Thinking about launching your own craft brewery and wondering what it really costs to start a microbrewery? While every brewery has unique needs, here are some common startup expenses to keep in mind.
Some of the bigger costs include:
Rent – What you’ll pay for your chosen location. Again, this varies greatly depending on the city. For example, renting a taproom in Topeka, Kansas, will likely be far cheaper than one in San Francisco or Brooklyn. If you’re planning to buy the property, you’ll also need to factor in the purchase price and decide whether to take out a mortgage.
Construction – Are you building from scratch? Renovating an older space? Or moving into a turnkey operation? Chances are, you’ll invest a good amount in design to create a brewery that truly reflects your brand and business goals. Those costs can add up quickly.
For instance, even though Romanow’s new Castle Island location is half the size of the original, he raised twice as much money—partly because the new site is in Boston, a city with an extremely competitive hospitality scene.
Utilities – Monthly bills to keep the lights on, water running, and everything operating.
Ingredients – At the most basic level, you can’t make beer without barley, hops, water, and yeast. If you start adding other ingredients—say, 500 pounds of raspberries—you’ll drive up the final cost of your beer. And if you plan to serve food, that adds another whole layer of expense.
Salaries – At a microbrewery, bartenders, brewers, cellar staff, packaging teams, marketing personnel, and others all need hourly wages or annual salaries.
Some smaller expenses include:
Permits, licensing, and insurance – All are essential, and all come with fees. Check with your local Alcohol Beverage Control (ABC) board as well as the Alcohol and Tobacco Tax and Trade Bureau to figure out these costs.
Equipment – This can range from brewing equipment, bottles, or cans to taproom glassware, flight boards, and furniture (more on this in “The Fourth Step: Finding the Right Brewery Equipment”).
Technology/software – Hiring a local sales rep? They’ll need some kind of sales software to help them sell. Plus, if you have a taproom, you’ll want a point-of-sale (POS) system to manage sales. And don’t forget Wi-Fi—for your daily operations and for your digitally savvy customers.
Marketing – One of the most common mistakes new brewery owners make is focusing only on the beer and ignoring the brand. Marketing helps you build a loyal following and cultivate a community, which leads to more sales and repeat customers. This is truly an area where you need to spend money to make money. Of course, how much you spend is up to you.
Sound like a lot? That’s because it is. If you’d like to learn more details about how much it costs to start a brewery, please don’t hesitate to reach out to Tiantai Beer Equipment.
