Wednesday, March 2, 2016

3 Useful Tips on Financing a Brewery

 

   We had a great plan and some awesome beer and figured money would be the least of our problems. I'm not saying we haven't had our share of miracles when it has came to generous people in our lives but, believe me, creativity is key when you are planning on opening a brewery with limited cash. I remember having the conversation with Mark as if it were yesterday. "We should be able to open with $50k no problem". Ahh, those were the days. Every brewery in planning must go through what I now refer to as wishful thinking. We had our budget and a couple stainless tanks that we had picked up on Craigslist. We were ready to take on the industry that we dreamed to be a part of someday. The plan was rolling in motion so the next logical thing to do was to reach out to local manufacturers of stainless equipment and do some price shopping. The first salesperson I met with worked for a company out of Napa, California. He was a really nice guy and had some super cool brochures. The equipment jumped out of the pages like the original Green Machine that I used to dream of inside the Sears catalog during Christmas (yep, I said it the original). The brew house had every trick option available. It had electronic temperature controls, an automated rake, and even lights to see inside the kettle. The glycol chilled fermentation and brite tanks were absolutely beautiful. I went over our plan with the sales guy but failed to mention our budget (looking back at an obvious mistake). After the meeting, he told me he would send a quote for the equipment in a couple days. Mark and I were not yet settled on the system size but we were going to let the quotes decide that. A few days later we received our first official quote, $370k plus tax and oh yeah, please don't forget the shipping. I thought umm, "Houston we have a problem". This was honestly the first time in my adult life that I had actual sticker shock. Needless to say, we had to pass on the system. We did learn a couple early lessons that week. First, we had no chance opening with decent equipment with only $50k and second, if we were going to open we would have to be extremely creative. You would be surprised how creative you can become when you launch into the oblivion of a dream.


Here are some tips on starting a brewery on a tight budget.

* Sell everything you own. Some people will disagree with me on this one but I believe when you mentally let go of material possessions in exchange for something that matters, you open your life up to more miracles. Hey and if your lucky, one day you will be able to tell people you sold your truck for beer money!

* Don't buy new. There are plenty of used options out there. You just can't be in a hurry and you almost have to be like a deal hunter. Have some cash available so when the deal of a lifetime comes up you're the first one there, ready and willing to purchase.

*Always ask for a discount. Let's face it, people love beer almost as much as they love money. Feel free to tell everyone you deal with that you're starting a brewery. They will surprise you. My favorite line to tell people has been, "we have a lot more beer than money" I have saved thousands of dollars by bartering with beer and negotiating for the best prices.

Cheers! J

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