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Old 09-12-2013, 09:44 PM   #11
moti_mo
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These things totally depend on how you go about setting up your business -

-how frugal you are with regards to acquiring equipment - you can save hundreds of thousands if you're patient enough

-finding the right location - again, patience - if you can find a place that doesn't require a huge build-out, again you can save hundreds of thousands

-your business model and where you're located - if you're taproom only in a city/area with high demand and you have low overhead, your margins are very good; if you're a 20 barrel production brewery in a 3-tier state that doesn't allow taproom-only and you're constantly fighting for shelf space, your margins aren't as good.

Plenty of micro- and nanobreweries are profitable very quickly. Many others aren't, but plenty are. Funkwerks was profitable within 6 months, and they operate a 15 barrel brewery. Crooked Stave did <400 or so barrels in their first year, but made great profits, and are stepping up to >3000 barrels next year in their third year. Much of this is frugality and being smart about their business models.

Results can vary dramatically, and regardless of your model, it will be hard work. But what job worth doing isn't hard work, if you're doing it right? Work hard, work smart, make gains, keep working hard some more, and try to ensure that you're enjoying it. If you're not enjoying it, do something else. Operating a brewery shouldn't be any different.

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Old 09-12-2013, 09:57 PM   #12
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Quote:
Originally Posted by yeahfairly View Post
If you can't hit over $200 a bbl as a nano you better not open a business! Nanos that think they can survive in the market in a three tier state without selling $3 or $4 pints are dreaming! If you can't sell you beer without a distributor you better be planning on opening a 15bbl or larger brewery and you better brew 4 days a week!
You are very correct. Tap Room sales are the only way that a brewery under 7 barrels will make any money. Anything under 15 barrels needs to have commercial accounts and a Tap Room. If you want to bottle only, you really need at least a 15 barrel brewery with at least 8 fermenters and 12 bright tanks (each 30 barrel and double batching), plus a bottling line and a *VERY* good distributor.

I've seen and heard that it isn't about the size of the brew plant, so much as the amount of fermenting and clearing space you have. Locally, Hangar 24 brews 24 hours a day, 6 days a week and they have problems keeping up with their demand (oh that I could have that problem).
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Primary: Tart Walking IPA
Secondary: Mead - Tart Cherry; Blackberry; Boysenberry; Cinnamon
Barrel #2: American Barleywine
Secondary: Dark Cherry Sour '13
Secondary: Pom-Cran Sour '13
Keg #1: Bourbon Barrel Oatmeal Stout
Keg #2: Cascade Pale Ale
Keg #3: Berliner Weiss
Keg #4: Cascade Pale Ale
Keg #5: Irish Red
Keg #6: Hopping Dead
Keg #7: Dad's Apple Cider
Bottled: Robin's Root Beer

 
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Old 09-12-2013, 10:02 PM   #13
CA_Mouse
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Quote:
Originally Posted by moti_mo View Post
These things totally depend on how you go about setting up your business -

Results can vary dramatically, and regardless of your model, it will be hard work. But what job worth doing isn't hard work, if you're doing it right? Work hard, work smart, make gains, keep working hard some more, and try to ensure that you're enjoying it. If you're not enjoying it, do something else. Operating a brewery shouldn't be any different.
Agreed. My BP has moderate growth over 3 years with any loans paid in less that 2 years (of course that is without paying myself (love a better half that makes good money)!).
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Mouse
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That which does not kill us makes us stronger. - Friedrich Nietzsche


Primary: Tart Walking IPA
Secondary: Mead - Tart Cherry; Blackberry; Boysenberry; Cinnamon
Barrel #2: American Barleywine
Secondary: Dark Cherry Sour '13
Secondary: Pom-Cran Sour '13
Keg #1: Bourbon Barrel Oatmeal Stout
Keg #2: Cascade Pale Ale
Keg #3: Berliner Weiss
Keg #4: Cascade Pale Ale
Keg #5: Irish Red
Keg #6: Hopping Dead
Keg #7: Dad's Apple Cider
Bottled: Robin's Root Beer

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Old 09-12-2013, 10:11 PM   #14
enricocoron
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We opened a 7 barrel with 4 FVs and it's profitable in under a year, production is estimated to be around 500 barrels in the first year. 75% of our production is sold directly to the consumer in the tasting room/pub or via growler fills and we opened up in our own hood. So just generalizing what you need to make to make a profit doesn't work. There are many business models that do not depend on economy of scale but of course that is the most common model. Of course, any profits have just been sunk right back in to better equipment etc. so nobody's getting any cheese. But I don't homebrew anymore, but I do enjoy brewing still, and it's rewarding to have your neighborhood stoked on your beer.

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Old 09-12-2013, 10:11 PM   #15
LovesIPA
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I read Tony Magee's book on the story of Lagunitas brewing and it was a real eye-opener, as well as being a very entertaining read. If you're at all interested in starting a brewery of any size, definitely to pick up a copy.

I bought mine at the brewery. I have no idea where else to get a copy. Amazon has it listed, but it's out of print.

 
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Old 09-12-2013, 10:17 PM   #16
Randy_Bugger
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This method never fails:

1. pay cash for building, build out and all brewing equipment
2. make beer
3. ???
4. profit!

 
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Old 09-12-2013, 10:38 PM   #17
moti_mo
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Quote:
Originally Posted by enricocoron View Post
We opened a 7 barrel with 4 FVs and it's profitable in under a year, production is estimated to be around 500 barrels in the first year. 75% of our production is sold directly to the consumer in the tasting room/pub or via growler fills and we opened up in our own hood.
Nice, congrats. Are you guys keeping your day jobs currently, or did you go all in?

 
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Old 09-12-2013, 11:05 PM   #18
enricocoron
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Day jobs still for sure, very tired at the moment.

 
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Old 09-12-2013, 11:09 PM   #19
moti_mo
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Quote:
Originally Posted by enricocoron View Post
Day jobs still for sure, very tired at the moment.
Yeah, that's what I figured. We have essentially the same business plan as you guys do. We have an 8-barrel system with 6 FVs and a 3-barrel pilot, and need to find a place. Have a good line on a place in our neighborhood as well, so hopefully it will work out. Keeping the day jobs initially, and plan on being very tired for quite a while.

I'd be interested in hearing more about your experiences in the first year if you don't mind sharing via PM.

 
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Old 09-13-2013, 12:03 AM   #20
TheMagicHatter
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Can I ask how old you guys are being that you have day jobs as well as running the brewery?

I'm hoping to do the same in the next year or so and just wanted to know what it was like for other folks.
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