My LHBS is for sale. If not sold it will close by the end of next month.

[OpenSights]

Very sad! My club, Red Ledge Brewers, has been around and based out of the Red Salamander for over 20 years. As a board member I know this before the rest of the club. $50k to buy it, name and everything. I would say well over $100k just in current stock.

Wish I knew more about the retail side of business and more about brewing. It would be a good transition from destroying my body as a drain cleaner, just not in the cards for me.

Stopped in twice today. Hops for $1/oz, free kettle (bad weld), free regulator with unknown issue. I’m going to track down some customers who owe me money so I can stock up.

Very sad point in my brewing hobby. I know the owner well, even have a job coming up in the fall at his house. But he’s been breaking even and in the hole every month. Bad location, online deals....

I’m tempted to buy, move the location... I just don’t know enough about brewing, cider, wine and mead to do it. Obviously this will come up in the board meeting next week and the following club meeting. Maybe we can figure something out....

 

[Bobby_M]

If its in the hole, not much point in buying it. If you want to run a shop, start from scratch without the baggage. The inventory is probably aging and not worth 50k.

 

[day_trippr]

I would caution anyone considering getting into the LHBS game to know the market before getting in too deep. The home brew business clearly peaked years ago and who knows where the bottom is. We have had a couple of stores in my area close down in the last 6 months, and the largest store in New England has been looking shakey AF for the last year. I'm starting to wonder what things will look like if it folds...

Cheers!

 

[OpenSights]

Problem is the internet.

 

[day_trippr]

That's part of it. The other part is fewer homebrewers than the heady peak...

Cheers!

 

[TheDudeLebowski]

My favorite lhbs store closed down a couple months ago. People like variety and fresh beer at the serving. Plus people don't support local unfortunately along with bargain shopping on the internet.

I was speaking to the owners and felt so sorry for them. A common problem were people calling on the phone asking how to use something they bought on the internet or even worse showing up at the shop and then leaving without even buying anything for the help..... Done venting.....

 

[OpenSights]

That's part of it. The other part is fewer homebrewers than the heady peak...

Cheers!

Heady peak? Wtf is that?

1: bad location, but kinda good, below a brewery/distillery. Hidden.

2: cost of grains, sanitizer, PBW, is on par with online.

3: You can get equipment from amazon cheaper from their distributors! WTF?! Let me give them fckers a call!

I’m going to schedule a meeting with the owner and have a sit down.

I’m also going to be talking with the club and see about the support they have.

I’m hoping to get more visible store front, I know landlords in this town.

 

[OpenSights]

My favorite lhbs store closed down a couple months ago. People like variety and fresh beer at the serving. Plus people don't support local unfortunately along with bargain shopping on the internet.

I was speaking to the owners and felt so sorry for them. A common problem were people calling on the phone asking how to use something they bought on the internet or even worse showing up at the shop and then leaving without even buying anything for the help..... Done venting.....

Exactly!

 

[MaxStout]

Sad to say, but unless some hardy soul buys the business, that 100k in inventory will be sold off for pennies on the dollar.

 

[OpenSights]

I might make something work.


Need to figure it out.

 

[MaxStout]

I might make something work.


Need to figure it out.

How much debt load is sitting on that store? If it's saddled with creditors, run like hell. OTOH, if debt is low, might be some possibilities. What's the market like? What brick-and-mortar competition is in the area? Is there enough population within a certain radius to make it viable, or is it a small town?

Maybe the buyer could negotiate some kind of hand-off to go with it, that the previous owner would stay on board for a little while until the new buyer gets a feel for it. Maybe the buyer could joint venture it with a complimentary business--liquor store, health food store, etc. I've seen a few successful LHBS tucked in to gas stations, etc.

 

[day_trippr]

Heady peak? Wtf is that?[...]

Is English your second language?

 

[OpenSights]

How much debt load is sitting on that store? If it's saddled with creditors, run like hell. OTOH, if debt is low, might be some possibilities. What's the market like? What brick-and-mortar competition is in the area? Is there enough population within a certain radius to make it viable, or is it a small town?

