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Starting a Brewery Business – How Much Does It Cost?

Do you want to know exactly how much it cost to start a brewery plant? If YES, here is a detailed cost analysis for starting a brewery plant and raising finance.

Starting a brewery plant is sure expensive and at the same time it is a profitable business venture. The fact that entrepreneurs who intend investing in the brewery industry have the options of starting on a small scale – microbrewery makes the industry open to both big–time investors and small investors.

As a matter of fact, most entrepreneurs that have the plans of launching theirs might not have the required start–up capital to build a standard brewery which is why it is easier to find microbreweries scattered all around the United States. Having provided you with a:

  1. Industry Overview
  2. Market Research and Feasibility
  3. Brewery Business Plan
  4. Brewery Plant Name ideas
  5. Licenses and Permits
  6. Brewery Marketing Plan
  7. Cost of Starting a Brewery
  8. Marketing ideas & Strategies

Beer is one of the drinks that is generally consumed in most parts of the world except for few countries (mostly Arab countries where sharia law is practiced), hence there is a large market for beer no matter the quantity you produce per time which is why starting a brewery business is considered a profitable venture.

No doubt, if you have the skills to brew beers of various flavors, then you need not waste time because you can turn your knowledge and experience into a money spinning venture by starting your own microbrewery in any city in the United States of America.

  • Industry Overview

A standard brewery is a plant where beer is brewed in large quantities usually well above 15,000 barrels annually by fermentation, while a microbrewery or craft brewery as it is called in some quarters is a brewery (plant) that produces a small amount of beer per time (at most 15,000 barrels of beer annually). A microbrewery is indeed a small scale brewery that can’t be compared to the conventional brewery plants and it is usually owned independently.

In order words, any entrepreneur that has some cash and brewing technique can comfortably start his or her own microbrewery business in the United States, Canada, United Kingdom or Australia. Generally, the selling point for a microbrewery is characterized by their emphasis on their unique flavor, the quality of their beer and their brewing technique.

It is important to state that before you can successfully launch your brewery plant in the United States of America, you are expected to meet certain laid down rules and regulations. First and foremost, you are expected to apply and get approval (license) from the Alcohol and Tobacco Trade and Tax Bureau (TTB), state wholesale license and any other license that is required by the local authority where you intend operating from.

It is TTB that has the authority to approve your beer label and the facility that you intend brewing your beer from. As a matter of fact, officials from TTB would have to conduct site inspection of your brewery plant before you can be given the go ahead to start brewing beer for public consumption and this process usually takes between 6 months to one year to complete.

Other factors you will also need to consider is the cost involved in setting up the business, licensing requirements and marketing and distribution plans. All these factors and components are essential as they go a long way in making the business a thriving and successful venture.

How Much Does It Cost to Start a Brewery Business?

Launching a brewery plant is just like starting any other business and it requires that you conduct your feasibility studies and market survey so as to get your economic analysis and your costing right. As a matter of fact, you just have to get your economic analysis right if your intention of building the business is to generate profit, grow the business and perhaps distribute your beers beyond a region to other regions within the United States and other cities in the world.

When conducting costing analysis for your brewery business, you have to critically examine these key factors; place, product, pricing and promotion. As a matter of fact, you would have to continue to review these key factors at regular interval while operating your brewery business.

It is important for entrepreneurs who are interested in starting a brewery to be aware that running a microbrewery/craft brewery is different from running or operating a standard brewery plant. Running a standard brewery plant attracts additional cost and responsibility like comprehensive distribution network, bureaucracies, growth strategy, and operational guidelines.

The cost analysis as it relates to starting a brewery business in the United States of America, Canada, United Kingdom and Australia is almost the same except for few variations. For instance, most of the equipment that are needed to launch a brewery company are manufactured based on international standard hence they are sold same price across different countries except for the additional price of importing the equipment from the country where it was manufactured.

Other factors that may be slightly different in terms of costing when it comes to starting a brewery business in any of the countries listed above are cost of labor, cost of transportation and logistics, local tax, business incorporation fee, rent/leasing amongst other factors.

When it comes to starting a medium scale brewery company, you should be prepared to either rent or lease a standard facility big enough to accommodate your machines, workers and warehouse/storeroom; this is going to be one of the areas where you are expected to spend the bulk of  your start–up capital.

How Much Does It Cost to Start a Brewery Business in the United States?

