Brewery Business Plan
Your Brewery Business Plan is about your vision, goals, resources, and strategy and will focus on the key points and prepare you for the challenges and growth, strengths and weaknesses that your brewery will have.
By providing unique beers to the local region and surrounding area. You want to give beer lovers a chance and help build the brewery. You should let beer lovers help select and name beers, design t-shirts and labels, volunteer to be taste-testers and even apply for a job as a brewer.
To run a brewery it's important to delegate operations. You are going to need a master brewer who is in charge of quality control and somebody who is going to run the other operations of selling the product - if either one fails - you will be out of business quickly.
People prefer different tastes therefore it's important to create a variation of flavors to your beer. There may be some commonality between your beers but if you can provide different beers you will have more turnover and ultimately more profit.
Flavors harmonize, not fight for individual attention. Hopping is generous, but to style. Seeing beer as equal to, if not superior to, wine, your beers should be designed to complement food.
Because of your efforts, you can soon expect to walk into any fine restaurant in the region and be pretty sure of finding your brew available.
The process of beer brewing, according to most historians and beer lovers, dates back roughly 5000 years. It was then that the fermenting capabilities of yeast were thought to have been discovered. Since then, the process of converting simple sugars into alcohol, which is precisely what fermenting is, has been used to make not only beer, but wine, liqueurs, and soda pop as well.
Today, multiple styles of Beer Brewing exist. There are commercial brewers, the Anheuser-Busches and Millers of the world, who mass produce their beers for millions of drinkers. There are "batch" brewers, often known as microbrewers, who produce smaller but more distinctive concoctions. Then there are home brewers, who perform essentially the same process, only on a much smaller scale.
The Basics of Beer Brewing
Any discussion of beer brewing requires a working knowledge of the basic principles that underlie it, most of which are chemical. Most (but not all) beers are derived from some sort of grain, most commonly barley. Barley looks a lot like wheat, which is identifiable by its golden stalks that are usually portrayed in movies and TV shows as gently blowing in a field somewhere in Iowa, Kansas, or the Ukraine.
Getting these grains into alcohol form requires several processes along the way, the first of which is known as malting. Barley is malted as it germinates or sprouts seeds, which is done by immersing it in water for a specific duration of time. This soaking period (mashing) determines just how far along germination can proceed, which in turn defines the relative abundance of sugar in the malt. This is the same sugar that will eventually be devoured by the yeast in the fermentation stage.
The Mashing Stage
As the malt is heated, a step that halts the germination process by drying the sprouted grains, it sets several different enzymes to work. Their job is to help facilitate the conversion of starch to sugar, which is necessary for fermentation. The "saccharification" can be done incrementally or all at once, depending on how the brewer wants the beer to taste.
The end product, called wort (but pronounced "wert"), is then rinsed and filtered in a device known as a "lauter tun." The wort is then collected in a boiler where it's introduced to the hops, the flower of the hops vine that gives beer its unique aroma and bitterness. The presence of hops in beer brewing is important in counterbalancing the sugars produced by the malting process. Hops may be added at any point during the boil depending on how much bitterness and aroma the brewer prefers.
Commercial Versus Independent Beer Making
It's helpful to remember that the goal of most commercial beer brewing is consistency. Customers who pick up Budweiser, Coors, or Guinness have a certain expectation about their cans' or bottles' contents. For this reason, there's far less latitude involved in large-scale beer brewing.
Independent and home beer brewing affords lovers of the froth a chance to experiment with aromas and flavors. This is done by shortening or lengthening certain steps of the beer brewing process, choosing a variety of different hops, barleys, and yeasts, and trying out different fermenting, storage, and bottling techniques. All these variables give home brewers a sense of control over the end product, which contributes to the satisfaction when it comes time, several weeks later, to enjoy the results.
A good marketing ploy is to feature your brews at the beer festival either locally or world-wide if you intend to go global.
A micro-brewery is a small brewery usually producing between two and 20 barrels of beer in each brewing session. Barley is transformed into malt at a maltings and is delivered to the brewery pre-crushed or ready for milling.
Other malts are added depending on the desired flavor. The grist is then transferred into a mash tun where it is mixed with hot water (known as 'liquor'). The starches in the malt are converted into sugar through this process. Wort is then pumped into a copper where the hops are added, and the mixture boiled.
