Beer cost per liter on a Brewery

[Mastoras007]

So what would the ballpark be on being able to serve to the public as well as to restaurants. The reason i ask is because competing for draft space with the big boys is really tough. They have a lot of advantages and can literally buy you out of the draft system. Especially when there may be limited draft towers available.

You will make significantly more money per Liter by selling it directly to customers. Think of it as the smaller the package the higher the profit margins. So where i can sell a beer to my customers for $7-8 in my location, that is the same price that the restaurant next door sells it for, but for them to make any money off of it i have to sell it to them at a much lower price per volume.

In my state i can only sell to a distributor who then adds 30% to the price that they sell it to the bar for them to add their 30% to get to that $7-8 mark. So i can only sell the keg for about $3 per pour and that is assuming that my competition are not undercutting me at $2/pour(which with economy of scale they can and will do).

For a niche product, the closer to the consumer that you can get the better.

Another extremely important note is that it takes me about an 8 hour brew day to produce 2 bbls of beer...even using 1/6 bbl(5.17 gals) that is only 12 kegs worth of beer. It takes time to wash those kegs and pack them. Labor on a 5hl system is your biggest cost. This also does not include all of the other paperwork and labor aspects of brewing. If you were able to offset your lower margin beer with direct to consumer sales for even a small portion of the beer produced that could make the business far more profitable.

It is very doable at 5hl for one person, but just producing the beer and packaging it is a full time job. Everything else would need to be handled by another employee.

Theanks for your advices!
A brewery-pub here have minimum boiler 1000Liters that's the law, don't know why, but just brewery no have any limitations on size,
Also for pub the money needs to be is to much,Its like opening 2 different business
Brewery otherwise can be different, don't know why but if people visiting the brewery the law is to different here, that's why all country have very few business like this,
I know only one i believe there are more but not much,
A easy way to do is to open a different place selling your beers different business, but this needs big capital
I'm plumber i think i can manage both, after all if need many hours that's means i have many sales,
100 kegs per month i think can be manageable, but I don't have experience to say that

 

[Bigbre04]

So your proposed system is basically a 4BBL system.
When you say you want to produce 100 kegs for delivery per month, what size kegs are you speaking of?
If it's 1/2 BBL kegs, then each brew will produce 8 - 1/2 BBL's,
If it's 1/6 BBL kegs, then each brew will produce 24 - 1/2 BBL's
So do you plan on brewing 4 or 12 times a month?
Will you be using a distributor or do you plan on self distributing?
Oh, and did you figure in a keg washer in your estimates?
Brian

@Mastoras007 Dont be discouraged by these messages. This is very doable as a single person, we are just trying to let you know what to expect if you havent brewed commercially before.

 

[Bigbre04]

Theanks for your advices!
A brewery-pub here have minimum boiler 1000Liters that's the law, don't know why, but just brewery no have any limitations on size,
Also for pub the money needs to be is to much,Its like opening 2 different business
Brewery otherwise can be different, don't know why but if people visiting the brewery the law is to different here, that's why all country have very few business like this,
I know only one i believe there are more but not much,
A easy way to do is to open a different place selling your beers different business, but this needs big capital
I'm plumber i think i can manage both, after all if need many hours that's means i have many sales,
100 kegs per month i think can be manageable, but I don't have experience to say that

Is there a difference between a brewery that sells beer to the public and a brewpub? In the states a brewpub sells food as well as beer. In Georgia the breweries are allowed to sell beer to the public but may not sell food.

100 kegs/month is more then i make (depending on the size of the keg). I brew about 2-3 times a week @ 4 kegs for each batch.

I use my former employers 3 keg automated washer which does about 25 kegs an hour. I spend about 4 hours between loading/unloading, driving too and from, and putting away kegs every 3 weeks or so.

Spent grain is an issue to take seriously. If you can find a cow farmer or possibly goats(im not sure if goats can eat spent grain), that is optimal. My batches are about 150lbs(dryweight) on average, each batch i fill 2 30gal trashcans. You would be producing about double the amount of spent grain as i am, probably 4 medium sized trashcans or totes.

