After homebrewing for a decade, Annette got her certificate in brewing from Siebel Institute while also doing an internship at Smuttynose. After that, she convinced me that with her aptitude for brewing and problem solving, and my background in marketing and business and my love of spreadsheets that we should open a brewery. It didn't take too much convincing. We decided to start with a 3-barrel system that Annette fabricated together from used tanks with the help of a local welder. We made that decision for several reasons. First of all, we wanted to bootstrap our business ourselves, so spending judiciously was always top of mind. Second, we wanted to test the market's appetite for our beers and our story. It's one thing to have your friends and families tell you that they love your beer ' it's quite another thing to have complete strangers tell you that they love your beer. We wanted to make sure that our beers were warmly embraced by the public before going big. Finally, not to say that we had low expectations, but we certainly didn't expect to sell as much beer as we did! We were extremely and very pleasantly surprised as to how customers and our community supported us.
YME are exported all over the world and different industries with quality first. Our belief is to provide our customers with more and better high value-added products. Let's create a better future together.
The biggest differences we found going from homebrewing to professional brewing were around yeast, packaging, and safety. How the yeast acts in 5-, 100-, and 500-gallons is very different. It's not a direct scale up, and the same goes for pretty much all ingredients. When we were homebrewing, we would re-use yeast, but if you've never done that before, then you would need to learn about yeast management practices such as harvesting, tracking, and cell counting. I could spend hours talking about packaging! There is quite a difference from brewing a batch of beer and filling up your pony keg or gravity feeding into bottles for personal consumption versus packaging beer for distribution. Part of the learning curve around packaging includes how to pour consistent fills, dealing with minimizing dissolved oxygen, labeling on wet bottles, and even choosing packaging equipment. Also, at a larger size, your equipment becomes more automated, and there are new concerns like best practices around cleaning and maintaining that equipment. There are also safety concerns that homebrewers might not think about. Instead of a pot on the stove and pretty safe sanitization chemicals, you have hundreds of gallons of boiling wort, dangerous chemicals circulating in tanks much bigger than you, and high pressure along with a dozen other concerns. Finally, because Annette is an engineer, she dove really deeply into the science of brewing really quickly. While homebrewing she had our water analyzed, took pH readings, filtered the water, sometimes adjusting with gypsum, etc. If you are a homebrewer with plans of scaling up to a nano size, it would be well worth your time to do some research into water chemistry.
In July we bought a 12-acre farm property and re-habilitated the beautiful post & beam barn into our brewery and a restaurant. We also went from a 3-barrel system to a 15-barrel system. From a business perspective, the biggest advantage of a larger system is just the pure efficiencies ' it takes us the same amount of time to brew 5 gallons (19 L) as it does 3 barrels as it does 15 barrels. On the other side, if you are into experimentation and making wacky brews, it will be a lot easier to sell 3 barrels of it than 15 barrels, which is one advantage of a nano brewery. That being said, if you have a large direct-to-customer channel like a brewpub, then that shouldn't be a big concern. Even at our current 15-barrel size, we can sell through a unique beer ' like our Beet Wit ' in our pub in a reasonable amount of time. The other side of the coin is that if you come up with a very popular brew, you have it around longer than a day and are able to share it with more customers! For example, we recently released our She Sells Seashells, a lightly salted hoppy blonde ale. In just over a week, the entire batch was gone. On our smaller system, this beer would have been around for only a day or two.
The biggest differences we found going from homebrewing to professional brewing were around yeast, packaging, and safety. How the yeast acts in 5-, 100-, and 500-gallons is very different.
If we knew how well our beer was going to sell, we might have just gone for it and opened a 15-barrel brewery to start. But, in reality, we think the path we took was the right path for us. We started small. We tested our recipes. We built a significant customer base. We had years of direct customer feedback and relationship building in our small taproom. We slowly staffed up. We won several awards along the way, and we built our brand. We met all the key chefs and farmers in our community. We collaborated with other brewers. In summary, we set a very strong foundation for the expansion.
