It takes more than a love of craft beer to open a microbrewery.It requires a lot of money and patience.Craft beer is one of the fastest growing industries.The number of micro-brewed barrels in the U.S. has doubled since 2007.If you love craft beer, you can make your business dreams a reality.
Step 1: Prepare for a lot of money.
Beer is one of the most taxed and regulated industries in the US.Depending on your state's laws, you may have to pay for distribution and structural reinforcements to support large tanks.It can take up to a year to apply for a federal brew permit from the Alcohol and Tobacco Tax and Trade Bureau.Before you can begin selling to the public, you must have all of your equipment in place and your location ready for business.It is up to you to decide how to finance your business.You will need to have a quicker return on investment if you rely on investments from other people.It could cost between $500,000 and $1 million to open a brewery.
Step 2: Take advantage of the tax code.
Craft brewers can take advantage of the federal government's reduced $7 a barrel rate for their first 60,000 barrels.The reduced tax was put in place to help small business owners open craft breweries.
Step 3: You have to calculate your barrels.
The number of barrels of beer you want to brew is a key factor in your investment and business plan.A barrel of beer is 31 gallons.The majority of microbreweries make less than 15,000 barrels a year.Brand new equipment to produce 30 barrels of beer can cost $1 million or more.
Step 4: A location is where you should scout.
You should know where you want to put your brewery.Will you have a restaurant attached to your brewery or a small tasting room?Will you sell t-shirts and beer glasses?What kind of space you need will be determined by these factors.A location on the edge of a busy area is a good place to start looking.You won't have to pay a lot in rent or mortgage if you benefit from foot traffic.
Step 5: Start up capital can be gained with a business plan.
You need to raise capital to open your brewery after you have determined the above factors.You will need to get money from other sources if you can't provide all of the startup costs yourself.A business plan is one of the most effective ways to raise funding.Your operational budget, location, and plans for making a profit for the first year should be included in the business plan.How you will fund the business must be clearly shown in your plan.Make it clear that you will provide 70% of the capital with your own money, 15% from small business loans and 10% from friends and family.Your Unique Selling Point should be included in the business plan.What is your brewery's offer that no other brewery in the area has?Why shouldn't an investor pick your project over someone else's?It's important to make a passionate case for your business.
Step 6: You should present your business plan to your friends and family.
Friends and family who already know you are one of the most common sources of funding for small businesses.They know your level of passion for the project and your general knowledge of the business.Taking money from friends and family could hurt your relationships if you don't handle their investment correctly or if the business fails.
Step 7: There is a small business loan.
The U.S. Small Business Administration is designed to help owners.The SBA 7a loan helps you pay for things like real estate, machinery, and other operational expenses.The 7a loans have a maximum of $5 million and an average amount of $337, 730.The interest rates are negotiated by the lender and the applicants.The application for this loan requires a lot of paperwork, including your personal financial history, projected loss statements, information for any other owners or affiliates, and income tax returns.
Step 8: You can use a home equity loan to finance your business.
A home equity loan is based on how much you owe on the mortgage and the current market value of your home.You could use this to finance your brewery if you have significant equity in your home.Don't take the first loan that is offered to you.Compare interest rates and repayment plans from multiple banks.The risks of this loan should be kept in mind.You could be forced to sell your house if you can't repay the loan.This shouldn't be used as your first resort.
Step 9: Crowdsourced capital raising is something to look into.
If you know that your friends and neighbors would love to have a great brewery in their neighborhood, then you should look into crowd funding websites.Your potential customers will be able to donate directly to you on these sites, and it will also be a great way to promote your business before it opens.
Step 10: You should protect yourself financially and legally.
Early on in your business strategy, you should hire a lawyer and an accountant.An accountant and a lawyer will make sure that you stick to your budget and stay compliant with all state and federal guidelines.
Step 11: You can visit your competitors.
When you have a common antagonist in a large corporation, the microbrewers are known for being supportive of each other.Ask other microbreweries for their opinions on things like picking equipment and designing the space for customers.
Step 12: The right equipment is needed.
Most of the equipment you can buy is ready to use.Every system that you will need can be supplied by companies like GEA Brewing.Better deals on used equipment can be found on sites like ProBrewer.Kettles Kegs Boilers Fermentation tanks Storage tanks Refrigeration equipment and ice liquid Cleaning equipment Filter tank and pump canning and bottling equipmentWill you have enough space to serve more customers if your microbrewery is successful?
Step 13: Make your location better.
You could be buying a former business or building a new one from the ground up.To create the best space for your customers, you should have a team of high quality contractors and designers.Make sure you have proper air flow.You have to make sure that your space is tall enough to hold large tanks and that it can be properly ventilated because Breweries run on steam.A proper drainage system is needed.It will take strong plumbing and a large drainage system to brew on location.The current plumbing system in your location needs to be renovated.Invest in high quality flooring.Your floors will suffer a lot of wear and tear from spilt beer, which is an easy detail to overlook.It's important that you have a floor that can hold up to beer.
Step 14: Consider the customer's experience.
How are you going to accommodate your customers?Customers will be seated primarily at a bar and small tables or at booths and large tables.Will you serve food and beer?What is the purpose of the space?Are you going to have a cozy, pub-like feel to it or will it be light and airy?How many people do you want to accommodate?If you have space for entertainment, you should consider a small stage.You could also do an open-mic night at a microbrewery, which is a popular place to socialize.
Step 15: Customers can be drawn to your location.
Extra incentives might be needed to draw in more customers as you build up your reputation for serving excellent beer.Offer happy hour specials, promote beer flavors, and host popular local performers for a discounted rate in order to attract more customers.You can host seasonal events at your brewery.You can host an oyster festival if you're located in a coastal area that's famous for its oysters.You can bring in customers by showing popular TV shows and movies.
Step 16: Get involved with the community.
You need to market yourself to the broader community if you want to draw in a lot of traffic.Beer festivals will be an obvious place to start, but consider also serving your beer at local food festivals, farmer's markets, and at large concert and film festivals.
Step 17: Broad distribution is something to embrace.
You shouldn't just sell beer at a single location.If you want to sell kegs of beer to other bars and restaurants, reach out to them.You should distribute your beer with local grocery stores and liquor stores if your brewery has a bottle system.Check your state's distribution laws.Some states allow you to self-distribute your beer while others require that you use an approved distributor.Here you can find a list.
Step 18: You can connect with important people.
If you want to try your beer, you need to research popular beer bloggers and local food critics.You should reach out to the magazines that are popular in your city or town.You can use social media to promote your brand.Adding a section on your website about all the best ways to enjoy beer is a good idea.Send out a weekly or monthly newsletter with special offers and information for your loyal customers.This will create loyalty amongst your regular customers and give your brewery a "niche" value.