After cooling, the wort is poured into fermentation vessels and yeast is added. During fermentation, yeast turns the sugar into alcohol and carbon dioxide.
Finally, the beer is put into conditioning tanks and left for several days. Beer is then put into casks for delivery. Sometimes priming sugar is added to the cask to aid secondary fermentation (which improves flavor), and dry hops which add aroma. Before dispatch, 'finings' are added to help 'clear' the beer.
Your beers should be available in bars as well as retail outlets, such as local markets and corner stores. You will also aim to distribute through supermarkets, but it is envisioned that getting shelf space in national supermarkets will be more difficult and more expensive.
Your objectives should be to establish relationships with local beer distributors in selected sales areas. Maintain tight control of cost and operation during expansion. Maintain a high-quality product that the company will become known for.
Running A Successful Brewery
Running A Successful Brewery
Your keys to success in the brewing market will be to implement a successful advertisement and marketing campaign to inform the public of your products and build brand image through marketing.
You need to plan your brewery. Trying to run your brewery without planning is like floating aimlessly at sea in a fog. You will not know where you are going, any more than where you have been or where you are. What is worse, sooner or later you will hit something.
Working out the cash you expect to get is part of the planning process. It will show you whether you need more finance. If you do, it will be easier for your bank or any other organisation to help you if you can give them a Brewery Business Plan which covers all of the information in a logical way.
Let's assume that your Executive Summary clearly outlines your idea, concept, opportunity, market, management team, and investment opportunity. Let's also assume that it's grabbed the attention of your reader / investor and has inspired them to read on. Moving forward, your reader quickly flips past your Table of Contents and glances at your brewery's Mission Statement.
What will they read? Is it compelling? Exciting? Does it give them the impression that your brewery and you are more than just business oriented, but also passionate? What does it tell your reader about you, your brewery, and your chances of future success? And will it stick in their mind as they read through the other sections of your Brewery Business Plan? If you can answer yes to these questions, then your mission statement has done its job.
Keep in mind that you don't want to put the carriage before the horse in regards to the relationship between your mission statement and your brewery business plan. In many ways, your brewery business plan (i.e. your business) should develop because you have a mission, not because it is a section in your brewery business plan. A great mission statement will not make up for a poor brewery business plan in the eyes of investors, but an undefined and uninspired mission statement may lead an investor to think twice about the quality of your brewery and it's goals.
A mission statement isn't just for the readers of your brewery business plan. Instead it should be viewed as the guiding principle for your entire brewery. It tells you, your company, your employees, your vendors, your customers, your investors, and your lenders what your goal is, what you stand for, and where you're headed. Essentially, your mission statement defines your brewery's values and outlines your organizational purpose and "reason for being".
A solid brewery business plan is organized to convey information to outsiders about the nature and intentions of your brewery. A clear mission statement serves as the "guiding light" of your brewery business plan, powerfully condensing the message you want to send to the reader.
A good mission statement is compelling, passionate, and energizing. It should be risky and challenging, but also achievable. If it falls between "we can't do it", but "we will do it anyway" then you're on the right track. Also remember that a mission statement isn't written in stone, and is likely to change over time as a brewery grows and market conditions change. Think of your mission statement like a race; give it a clearly defined finish line and determine a time period when it will be achieved.
Writing a mission statement can be a difficult and challenging task. If you don't know what you stand for and what you believe in, then it's impossible. If you don't know what principles you operate from and how you will treat those who come in contact with your brewery, then it's impossible. If you're not excited about what you are doing and lack a passion for your product or service, then it's impossible. Instead of trying to just "write it" or "get it done", devote some serious thought and soul searching to your mission statement. It must boldly state what you, your brewery, and it's future are all about - and it's worth the effort.
A mission statement should require little or no explanation, and its length is less important than it's power.
Attempt to keep your mission statement simple, but this doesn't necessarily mean it should be short. Try limiting it to one paragraph, although it could vary anywhere from one sentence to a full page.
Every mission statement should be different. So don't try to use the one that resembles the flavor of your closest competitor. Instead write a mission statement that reflects your individuality, creativity, and uniqueness.