My last piece of advice to anyone looking to open their own nanobrewery is to get some professional brewing experience under your belt, even if it is just volunteering one day a week at a brewery where you are watching the brewing process, helping to dig out the mash tun, or bottling. Also, remember that opening a brewery is much more than just making great beer. Make sure you spend a significant amount of time on your brand ' what do you stand for, what makes you different, why should customers want to buy from you? Be prepared for when the press calls. Know your story and have your elevator pitch down cold. Finally, even if you are a one-man or one-woman show, invest some time in social media. We've found that that is a very easy and cost effective way to connect with our customers.
I was sick of my corporate job and wanted to do something I enjoyed everyday, which is how I decided to open a nanobrewery. It's also why I named the brewery after Sisyphus, the Greek king condemned to push a rock up hill for eternity. The moral of that story is we often can't control the situation around us, so we should do whatever we can to enjoy what is right in front of our faces. I wanted to put brewing there in front of me and see if I could tackle that mountain.
We started with a 2-barrel system. I wanted to create a system and business that my wife and I could manage on our own. We had no desire to go large or grow to be on every tap line and in every liquor store. We had been to enough nanobreweries around the country and our own state to know that this concept can work, despite what many people who have been in the industry for a long time may say.
There was definitely a learning curve, and I'll honestly say that we were lucky to overcome it. When we first opened, our beer was bad, but we were out of money and had to sell it or just go away quietly forever. If we could go back and do it all over again, I wouldn't have put us in that situation, but many things came up in the construction/permitting phases that made the projected budget go out the window. You can never have enough working capital when you are starting up. Factor in many, many months of working expenses. There will always be something to buy that will make your brewery better/more productive or help you make better beer. It's important you have the cash in the bank to not worry about the day-to-day expenses and being able to focus on putting your cash flow to work for you right away. I've also learned that I would not want to work this type of brewery model if we were distributing. We are lucky enough to have enough business in our taproom that we don't need to explore the distributing business.
Anyone considering opening a brewery needs to understand the amount of work and time it takes. I think a lot of people do back of the envelope estimations, thinking 'I'll brew two batches a week, and be open for this many hours, and everything will be great.' People seem to overlook that each batch not only needs to be brewed, but put into a brite tank or kegs, and carbonated, then you have to clean those tanks, order ingredients, maintain the books/paperwork. I was all-in from the start, and working 80'100 hour weeks for well over the first two years. I don't know how I would have managed everything while trying to keep a job down.
There are advantages to being small, one being that it lets us constantly change and rotate up our beers. We don't have the same tap list from week to week, and that was one of my goals for the place when we opened. I like walking into a place I haven't been to in a week or two and finding new things to try. I think a lot of people appreciate that. Another advantage that is also a disadvantage is people in Minneapolis, and around the country, aren't quite educated or aware of the nanobrewing movement. So people lump us into categories along with the big boys, when we don't have the money or equipment that they have to make the beer. On the plus side, our beer is right up there with them in terms of quality and people think our small business is bigger than it actually is.
Last fall we added a 90-seat comedy theater/event space to our brewery, and also added four new 5-barrel fermenters that doubled our fermentation capacity. Once we did that, we reached our ideal size. When my wife and I started this business we wanted it to be a small local business that stayed that way. We didn't get into this to get rich, it was just to make a living and be happy with life. And now that we are both very happy with our lives, we just want to enjoy the ride from here on out. Hopefully we will sell 500ish barrels of beer this year, and then keep doing that year after year until I'm ready to retire.
We have a 2-barrel system yielding 62-gallon (235-L) finished batches. It is fabricated from commercial soup kettles for our mash tun and hot liquor tank with 100-gallon (380-L) boil kettles and 80-gallon (300-L) stainless steel conical fermenters. We have had customers describe our place as the ultimate garage brewery. My partner and I had a goal of keeping our startup costs to a minimum while still being able to produce enough product to be a viable business. We spent about 10% of what some other small capacity brewers have spent on commercially produced brewing systems. In all my years of teaching brewing, I have always said that the ingredients don't care how much you spent on the equipment. Good brewing is based on process control, regardless of your budget.
