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How to Write a Brewery Business Plan: Complete Guide

• January 3, 2023
• Food & Beverage

Whether you’re looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your brewery, you will need to prepare a solid business plan.

In this article we go through, step-by-step, all the different sections you need in the business plan of your brewery. Use this template to create a complete, clear and solid business plan that get you funded.

1. Executive Summary

The executive summary of a business plan gives a sneak peek of the information about your business plan to lenders and/or investors.

If the information you provide here is not concise, informative, and scannable, potential lenders and investors will lose interest.

Though the executive summary is the first and the most important section, it should normally be the last section you write because it will have the summary of different sections included in the entire plan.

Why do you need a business plan for a brewery?

The purpose of a business plan is to secure funding through one of the following channels:

• Obtain bank financing or secure a loan from other lenders (such as a SBA loan )
• Obtain private investments from investment funds, angel investors, etc.
• Obtain a public or a private grant

How to write your brewery’s executive summary?

Provide a precise and high-level summary of every section that you have included in your business plan. The information and the data you include in this segment should grab the attention of potential investors and lenders immediately.

Also make sure that the executive summary doesn’t exceed 2 pages in total: it’s supposed to be a summary for investors and lenders who don’t have time to scroll through 40-50 pages, so keep it short and brief.

The executive summary usually consists of the five major sub-sections that include:

• Business overview : this segment will provide a high-level summary of your business and the products you will sell. For example, mention the type of brewery you want to open (such as microbrewery, brewpub, taproom brewery, regional brewery, contract brewing company, etc.). Also, briefly mention your products and services (if you offer a sit-in taproom for example) and pricing strategy
• Market analysis : summarise the market where you will operate and provide a brief about the target audience , market size , competitors, etc. No need to provide granular data here, save it for the Market Overview section later on (or the appendix). You must provide only scannable data points to keep potential investors and/or lenders hooked.
• People : introduce your brewery’s management and employee structure. Provide a brief (no more than a couple of sentences each) of the knowledge and experience of the team. Also, speak about your hiring plans.
• Financial plan : how much profit and revenue do you expect in the next 5 years? When will you reach the break-even point and start making profits? You can include here a chart depicting your key financials such as revenue, gross profits, and net profit
• Funding ask : what loan/investment/grant are you seeking? How much do you need? How long will this last?

Brewery Financial Model

Download an expert-built 5-year Excel financial model for your business plan

2. Brewery Business Overview

This is the section where you will provide details about your brewery and the chosen business model. You must address some important questions that lenders and/or investors generally ask. Here is a quick list of some of those questions you must address:

• What’s the brewery’s location and why did you select that location?
• Why did you select the type of brewery you want to open?
• What will be the beer products you will offer? Any other drinks or services?
• What will be your pricing strategy and why?
• Who is your target audience?
• How many customers can you serve at once (in case you are going for options like taproom brewery or brewpub)?
• What will be the legal structure of your company?

Let’s look at different subsections that you must include:

a) History of the Project

Any business must have two components:

• Passion & experience of the business owner
• Rationale behind starting this type of business today

Passion & experience

You may or may not have prior experience. If you have experience, speak about it and how it will help you to run your business. For instance, you may have been a brewmaster in a popular brewery for 12 years, and now you want to start your own brewery and use your knowledge to run it more efficiently.

However, if you don’t already have experience, that’s fine. You must demonstrate your passion and some industry knowledge that you have acquired through intensive research.

Is there a certain problem (or perhaps, a set of problems) that your brewery will try to solve when it comes into existence? For instance, there may not be any brewpub in the area, and you want to capitalize on the opportunity. 

However, you must understand that the market must be suitable for the business. For instance, if the target audience in the location prefers a taproom brewery, offering a brewpub instead may not be a wise decision.

b) Business Model

This sub-section of the Business Overview will explain your business model. Describe the following points briefly:

• Will you buy an existing brewery and do some remodeling, or will you start a new brewery and design it from scratch?
• The type of brewery you want to open and why
• Equipment, inventory, and storage facilities that are essential for the brewery to operate successfully

There are multiple types of breweries that you can consider:

