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Has anyone here gone pro?

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I can assure you that after 1 year of brewing, your beer is probably mediocre to average at best. That is unless you're incredibly gifted at a hobby you just began, but I'll go with the averages. Friends and family opinions mean absolutely nothing.

That doesn't mean you couldn't run an amazing business with a great atmosphere and sell average beer to uneducated/uncaring folks. I just don't know if that's sustainable.

I’m not arguing otherwise. I just came in here to get information. I can assure you that you know nothing about me and my attention or nonattention to detail. Furthermore, you know nothing of the equipment I use to brew my beer. The only thing I can assure you of is you can assure me of nothing. My beer may be incredibly average. It may also be great. You, sir, from a distance can’t assure me of that.

I’m not thinking about opening a brewery tomorrow. I’m just on a fact finding mission to see what others have gone through that have been down this path. Thanks for the non information, though.
 
I’m not arguing otherwise. I just came in here to get information. I can assure you that you know nothing about me and my attention or nonattention to detail. Furthermore, you know nothing of the equipment I use to brew my beer. The only thing I can assure you of is you can assure me of nothing. My beer may be incredibly average. It may also be great. You, sir, from a distance can’t assure me of that.

I’m not thinking about opening a brewery tomorrow. I’m just on a fact finding mission to see what others have gone through that have been down this path. Thanks for the non information, though.

With the wealth of small breweries opened by homebrewers who clearly weren't ready to make the leap, and the wealth of bad beer out there as a result, people's skepticism is justified.

Don't take it personally.
 
What does it actually take to go from the home brew level to professional? Is it worth it?
There has been quite a few fairly lengthy threads over the years about homebrewers taking the leap. Do a search and you'll find a lot to read, both good and bad. A few years back, after winning a few competitions, I did the research on what it would take. A fair amount of the research was checking out threads on this forum. I also checked out the AHA forum and the Probrewers forum. Also bought several books and studied them, and visited every brewpub/brewery within 50 miles. So, do your research. Bottom line for me- 1. The big money maker in a brewpub is the food side 2. You make more $ selling your beers by the pint at your place, the least $ selling bottles/cans/kegs to others. 3. To set up a 7-10 barrel brewery, which seemed to be the minimum to sustain yourself without rebuilding and buying new equipment in 2-3 years, will cost +/- $300.000. and that didn't include buying/leasing real estate or include the food side.
4. Everyone says that whatever your setup estimate is, double or triple it and do the same for whatever timeline you've worked out.
Needless to say I was quite discouraged. Not going to happen for me unless I find a sugardaddy to bankroll the whole shooting match. For you? Dreams are a GOOD thing. Dream big , but back it up with some practical knowledge. Good Luck! If you do it. I'll come out and visit wherever you are.
 
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@Blackdirt_cowboy, you have been given a wealth of information. Let's say your beer is the greatest, you have the proper capitalization and future access to additional funds, you have the best employees and are in the best location with no competition. Doesn't your statement "I’m not sure at this stage in life I want to learn a new business" really answer your question?

It can be stressful when a family member bank rolls a new business venture. Do you have a business plan? When will you breakeven? The last 9+ years, our economy has improved. People are going out to eat and drink more. I would suspect if there was a downturn in the economy (recession), the first thing people will cut in their discretionary spending is going out to eat and drink. I know in my community, several restaurants and breweries went out of business over the last nine years (many within the last two years). Could your new business venture survive a recession? Just some quick thoughts.....
 
I don't know about the laws in Texas, but I have had 2 friends here in California go pro. Both had to lease a commercial property, install all their beer equipment, and let it sit for a full year until all the inspections had passed before they could produce a drop.
 
I don't know about the laws in Texas, but I have had 2 friends here in California go pro. Both had to lease a commercial property, install all their beer equipment, and let it sit for a full year until all the inspections had passed before they could produce a drop.
I've been involved in two startups and yes, the startup capital costs and delay from funding/debt and equipment/space/buildout to any sort of revenue coming back is HUGE.

Whoever said triple your budget and triple your timeline had it right.

I guess this is all to say, if you have ANY second doubts, don't do it.
 
Lots of good info here. I also know of a brewery here in Florida that had to wait over ten months for all the inspections and permits. That is a long time to pay rent without being able to open and have any money coming in....

Oh and Auggie good luck on your business! Keep us posted!