These are the key expenses you are expected to make when starting a medium scale but standard brewery business in the United States of America;

  • The total fee for registering the business in the United States of America – $750.
  • Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $1,300.
  • Marketing promotion expenses for the grand opening of the winery in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580
  • Cost for hiring business consultant (writing business plan inclusive) – $2,500.
  • Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
  • The budget for permits, Insurance and license – $5,000
  • Construction of the brewery facility, tasting rooms and other administrative blocks could cost about – $200, 000
  • Cost for the purchase of commercial brewery equipment (Steam Generators – electric, Steam Generators – gas, Malt mills/grinders, Screw conveyors for malt grist, Self-cooled fermentation & maturation tanks, Maturation (lager) tanks, Serving (bright beer) tanks, Cylindrical-conical fermentation tanks, Open fermentation vats, Yeast storage tanks, Machines for washing a filling of kegs, Plate Filters for filtering of beer and cider, Candle diatomaceous earth filters for filtering of beer, Candle diatomaceous earth micro filters for micro filtering of beer, and stainless steel vessels (pressure tanks, jacketed refrigerated containers, vessels with agitators, containers for yeast growing)) – $150,000
  • Equipment for the offices such as filing cabinets, safety gadgets, computers, printers, telephones, fax machines, furniture and electronics could cost about – $15,000
  • Creating and launching an official website could cost about – $700
  • Other expenses such as signage, business cards, advertisements, publicity and promotions) could cost around – $2,500
  • The cost for opening party: $2,000
  • Miscellaneous: $5,000

You will need an estimate of seven hundred and fifty thousand dollars ($750,000) to successfully set up a medium scale but standard brewery in the United States of America. Please note that this amount includes the salaries of all the staff for the first 3 months of operation.

Starting a small–scale but standard brewery business i.e. a micro–brewery in the United States of America will cost about two hundred and fifty thousand dollars to five hundred thousand dollars ($250,000 to $500,000). Please note that in other to achieve this, you may buy off a small micro-brewery company that is put up for sale or you may purchase fairly-used brewery equipment and machines. With that you will be able to cut your start – up cost to the barest minimum.

When it comes to starting a standard and large-scale brewery business, a business whose products (beers) will be distributed all across the United States of America and other countries of the world and also a brewery business that has the intention of selling franchise, then you should look towards budgeting well over two million five hundred thousand dollars ($2.5 million).

How Much Does It Cost to Start a Brewery Business in the UK?

These are the key expenses you are expected to make when starting a medium scale but standard brewery business in the United Kingdom;

  • In the United Kingdom, Online applications are usually registered within 24 hours and cost £12 (paid by debit or credit card or PayPal). Postal applications take 8 to 10 days and cost £40 (paid by check made out to ‘Companies House’). There’s a same day service costing £100.
  • Legal expenses for obtaining licenses and permits as well as accounting services (software, P.O.S machines and other software) – £4000
  • Marketing promotion expenses for the grand opening of the brewery in the amount of £3,500 and as well as flyer printing (2,000 flyers at £0.04 per copy) for the total amount of £3,580.
  • The cost for hiring business consultant (including writing business plan) – £2,500.
  • Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – £2,400.
  • Construction of the brewery facility, tasting rooms and other administrative blocks could cost about – £180, 000
  • Cost for the purchase of commercial brewery equipment (Steam Generators–electric, Steam Generators–gas, Malt mills/grinders, Screw conveyors for malt grist, Self-cooled fermentation & maturation tanks, Maturation (lager) tanks, Serving (bright beer) tanks, Cylindrical-conical fermentation tanks, Open fermentation vats, Yeast storage tanks, Machines for washing a filling of kegs, Plate Filters for filtering of beer and cider, Candle diatomaceous earth filters for filtering of beer, Candle diatomaceous earth micro filters for micro filtering of beer, and stainless steel vessels (pressure tanks, jacketed refrigerated containers, vessels with agitators, containers for yeast growing)) – £120,000.
  • Equipment for the offices such as filing cabinets, safety gadgets, computers, printers, telephones, fax machines, furniture and electronics could cost about – £13,000.
  • Creating and launching an official website could cost about – £600.
  • Other expenses such as signage, business cards, advertisements, publicity and promotions could cost around – £2,500
  • The cost for opening party – £2,000
  • Miscellaneous: £5,000

You will need an estimate of six hundred and fifty thousand Pounds sterling (£650,000) to successfully set up a medium scale but standard brewery in the United Kingdom. Please note that this amount includes the salaries of all the staff for the first 3 months of operation.

Starting a small–scale but standard brewery business i.e. a micro-brewery in the United Kingdom will cost about two hundred thousand to four hundred thousand Pounds sterling (£200,000 to £400,000). Please note that in other to achieve this, you may buy off a small micro-brewery company that is put up for sale or you may purchase used brewery equipment and machines. With that you will be able to cut your start–up cost to the barest minimum.