• Nano brewery : This is the smallest type of brewery. There are no defined barrels per annum, but they produce a very limited amount of beer per year
• Microbrewery : This type of brewery will produce less than 15,000 barrels of beer a year. Most beer is sold onsite instead of using distributors. These breweries are typically independently owned
• Brewpub : A restaurant and brewery hybrid in which the beer produced is served to the bar customers
• Taproom brewery : These are professional breweries that sell beer onsite and even via distributors. However, there are no restaurant services available. Sometimes, such breweries will have attached taprooms
• Regional brewery : These are breweries that produce anywhere between 15,000 and 600,000 barrels of beer a year
• Contract brewing company : In this form, a company will hire other breweries for beer production and packaging. However, the marketing and distribution of the beer will be the responsibility of the hiring company

The type of brewery that you want to open will depend on its market size, target audience, your business expansion plans, etc. For instance, if you want to sell your products outside of your state, you may want to go for a regional brewery or perhaps, settle for a contract brewing company.

c) Products & Services

Since you want to start a brewery, you will obviously be selling beer. However, you may decide to make different flavors. Also, if you want to open a brewpub, you may also be running a full-scale restaurant and serving food to your customers.

Depending on the type of brewery you will open, you must list all the products and services that you will sell. For example, if you are selling packaged snacks (taproom brewery) or instead if you want to have a full-service kitchen (brewpub), mention the relevant products here.

d) Pricing Strategy

In this segment, you must explain your pricing strategy. The price of the beer will depend on the product itself and its manufacturing complexity. Even the raw materials and the scale of your business will also determine the pricing.

If you are creating a premium line of products with a higher price tag, make sure that there is a proper justification for that. 

It is a good practice to include a pricing chart for all possible products if you have a small menu. However, if you are offering many products, provide a sample menu with the pricing range.

3. Brewery Market Overview

A complete understanding of the market where you want to operate is important for the success of your business.

For example, if you want to open your brewery in an affluent area where people don’t mind spending extra in exchange for a unique craft beer, a specialty taproom brewery may be a successful business.

Therefore, you must cover here 3 important areas:

• Brewery Industry Status Quo : how big is the brewery industry in your area? What is its growth rate (or decline rate) and what are the factors contributing to its growth or decline?
• Competition overview : how many competitors are there? How do they compare vs. your business? How can you differentiate yourself from them?
• Customer analysis : who is your target audience? What type of breweries do they prefer? How regularly do they visit breweries? Do they prefer to sit and eat in a brewery, and if so, do they prefer brewpubs or do they prefer taproom breweries? How much do they spend on average?

a) Brewery Industry Status Quo

How big is the brewery industry in the us.

According to Brewers Association , the overall beer market in the US is $100 billion, while craft beer accounted for 27% market share ($26.8 billion).

After a decline of 9% in 2020, primarily due to the COVID-19 pandemic, the beer industry bounced back by 8% in 2021.

However, what’s interesting is that the overall number of breweries in the U.S. increased in 2021 and reached an all-time high of 9,247 breweries (+2.5% vs. 2021) of which the breakdown (in terms of production volume) is shown below:

How big is the brewery industry in your area?

Once you provide the overall picture of the US, divert your attention to the area where you want to operate. It might not be possible to find region or area-specific studies, and hence, you must estimate the size of your market yourself. For more information on how to do so, read our article on how to estimate TAM, SAM and SOM for your startup.

For example, there were 9,247 craft breweries in the US accounting for $26.8 billion in sales. Hence, the average annual revenue for each craft brewery stood at about $3,000,000.

Therefore, if there are 18 craft breweries in your area (city or region), the overall brewery market size is approximately $54 million.

How fast is the brewery industry growing in the area?

After market size, you must look into the growth rate of the brewery industry in your area. This information may not be available via online research papers. However, assessing the growth rate of the brewery industry can be assessed using the number of competitors in the area.

For instance, if there were 13 breweries in 2018 and 18 breweries in 2022, the average annual growth rate of the brewery market in your area is 8.3%.

What are the current brewery market trends in your area?

It is vital to understand the trends of the brewery industry in your area. Understanding trends will allow you to devise marketing strategies.

Understanding trends won’t be easy. You must conduct research and talk with your target audience. Additionally, you must also study your competitors to understand their target audience, the products they sell, etc.