Maybe the buyer could negotiate some kind of hand-off to go with it, that the previous owner would stay on board for a little while until the new buyer gets a feel for it. Maybe the buyer could joint venture it with a complimentary business--liquor store, health food store, etc. I've seen a few successful LHBS tucked in to gas stations, etc.

I’ll find out the details. I’m thinking of down scaling. Get rid of the overhead.

 

[OpenSights]

Is English your second language?

 

[OpenSights]

So is there a problem with my English?

 

[OpenSights]

Day, I like ya!

 

[day_trippr]

lol! No, just your "wtf does that mean?" in reaction to something easily understood...

Cheers!

 

[passedpawn]

My advice to the OP is run away.

 

[day_trippr]

I'm inclined to agree. Unless there's something particular about this opportunity that makes it an outlier, investing in negative growth businesses is rarely a successful strategy...

Cheers!

 

[bob1852]

All brick & mortar retail is slowly dying (for many reasons: some good, some bad).

It's not surprising to me at all that an LHBS is trying to sucker someone else into their misery.....I mean, sell their business....

 

[TwistedGray]

My LHBS is honest with me everytime I bring up the idea. He says that I should do it if I don't need to make money...because you won't. We're in a well populated area with significant wealth and a very large military and foreign presence. We have a popular University here, a small but viable craft brewery scene, and all the other **** that brings people to Monterey.

By the way, since converting to all grain I only ever buy ingredients from him, and 90% of the time everything being related comes from his shop (unless I get something from HBT or my wife buys me something for a present). My revenue for him is in the hundreds of dollars every year ... the low hundreds! Over the couple dozen times I've been there, I have seen in total less than 10 people.

 

[OpenSights]

All brick & mortar retail is slowly dying (for many reasons: some good, some bad).

It's not surprising to me at all that an LHBS is trying to sucker someone else into their misery.....I mean, sell their business....

I wouldn’t quite say sucker someone into it. Really they just plan on closing but the offer is out there for anyone interested.

I’m really on the fence. I figure I have about ten years left in my business before my body is completely destroyed. I love being my own boss, I love what I do, I’m good at it but the cost is painful. Over the last ten years I can’t think of a single week when something didn’t hurt. Running a shop would extend my working years.

On the flip side, while I’ve mastered my current skill, I honestly don’t think I know enough about brewing to run a brew store. Their one and only employee is very knowledgeable. He’s usually the first person I go to when I have a question. I know I wouldn’t be able to make a viable replacement.

If the store was ran without an employee it would be profitable. I don’t know how much Nick makes, but having an employee is expensive, the reason I don’t have any.

 

[TwistedGray]

I wouldn’t quite say sucker someone into it. Really they just plan on closing but the offer is out there for anyone interested.

I’m really on the fence. I figure I have about ten years left in my business before my body is completely destroyed. I love being my own boss, I love what I do, I’m good at it but the cost is painful. Over the last ten years I can’t think of a single week when something didn’t hurt. Running a shop would extend my working years.

On the flip side, while I’ve mastered my current skill, I honestly don’t think I know enough about brewing to run a brew store. Their one and only employee is very knowledgeable. He’s usually the first person I go to when I have a question. I know I wouldn’t be able to make a viable replacement.

If the store was ran without an employee it would be profitable. I don’t know how much Nick makes, but having an employee is expensive, the reason I don’t have any.

Just think of all the time you'll have to read during the down time. You'll be a master brewer before you know it.

 

[betarhoalphadelta]

It's a hard business...

One bit of advice--if you can get a license to sell alcohol, it's a HUGE help.

Here in SoCal we just had a LHBS practically around the corner from me close. We have a lot of homebrewers in the area, but we also have several stores. There's another LHBS about 10 minutes away, and a second about 20-25 minutes away. Both of those have an advantage in that they sell beer and craft kegs on-site. And being homebrew stores, they tend to stock and acquire some of the more rare things that you're not going to find at a typical liquor store. And they've gotten to the point where some people come in JUST for the craft beer who don't brew.

