brewery in a pub that would be different

SCBrewster said:

That's awesome! I am out of Florence as of right now. I work in Hartsville. Not sure what area we are thinking just quite yet. I wonder if The state of sc is a tough place to do it or not with alcohol laws and all of that.

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I have family in hartsville. I'm down in the low country. The tasting room laws make it tough to make a nano work, as we can't sell pints. Plus SC is still a 3 tier state which needs to be changed

Oh alright. So what is the tasting room deal? Is that only if you are a bottling brewery? I would imagine that would be different if you area brew pub right?

Do you know an average for startup cost of a bottling brewery as opposed to a brew pub?

Depends on the setup you want, a brew pub is much more complicated with having a kitchen.

I believe you can serve full pints at a brew pub since you are serving food too. A production brewery can't, just 4oz samples. I plan on going the production route

MotorcycleMatt said:

Depends on the setup you want, a brew pub is much more complicated with having a kitchen.

I believe you can serve full pints at a brew pub since you are serving food too. A production brewery can't, just 4oz samples. I plan on going the production route

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Doesn't that depend on the laws of the state in which you're located?

Denny said:

Doesn't that depend on the laws of the state in which you're located?

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Depends entirely on that. In CA a brewery can serve on-site regardless of whether they have a restaurant or not.

Denny said:

Doesn't that depend on the laws of the state in which you're located?

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Yes, but since we are both in SC....

MotorcycleMatt said:

Yes, but since we are both in SC....

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Didn't realize that....obviously!

Denny said:

Didn't realize that....obviously!

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No worries man

Startup cost estimate?

Too many variables to have an estimate.

Hmmmmmmmmm ok I'll have to do some research. I need to perfect brewing and learn much more in the next year or so before I can even start estimating that anyway. Gotta get some good brews down!

SCBrewster said:

Oh alright. So what is the tasting room deal? Is that only if you are a bottling brewery? I would imagine that would be different if you area brew pub right?

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Try and talk to the guys at holy city down in charleston. I'm still not sure how they have their company set up seeing as how they have a tasting room at the brewery... That has baffled me for some time.

I definitely agree that SC distribution laws need to be changed ASAP, especially since in the upstate we have a few emerging breweries that are about to pop on the scene. I'm in Greenville.

Lots of info/resources here:

http://www.probrewer.com/

HollisBT said:

Try and talk to the guys at holy city down in charleston. I'm still not sure how they have their company set up seeing as how they have a tasting room at the brewery... That has baffled me for some time.

I definitely agree that SC distribution laws need to be changed ASAP, especially since in the upstate we have a few emerging breweries that are about to pop on the scene. I'm in Greenville.

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West brook does too, as does coast.

may have been answered...

I wanted to ask...how many barrels per year and tanks would I need to effectively produce three taps available for sale in a "nano" brewery year around?

Also, what space would be needed to produce these results?

How much do new tanks cost vs used tanks?

Do I need different types of tanks for different brews?

We will be opening a production brewery in Chicago this summer and here is the advice I can give...

Be very realistic with how much money you have. This is an extremely expensive business to start. One aspect on that is you need to expect to pay rent for 6-8 months before you can even begin to brew while you wait on licensing. Our building will cost us around $30k before we even start production. Equipment is also not cheap. Our 5bbl setup with four 10bbl fermenters and two 10bbl brite tanks is around $65k, and that's on the cheaper end of suppliers.

Also, know your market. Know how much beer you can SELL, not how much you can produce. Having your cold storage filled with kegs does your bank account no good. You'll need to research what you can actually sell it for too. If you're pitching your IPA to the local bars with $180 kegs while they are buying $120 kegs of Bell's Two Hearted they will laugh you out of the bar. Be realistic in your figures.

With that said, build yourself a pro forma and see if you actually have a business. Put EVERY cost in there. Rent, insurance, taxes, labor, grain, hops, yeast, water, electric, gas, sewer, trash, delivery vehicle, cleaning chemicals, etc.

jholiday87 said:

may have been answered...

I wanted to ask...how many barrels per year and tanks would I need to effectively produce three taps available for sale in a "nano" brewery year around?

Also, what space would be needed to produce these results?

How much do new tanks cost vs used tanks?

Do I need different types of tanks for different brews?

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It all depends....... How much beer are you able to sell? Three taps should be pretty easy to keep up with ven if you are only brewing on a 1 bbl system. The big question is at what point is it worth your time. Nano's can be profitable...even at a 1bbl scale. Providing your rent is cheap and you sell all the beer "in house" at 4-5 bucks a pint. Of course profitable means when all is said and done you might clear 1-2k a month.

SCBrewster said:

Startup cost estimate?

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Would you like someone to write your business plan for you too? If you're really that passionate about it, find an example business plan online and spend the time and energy to put it together. I put my plan together and quickly became discouraged at the costs needed to obtain a 15 BBL system. Do you have $200K for a turn key 15 BBL system - now remember that doesn't include installation or anything else, just the bare bones components. Throw in legal costs, permitting, zoning, rent, etc. I'm not trying to discourage you but if this is something you're truly interested in than you need to do your homework.

There are numerous resources out there - books, internet, and even local resources that can help you out.

Darwin18 said:

Would you like someone to write your business plan for you too? If you're really that passionate about it, find an example business plan online and spend the time and energy to put it together. I put my plan together and quickly became discouraged at the costs needed to obtain a 15 BBL system. Do you have $200K for a turn key 15 BBL system - now remember that doesn't include installation or anything else, just the bare bones components. Throw in legal costs, permitting, zoning, rent, etc. I'm not trying to discourage you but if this is something you're truly interested in than you need to do your homework.

There are numerous resources out there - books, internet, and even local resources that can help you out.

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Well said. Doing the research on your own will help you far more than us providing the answer would. Nothing wrong with asking questions when you open a brewery, but questions this basic you need to research on your own. Too many variables that only you will know the answers to. I could give you my entire business plan, pro forma, operating agreement, etc. but none of it would be of any use to you since it's a completely different market and probably different business strategy.

I have a copy of Sam Calagione's "Brewing Up a Business". Don't bother with it - it is more of a philosophical and lessons learned read than anything else. There are example business plans out there on the internet - just find one that you can utilize and then apply to your future business.

According to probrewer a production brewery is a million plus.

http://discussions.probrewer.com/showthread.php?3421-Starting-a-micro-brewery-(cost)