The 5 Secrets of a Successful Microbrewery

The US Bureau of Labor Statistics research shows that up to half of all small businesses manage to survive five years or more, and a third of this survive ten years or more with the probability of success increasing with the age of the business. In fact, there has been research on the restaurant industry that has shown a 60% failure rate over a three-year period. On the other hand, 76% of modern day microbreweries that were established since 1980s are still running with failure rates of only 24%. This high success rate of microbreweries have seen a large number of openings over the last decade bringing with it a liquor liabilities that require thorough planning, good products and new markets in order to succeed. Here are 5 secrets that will help you run a successful microbrewery.

1. Start on the right foot


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In order to master any trade, you must spend time learning about it. The microbrewery business requires you to have a sound brewing knowledge and a thoroughly researched market. This means that you can’t just decide to open one anywhere at any time you have the money to do it. A national and local market research is needed but given that the brewing industry is dominated by a small number of internationals, you better concentrate your research on the local market. In order to know the local demand and tastes, you will need to visit local bars and beer vendors. This will help you come up with a product that people will like and the project the production scale.

2. Make expansion plans from the start

Having conducted your market research, the results should enable you to decide the type of microbrewery to embark on and at what scale. Usually, many brewery owners prefer to start small and make expansions later. From past experience, many microbreweries that started small without making any early plans for future expansion found themselves in big trouble as the demand grew faster than they expected. Many of them wish they had made expansion plans at the time of starting the microbrewery while others wished they had started with a bigger system.

3. The running costs and time are not what they seem


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Seasoned veterans and brewery consultants will always tell you to plan for entire running costs to take twice as much. The truth is that running costs might even take three times as much as the amount you initially planned for especially when you consider construction costs that are a result of expansion. Breweries also require lots of time commitments and labor costs can become more expensive than anticipated and you should be prepared just in case.

4. Be prepared to deal with complicated permits and legal issues

Another liquor liability that the brewery industry especially microbrewers has to deal with is the complicated permits and legal issues that are associated with it. The licensing process and getting a permit to run a microbrewery can be truly difficult and it needs a lot of patience. Luckily, you can use the services of a liquor licensing attorney to help you in the entire process.

5. Prepare for huge administrative work

Having brewing and personnel management skills ensures that you hire the right employees for the operations, that you are in charge of it and that you prepared enough to handle all the administrative requirements of your microbrewery.

The microbrewery venture is a good one with a high success rate and great potential for future expansion, but there are also liquor liabilities that if not well-taken care off can bring your microbrewery down. You need to watch out for barriers!

About the Author

Financial professional and online entrepreneur, I'm best known as The Financial Blogger. I want to make money because I like enjoying life the way it should be; with a lot of great food and wine! I also love to spend time with my lovely wife and 3 kids!