So you head in, buy some [probably low margin] homebrew supplies and/or equipment, then spend another $30-50 on rare beers at much higher margin.

The LHBS that closed couldn't sell beer. The owner now tends bar at a local brewery, and I was chatting with him about it. He cited that explicitly as something that made it hard for him to be financially viable as a business.

I don't know your locality or their laws regarding alcohol sales, but diversifying your business model to include sales of beer could be the difference between this being financially viable and it being a money pit.

 

[OpenSights]

It's a hard business...

One bit of advice--if you can get a license to sell alcohol, it's a HUGE help.

Here in SoCal we just had a LHBS practically around the corner from me close. We have a lot of homebrewers in the area, but we also have several stores. There's another LHBS about 10 minutes away, and a second about 20-25 minutes away. Both of those have an advantage in that they sell beer and craft kegs on-site. And being homebrew stores, they tend to stock and acquire some of the more rare things that you're not going to find at a typical liquor store. And they've gotten to the point where some people come in JUST for the craft beer who don't brew.

So you head in, buy some [probably low margin] homebrew supplies and/or equipment, then spend another $30-50 on rare beers at much higher margin.

The LHBS that closed couldn't sell beer. The owner now tends bar at a local brewery, and I was chatting with him about it. He cited that explicitly as something that made it hard for him to be financially viable as a business.

I don't know your locality or their laws regarding alcohol sales, but diversifying your business model to include sales of beer could be the difference between this being financially viable and it being a money pit.

That’s some good insight! My local laws allow “sampling”, Obviously need to be 21. My LHBS usually has 10 on tap, mostly house made extract kits for sale. Closest LHBS is about 20 minutes away, so not bad. I’ve never been there, but word around town is they’re a shizt show. I can’t tell you how many times I’ve seen them give business to my LHBS!

Honestly it’s going to the loss of my Cheers.

But three blocks from my house is a former club members brewery where, most likely be our new meeting location.

 

[MaxStout]

It's a hard business...

One bit of advice--if you can get a license to sell alcohol, it's a HUGE help.

Here in SoCal we just had a LHBS practically around the corner from me close. We have a lot of homebrewers in the area, but we also have several stores. There's another LHBS about 10 minutes away, and a second about 20-25 minutes away. Both of those have an advantage in that they sell beer and craft kegs on-site. And being homebrew stores, they tend to stock and acquire some of the more rare things that you're not going to find at a typical liquor store. And they've gotten to the point where some people come in JUST for the craft beer who don't brew.

So you head in, buy some [probably low margin] homebrew supplies and/or equipment, then spend another $30-50 on rare beers at much higher margin.

The LHBS that closed couldn't sell beer. The owner now tends bar at a local brewery, and I was chatting with him about it. He cited that explicitly as something that made it hard for him to be financially viable as a business.

I don't know your locality or their laws regarding alcohol sales, but diversifying your business model to include sales of beer could be the difference between this being financially viable and it being a money pit.

Agree. You need something else to drive more sales. LHBS and a liquor store would be complimentary, and not competing with one another. Getting an off-sale liquor or beer license will help bolster an LHBS, and to some degree, vice-versa. Make a low-ball offer to the present LHBS owner and see if you can grab that inventory and fixtures for a reasonable price. Then join up with someone who has a liquor store, or start your own. Create separate business entities, perhaps LLCs, put them under one roof. Or lease a spot in someone's store.

 

[mashpaddled]

Wanting to buy a failing business in which you know too little about how to operate that kind of business or the products it sells seems like an awful idea especially if you want to let go the employee who knows a lot more than you do.

 

[shetc]

One of my local shops is really a craft beer store first and a homebrew shop second. They are a pretty good LHBS so clearly the craft beer is the definite money maker, and it allows them to offer the homebrew supplies. The owner is a professional brewer so he is serious about the LHBS part. The other shop is only an LHBS but my club has a relationship with it - we'll see how it fairs.

 

[OpenSights]

Decision made. No go. Did the math, $10-15k for the business and a $15k loan on top would provide at least a profit for a year or so.