When it comes to starting a standard and large scale brewery business, a business whose products (beers) will be distributed all across the United Kingdom and other countries of the world and also a brewery business that has the intention of selling franchise, then you should look towards budgeting well over two million Pounds sterling (£2 million).

How Much Does It Cost to Start a Brewery Business in Canada?

These are the key expenses you are expected to make when starting a medium scale but standard brewery business in Canada;

  • For federal incorporation of business in Canada, the cost to incorporate is $200 if filed online through Corporations Canada’s online Filing Centre ($250 if filed through other means).
  • Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $1,300.
  • Marketing promotion expenses for the grand opening of the winery in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580
  • Cost for hiring business consultant (writing business plan inclusive) – $2,500.
  • Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
  • The budget for permits, Insurance and license – $5,000.
  • Construction of the brewery, tasting rooms and other administrative blocks could cost about – $200, 000.
  • Cost for the purchase of commercial brewery equipment (Steam Generators–electric, Steam Generators–gas, Malt mills/grinders, Screw conveyors for malt grist, Self-cooled fermentation & maturation tanks, Maturation (lager) tanks, Serving (bright beer) tanks, Cylindrical-conical fermentation tanks, Open fermentation vats, Yeast storage tanks, Machines for washing a filling of kegs, Plate Filters for filtering of beer and cider, Candle diatomaceous earth filters for filtering of beer, Candle diatomaceous earth micro filters for micro filtering of beer, and stainless steel vessels (pressure tanks, jacketed refrigerated containers, vessels with agitators, containers for yeast growing)) – $150,000
  • Equipment for the offices such as filing cabinets, safety gadgets, computers, printers, telephones, fax machines, furniture and electronics could cost about – $15,000
  • Creating and launching an official website could cost about – $700
  • Other expenses such as signage, business cards, advertisements, publicity and promotions could cost around – $2,500
  • The cost for our opening party: $2,000
  • Miscellaneous: $5,000

You will need an estimate of seven hundred and fifty thousand dollars ($750,000CAD) to successfully set up a medium scale but standard brewery in the Canada. Please note that this amount includes the salaries of all the staff for the first 3 months of operation.

Starting a small scale but standard brewery business i.e. a micro-brewery in Canada will cost about two hundred and fifty thousand to five hundred thousand dollars ($250,000CAD to $500,000CAD). Please note that in other to achieve this, you may buy off a small brewery company that is put up for sale or you may purchase fairly-used brewery equipment and machines. With that you will be able to cut your start-up cost to the barest minimum.

When it comes to starting a standard and large scale brewery business, a business whose products (beers) will be distributed all across Canada and other countries of the world and also a brewery business that has the intention of selling franchise, then you should look towards budgeting well over two million, five hundred thousand dollars ($2.5 millionCAD).

How Much Does It Cost to Start a Brewery Business in Australia?

These are the key expenses you are expected to make when starting a medium scale but standard brewery business in Australia;

  • In Australia, the fees to register your business name with ASIC include: $34 for 1 year. $80 for 3 years.
  • Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $1,300.
  • Marketing promotion expenses for the grand opening of the brewery in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
  • Cost for hiring business consultant (writing business plan inclusive) – $2,500.
  • Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
  • The budget for permits, Insurance and license – $5,000
  • Construction of the brewery facility, tasting rooms and other administrative blocks could cost about – $200, 000.
  • Cost for the purchase of commercial brewery equipment (Steam Generators–electric, Steam Generators–gas, Malt mills/grinders, Screw conveyors for malt grist, Self-cooled fermentation & maturation tanks, Maturation (lager) tanks, Serving (bright beer) tanks, Cylindrical-conical fermentation tanks, Open fermentation vats, Yeast storage tanks, Machines for washing a filling of kegs, Plate Filters for filtering of beer and cider, Candle diatomaceous earth filters for filtering of beer, Candle diatomaceous earth micro filters for micro filtering of beer, and stainless steel vessels (pressure tanks, jacketed refrigerated containers, vessels with agitators, containers for yeast growing)) – $150,000.
  • Equipment for the offices such as filing cabinets, safety gadgets, computers, printers, telephones, fax machines, furniture and electronics could cost about – $15,000.
  • Creating and launching an official website could cost about – $700.
  • Other expenses such as signage, business cards, advertisements, publicity and promotions) could cost around – $2,500.
  • The cost for opening party: $2,000.
  • Miscellaneous: $5,000.

You will need an estimate of seven hundred and fifty thousand dollars (AUD$750,000) to successfully set up a medium scale but standard brewery in Australia. Please note that this amount includes the salaries of all the staff for the first 3 months of operation.

