Plan to Start Selling Your Craft Beer? Here are 3 Ways to Prepare
Despite the economic changes resulting from the pandemic, craft beer has managed to make a comeback. 2020 was a noticeably rough year for small brewers, but 2021 saw a 1.4% increase in generated dollar sales. To capitalize on the post-pandemic market, you’ll need to start now.
Even in a welcoming market like craft beer, starting a business can be difficult. That’s why you need to build business optimism before you open and remain competitive once you are.
How To Prepare Your Business to Sell Craft Beer
Craft beer is traditionally produced and sold by small breweries. Most independently owned breweries will have to go through the following steps before they’re ready to open their doors.
1. Decide on Brewery or Storefront Type
It sounds like a simple question, but there are several brewery types to choose from:
- Macrobrewery: A brewery that produces over 6 million barrels per year.
- Microbrewery: A brewery that produces less than 6 million barrels per year.
- Nanobrewery: A brewery that produces less than 200 gallons per year.
- Brewpub: A restaurant/bar/pub that brews its own beer on-premises.
The brewery type you pick should be determined by your expertise, the size of your team, and how you plan to scale. You can use apps and tools to help make your decision easier.
For example, one of the main advantages of Untappd for businesses is its database of over 3 million beers. If you can’t afford to conduct true customer research at the moment, you can use apps like Untapped to track your brewery’s analytics and create custom menus for your bar.
2. Spend A lot of Time on Your Brand
Building a recognizable brand can be complicated, but if you get it right, your brand will sell your beer for you. Here are a few steps you should take before coming up with your craft beer brand:
- Define the benefits of local branding vs. international branding.
- Identify what makes you unique and build your business around it.
- Build a strategic plan that involves your definition of winning.
- Determine where you’ll win (what customer’s you’ll target).
- Determine how you’ll win (the steps that get you to the end goal).
- Ensure your brand is scalable, sustainable, and organized.
While branding does include visuals, like colors and fonts, is essential, the most crucial aspect of any brand is your unique customer value proposition. This describes why your customers should buy your product. Once again, customer research is needed to develop a sellable brand.
3. Documents, Equipment, and Space
We recommend seeking legal counsel to navigate licensing and permitting for your brewery, as requirements vary based on size and state. However, you will need a federal brewing permit if you plan to sell your beer, as this permit verifies if your equipment is installed and operational.
A state liquor license is needed to capitalize on on-premise taproom businesses, and you may need another license if you plan to sell beer steins, hats, shirts, and other merch with your logo.
If you’re seeking a business loan from the bank (to buy space or equipment), you need to have property, casualty, and liability insurance. Even if you don’t need a loan, insurance can help you prevent legal mishaps or potential legal action from customers, employees, and suppliers.
It’s a good idea to purchase the following brewing equipment slowly to cut down on costs:
- Bottling equipment
- Tubing, piping, and brew pumps
- Cooling/chilling systems
- Fermentation tanks
- Beer storage
- Boilers and brewing kettle
When you have the money, you can start scoping out a brewery location. We recommend getting a building near your target demographic with a large, growth-ready warehouse.
If you want to build a restaurant and a brewery, become knowledgeable on zoning laws.
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