Some common questions you may ask the target audience include:

• What type of breweries do they prefer?
• At what time of the day do they prefer to visit a brewery (evening, afternoon, late night)?
• How frequently do they visit breweries?
• What type of foods do they usually order along with beer (if they are going for taprooms having a partnership with food trucks or they are opting for brewpubs)?

You can ask as many questions as you need to understand the evolving trends.

b) Competition Overview

Studying your competitors’ business models is vital. You need to understand what makes them successful or why they fail. A clear understanding of their brew offerings, marketing strategies, etc., will allow you to provide a better service.

If your competitors are offering nearly the same products & services, then what is their market share and how do they market their products & services to attract new customers?

It is always a good idea to do some research (if necessary, physically visit your competitors without revealing your business intentions) and create a comparative table summarizing their product & service offerings, marketing strategies, target audience, etc.

Here is a sample table that you can use:

The table you will create will depend on what information you need and want to include based on your proposed business model.

Brewery SWOT Analysis

It’s always good practice to provide a SWOT analysis as part of the business plan for your brewery. It must be crisp and highly focused. SWOT stands for Strength, Weakness, Opportunities, and Threats.

Here is a sample that you can use as a reference:

• Strengths : 8 years of brewmaster experience in a reputed large (non-craft) brewery
• Weaknesses : Startup cost, zero reputation
• Opportunities : An affluent neighborhood with rising demand for a brewpub, no brewpub in a 2-mile radius
• Threats : Increasing cost of raw materials, mass-production beer manufacturers are flooding the market

A clear understanding of your strengths and weakness along with opportunities and threats in the real market can help you to design your marketing strategy. It also helps potential investors to assess the risk and reward profile of your business and is often a must have in your brewery business plan.

c) Customer Analysis

This is the sub-section where you will provide a detailed analysis of your target audience. You will expand the data points your provided earlier in the Business Overview segment.

Some important points that you must include in your customer analysis include:

• Age and gender distribution (you can get local demographic data from census.gov )
• Per capita expenditure on beer
• Frequency of brewery visits
• Average monthly income and disposable income
• Average bill size per visit
• Average yearly or monthly spending on breweries
• Type of breweries preferred
• The expected price range for brews
• Inclination towards loyalty programs
• Things they dislike about existing breweries and what they expect to be improved

You can add as many data points as required to validate your business decision. The idea here is to display your deep understanding of the target audience and their needs, preferences, and expectations. This knowledge can help you to tailor your products & services to attract new customers.

4. Sales & Marketing Strategy

This is the segment where you outline the customer acquisition strategy of your brewery. Try to answer the following questions:

• What is your USP ?
• What are the different marketing strategies you will use?
• How do you intend to track the success of your marketing strategy?
• What is your CAC or customer acquisition cost?
• What is your marketing budget?
• What introductory promos and offers do you intend to provide for attracting new customers?

Let’s expand a bit on a few questions below:

What marketing channels do breweries use?

Marketing channels are ways of communication businesses use to attract customers. Logically, not all breweries use the same marketing channels. For example, a taproom that sells craft beer will most likely rely more on social media and signage vs. a regional brewery that only sells to resellers, restaurants, bars and other business customers (they will likely use a sales team instead, along with some paid media, print ads in specialized magazines, etc.).

See below a few examples of marketing channels that breweries typically use:

• Sales representatives (only breweries selling to businesses)
• PPC ads, Facebook ads, etc.
• Customer interaction through social platforms like Instagram, Facebook, etc.
• Email marketing
• Loyalty programs
• Word of mouth, recommendations

Of course, it’s not mandatory to use all channels. Instead, you can start by focusing on a few of them, and add others as you scale up later on.

Also, you must have a fair and nearly accurate estimate of your marketing budget. Failure to display a well-planned and adequate cash flow for advertising and marketing can lead to investors losing confidence. That’s because investors are fully aware that if adequate funds are not allocated for marketing, the business will be derailed before becoming a success.

What is your unique selling proposition?

In other words, how do you differentiate yourself vs. competitors? This is very important as you might need to win customers from competitors. A few examples of USPs are:

• Quality of beer products : your craft beer(s) may be of higher quality (raw materials r transformation) vs. your competitors’
• Location : your brewery may be located closer to your customers, reducing transport costs for your customers
• Partnerships : you may have partnered with famous brands, bars, restaurant chains or franchises your customers are fond of
• Price : your beer products (and/or food if you have a brewpub) may be cheaper vs. competitors
• Extra products / services : you may be the only brewpub in the area offering food to your customers, whilst all other competitors only offer taprooms

Your USP will depend on your business model, competitor analysis , target audience, and product. The idea is to speak to customers’ emotions and needs. Whatever your USP be, it should appeal to your potential customers and attract them. Plus, The USP you offer should be convincing enough for investors and lenders.

