Homebrewing saved me over $1000 in 2015!

[IrregularPulse]

Homebrewing cost me too much money. I have a potential brewery sitting in my cellar, not producing any alcohol and taking up floor space for a hypothetical piece of equipment that could one gain generate income.

 

[broadbill]

I understand considering opportunity costs when it's something you don't want to do, like a tricky house repair or something when you're debating on sinking all your spare time vs paying someone. But counting labor on a hobby is just wrong.

Hey, I agree counting labor on a hobby is wrong, but I'm not the one believing I actually save money by brewing my own beer compared to what I can buy it for. This only looks good from a cost stand point because you specifically ignore the labor we put into it. Breweries don't have this luxury and pass along the cost to the consumer.

If for sh*ts & giggles you did a labor calculation you'd probably see that craft beer is probably very competitively priced compared to our home brewed beer (especially if we charged the hourly rate we get at our day jobs!). This is because that although they pass along labor costs, they also pass along the savings for brewing at scale. 6 man hours gets you five gallons. 12 man hours gets them 10 bbl.

 

[hunter_le five]

I understand considering opportunity costs when it's something you don't want to do, like a tricky house repair or something when you're debating on sinking all your spare time vs paying someone. But counting labor on a hobby is just wrong.

Yup. If I choose to stay at home and brew beer instead of going to work today at my hourly job, then yes, there is a very real opportunity/labor cost.

But if I'm choosing between homebrewing beer or binge-watching reruns of Hannah Montana with my thumb up my assh0le, then there's no real monetary cost involved. With either choice it's recreational time.

 

[hunter_le five]

Hey, I agree counting labor on a hobby is wrong, but I'm not the one believing I actually save money by brewing my own beer compared to what I can buy it for. This only looks good from a cost stand point because you specifically ignore the labor we put into it. Breweries don't have this luxury and pass along the cost to the consumer.

If for sh*ts & giggles you did a labor calculation you'd probably see that craft beer is probably very competitively priced compared to our home brewed beer (especially if we charged the hourly rate we get at our day jobs!). This is because that although they pass along labor costs, they also pass along the savings for brewing at scale. 6 man hours gets you five gallons. 12 man hours gets them 10 bbl.

Do you consider reading a book to be labor? How about watching a movie? I guess that $5 movie rental actually cost you $45!

Activities engaged in a hobby/recreation do not equal labor. Especially when the "process" is part of the fun.

 

[bob1852]

Do you consider reading a book to be labor?

Actually, yes, I do.

 

[canehdianman]

I sat down with my wife last night and went over our yearly finances.

In 2014 I was not a homebrewer, we spent $1500 on alcohol at the booze store and going out to local pubs for a beer.

In 2015 I had a 15 gallon system, 6 tap keeezer, and haven't bought a six pack in well over a year.

In 2015 we spent $350 on alcohol at the booze store and local pubs.

Considering I spent about $400 on ingredients in 2015 that is over $1000 less money spent in 2015. I was pretty surprised and tickled by those numbers.


Now the long backstory if you want to read on:

I know this doesn't factor in equipment but I had wanted to brew for years so in late 2014 I got a modest 5K inheritance from my grandma's passing. I decided grandpa (who was a boozer and woodworker) would love to see me put that to good use so I spent about 3K getting a nice setup for brewing, (15 gallon cooler and pot setup, 6 tap keezer) and the rest of the money I spent on tools for a wood shop, since we just bought a house with a shop and no tools. Grandpa was also cheap so I know he would love it if I could tell him he's helping me enjoy great beer and save money in the long run!

Cheers!

I love homebrewing as well, but it takes a while to recoup the initial investment for most people (except BIABers I suppose).

If you include the 3k you spent on equipment, you spent 3400 in 2015, as opposed to the 1500 you spent in 2014. But on the bright side, in 3 years or so, you'll be ahead of game!

 

[iijakii]

Hey, I agree counting labor on a hobby is wrong, but I'm not the one believing I actually save money by brewing my own beer compared to what I can buy it for. This only looks good from a cost stand point because you specifically ignore the labor we put into it. Breweries don't have this luxury and pass along the cost to the consumer.
.

But we're only talking about a cost standpoint. You keep bringing up labor saying he isn't saving money. He is saving money (if you ignore the equipment cost...) though! He spent less on alcohol + brewing ingredients this past year than the previous. Whatever his possible labor rate might be is totally irrelevant to the discussion.