Starting a small scale but standard brewery business i.e. a micro-brewery in Australia will cost about two hundred and fifty thousand dollars to five hundred thousand dollars (AUD$250,000 to AUD$500,000). Please note that in other to achieve this, you may buy off a small brewery company that is put up for sale or you may purchase fairly-used brewery equipment and machines. With that you will be able to cut your start–up cost to the barest minimum.

When it comes to starting a standard and large scale brewery business, a business whose products (beers) will be distributed all across Australia and other countries of the world and also a business that has the intention of selling franchise, then you should look towards budgeting well over two million, five hundred thousand dollars (AUD$2.5 million).

Estimating Start–Up Cost for Brewery Business Based on the following factors;

  • Specific Location

One good thing about brewery business is that it is not location bound; you can start the business in the outskirts of town, in the middle of town or any location as long as you can secure a facility with government approval for the kind of production business that you want to start.

All you need to do is ensure that you choose a good location that can give you easy access to raw material and available market. You will do pretty well in this line of business if you locate it in a centralized location with good distribution network, labor and access to cheap raw materials.

  • Staff/Manpower

When it comes to starting a standard brewery company on a large scale, you would need the services of the following professionals;

  • Chief Executive Officer (Owner)
  • Brewery/Plant Manager
  • Human Resources and Admin Manager
  • Craft Sales Representative
  • Brew house Operator (Milling, Mashing, Lautering, Boiling, etc.)
  • Cellar-Related Operator (Sanitation, Fermenting, Monitoring, Capping, Chilling, etc.)
  • Packaging Operator (Filtering, Carbonation, Packaging, etc.)
  • Quality Control Operator (Sampling, Tasting, and Monitoring, etc.)
  • Sales and Marketing Team
  • Accountants/Cashiers
  • Distribution Truck Drivers

Can a Brewery Business be Bootstrapped on a Lean Budget Right from Home?

Irrespective of the fact that there are several brewery companies cum brands whose products can be found nationally and in some countries of the world, that does not rule out the fact that an aspiring entrepreneur can successfully start a small scale (micro–brewery) business on lean budget right from his home.

If you want to start a brewery business on a small scale, you can choose to start servicing your immediate community and later on your town. All you would need are contacts, packaging, networking and good marketing and customer service skills. However, if you intend starting it on a large scale, then you should consider spreading beyond your city to state level and even national level.

As a matter of fact, the beer production process from start to finish can be done in a well managed space in your home/compound. All you need to do is to have a storeroom that will serve as your warehouse; a place where you store both your raw materials, packaging materials and finished goods (bottled and canned beer).

Although there will be limit to the number of employees that you can employ per–time and also the number of products (bottles and cans of beers) that you can churn out per time, but that does not stop you from breaking even within the expected time frame for a small scale business that falls under the brewery industry.

Running a small scale (micro – brewery) business will help you cut cost, but you must be ready to take on much more than two roles in the business. You are likely going to be the chief executive officer, head of marketing, tasting room rep, quality control officer amongst other roles that you can fit in. You can’t rule out the fact that when it comes to starting a small scale brewery business from your home, you are more likely going to market the products from the booth of your car from one location to another.

How Much Does It Cost to Buy a Brewery Franchise?

In the United States of America, the Average Cost of Purchasing a Brewery Franchise is $219,000 + Minimum Liquid Capital: $75,000. Examples of 3 Well – Known Brewery Franchising Companies in the United States of America are;

  • Growler USA Franchise America’s Microbrew
  • Brew Rebellion Franchise
  • Rock Bottom Brewery Franchising

In the United Kingdom, the Average Cost of Purchasing a Brewery Franchise is £180,000. Examples of 3 Well – Known Brewery Franchising Companies in the United Kingdom are;

  • Clear Brewery Franchise
  • Beerdock Craft Beer Franchise
  • Black Tap Brewery Pub Franchise

In Canada, the Average Cost of Purchasing a Brewery Franchise is $219,000 (Canadian Dollar) + Minimum Liquid Capital: $75,000CAD. Examples of 3 Well – Known Brewery Franchising Companies in Canada are;

  • The Canadian Brewhouse Franchise
  • U-Brew It Microbrewery – Franchise
  • Original Six Brewery

In Australia, the Average Cost of Purchasing a Brewery Franchise is AUD$219,000 + Minimum Liquid Capital: AUD$75,000. Examples of 3 Well – Known Brewery Franchising Companies in Australia are;

  • Harringtons Brewery International Ltd – Franchise
  • Brew By U – Franchise
  • Country Brewer
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