John
 
1. The big money maker in a brewpub is the food side 2. You make more $ selling your beers by the pint at your place, the least $ selling bottles/cans/kegs to others.

Not necessarily. The thing with food is that it's far more of a high fixed costs, high margin kinda business. So if you do it on a small scale, then it's not very profitable but is a way to sell more beer, if you can do it on a large scale then you can make some decent money. But you need to deal with chefs, who are just a nightmare.

It's interesting that in general a lot of the new places in the UK are getting away from "proper" food that needs a chef, and doing low-tech food to keep people drinking - plates of charcuterie, pies, pizzas at the most complicated (you can get pizza cookers that cook a pizza at >800*F in 90 seconds these days - none of the romance of a wood-fired oven but...90 seconds).

I think the ones that work are those with a good gender balance, which means more than just beer eg keg sparkling wine and a decent selection of gins, particularly "flavoured" gins. Works well even in a pretty primitive industrial-unit type of tap room.

Worth remembering that if you're doing it on your own, then running a brewery is 80% cleaning, 30% paperwork, 30% selling and 10% brewing - and if you're not prepared to put in 150% of the hours then it's probably not for you.
 
1. The big money maker in a brewpub is the food side

This hasn't been my experience in our brewpub over the past two years--the beer floats the boat. The profit margin on food isn't even close to what it is on house-brewed beer and the staffing requirements and the resultant labor costs on the food side pretty much make the food end a push most of the time. There are two brewers at our pub, me and my assistant. In the kitchen on a busy day are two line cooks (sometimes three), two or three prep guys, and a dishwasher. On the floor we have two or three bussers, five or six servers, two bartenders, and one or two bar backs. Maybe in other parts of the country this isn't so but in So Cal there's VERY little money on the food end. According to our accountants, the industry average net for restaurants is 1.5% - 3% and you have to be REALLY diligent to hit those numbers on a consistent basis on the food side.

Cheers,
--
Don
 
I have business experience, our area didn't have a brewery, I thought about it and then wimped out and kept my safe (but really dull) day job.
Now there are two breweries, and two wineries, and I feel like my opportunity passed me by.
So to the OP, if you the money, go for it. If you don't, work like hell to get the cash and follow your dream. If it fails? Pick up the pieces and start again. There are many business people who have started businesses, failed and started over several times until they figured out what they had to do to be successful.
 
I may have missed this in the thread but what is the deep down reason why you are considering this venture?
 
Having food is good for a few reasons, keeps people in seats drinking, and makes it more likely a family can come and stay a while.

But as already elaborated, it's not a money driver and often a wash if not a loss. But if it keeps the beer flowing more where the margins are higher, it can be worth it.

One thing I've learned, you need to either focus on your taproom, or don't. That means things that'll draw people to the taproom- food, good convenient location, ever changing variety, basically a smaller system brewpub, and don't bother with distro. Food can't be an afterthought either. But without food, you're probably in trouble.

Or lean in hard on distro and let the taproom be an afterthought. As in it's fine to have one but don't rely on it for business. This means keeping your costs down because your margins will shrink.

I hear the analysts saying that the moderate production brewers will be the ones to struggle as the market contracts. In reality I see the small-ish places (the 10-15 bbl system ones) trying to do both at once hurting more than anyone lately.
 
I may have missed this in the thread but what is the deep down reason why you are considering this venture?


catmoney.jpg
 
Personally, when I've given thought to having a go on my own, the model that makes the most sense is operating a primarily contract brewery. Large production space. Charge a premium to brew for others. Make what they want the way they want, and if they can't sell it you're still getting paid. From what I've seen it's a successful model between smaller places struggling to grow (I had to farm many a contract batch when a previous job was oversold in the market because the powers that be refused to listen to me), and store brands.

But I suspect as the market shrinks the demand for contract beer will shrink as well, and that model will become less viable.
 
I’ve really been enjoying this conversation. To a few points that were brought up, the recipes that I’m brewing, I’ve developed myself. If my family is biased, they are biased against me. They’re extremely outspoken. If my beer is even marginally bad, they will dang sure let me know now, and into the future. (“Remember that one time when you made that crappy beer...?)

My father in law has offered to be the money behind the operation, and leaving everything else up to me. I run my own business now, so that won’t be the challenge, but I’m not sure at this stage in life I want to learn a new business.