Use a tone that best reflects the culture of your brewery, and get as many people as possible involved in its construction. If everyone doesn't buy into your mission statement, then it will not effectively shape your company and its actions, and thus it will lose its effectiveness. So if someone reads your mission statement and comments "great, but who cares" consider rewriting it and adding some passion. The passion and excitement you demonstrate in your mission statement will carry over not only to the rest of your brewery business plan, but also into the day to day operations of your brewery.
Brewery Business Plan
Brewery Business Plan
Writing your Brewery Business Plan
Writing your Brewery Business Plan can seem a daunting challenge. However, this skill is a vital requirement for any brewery seeking to increase their chances of survival.
Write from the audience's perspective - The starting point for any Brewery Business Plan should be the perspective of the audience. What is the purpose of the Brewery Business Plan? Is it to secure funding? Is it to communicate the future plans for the brewery? You should tailor the Brewery Business Plan for different audiences, as they will each have very specific requirements. For example, a potential investor will seek clear explanations detailing the proposed return on their investment and time frames for getting their money back.
Research the market thoroughly - The importance prospective investors place on knowledge of the market and the need for brewers to thoroughly research their market is paramount. The brewer should undertake market research and ensure that the plan includes reference to the market size, its predicted growth path and how they will gain access to this market. A plan for a Brewery will consider predictions about whether the breweryis likely to grow or decline and conclude with a review of the competitive environment.
Understand the competition - An integral component to understanding any business environment is understanding the competition, both its nature and the bases for competition within the industry. Is it a particularly competitive environment, or one that lacks competition? How are the incumbents competing—is there a price leader evident? Finally, including a thorough understanding of the bases on which you intend to compete is vital; can you compete effectively with the existing brewers?
Attention to detail - Make your Brewery Business Plan concise, but include enough detail to ensure the reader has sufficient information to make informed decisions. Given that you have a significant role to play in the running of the brewery, the Brewery Business Plan should reflect a sense of professionalism, with no spelling mistakes, realistic assumptions, credible projections and accurate content.
Focus on the opportunity - If you are seeking investment in your brewery, it is important to clearly describe the investment opportunity. Why would the investor be better off investing in your brewery rather than leaving money in a bank account, shares, or investing in another business? What is the Unique Selling Proposition (USP) for the business? Why will people part with their cash to buy from you?
Ensure all key areas are covered in the Brewery Business Plan
Undertake research on what a Brewery Business Plan should contain. Include sections on the Brewery, Product / Service, Market, Competition, Management Team, Marketing, Operations and Financials. The plan should also take on board the readers' various preferences for viewing data. While many plans are predominantly textual, the plan should include some simple color charts and spreadsheets.
Do the sums - The numbers will be subject to particular scrutiny. Costs should be documented in full and sales predictions should be both conservative and realistic. While costs are more certain and predictable, a crucial factor in the success or failure of the brewery will be the level of sales. If you are not particularly comfortable with maths, have someone assist you in preparing a simple cash flow and break-even chart. This will help the reader understand how many sales you must make to cover your costs, and also how much financing you must raise to start up successfully. Remember, at the beginning, there are a lot of start-up expenses in a period of uncertain sales volumes. If sales are on credit (including via credit card) it may take up to four weeks for you to receive the cash.
Executive Summary - Arguably the most important component of the Brewery Business Plan is the Executive Summary. This is a summary of the entire Brewery Business Plan and is contained at the start of the plan. It also tends to act as a key qualifier for time-pressed investors - if they like it, they will read on, if not they will go no further. It should be completed at the very end of the business planning process and should have a "wow factor" that entices them to read further. In tandem with this, you should also prepare a short "elevator pitch," a five-minute overview of the key benefits of the new brewery.
Review process - Once you have completed your Brewery Business Plan, have it independently reviewed. Select someone detached from the process who can offer constructive criticism on all aspects of the plan. This review should prompt further questions that will need to be addressed in a revised draft.
Implement the Brewery Business Plan - Your Brewery Business Plan should always be viewed as a living document and contain specifics regarding dates, deadlines and specific responsibilities. It should be constantly reviewed and updated, as well as being used in regular "plan versus actual" discussions. Business relies heavily on people taking actions and being accountable for them. A winning Brewery Business Plan will help to ensure that the brewery is fully focused on what is required to achieve the your goals.
Great breweries do not happen by accident.
They are planned that way!
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