 

[passedpawn]

Decision made. No go. Did the math, $10-15k for the business and a $15k loan on top would provide at least a profit for a year or so.

I think you made a good decision. But I read your other posts above, I appreciate your situation, just keep thinking about other opportunities.

 

[OpenSights]

I don’t want my store closing, I hate to be a leach or shark. I’ve paid more to them than buying on line for the last two years. Specialty grains not carried by other LHBS in the area, yeast...

Got all four, new, for $20. Have some reading to do....

 

[IslandLizard]

Glad to hear you fought off the initial impulse, which is understandable.

It's always sad to see a good store closing, especially one you're a loyal customer to. But if profit isn't enough to justify its existence, what's the point? Unless someone is into providing bottom line charity and needs a pastime.

One of the LHBS in my area "transferred ownership" 2-3 years ago. I had looked into it a little, but the only ones I could see getting guaranteed positive income were the strip mall owner/agency where the store space was leased, suppliers, insurance co, utilities, etc. It's still there and seems to do as well as it did before, from what I heard. They rely on loyal patrons.

There must be better business models for LHBS...

 

[passedpawn]

Glad to hear you fought off the initial impulse, which is understandable.

It's always sad to see a good store closing, especially one you're a loyal customer to. But if profit isn't enough to justify its existence, what's the point? Unless someone is into providing bottom line charity and needs a pastime.

One of the LHBS in my area "transferred ownership" 2-3 years ago. I had looked into it a little, but the only ones I could see getting guaranteed positive income were the strip mall owner/agency where the store space was leased, suppliers, insurance co, utilities, etc. It's still there and seems to do as well as it did before, from what I heard. They rely on loyal patrons.

There must be better business models for LHBS...

I'd love to just buy everything on Amazon. Srsly. I now buy all my consumables (grain, yeast, hops) from my LHBS even though it's expensive. I like those guys. Still, the convenience of getting from Amazon is compelling.

I know @Bobby_M is going to come in here and yell at me, I totally understand his point of view. Some people definitely get help from the shop, especially newbs (I was there once). So I'm only speaking for myself.

 

[Darwin18]

You probably made the smart move not to buy this failing business. There could be a lot of different reasons why the business is failing but why you want to be tied to that? You could always buy up his inventory and equipment (if it's of sufficient quality), but I'd go with a fresh start. Like other's have mentioned here already, it's a tough business climate for the LHBS and you'd need to do quite a bit to set yourself apart. A license for draft beer on premise would probably be a great move if your state allows for it.

 

[Dustin_J]

Damn, sorry to hear about this. Karl (I assume is still the current owner) is a great guy, and I had a lot of good times at both the old and "new" store locations when I lived in East Lansing in the mid-2000s. As strong as that club is, though, I'd imagine things will keep moving forward. I'll drink a pint or two tonight in honor of the Red Salamander - the place I basically learned how to make beer.

 

[cmac62]

My LHBS owner said something about retiring the last time I was in and I thought for about two seconds "hey maybe a homebrew store would be a good thing to get into. Then I remember him telling me in the past that he is barely staying open. That is why I go there regularly and buy most of my stuff from him. But I know it would be a HUGE mistake for me.

 

[OpenSights]

Damn, sorry to hear about this. Karl (I assume is still the current owner) is a great guy, and I had a lot of good times at both the old and "new" store locations when I lived in East Lansing in the mid-2000s. As strong as that club is, though, I'd imagine things will keep moving forward. I'll drink a pint or two tonight in honor of the Red Salamander - the place I basically learned how to make beer.

Karl sold it about three years ago to Tom... don’t know his last name. They offered to sell it back, but he declined.

RLB will probably be bouncing around. Plenty of former members who went pro have breweries! We just bought a new chugged pump for firebrew, and looking into sources for supplies. Come to LBF in Reo town Saturday after 5:30. I’ll be working... just not sure where.

If you have time and need some supplies stop in! Lots of 1oz hops for a buck, good selection of grain and yeast left. Tell Nick Red Yeti said Hi.