Anyone Started A Microbrewery?

[mick8882003]

I have had this thought rolling around in my head for awhile now. I am curious about starting a microbrewery. I am wondering what it would take to do a few niche brews that I could sell (legally of course.)
Has anyone tried this? What's your success been like?
I am not looking to make a killing out of this, just enough to fund my hobby and a little extra.
I am thinking of how good it would be to have a good all grain system with good temp control.

I am guessing that the hardest part would be to get beer into the local pubs, I assume they would be tied up with contracts? No?

Well its a nice dream, but far from reality.

Cheers Mick

 

[Bribie G]

I would heartily recommend that before even thinking about how big a mash tun etc, you approach your local TAFE and enrol (to get in next term) to do a Certificate iv in Small Business Management where you will learn all sorts of secrets like doing a business plan, types of finance, advertising, how to survive your first year etc. Being rural I'm sure you would be able to do it Externally.

I assume you are at Mathoura on the Murray, with the constant flow of tourists and being presumably in a wine area as well, a Micro might go down well.

 

[newguy]

The owner of the oldest micro in my city gave our club a talk regarding his start in the business. What he stressed most was that no matter how thorough your planning, double your cost estimate and halve your sales estimate. He also said that it's much better to start small and minimise your risk, then build your business. Rather than going all out and buying the biggest best equipment you can find and then not be able to sell your product, or have to pour it all out because of infection/quality control issues, etc. Quite a few successful breweries were founded with little more than 15gal homebrew systems.

 

[reviled]

The owner of the oldest micro in my city gave our club a talk regarding his start in the business. What he stressed most was that no matter how thorough your planning, double your cost estimate and halve your sales estimate. He also said that it's much better to start small and minimise your risk, then build your business. Rather than going all out and buying the biggest best equipment you can find and then not be able to sell your product, or have to pour it all out because of infection/quality control issues, etc. Quite a few successful breweries were founded with little more than 15gal homebrew systems.

How much is 15 gallons? About 75 odd litres?

 

[newguy]

More like about 60-65l.

 

[reviled]

More like about 60-65l.

I like the way you think with this and I think its much more logical, it may mean that at the start you need to do more brewing, but better that than throwing beer down the sink Can allways build up equipment later when you know it will be worth while!

 

[newguy]

I like the way you think with this and I think its much more logical, it may mean that at the start you need to do more brewing, but better that than throwing beer down the sink Can allways build up equipment later when you know it will be worth while!

Exactly. You also don't have to worry about selling 2,000l of beer. 60l (3 x 20l kegs) is much easier to sell, which gives you cash to cover the next batch plus some to put toward rent, paying yourself, etc.

Not too long ago someone posted a link to a very interesting story about Dogfish Head and I'm pretty sure they brewed almost nonstop on a very small system in the beginning too.

 

[reviled]

Exactly. You also don't have to worry about selling 2,000l of beer. 60l (3 x 20l kegs) is much easier to sell, which gives you cash to cover the next batch plus some to put toward rent, paying yourself, etc.

Not too long ago someone posted a link to a very interesting story about Dogfish Head and I'm pretty sure they brewed almost nonstop on a very small system in the beginning too.

The problem which comes up over here (not sure if the law is diff in Aus) is that you have to pay excise on what you brew, before you sell it, so it can be expensive, before youve even sold anything... <_<

 

[newguy]

The problem which comes up over here (not sure if the law is diff in Aus) is that you have to pay excise on what you brew, before you sell it, so it can be expensive, before youve even sold anything... <_<

It can be even worse in Canada. Each province is different, but here in Alberta things are a bit weird. You also have to pay excise on what you brew before it is sold too, but you don't immediately have to pay. I think it's monthly or maybe even quarterly. You have to pay excise based on the finished volume of wort in the kettle, prior to chilling. You don't get any credit for losses of more than 5% between the kettle and the bottle/keg.

Things get really weird depending on how you sell it. If the brewery sells the product directly to an establishment, say a keg of beer to a restaurant, then the restaurant directly pays the brewery. If the brewery sells their product into the provincial liquor store system, then the government appointed distributor takes the product and doesn't pay for it. The government directly pays the brewery, usually very late (or so I've heard).

 

[devo]

More like about 60-65l.

15gal = 56.781177 litre B)

 

[Jamz]

15gal = 56.781177 litre B)

Yeah, but depends if we're talking imperial gallons or US gallons.

In imperial gallons its 68.19 litres

 

[devo]

Yeah but everyone knows that it's the sepo's who offer the most resistance to the metric system.

 

[Millet Man]

The problem which comes up over here (not sure if the law is diff in Aus) is that you have to pay excise on what you brew, before you sell it, so it can be expensive, before youve even sold anything... <_<

We pay excise every Monday morning on what left the brewery in previous week (Mon-Sun).

Back to the original question; there are a couple of threads on here on what is required to set up a micro so see if you can dig it up as it covers most of the basic questions and looks at state by state differences (eg: Vic much cheaper and easier than NSW).

There is also a very small micro in Sydney somewhere that does 50 lt batches as I recall (happy goblin ??? or something like that), do a search for it too.

Cheers, Andrew.

 

[Wasabi]

Exactly. You also don't have to worry about selling 2,000l of beer. 60l (3 x 20l kegs) is much easier to sell, which gives you cash to cover the next batch plus some to put toward rent, paying yourself, etc.

Excise in North America is generally a bit kinder than here.

That being the case I am going to repost this comment made by Richard Maroney of Sail & Anchor, Mad Monk and recently helping our at Colonial.

"I did an exercise for a National Pub company in mid 2000 and the break even point for that system (20hL brew length)was 1250hL (125000l) per year. The skew on that was is that everything was vertically integrated ie we were our own customer with some excess product getting farmed around the other pubs in the portfolio. So marketing costs etc... to push product wasn't a big component of the outgoings."

Its an expensive business that can only be offset by volume.

In the above example, a 20L keg of beer at 4.5% is going to attract $26 in excise
A 50L of the same beer attracts only $45 in excise.

The ATO will give you back 60% of your excise if you sell less than 30,000L (300hL) a year. No micro in Australia, to my knowledge, has made money making less than 30,000L a year.

Its the horrible catch that you can't make money if you start too small, but you need too much money to start big.

If you actually intend to package the beer in bottles / cans...well thats another story. The calculations we have done put the cost of packaging and excise at $35 / carton. That's not including raw materials, making the beer, running the brewhouse or labour.

As soon as the government fixes the ####### up excise system in this country, the better chance micro's will have to not only break even, but maybe...just maybe...even feed their kids.

 

[Adamt]

This subject comes up every few months... there was a huge thread on this about 6 months back I think. Can't remember what it was called but do a search.

 

[quantocks]

Hey Mick,

try this one mate:

micro brewery process

 

[Linz]

Yeah but everyone knows that it's the sepo's who offer the most resistance to the metric system.

Ahh..recently the Poms had a stink over the 'Pint' glass...and the EU backed down on forcing them into the 0.3l and 0.5l serving sizes...Poms finally learnt somthing from the yanks?!?!?