We initially took advantage of our small batch size by producing a constantly changing lineup, only making a few beers more than once per year. We were trying to appeal to that part of the market always in search of something new. By the end of our second year, we had also introduced ten standard beers to meet expectations of the more traditional market elements. Now we pace our production to maintain the ten standards and release up to 40 different specialty beers, including our Belgian, cask-aged, and sour series.
With the advantage of hindsight, I would have made it a priority to start with twice the capital we did, so that marketing and staffing needs wouldn't be squeezed so tight in the first three. Holding back on merchandising and marketing slows down the growth track and while guerilla techniques can help, marketing is a beast that must be fed.
I would encourage all aspiring brewers to get a fuller education and experience in a commercial brewing environment to better grasp all there is to know and all there is to do in this industry before giving it serious consideration. I also think it is important to realize you are not in the business of making beer, you are in the business of selling beer and you have to embrace that.
A nanobrewery is THE ultimate goal for many homebrewers.
After all, you get to sell beer without running through the complications of a full-scale brewery.
Starting a nanobrewery is a pretty big decision. But if it's something you want to do, we have made a step-by-step guide to help you start a nanobrewery.
This kind of business involves more than just spending all day brewing.
To begin your journey to achieving success in the craft beer industry, we've enumerated the steps for starting your own nanobrewery:
Before you plan on making your brew hobby into a nanobrewery, check your local laws first.
That's because there may be laws that prevent breweries of a specific size (or ANY size) from existing in your area. Aside from that, there may also be regulations on transporting your newly-brewed craft beer off-site.
Minnesota used to prohibit breweries from selling beer in standard 12, 16, and 32oz cans. But recently, the Minnesota House of Representatives relaxed liquor license laws to allow breweries to sell their beer on-site to customers directly.
Every state has laws on breweries, but you should know what they say about NANObreweries in particular. Not educating yourself on your regional laws might cost you.
If you don't see anything about nanobreweries (or nanobreweries aren't allowed), you can TRY to talk to your local government and ask them to change liquor license laws.
It's not guaranteed that they'll help make your brewery legal, but they may reconsider as long as it still follows the state's laws.
Aside from knowing the local laws, it would help if you also considered how good the customer base in your area is.
If you live in a rural area, you might not get enough foot traffic. As such, you can think about opening your nanobrewery in a suburban area with a decent population.
This is because selling directly to customers is faster and gives you direct profit than shipping them to distributors first.
Having middlemen might put a serious dent in your earnings. After all, they'll want a share in your profits while asking you to keep your prices low enough to still be competitive enough.
Setting aside time to attend classes or study on your own will greatly help you understand how to run a business.
But remember that you won't spend all day brewing. ' After all, running this kind of business also involves a lot of paperwork (to keep your brewery legal) and interacting with other people.
As such, some things you should also learn are:
You should PRIORITIZE learning how to properly run your humble brewery business since bad business practices will kill your business faster than bad beer.
Knowing how to run your business is well and good, but you should also focus on researching about your industry.
People tend to think that entrepreneurs are risk-takers ' they're not. Instead, they're risk ELIMINATORS who take the leap only when they understand the situation they're in.
Talk to a brewery consultant and other owners of breweries to listen to their experiences and pick up some advice.
Being up-to-date with the latest brewing trends and market information will also be helpful.
You should also understand the risks in the brewing industry so you can create contingency plans in advance.
As previously mentioned, learning how to run a business comes first and a good brewery second.
Once you've learned what bad business practices to avoid, you should learn how to brew GREAT beer.
There are online guides that can help you with this, and you can also ask for tips from fellow brewers or tap a brewery consultant.