Of course commercial beer prices are a lot more than just ingredients, there's labor, taxes, building and other overheads etc... but so what? Does he need to amortize his mortgage too so he can get a good picture here? So youre brewing in your garage, do you divide your mortgage into sqft and rent the space from yourself and add that into the batch costs?

 

[bob1852]

But we're only talking about a cost standpoint. You keep bringing up labor saying he isn't saving money. He is saving money (if you ignore the equipment cost...) though!

So he is saving money (just ignore the part where he isn't).

Does he need to amortize his mortgage too so he can get a good picture here? So youre brewing in your garage, do you divide your mortgage into sqft and rent the space from yourself and add that into the batch costs?

If you want to get a true cost of homebrewing, then yes.

 

[GilaMinumBeer]

I guess that $5 movie rental actually cost you $45!

$55. $5 rental plus $1 per shade in home use movie props.

Wait, what?

 

[broadbill]

Do you consider reading a book to be labor? How about watching a movie? I guess that $5 movie rental actually cost you $45!

Activities engaged in a hobby/recreation do not equal labor. Especially when the "process" is part of the fun.

I agree. that isn't what I'm talking about.

 

[iijakii]

So he is saving money (just ignore the part where he isn't).

Agreed, which is why I can't say homebrewing saves me money. The OP specifically mentions to ignore that part though and focus on the alcohol - alcohol relationship.

If you want to get a true cost of homebrewing, then yes.

Nope.

 

[hunter_le five]

I agree. that isn't what I'm talking about.

Please explain.

 

[iijakii]

I agree. that isn't what I'm talking about.

/thread

We converted him, guys!

 

[hunter_le five]

If you want to get a true cost of homebrewing, then yes.

Nope. The mortgage is a cost with or without homebrewing, and is therefore irrelevant for cost analysis.

/managerial accountant

 

[m00ps]

my 11 minute brewdays and extreme boundary pushing efficiencies save me more time and money than all you suckers

end of discussion. advantage: m00ps

 

[bob1852]

Nope. The mortgage is a cost with or without homebrewing, and is therefore irrelevant for cost analysis.

/managerial accountant

You insist that we must include labor costs in the homebrewing cost analysis.

If I work from home, I can deduct part of my home expenses as a home office, correct?

Ergo....

 

[GilaMinumBeer]

my 11 minute brewdays and extreme boundary pushing efficiencies save me more time and money than all you suckers

#raiseatoastedsteaktoyou

 

[bob1852]

Agreed, which is why I can't say homebrewing saves me money. The OP specifically mentions to ignore that part though and focus on the alcohol - alcohol relationship.

Then he needs to start a new thread. This one is about homebrewing saving you money (which it doesn't).

 

[Hello]

Holy crap! You nerds sure took the wind out the guy's sails! But really, I think it has been established that home brewing may not actually save money for some. In some cases, if you stick with a brewing kit, never make an upgrade and brew on as you would then yes, home brewing can save money. I'm in the red myself. I didn't start home brewing to save money though.

 

[hunter_le five]

You insist that we must include labor costs in the homebrewing cost analysis.

I'm insisting the opposite.

If I work from home, I can deduct part of my home expenses as a home office, correct?

Ergo....

Your logic is infallible. You win the the thread.

 

[iijakii]

Then he needs to start a new thread. This one is about homebrewing saving you money (which it doesn't).

My records show brewing equipment has a lifetime of 30 years, when we amortize his 3400 setup there's just a marginal cost of $113 added, he's still coming in ahead.

Hey I can accounting101 too. He's also saving soooo much gas not driving to the store and pub all the time.

 

[bob1852]

My records show brewing equipment has a lifetime of 30 years, when we amortize his 3400 setup there's just a marginal cost of $113 added, he's still coming in ahead.

Hey I can accounting101 too. He's also saving soooo much gas not driving to the store and pub all the time.

But gas is cheaper this year than it was last year.

 

[broadbill]

Please explain.

I'm not arguing if labor should or should not be accounted for (I think we agree is shouldn't be, as it is hobby).

What I'm saying is the statement that I saved X dollars homebrewing because that much craft beer would have cost Y is false because that person not taking into account the same set of inputs to produce that amount of beer.