Finally, as far as market share goes, there is ONE craft brewery in at least a 60 mile radius of me, maybe even out to 100 miles. I am 20 minutes from Waco, Texas which has seen tremendous growth in tourism due to Chip and Joanna Gaines of fixer upper fame. I think in my area, it may the perfect time to strike.

But you all have brought up a ton of valid points. The main one, which has been on my mind already, is this is my hobby. I turned my first hobby into my job, and over the years it has become less and less fun. I’m not sure I want to do that again.

Carry on with the conversation. It has been very educational.

It sounds like a pretty decent opportunity (from your 1,000 mile high market analysis).
 
I used to see Red Tail Ale and Eye of the Hawk at Grocery Outlet pretty regularly for $3/6-pack. Neither were memorable (either way) but the bottles were nice and the labels came off easy.

Yeah the Saratoga one didn't have memoral beers either but the brewing facility is pretty nice. The area is over-saturated like crazy right now and I don't know if they stopped contract brewing due to the legal stuff with the owner or the decreased production or both but the location is OK.
 
I went pro, but *spoiler* - I’m not brewing professionally anymore. Before I went pro, a number of years ago, I was in a similar situation in the DFW area, just up the road from Waco. I had been brewing for a year, my friends and family were supportive and liked my beer... But I ultimately chose to become a brewer because it looked to be a good career fit, the industry was growing rapidly, and I had an insatiable desire to learn as much about brewing as possible.

I will say that some homebrewers make good beer right away, and I brewed some decent beers in my first year (some were drain pours). However, in my opinion, the real test of a brewer’s quality is consistency. Most pro brewers are brewing a limited number of beers over and over, with only an occasional chance to experiment. When you’ve brewed dozens of batches of the same beer, you’re better able to detect the variations between them and chisel away at the imperfections. For a pro brewer to succeed, there also needs to be a focus on the scientific aspects of brewing as they are key to improving quality and maintaining consistency. And unless you have a microbiology degree or similar qualification, you need some education to that end, either through a brewing school or brewing literature. But I digress...

Since I had a full-time job, I took online courses from the Siebel Institute for about a year while volunteering at a brewery during weekend tours. Ultimately, beertending got my foot in the door and my certification got me hired as a cellarman. I quickly realized that although my education had given me a good foundation, I had a LOT to learn...so I set myself to the task. 1 year later, I had moved up to brewer, and 1 year after that, I left my position. My passion for beer hadn’t abated, but I had grown tired of the physically uncomfortable environment that is a hot, humid, noisy production facility. Furthermore, I was barely sleeping while working the third shift, which resulted in constant fatigue and bouts of depression. I left on good terms (aided by the gold medals that we won at GABF during my last week), and eventually found a new career that’s a great fit for me.

Though I haven’t missed the work environment too much and I’ve enjoyed the return to homebrewing, I have missed my former team. A good brewing team is much like a family. You work together, travel together, socialize together... You rely on each other for assistance, safety, encouragement, etc. You work through issues and grow closer through the struggle. The beer is great, but for me, the best part of working at a brewery was the team.

Pro brewing isn’t easy work - no more “relax and have a homebrew.” The constantly recurring task of cleaning is no joke, and you will sweat (and bleed) as you drag hoses, load grain, sling kegs, etc. You’ll also burn yourself with hot water/wort/steam, splash harsh chemicals on yourself (hopefully not in your boots or eyes), get a nice big whiff of CO2, smack your head on a fermenter... All in a day’s work. Oh, and the pay isn’t great unless you own the place and produce a good bit of beer, in which case you probably aren’t on the brewhouse anyway. Sure, some head brewers make out pretty well, but they’re the exception to the norm, and likewise, they don’t do much brewing.

Still, the Texas brewing community is awesome and will definitely be supportive if you start your own place. The camaraderie between brewers is truly unique - competition is generally friendly, everyone wants the best for each other and there are few trade secrets. And there’s no better way to bond than over a few beers.

Of course, running a business is a completely different skill set from brewing beer. All aspects are important - management, marketing, sales, production, packaging - good beer isn’t enough, though it’s a start. Brewing equipment is expensive. The legal process is tedious. And Texas laws are a mess when it comes to independent breweries, though progress is slowly being made thanks to the efforts of various craft brewers.

I highly recommend working at a brewery before starting your own, or at the very least interning at one. And get some type of relevant education, it will help you immensely. When you buy equipment, buy as large as possible, so that you can grow with demand and quickly become profitable. Expect to encounter obstacles - the more you do your homework ahead of time, the better you’ll be prepared to overcome them.