5. Management & People

You must address two things here:

• The management team and their experience/track record
• The organizational structure: different team members and who reports to whom?

a) Management

Small businesses often fail because of managerial weaknesses. Thus, having a strong management team is vital. Highlight the experience and education of senior managers that you intend to hire to oversee your brewery business.

Describe their duties, responsibilities, and roles. Also, highlight their previous experience and explain how they succeeded in their previous roles.

It is also important that you explain how their experiences and qualifications help you in implementing the brewery you are proposing. If they have specialized training, and experience (such as a certificate in brewing technology covering concepts like wort production, fermentation, etc.; brewmaster experience, etc.), add that information.

b) Organization Structure

Even if you haven’t already hired a brewer, head brewer (or brewmaster), tasting staff, tasting room manager, marketing personnel, quality control personnel, and other relevant staff members, you must provide a chart of the organizational structure defining the hierarchy of reporting.

6. Financial Plan

The financial plan is perhaps, with the executive summary, the most important section of any business plan for a brewery.

Indeed, a solid financial plan tells lenders that your business is viable and can repay the loan you need from them. If you’re looking to raise equity from private investors, a solid financial plan will prove them your brewery is an attractive investment.

There should be 2 sections to your financial plan section:

• The startup costs of your project (if you plan to start a new brewery, purchase new equipment, renovate your brewery, add a taproom to your brewery, etc.)
• The 5-year financial projections

a) Startup Costs

Before we expand on 5-year financial projections in the following section, it’s always best practice to start with listing the startup costs of your project. For a brewery, startup costs are all the expenses you incur before you open your brewery and start making sales . These expenses typically are:

• The brewing systems and other equipment
• The leasing deposit for the space (if you rent) or to buy the real estate (if you buy)

Logically, brewery startup costs vary significantly based on factors like the size of your brewery, its capacity (in barrels), its location, the quality of equipment, etc.

On average, it costs $158,000 to $340,000 to start a 2,000 barrel craft brewery.

Note that these costs are for illustrative purposes and may not be fully relevant for your business. For more information on how much it costs to open and run a brewery, read our article here .

b) Financial Projections

In addition to startup costs, you will now need to build a solid 5-year financial model for your brewery.

Your financial projections should be built using a spreadsheet (e.g. Excel or Google Sheets) and presented in the form of tables and charts in the business plan of your brewery.

As usual, keep it concise here and save details (for example detailed financial statements, financial metrics, key assumptions used for the projections) for the appendix instead.

Your financial projections should answer at least the following questions:

• How much revenue do you expect to generate over the next 5 years?
• When do you expect to break even?
• How much cash will you burn until you get there?
• What’s the impact of a change in pricing (say 15%) on your margins?
• What is your average customer acquisition cost?

You should include here your 3 financial statements (income statement, balance sheet and cash flow statement). This means you must forecast:

• The number of barrels you produce over time ;
• The number of beers (or barrels) you sell ;
• Your expected revenue ;
• Operating costs to run the business ;
• Any other cash flow items (e.g. capex, debt repayment, etc.).

When projecting your revenue, make sure to sensitize pricing, cost of raw materials (malt, hops, packaging, etc.) and your sales volume. Indeed, a small change in these assumptions may have a significant impact on your revenues and profits.

7. Funding Ask

This is the last section of the business plan of your brewery. Now that we have explained what your brewery business model is, what types of beer you sell and to whom (individuals vs. businesses), what’s your marketing strategy, etc., this section must now answer the following questions:

• How much funding do you need?
• What financial instrument(s) do you need: is this equity or debt, or even a free-money public grant?
• How long will this funding last?
• Where else does the money come from? If you apply for a SBA loan for example, where does the other part of the investment come from (your own capital, private investors?)

If you raise debt:

• What percentage of the total funding the loan represents?
• What is the corresponding Debt Service Coverage Ratio ?