You might encounter people who say that they'll start selling beer after practicing with just a few batches.
DO NOT be like them.
Chances are they'll realize their mistake after those first few batches, or they'll end up selling subpar beer that won't appeal to customers.
We understand it can be exciting to finally be able to sell your own beer. However, don't expect business-worthy beer right from the get-go 'a or even after the first few attempts.
In fact, you might need to brew several hundred batches before you can make beer that's good enough to compete with restaurants and bars.
This equals several years of practice, but you can try to shorten that by getting good professional brewing experience in a commercial brewing environment.
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Of course, you can't expect to get good profit (or ANY profit at all) at this stage, but you can enjoy them yourself or with potentially a few friends. Take this time to ask them what they think about your beer and how you can improve it.
A good bar to set in knowing how good your beer has become is entering professional competitions and scoring well.
You don't need to rank first, but your brew should convince professional judges that it's good enough to be sold.
Some people who have a deep interest in brewing run picobreweries first just to test if they have what it takes to run a business. This is also a good time to know if the beer they're currently brewing is good enough to sell.
Some people even start homebrewing ' which makes about two hundred gallons a year.
Bad batches are INEVITABLE.
After all, the brewing process is a delicate science, so things can still go wrong every once in a while, no matter how experienced you are. Factors like bad grains or how long your batch stays in the machine can also result in bad beer.
You might especially be more prone to bad batches when you're experimenting ' such as when creating new flavors or improving your base recipe.
Be open to criticism. Regular customers naturally expect inconsistencies in nanobreweries since factors like brewery equipment are different from commercial breweries.
As such, they'll be okay with giving you another chance AS LONG AS you don't sidestep the problem and explain what you're doing (or will do) to address it.
The only advice we can give you here is to keep brewing and learn from the problems that resulted in bad batches.
Brew at least one keg at a time ' even if you're still at the learning and experimenting stage.
That at least gives you just enough beer to share to ask for people's opinions. This would also be around the same MINIMUM amount as what you'll usually be making.
You can brew larger batches, but remember that you're running a business. That means you're also dealing with other tasks like doing paperwork, paying taxes, and advertising your nanobrewery.
It's important to decide how much you want to produce right from the start since ingredients and processes will depend on the amount of beer you're brewing.
There's no problem if you're scaling up from a homebrewery or picobrewery. However, you have to decide how much you want to make BEFORE you scale up.
If you keep changing amounts, you'll also end up introducing errors and messing with the flavors.
Nanobreweries typically brew two or three barrels at a time. But it's better to wait until you're more experienced before you do that too.
Then to make enough money, charge per pint ' but keep the price lower than nearby restaurants. This kind of competitive pricing attracts people who want a good deal on drinks in the area.
You can expect to spend several thousand dollars just starting your business ' and you'll need to make enough to get that amount back eventually.
When writing up a budget plan, list down EVERYTHING you'll need for the nanobrewery.
You can lease or buy your own space if you're not going with a hybrid home/business facility.
If you're leasing, you have to worry about deposits, utility deposits, and pre-opening rent.
You can TRY to negotiate to get a few months of rent-free occupation just to get your nanobrewery up and running.
If you want something like taproom breweries, you'll need tables, bar stools, and such. If not, you'll still need sinks and storage for supplies.
Good-quality running water is important for a good brew. You'll also need electricity and a proper drainage system that's acceptable for food production operations.
As for equipment, you MAY choose to get secondhand brewing equipment to lower costs.
Stainless steel is ideal, but food-grade plastic and rubber (like polyethylene plastic and neoprene) will work well too.
When you buy brewery equipment, some things you SHOULD have are:
Check regulations by your local government on what permits you'll need to obtain. Some examples include:
Contact us to discuss your requirements of nano brewhouse. Our experienced sales team can help you identify the options that best suit your needs.
You can ask your local Brewers Association any questions regarding permits since some states might have their own fees and licenses for other things.
