When driving by yourself for 6 hours, a lot of things go through your head. Things like “How do people listen to Howard Stern for hours at time?” and “I am going to risk a lot of my family’s and other peoples’ money on this brewery, so I better not mess this up.” The Howard Stern question left me stumped and the idea of minimizing risk while at the same time planning for success is a tough one. Some associate planning for success with “go big or go home,” and for a brewery, that is certainly an option if you have the money (say $1.5M) to do it. I choose to look at planning for success in a different way.
Assuming the concept is a good one (which it is) and you have done the legwork to give yourself and others confidence that things will go as planned (which I’m doing), the most critical step towards success is getting open. As I mentioned previously, within the first hour of arriving at the Brewery Immersion Course, Tom Hennessy and I were talking about the concept - A production brewery with tap room in Pasadena that focuses on lager beers. By the third day, we had nailed down 3 alternatives so that if I can’t get enough money or find the right space to do the big option, I can still get the brewery started. Here is the list:
Option 1 - 15bbl brewery with 30bbl fermenters and bright/serving tanks. When accounting for a decent amount of expansion, this requires ~5,000sf, high ceilings and good infrastructure. Tom estimated this costing $250,000. However, because I don’t have costs for building out the space, and I am going to want a hefty contingency and some sizeable working capital set aside, it could easily end up $450,000+.
Option 2 - A smaller 7-10bbl system, with 15-20bbl bright/serving tanks. This requires 2,500sf and all the stuff mentioned above. This is more of a short term space and only works if there is expansion potential or there are very high ceilings (let’s say 25’ minimum) that would enable very tall fermenters. The model for this would be the Telluride Brewing Co., who fit their 15bbl system and huge fermenters in a 2,600sf space, and produced 1,500bbl their first year. This year they are projecting 9,000bbl, all of which will be brewed and fermented in that same square-footage (which is insane). They have leased additional space for packaging and storage to keep up with their growth.
Option 3 - Locate in a space that formerly housed a restaurant, with a minimum of 2,000sf (preferably 3,000sf or more) and serve a very basic menu (sausages or tacos or sausagetacos - wait, did I just invent something awesome?!?). The benefit of this is that restaurants typically have much of the infrastructure needed for a brewery, so that reduces cost. This will also open up the areas I can locate in within Pasadena and the food provides another revenue stream. The obvious drawback is that I will be producing less beer at this location than I would in Option 1 (and probably Option 2). But the idea is that once production has maxed out at this first location, a second location, dedicated solely to brewing beer for distribution, will be built. This first location will remain as the Wild Parrot Pub.
When taking into account minimizing risk along with planning for success, I am pretty hot on Option 3 as the preferred path and Tom is too.
Verify zoning for each of these options (so I can know where I can locate and what permits are necessary)
Incorporate (to help out the poor, struggling lawyers of California)
Figure out home much of our own money we can invest (which will determine how much money we will need to raise/panhandle for)
Oh, and finish that business plan that has been in the works for about 2 years now. (Now even more complicated with multiple options, including a food component)