If you raise equity

• What percentage ownership are you selling as part of this funding round?
• What is the corresponding valuation of your business?

Use of Funds

Any brewery business plan should include a clear use of funds section. This is where you explain how the money will be spent.

Will you spend most of the loan / investment in paying your employees’ salaries? Or will it cover mostly the cost for the lease deposit and the renovation?

Those are very important questions you should be able to answer in the blink of an eye. Don’t worry, this should come straight from your financial projections. If you’ve built solid projections like in our Brewery financial model template , you won’t have any issues answering these questions.

For the use of funds, we also recommend using a pie chart like the one we have in our financial model template where we outline the main expenses categories as shown below.

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Business Plan Resources for Breweries

I started with the Brewers Association in 2014. My goal is to engage with as many members as possible, help them maximize their membership benefits, and act as the resident resource-Sherpa to assist in navigating through the mountain of information.

In my free time I like to sip on IPAs and pilsners while playing bass loudly or petting my dogs. I openly welcome pup-pictures and all heavy/loud/noisy music suggestions.

Many of the discussions we have at the Brewers Association (BA) revolve around resources and ideas that are specific to the beer industry. We focus on technical brewing, acquiring the right ingredients, building a brand, marketing beers, passing OSHA inspections, and complying with the TTB, among other things. Yet, there is a foundation to breweries, brewpubs, and taprooms alike, that is the common thread of all businesses. That foundation is a well-constructed business plan.

Learn How to Create and Maintain Your Business Plan

I’m often asked what business planning resources the BA provides, and I point members to our production statistics , benchmarking surveys , insight & analysis articles , and a myriad of Craft Brewers Conference (CBC)  presentations covering specific business-related topics. Additionally, Brewers Publications offers The Brewers Association’s Guide to Starting Your Own Brewery , which includes guidelines for business planning and a sample business plan. Despite all this information, though, I still hear questions about the root of the business plan – where to start and how to create one. So, I’ve compiled a handful of resources to help breweries create and maintain a business plan.

We all have preferences on how we digest educational materials. So, the information below comes in multiple formats from a variety of sources. These resources are helpful whether you are looking to create your first business plan or simply want to update your current one. A business plan is a living document that should be updated regularly, rather than a ‘one and done’ springboard for prospective businesses. This is by no means a comprehensive list of resources on this topic, as there are hundreds of them available. Rather, it’s a jumping off point for members who want to establish and expand their knowledge. These resources can help us establish and refresh business plans, in addition to highlighting components we wish to explore further.

Business Plan Resources:

• Writing Your Brewery Business Plan  is a step-by-step review of the necessary elements within a business plan and why those things are important.
• Successfully Planning, Starting and Operating a Nano Brewery  offers a broad overview of the planning process with highlights on fundamental considerations for both launching and growing a brewery.
• The Nuts & Bolts of Great Business Plans – An often cited (and very comprehensive) guide to the broader and finer points of creating your business plan. This 30-page PDF document is updated yearly and provides excellent details on the what and why of each section in the outline.
• The U.S. Small Business Administration (SBA) is a great general resource for businesses. They offer a step-by-step tool that explains each section of the business plan template, along with a place to input your specific business information along the way.
• SCORE , a nonprofit resource partner with the SBA, has a variety of resources geared toward creating business plans and starting small businesses. This includes a 60-minute webinar on One Page Business Plans , an on-demand Developing a Business Plan course , articles about business plans , and even mentorship opportunities .
• For those who prefer educational videos, BizPlanTemplate.com offers a free business plan template paired with a 10-minute tutorial explaining each section.
• If learning on the go is of interest, scribendi.com offers a very succinct podcast outlining How to Write a Business Plan . For those starting from scratch, this is a good primer for the deeper dive into more detailed templates.

Don’t Forget to Use Your Community

As a final note, I’d be remiss not to mention the Brewers Association Forum . This is an excellent place to ask questions and engage with fellow brewery owners as you create and revise your business plans. While each brewery (and therefore business plan) will be unique, there is much to be learned from those around us. I am constantly reminded of the community mindset amongst many breweries, and this a fantastic way to connect and share resources with one another.

Resource Hub:

More like this.

The Human Resources Guide for Small Breweries

Zywave: Hiring and Onboarding

Resource hub, search brewersassociation.org.