Having regular business insurance protects you from serious financial losses. It covers risks such as property damage, liability claims, and natural disasters.
However, you'll also need liquor liability insurance ' which protects you from claims of property damage or injury that an intoxicated customer causes after you serve them alcohol.
If you plan on having employees, you'll need other kinds of insurance too.
Workers compensation insurance will give employees medical care or cash benefits if they become injured or sick as a direct result of the job.
Meanwhile, unemployment insurance is state-provided insurance that will pay individuals who lose their job but still meet certain eligibility requirements.
To ensure you cover all bases, it's a good idea to work with an insurance agent.
To further solidify your vision for your nanobrewery, make a COMPREHENSIVE craft brewery business plan.
Important parts of the document include:
This will let you see if you have a viable business model and acts as a roadmap to improve your business management. Address any potential flaws or problems to reduce the risk you face in the future.
As such, do not rush this step.
Even without offering notable food services or being a full-service pub, starting a nanobrewery can cost as much as $30,000 per barrel.
Nanobreweries may have lower profit margins than large-production craft breweries, but you'll have to buy brewery equipment and other resources that are similar to larger breweries.
Bank loans can be HARD for startups because of the low-profit margin. Because of that, some have taken to borrowing from friends and family, selling their car or house, or even cashing in retirement plans.
Fortunately, as the number of nanobreweries increased, aspiring beer brewers have looked at other sources to fund their humble brewery business.
You can use platforms such as GoFundMe, Kickstarter, and IndieGoGo to fund your business.
For these platforms, people pledge a certain amount of money until you have enough to meet your goal.
There are also equity crowdfunding platforms, where companies (rather than individuals) invest in your business. Then, there are debt crowdfunding platforms, where you'll have to pay investors back with interest.
There's even a craft beer-specific platform called CrowdBrewed, which has kickstarted breweries such as Portland, Chicago's Pipeworks and Raleigh, and N.C.'s Crank Arm Brewery.
This system is similar to the Community Supported Agriculture (CSA) model.
Subscribers can 'pre-buy' a certain amount of beer from CSB breweries ' often coming in the form of one or two growlers a week.
The money from these pre-buys can give you the capital you need for ingredients. Of course, you also get reliable customers once you're ready to sell beer.
If they think you've made a great drink and like how you treat them, there's a very high possibility that they'll be regulars.
You can make a mini brewers association by banding together with other aspiring brewers to form brewery incubators.
This is a viable business model that will operate under alternating proprietorship licenses. The idea here is that several brewers will share one brewing system.
Aside from the shared space and equipment, being part of these incubators lets you interact and collaborate with other fellow brewers.
Once a brewer becomes big enough to need and afford their own space and license, they can leave to make room for a new brewer.
The difference lies in how many barrels of beer a brewery makes each year.
Microbreweries sell AT LEAST 75% of their beer off-site and make less than 15,000 barrels.
Generally, microbreweries sell their drinks locally ' although some also ship small amounts to other places.
Meanwhile, nanobreweries are essentially taproom breweries but sell only around 5,000 barrels a year.
It's not rare for a nanobrewery to also be a food service location, and they sell only around 25% of their brews off-site.
Some nanobreweries DO go under 5,000 barrels. But it would be best if you didn't go too low ' otherwise, you can't expect it to be a good business.
Some who are interested in brewing run picobreweries if they don't exactly want to handle a business.
There's no formal brewing industry definition for picobreweries, but brewers consider these as businesses that make less than 500 kegs per year.
If you go below even that, you're just making batches for yourself and potentially a few friends.
Admittedly, picobreweries are too small to make a production brewery viable ' so people who start these normally do it just for the brew hobby rather than for the money.
However, you CAN start your business as a picobrewery to get good professional brewing experience, then scale up from there. This can also let you test if your beer will sell well in your area.