Did they save money?....uh sure, if you leave out things like labor, equipment, and all the other stuff a business has to pay for to get their beer into your gullet. But then we are back to the beginning on this, arguing if we should include those inputs in the first place.

 

[iijakii]

What I'm saying is the statement that I saved X dollars homebrewing because that much craft beer would have cost Y is false because that person not taking into account the same set of inputs to produce that amount of beer.

The price makeup of an item has no bearing on the cost you pay for it??

 

[broadbill]

I'm insisting the opposite.



Your logic is infallible. You win the the thread.

The price makeup of an item has no bearing on the cost you pay for it??

you mean markup?

 

[bob1852]

So if I bottle in Sierra Nevada bottles, I need to include the original price of the Sierra Nevada beer into my cost analysis, correct? Otherwise, I wouldn't have bottles to put my homebrew in.

 

[m00ps]

Your logic is infallible. You win the the thread.

But....but....*sob*

 

[hunter_le five]

I'm not arguing if labor should or should not be accounted for (I think we agree is shouldn't be, as it is hobby).

What I'm saying is the statement that I saved X dollars homebrewing because that much craft beer would have cost Y is false because that person not taking into account the same set of inputs to produce that amount of beer.

Did they save money?....uh sure, if you leave out things like labor, equipment, and all the other stuff a business has to pay for to get their beer into your gullet. But then we are back to the beginning on this, arguing if we should include those inputs in the first place.

That is not how a cost comparison works. Inputs in alternative A do not have to be the same as inputs in alternative B. Marginal costs of option A and option B are what is relevant.

It comes down to what did the OP spend brewing his beer versus buying.

When homebrewing, you do not have to pay for labor, and it should not be counted, as we have already agreed.

When buying craft beer, you are effectively paying someone else to brew beer for you, package it, distribute it, etc. All these are relevant input costs, whether or not the same input costs apply to the alternative.

 

[bob1852]

It comes down to what did the OP spend brewing his beer versus buying.

in 2015:

$3400 brewing
$350 buying

I'll let the rest of you accounting experts decide which number is greater.

 

[GilaMinumBeer]

So will I save money making Brew Dog beers or not?

 

[hunter_le five]

in 2015:

$3400 brewing
$350 buying

I'll let the rest of you accounting experts decide which number is greater.

Let me get my abacus out of the attic, and I'll get back to you.

 

[GuldTuborg]

in 2015:

$3400 brewing
$350 buying

I'll let the rest of you accounting experts decide which number is greater.

OK, so just be patient until next year and see how the 2014 vs 2016 costs compare. Because, you know, the gear upgrade itch is so easy to ignore.

 

[bob1852]

OK, so just be patient until next year and see how the 2014 vs 2016 costs compare. Because, you know, the gear upgrade itch is so easy to ignore.

Well, according to most people in this thread it doesn't matter.

You only compare raw ingredient costs versus packaged commercial beer costs.

Now, if he's eating handfuls of raw barely and pellet hops sprinkled with yeast, then maybe he is actually saving money.

 

[MyQuL]

There are NO labor costs associated with homebrewing, unless you either 1) pay yourself, or 2) pay someone to homebrew for you.

My time at work earns me money, my time at home (homebrewing) earns me $0

Exactly my point

 

[GuldTuborg]

Now, if he's eating handfuls of raw barely and pellet hops sprinkled with yeast, then maybe he is actually saving money.

I assume most around here do this, don't you?

 

[HausBrauerei_Harvey]

My records show brewing equipment has a lifetime of 30 years, when we amortize his 3400 setup there's just a marginal cost of $113 added, he's still coming in ahead.

Hey I can accounting101 too. He's also saving soooo much gas not driving to the store and pub all the time.

Actually I'm lucky enough to live within walking distance of 4 breweries! Of course if we factor in that my time is money the 15 or 30 minutes it takes to get there it's about a wash with gas cost I suppose.

 

[iijakii]

you mean markup?

No, I mean makeup. $5 is $5, doesn't matter what that is going towards.

 

[slym2none]

Doing a keg system, that is where the money should be spent and it does take a lot of time to offset the cost versus buying bottles but the time and space savings is worth it

I'd rather spend the money used for a keg-setup to brew more beer.

 

[Auger]

never make an upgrade

BLASPHEMER!

caps

 

[bob1852]

I assume most around here do this, don't you?

Yes, but I pelletize my own hops to save money, as well as dehydrate my liquid yeast into dry to save money as well.