 

[Mastoras007]

So your proposed system is basically a 4BBL system.
When you say you want to produce 100 kegs for delivery per month, what size kegs are you speaking of?
If it's 1/2 BBL kegs, then each brew will produce 8 - 1/2 BBL's,
If it's 1/6 BBL kegs, then each brew will produce 24 - 1/2 BBL's
So do you plan on brewing 4 or 12 times a month?
Will you be using a distributor or do you plan on self distributing?
Oh, and did you figure in a keg washer in your estimates?
Brian

20 Liters kegs so 24-25 Kegs per batches so is 4 brews for 1 month (500 liters in the fermentor)
Planing everything without employees, but truth is 100 kegs per month i can have 1 employee and still can be very profitable (according to my calculations)(if they are correct??)
Keg washer not planed

 

[Bigbre04]

20 Liters kegs so 24-25 Kegs per batches so is 4 brews for 1 month (500 liters in the fermentor)
Planing everything without employees, but truth is 100 kegs per month i can have 1 employee and still can be very profitable (according to my calculations)(if they are correct??)
Keg washer not planed

If you are doing distribution you will likely need to have a salesperson as well. Will you be using a distributor or self distribution? Likely need 1 day a week of sales/delivering kegs. likely 1 full day of packing and washing kegs. that leaves 3 days for the rest of the process. I would expect atleast 1 day every 2 weeks for office work.

I would plan on starting out solo and then hiring one person part time. You will find some locals who like beer who might be interested in some part time work to help you out.

 

[Mastoras007]

Is there a difference between a brewery that sells beer to the public and a brewpub? In the states a brewpub sells food as well as beer. In Georgia the breweries are allowed to sell beer to the public but may not sell food.

100 kegs/month is more then i make (depending on the size of the keg). I brew about 2-3 times a week @ 4 kegs for each batch.

I use my former employers 3 keg automated washer which does about 25 kegs an hour. I spend about 4 hours between loading/unloading, driving too and from, and putting away kegs every 3 weeks or so.

Spent grain is an issue to take seriously. If you can find a cow farmer or possibly goats(im not sure if goats can eat spent grain), that is optimal. My batches are about 150lbs(dryweight) on average, each batch i fill 2 30gal trashcans. You would be producing about double the amount of spent grain as i am, probably 4 medium sized trashcans or totes.

As a brewery I can't sell to the public need different licence, I can only sell to other businesses, the trick i know for sure is that they open another business another vat number and selling beer to themselves, to bar lets say
I'm speaking for 20liters kegs
Truth is there are many farmers around here didn't think of that

 

[The Brew Mentor]

Is there a difference between a brewery that sells beer to the public and a brewpub? In the states a brewpub sells food as well as beer. In Georgia the breweries are allowed to sell beer to the public but may not sell food.

100 kegs/month is more then i make (depending on the size of the keg). I brew about 2-3 times a week @ 4 kegs for each batch.

I use my former employers 3 keg automated washer which does about 25 kegs an hour. I spend about 4 hours between loading/unloading, driving too and from, and putting away kegs every 3 weeks or so.

Spent grain is an issue to take seriously. If you can find a cow farmer or possibly goats(im not sure if goats can eat spent grain), that is optimal. My batches are about 150lbs(dryweight) on average, each batch i fill 2 30gal trashcans. You would be producing about double the amount of spent grain as i am, probably 4 medium sized trashcans or totes.

Yes, finding someone that is reliable to pick up the spent grain is a big deal!
Grain sours quickly, stinks terribly and attracts nuisance animals and flies.

Here's another very big thing to think about. Water. How is it? Have you brewed with it? Does it have Chlorine and or Chloramine? What is the pH?
What minerals are in it? Sorry to give you more to think about, but I'd say Water is a huge factor.
Cheers,
Brian

 

[Mastoras007]

If you are doing distribution you will likely need to have a salesperson as well. Will you be using a distributor or self distribution? Likely need 1 day a week of sales/delivering kegs. likely 1 full day of packing and washing kegs. that leaves 3 days for the rest of the process. I would expect atleast 1 day every 2 weeks for office work.

I would plan on starting out solo and then hiring one person part time. You will find some locals who like beer who might be interested in some part time work to help you out.

I have 2 brothers they will help if need sure, probably without money

Yes, finding someone that is reliable to pick up the spent grain is a big deal!
Grain sours quickly, stinks terribly and attracts nuisance animals and flies.

Here's another very big thing to think about. Water. How is it? Have you brewed with it? Does it have Chlorine and or Chloramine? What is the pH?
What minerals are in it? Sorry to give you more to think about, but I'd say Water is a huge factor.
Cheers,
Brian

Water is good, i brew many times home, using just a carbon filter, but anyway on commercial brewery i will use RO

 

[Bigbre04]

I have 2 brothers they will help if need sure, probably without money

Water is good, i brew many times home, using just a carbon filter, but anyway on commercial brewery i will use RO

RO is not needed. I brew with tap water in a beach community. I get my water tested annually and it is consistently ok. I do minimal salt adjustment and the same salts for every batch(balanced 2 on here). Partially because i dont have filtration so i can only adjust my water a little. You only need RO if your water is very bad. Every dollar saved when starting up is super important.