Starting a nanobrewery can be both exciting and scary. To give you a better idea of what to expect, we've answered a few questions below:
How much you need to shell out to start a nanobrewery depends on multiple factors, such as:
The HIGHEST you can expect to pay is around $30,000 per barrel.
But if you're not planning on hiring employees, don't need much construction, and are buying secondhand brewery equipment, then you're drastically lowering your startup cost.
Alternatively, you can get bids for the jobs you need.
How profitable your business will be depends on your local market.
While it's certainly an attractive idea to set the price as high as possible, remember that competitive pricing attracts people.
Depending on your location, you can actually charge up to $7 a pint and STILL be cheaper than nearby restaurants and bars. However, compare prices in your area first and ensure that your beer is worth that price.
You can also get higher profits if you don't have middlemen that want a cut of the earnings while lowering prices enough to attract customers.
As such, you should consider DIRECTLY selling drinks locally. It's also ideal to sell by the pint.
When deciding how much to sell your craft beer, consider day-to-day expenses so your profit covers those too.
It mainly depends on how long it takes for you to brew business-worthy beer.
This would take several years (and several hundred batches).
Even if you did attend classes online or work at large production craft breweries, you likely won't get it on your first few attempts.
For one, larger breweries will most probably have different equipment than nanobreweries ' so you'll need to practice with what you have.
Of course, having experience will GREATLY help you eventually brew great beer. That's because you already know which grains are best or how long your batches should sit in the machines.
While you'll still end up with a trial and error method of perfecting your brew, you have a more solid foundation in starting. Thanks to that, you may have better direction compared to if you're starting blindly.
Yes, people skills are VERY important in any food service location, including nanobreweries! After all, as a business owner, you're pretty much the face of the company.
Because of that, how you act can determine whether you get regular and reliable customers or not ' and regulars are a huge part of any business. As long as you have regulars, you're sure there are people you can rely on to avail of your products.
If you make friends with your customers, they'll feel like they really matter to you (which they should). They'll also remember your business as having a warm and welcoming environment.
If your customers are happy with you, they'll advertise your business through word of mouth, resulting in more customers!
Customers can also be sources of information. Aside from giving you feedback, they can give you ideas on what other great drinks they want to taste and you can try to make.
The great thing about nanobreweries is that you can test and adjust flavors more easily than larger-scale breweries.
If you want, you can even make different batches that will cater to different groups of people. This is also something restaurants and large breweries can't do.
Aside from people skills for serving drinks, you should also know how to handle company matters. This includes returning calls, answering emails, and interacting with fellow brewers.
After all, as people of authority on beer, brewers can also have a big influence on your business.
Making beer and selling beer on-site at home is technically possible ' but only in very specific cases.
The formal brewing industry definition of homebrewing is brewing beer on a small scale for non-commercial purposes.
That means you CANNOT brew beer then sell it. Depending on where you live, you might not be able to take the beer out of the house unless you're bringing it to where liquor is also allowed.
You can get around regulations by having a hybrid home/business facility. But one catch is that you probably shouldn't put your brewed beer into your living room.
In most cases, though, you can only brew at home:
Local governments will have different regulations, so consult a lawyer first before brewing anywhere.
A homebrewery can make about two hundred gallons of beer a year ' assuming two adults are working on it.
If your business does well, you can try to scale up to earn enough money from it.
Being part of the craft beer industry is exciting ' and starting a nanobrewery is something many homebrewers want to try.
Although it won't give you as many problems as a full-scale brewery, a lot of preparation still goes into it:
Take your time in making a craft brewery business plan to ensure that you're achieving success in the future.
The nanobrewery business involves more than just making beer and serving drinks.
Instead, you should also consider things such as how to improve your craft beer further, advertise your business, and make a direct profit!
Lead marketer, brewer, dad, and husband. Pretty much an all-round awesome guy. Self proclaimed coffee addict who's been home brewing beer (among other things) for 25+ yrs. Also an aspiring pro-brewer and micro-brewery owner!