Every brewery is different and brewers themselves are an eclectic bunch. What worked for me may not work for you, and it certainly isn’t the only way to go. Though brewing wasn’t the profession for me (at least for now), it may be just right for you, and the world needs good brewers!

Cheers!
 
This hasn't been my experience in our brewpub over the past two years--the beer floats the boat. The profit margin on food isn't even close to what it is on house-brewed beer and the staffing requirements and the resultant labor costs on the food side pretty much make the food end a push most of the time. There are two brewers at our pub, me and my assistant. In the kitchen on a busy day are two line cooks (sometimes three), two or three prep guys, and a dishwasher. On the floor we have two or three bussers, five or six servers, two bartenders, and one or two bar backs. Maybe in other parts of the country this isn't so but in So Cal there's VERY little money on the food end. According to our accountants, the industry average net for restaurants is 1.5% - 3% and you have to be REALLY diligent to hit those numbers on a consistent basis on the food side.

Cheers,
--
Don

Food service is not the savior of a brewery. It’s a second business that your attempting to run. Look at the BA data, brewpubs fail at twice the rate compared to stand alone breweries.
 
I’m in the food biz and after 7 years running my business I’m finally making 5% at the end of the day. I didn’t get paid the first year. Lost money the 2nd and made a salary (smaller than my previous salary) the 3rd year... I didn’t make any real money until I paid of the bank after year 5. This last year was the first time I felt comfortable writing myself a 5 figure bonus check. I put it in savings.

I have several friends that brew professionally. We have been kicking around opening a 10bbl brewery with 20 bbl fermentors for over 2 years. We have raised 350k and have another 200k in personal investments (our own funds). Even at $550k cash I feel we are well short of what’s needed to really be financially stable enough to pull off the start up. TTB is running at 6-12 months for approval, during the approval process rent needs to be paid, some salaries need to be paid, equipment needs to be purchased and a tap room needs to be built out. We estimate those costs at $390k minimum. That’s real money out of pocket prior to brewing a batch of beer.

In my opinion estimating annual sales in the first three years is a complete shot in the dark. That’s also the thing that you need to correctly estimate to have a chance of beating the odds.

It’s been a great run for craft beer the last 20 years and I’m sure the best of the brewers out there can survive a downturn in the economy.. but it’s entirely probable that we see a shift for the worse over the next few years. Hell the increase in interest rates alone will increase your costs. Current bank rates for prime borrowers are 6% now but when I borrowed the money to start my business I was paying 4.5%. That additional 1.5% could be the difference between loosing money year one and breaking even. The SBA is still a good option for start up’s.

Another potential challenge is hop contracts. To secure forward commitments on hops means you need to contract in advance and hit volume numbers. You could always try to resell those hops but you are signing contract that obligates you for payment in the future. Good luck securing enough Galaxy for your awesome can’t miss DIPA in year one.

It’s possible to achieve success and beat the odds (24% brewery failure rate while we enjoy the best run in the economy over the past ten years) you’ll need to be completely organized, well financed, well managed and lucky. Opening a 10-30 bbl brewery is not for the faint of heart. I know three 1.5-3 bbl breweries near me that have failed to turn a profit by year 5. So for me less than 7-10 bbls isn’t worth the risk and a business that doesn’t turn a profit is a glorified hobby.

The question to ask yourself is if “I get caught not knowing what I need to know can the brewery survive?” Another really good question is “how long can I and the brewery survive without making money?” Then you need to be brutally honest with yourself and walk up and down the isle at a really well stocked beer store and ask yourself if your beer is better than the majority of the beer on the shelf. Then you need to ask yourself if you’ve really got what it takes to create and run a business from the ground up.

With all of that said I still want to pull the trigger and open. We’re actually going to look at an old Culligan water facility on Friday. 18’ ceilings, 6” water main, sprinklers installed and 40 parking spaces. 14.50 a sq foot at 5,000 sq feet or $72,500 in hard earned cash paid in advance of receiving your TTB lic.
 
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I went pro as an employee about a year ago. The brewery had just grown to require three people in the brewhouse, and I was already a cook at the same business. I'm in school for Fermentation Science, and it's been quite validating to discover how much I love the work. I've even been able to write a recipe, and will have the opportunity to do more of it in the future.
 
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