Nano Brewery Feasible?

[keelanfish]

So, the same old story, homebrewer dreaming about going pro...

Anyhow, I've got some good friends that I brew with that are in the food business. They own a couple of successful establishments and they have gotten the bug to start a brew pub. I've done enough research to determine that starting a micro-brewery (say 3 to 7 bbl) size brewery is going to cost some serious coin and I've advised my friends of that. The last thing I want to do is give them a false sense of how much capital this is going to take.

So, they seem hell bent on going forward with a gastro-pub concept, brewery or not. I'm curious to get your thoughts on the feasibility of starting with a nano-brewery to supplement the guest handles with a lineup of fairly unique, intense, or high gravity beers (think small pours). Say a custom brew sculpture fitted with three 55 gallon Blichmann boiler makers and 42 gallon Blichmann connicals? I know there is a lot more to consider than just these major components to the system, but it seems like even if the economy of scale only allowed a break-even price structure for the on-premise beers it may be worth it to distinguish the establishment from other beer bars and also with consideration to future brewery expansion. The setup would be a hell of a pilot system.

Downsides I see are lacking economy of scale and significant time input associated with brewing. Upsides are relatively minimal startup costs, minimal modifications to the space, and a degree of flexibility/experiementation that may not be feasible with a larger brewing system. Also, in the event that the business didn't work out, I'd be left with one hell of a homebrew system.

Thoughts?

[PSUHomebrewer]

A nano brewery just opened by me and their setup is a glorified homebrew rig (x3x55g boilermakers on a Brutus type stand with 809&nano pump and a thermonator chiller). They are selling and producing a fair amount in 1/6 kegs.

The big issue is space and volume. A system of that size can easily supply an entire restaurant as long as your fermentors and bright tanks are big enough or you have enough of them. Also it will mean instead of brewing once a day or every other, it will probably be 2-4times a day.

It's all doable, just depends is on if the time investment is worth more than the capital investment.

[Adam]

The brewpub near me has a 7 barrel system with 3 fermenters and brews once a week in a city of just under 8,000. They have 10 beers on tap and have BMC in bottles with a few import bottles. Thing I like about them is they price their [true] pints at $3.25 but a bottle of Bud Light will cost you $5!

Smaller systems equal more labor. My opinion, if I'm going to spend a few hours brewing I would want it to be something that I know can sell quickly and make a profit, rather than brewing the niche within a niche within a niche type beers that sell slow. I wouldn't focus on breaking even with beer, it's a business and everything you do must be done with the intent to make a profit. If you're really after just brewing niche beers that won't sell as well as session beers will, then a 1bbl system might be all you need.

It's been cited in a few places to plan for 5-10 bbls per seat per year for a brewpub depending on the size of your market. Say 100 seats at 5 barrels is 500 barrels annual production which on a 7bbl system is a bit over 70 batches.

I wouldn't start on a glorified homebrew system unless you're already open and waiting for the brewhouse to arrive or you're going for the niche stuff for a few handles. People usually don't order an 8% beer with dinner. My village brewpub has a 3.5bbl system and all four taps have 7% or bigger beers. Takes a long time to kill the serving tanks.

With a city as big as in your profile, 7bbl is minimum. There are many breweries selling their small systems, either due to going out of business or expanding. Fair amount of used systems in the market now.

[foomench]

I've done enough research to determine that starting a micro-brewery (say 3 to 7 bbl) size brewery is going to cost some serious coin and I've advised my friends of that.

What do you consider serious coin? $200k, $500k, $1m? You can buy used systems cheap sometimes. Without owning your property you can get away with a lower start-up cost, but you will have a tougher time getting a loan. You should attend the CBC if you can. Mountain Sun in Boulder was started pretty cheap. They didn't own their property at the time, but I think they do now, and they've expanded ... I think they started with ~7 barrel with a bunch of dairy equipment. At least that's what some of the original stuff looked like.

Lots of nanos in the PNW. The brother of one of my local homebrewing friends started up NW Peaks Brewing, making sub-barrel sized batches.

[Drezden]

Friends are opening their brewery May 11, 2012 in Louisville, Kentucky. The system is 4 bbl dairy, steam and solar fired 2 vessel. 10 taps in the tasting room, 2 walk-in coolers. They spent more than planned. Check out Apocalypse Brew Works for some ideas.

[Steelers&Beer]

if they're going gastro pub, they will/should have a ton of different beers and they will always be changing. At least that's how i have experienced it. If they are going for small, specialty brews, then see how much they are willing to invest. If they want their own brew pub, that's a whole different game. Small nano brewery ran by you, might be able to pull off for low 5 digits, (1-2 bbl system, fermentors, pumps, glycol, kegs, permits...easy 10K) if you already have the space. 7 bbl brewpub is gonna be A LOT more. Everyone interviewed or that has written a book says the same thing; IT WILL COST YOU MORE THAN YOU PLANNED TO SPEND!
If you are going to offer them something and they are willing to invest, do not short yourself. Get good reliable equipment. Time is money and if you're working twice as hard as you need to, it won't be long before you start to get pissed for giving them a great deal. Basically, give them a fair offer but don't screw yourself to be a professional brewer. My 0.02.

[keelanfish]

Some good feedback here, thanks everyone for the replies, they've got me thinking. I need to meet with them to figure out how big a space they're thinking and what kind of money they are planning to invest in the place. I'm thinking small, but a bit bigger than 1-2 barrels is probably the way to go. Time to do some research on how to pull off a 3-4 barrel brewery cost effectively.

[foomench]

BTW, have you looked at http://probrewer.com/ ? Lots of used equipment there, from nano breweries on up. 7 BBL system for $30k, nano systems <$10k. You will add freight and a lot more to get things installed, but for opening a restaurant, that's just a fraction, IMHO.