Selling.....maybe?

Should I?There’s a dude out here in Idaho, older guy than me, he could be my dad, actually…and he is pretty well off. He is pushing me hard to get a license (on hs dime) and set up to sell to resturants, etc… He’s been looking at it pretty closely, and researching. I gotta tell ya guys, it’s real tempting. Of course, I’d start real small at fist. Maybe even have to give away a few kegs, from there, charge a small fee. If I get enough room to ferment, I figure I could kick out a fair amount of beer in a few days.
  Let’s say 5 gal cost me 15$ to brew…I could sell that 5 gallons for 40$, I’m thinking. There’s 40 pints in 5 gallons. So, if they charge 5$ a pint, that’s a 160$ profit for the buyer. Pretty good investment, no?
  Am I crazy for even considering this? Should I even try? I mean, I sure have the time to do it. And, despite what I say, and all the trash talking I do of myself, I make some pretty dang good beer. Nothing vertured, nothing gained, right?

Major? Where are you? Help a brother out here!

Figure out how much the taxman fed/state/local wants out of that profit estimate. Then your self employment tax fed/state/local plus social security medicare/medicaid. If you’re then still in the mood, I’d say go for it.

Oh yeah, gotta figure that all in, for sure.

Maybe you should join the BA and talk with some pros.  That’s what they’re there for.

A lot of work for not much money, but hey, if you REALLY love brewing (and working your ass off) go for it.

It has it’s appeal. Weaze Keith would have the answers for you. I want to work less and have no responsibilities or commitments. So my advice would be useless. 8)

I’ve been thinking about it as I’ve been running a batch of Very Old Dark Kilauea Ale and I can’t resist…

All three in one:

Maybe you should join the BA and talk with some pros.  Their advice is what they’re there for.  ;D

If you take the plunge, I recommend not starting too small, or you’ll have to brew around the clock to make ends meet.  I see new breweries open up with 2/3 bbl, or 1 bbl systems, and they just cannot make enough beer to stay in business.  They have to brew so much that it actually becomes work - yuk!

In business there is the 2 x 1/2 rule.

Sit down and do a business plan. Figure ALL COGS; fixed and variable over head, ingredients, taxes, license, etc… Then figure profit to be made, gross and net.

Then plug in the 2 x 1/2 rule.

In the real world it will cost twice as much as you figure and you will make only 1/2 the profit calculated.

This is a starting point.

Is he going to pay for all of the new equipment and kegs you’ll need?  Will he be the owner and you an employee?  Where does the money go and who decides?    Can you legally brew commercially in your backyard brewshed or do you need to find a new location?  Do you really want another job and everything that comes with it?

And do you really want to have to brew when and what the market demands?

When starting a business a lot of people will give you a lot of reasons why it won’t work.  When it does work it can be very satisfying.  There’s nothing like it.  Just do a lot of research and planning before you decide to commit yourself to the business.

Two words:  Due diligence.

Weaze, you probably need at least $40-80 grand to really get off the ground. Have a vision and insist to your investor that you stick to it. Better yet, find a few guys with a little money who share your vision and take of that way. That’s what I did. no investors aside from the core four owners.

Once you get started you will realize that 90 grand is really no money at all and that there is tons of bucks out there. In the words of Sly and The Family Stone - “You can make it if you try”.

So much to think about, so much research to do. All just a dream right now, but the possibility is there. I was not sure what I would be getting into, that’s why I wanted to ask here. The coming weeks, you bet I will be researchuing a ton. I would really love to do tghis at home, if the laws allow. But, time will tell. We all have to have a goal, right? 8)

Research…research…and more research. Make sure you have all of your ducks lined up before you take the plunge. You have my vote, but make sure you really understand what you’re getting yourself into before you do it. I’ve started researching the business and after reading a couple of books my jaw was on the floor.  :wink:

It sure does sound appealing. Be careful.

The break-even points will be a little different for everyone, but I was looking at a very small brewery operation and determined that it just can’t be profitable. At a bare minimum, you need about a 1-1.5 bbl system just to amortize the capital costs within a few years.

Might be an obvious suggestion, but you should also talk with a CPA about helping with a business plan. They might now know the brewing business first had, but they do know business and can help with financial analysis and business plans.

If you don’t have one, I would recommend you get references for one of your own and not use the same guy as the guy offering the money. Like most attorneys, CPA will usually offer a half hour consultation free of charge.

Good Luck!
Dano

And the overwhelming statistics are there to support that. But, some succeed, and you can’t be one of them if you don’t try.

Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win. – Sun Tzu

words to live by!

I would agree that $60 K is bare minimum you need to have.

I also agree when you are done with your business plan financial multiply it by 2 (just get by) to 2.5.

Good luck.