High costs you will face as you open a brewery

Opening up your first brewery is pricey. Sure, some costs are obvious, but not all. You’ll need to pay for staff and figure out how to put beer in the hands of customers, but what else? Luckily, we’ve worked with a ton of pro-brewers at this point. Be sure to check out this advice before you open up or renovate your brewery!

  1. Time is money, and working on permitting with the government takes time.

We were able to connect with our friends over at Tradesman Brewing Co, based out of SC. They ran a successful campaign on Mainvest and it wrapped up in November of 2021. Sara McConnell, the VP of Operations, says “the time involved to get through planning, permitting, and inspections during renovation cost a lot! We aren't open and we aren't generating revenue. It was supposed to be a four-month renovation and ended up being closer to 8 months, and we didn’t expect it.” According to the Paul Mueller Construction Company, it can take up to 6 weeks for you to even be able to estimate how long and expensive the build will be. It can be overwhelming, but it’s necessary to grasp the challenges you’re taking on.

On top of this, having the ability to distribute alcohol takes time. Our friends at Tradesman Brewing Co faced this as a South Carolina brewery. It can take between 30 - 120 days to receive a liquor license... but if there’s an issue, it can take 175 days or more in South Carolina, according to The Toast Tab blog.

When you’re getting ready to open a brewery, you should consult with other brewers in your area about the permitting and inspection processes prior to kicking things off. You don’t want to end up being surprised by the timeliness of parts of the process.

  1. Not every estimate is right.

This goes right off of our first tip from Tradesman Brewing Co. We were able to connect with another set of Mainvest alum, Nexus Brewery, and chat through the problems they faced, and what they would have done differently. Overall, Nexus Brewery faced a lot of complications in terms of the building remodel and equipment.

Ken Carson, the owner of Nexus Brewing, shared with us that the “biggest cost was the building remodel. Honestly it was mainly because the architects, the people I spoke to about estimated costs to improve the building, were way off from what we had projected. They had estimated the project to cost 150 grand, but ended up costing 300 grand.“

Not only was the estimate off, but Ken had to learn the hard way that he needed more equipment. When we asked Ken what he needed more of during the opening, he immediately responded with “refrigerators!!!! Had to expand the walk-in. Things like that that weren’t anticipated. We thought we were okay with one fridge, but we needed two. I was a banker all my life. If I was a restaurant person, I probably would have known.”

Craig Penno, the owner of Mill 77, gave us more insight into what it was like opening up his brewery in Amesbury, Massachusetts. “A lot of overrun on the buildout. The pandemic was dying down, things were opening up, and the competition for contractors either resulted in the cost of a job being higher than anticipated, or taking a lot longer. Stuff like that delayed us getting to opening. That were the hidden costs - we anticipated to be open already.”

While permitting and contractor work are two very different topics, our first and second costs in this article directly correlate. You want to limit the amount of time spent prepping for opening day. Every day spent prior to being open and operating, is an extra day without bringing in revenue at your brewery.

  1. Your team might not be able handle it all - and that’s ok.

If you’re fortunate enough to launch your brewery with a team, you may think you’re set when it comes to having more teammates. It’s easy to hope that your team will be able to handle everything, from designing the space, to marketing the opening day. That isn’t always the case. Bill Eddins, the co-owner of MetroNOME Brewery, says “I would have outsourced more of the organizational component of putting everything together. Dealing with governments and tracking things down - it takes so much time and energy.”

It isn’t cheap to get others involved, and that is a cost to be considered. According to Hubspot, the average freelance business consultant charges about $100 an hour. While freelance consultants can be added to the mix, it does come with a high price tag.

The last thing you want is to be burnt out. It might take looking to others for help, beyond the teammates that you already have. Having others involved, whether it be freelance consultants, or one of your relatives, could even reduce the risk of having estimates for products be far off. Multiple perspectives can be helpful as you prep for your opening day.

Our biggest takeaway with connecting with our Mainvest alumni brewers is that time can make or break your launch. If you can minimize surprises throughout your journey of opening the brewery, you’ll spend less time waiting to maximize your potential revenue. If you have access to others for help with sales, operations, and beyond, you’ll spend less time struggling with tasks that are unfamiliar to you.

Lucky for you, Mainvest is here to help. you can check out our cost guide for brewers here.

Written by Abigail Sullivan, Community Manager @ Mainvest

posted January 19, 2023
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