Commercial brewing is all about scale. RO for homebrewing is fine because you arent really worried about utilities. RO wastes alot of water and forces you to add back minerals that you already had. In my previous brewery we had large charcoal and particulate filters, but that was basically all we did as far as filtration. We added Gypsum and CaCl2.

Brothers are good helpers.

One big thing that people dont understand going from homebrewing to commercial brewing is proper CIP Practices and chemicals. You will need to transition from PBW and Star san to heavier duty chemicals like Sodium Hydroxide, Nitric phosphoric acid, and Peracetic. Proper cleaning techniques are easy, but they are not something that a homebrewer knows right off the bat. A floor pump cart, CO2 bulk container, Brew hoses, Hydrometers, Fill heads, etc. are all things that you will need.

It might be worth while to spend some time at your local brewery volunteering to learn some stuff. They can also be an invaluable resource in the future. I dont know the industry there though, they may tell you to leave them alone. The states brewing culture is very different then in europe.

if you are serious about this project, start working out recipes. repeat them and fine tune them before you get started. Scaling them isnt too difficult, but the system might take some time to get used to so having the recipes nailed down is a good thing. Start sharing bottles with locals and friends. get your name out there asap. Feed back is important from others. It sounds like you will need to build your own local beer scene so inviting people to homebrew with you is gonna be important. Give it out in exchange for feedback.

I can help you with some of this, but im not physically there...

 

[Mastoras007]

RO is not needed. I brew with tap water in a beach community. I get my water tested annually and it is consistently ok. I do minimal salt adjustment and the same salts for every batch(balanced 2 on here). Partially because i dont have filtration so i can only adjust my water a little. You only need RO if your water is very bad. Every dollar saved when starting up is super important.

Commercial brewing is all about scale. RO for homebrewing is fine because you arent really worried about utilities. RO wastes alot of water and forces you to add back minerals that you already had. In my previous brewery we had large charcoal and particulate filters, but that was basically all we did as far as filtration. We added Gypsum and CaCl2.

Brothers are good helpers.

One big thing that people dont understand going from homebrewing to commercial brewing is proper CIP Practices and chemicals. You will need to transition from PBW and Star san to heavier duty chemicals like Sodium Hydroxide, Nitric phosphoric acid, and Peracetic. Proper cleaning techniques are easy, but they are not something that a homebrewer knows right off the bat. A floor pump cart, CO2 bulk container, Brew hoses, Hydrometers, Fill heads, etc. are all things that you will need.

It might be worth while to spend some time at your local brewery volunteering to learn some stuff. They can also be an invaluable resource in the future. I dont know the industry there though, they may tell you to leave them alone. The states brewing culture is very different then in europe.

if you are serious about this project, start working out recipies. repeat them and fine tune them before you get started. Scaling them isnt too difficult, but the system might take some time to get used to so having the recipes nailed down is a good thing. Start sharing bottles with locals and friends. get your name out there asap. Feed back is important from others.

I can help you with some of this, but im not physically there...

I through that RO is a must thing,
I can do a test water here and see what I get but in general we have good water here.

I have recipe, I'm on stage that making small changes bitterness taste etc i have already give to friends, the point is to take a beer as simple as posible as i said we are not familiar with ale flavored beers, i had brew siera nevada was great but my brother didn't like it, was strange to him


If this becomes reality i will sure need some critical information, cleaning chemicals for example
I'm reading Palmer's book those days, taking notes important things that I'm learning is a good start this book already helped me alot

 

[Mastoras007]

Theanks for your interest!!

 

[Bigbre04]

I through that RO is a must thing,
I can do a test water here and see what I get but in general we have good water here.

I have recipe, I'm on stage that making small changes bitterness taste etc i have already give to friends, the point is to take a beer as simple as posible as i said we are not familiar with ale flavored beers, i had brew siera nevada was great but my brother didn't like it, was strange to him


If this becomes reality i will sure need some critical information, cleaning chemicals for example
I'm reading Palmer's book those days, taking notes important things that I'm learning is a good start this book already helped me alot

Water chemistry is very important, but your water is probably just fine. With small salt additions and some filtration you can make great beer with tap water.

I agree with you as far as simplicity to start. A good clean lager will be your best seller. But you can make the occasional half batches of different styles and let people try them.

one good way to break non beer drinkers into hoppy beers is to take the same light lager and dry hop it. it removes the scary aspect of the hops while still being familiar.

Also doing more traditional European styles might be more approachable then American in your face styles.

Palmers book is good, but nothing will beat a little hands on. It would also be helpful to make friends with your other local brewers.

Happy to help. Just ask.