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How To Write a Business Plan for Brewpub in 9 Steps: Checklist

By henry sheykin, resources on brewpub.

• Financial Model
• Business Plan
• Value Proposition
• One-Page Business Plan
• SWOT Analysis
• Business Model
• Marketing Plan

The brewpub business model has become increasingly popular in the United States, driven by a growing demand for specialty craft beers. Craft breweries are creating unique and flavorful brews, attracting beer enthusiasts who are willing to pay a premium for quality and taste. According to the Brewers Association, the craft beer market in the US has been experiencing remarkable growth, with a 15% increase in sales volume in 2019.

If you're considering venturing into the brewpub industry, it's essential to have a solid business plan in place. A well-thought-out plan will not only help you navigate the challenges of starting and running a brewpub but also increase your chances of success in this competitive market. In this blog post, we'll outline nine crucial steps to guide you through the process of writing a comprehensive business plan for your brewpub.

Step 1: Research the market and competition

Begin by thoroughly researching the current market trends and competition in the brewpub industry. Understanding your competitors and their offerings will help you identify opportunities for differentiation and potential gaps in the market that you can exploit.

Step 2: Identify your target market

Define your target market by considering factors such as demographics, preferences, and buying behaviors. This information will enable you to tailor your brewpub's offerings to meet the needs and expectations of your intended customers.

Step 3: Determine the location and space requirements

The location of your brewpub can significantly impact its success. Consider factors such as foot traffic, parking availability, and proximity to other businesses or attractions. Determine the amount of space required for brewing, serving, and any additional facilities or amenities.

Step 4: Conduct a feasibility study

A feasibility study will help you assess the viability of your brewpub idea by analyzing market demand, potential revenue streams, and projected costs. This evaluation is crucial for making informed decisions and securing funding.

Step 5: Develop a unique selling proposition

To stand out in the competitive brewpub industry, you need a unique selling proposition (USP). Identify what sets your brewpub apart from others and highlight it in your marketing efforts. This could be your signature brews, a specific theme or atmosphere, or exceptional customer service.

Step 6: Create a comprehensive financial plan

Building a financial plan will enable you to determine the costs involved in setting up and operating your brewpub. It should include details such as startup expenses, ongoing operating costs, pricing strategies, and revenue projections. This plan will assist you in securing funding and managing your finances effectively.

Step 7: Outline your marketing and advertising strategies

Develop a marketing and advertising plan to promote your brewpub and attract customers. Consider incorporating strategies such as social media marketing, local partnerships, events, and loyalty programs. Highlight the unique aspects of your brewpub to differentiate yourself from competitors.

Step 8: Establish your legal and regulatory requirements

Ensure compliance with all legal and regulatory requirements for operating a brewpub. This includes obtaining the necessary licenses and permits, adhering to health and safety regulations, and understanding any specific alcohol-related laws that apply to your location.

Step 9: Formulate a staffing plan

Develop a staffing plan that outlines the roles and responsibilities required to run your brewpub efficiently. Consider factors such as hiring, training, scheduling, and maintaining a positive work culture that aligns with your brewpub's values.

By following these nine steps, you'll lay the foundation for a successful brewpub business. Each step is crucial for creating a comprehensive business plan that will guide your operations, attract investors, and position your brewpub for long-term growth and profitability. Cheers to your brewpub venture!

Research The Market And Competition.

Before starting a brewpub, it is crucial to conduct thorough market research to understand the current trends, preferences, and demands in the craft beer industry. By doing so, you can identify gaps in the market and determine how your brewpub can stand out from the competition.

Here are some key steps to consider during your market research:

• Study the craft beer market: Analyze the growth rate, market size, and potential opportunities in the craft beer industry. Look for statistics, reports, and industry trends to gain insights into consumer preferences and market saturation.
• Analyze the competition: Identify existing brewpubs in your target area and study their offerings, pricing, and branding strategies. This will help you understand what sets them apart and how you can differentiate your brewpub.
• Identify your target audience: Determine the demographics, tastes, and preferences of your potential customers. Understand their motivations for visiting brewpubs and tailor your offerings to meet their needs.
• Perform a SWOT analysis: Assess the strengths, weaknesses, opportunities, and threats associated with your brewpub. This analysis will help you identify areas where you can excel and potential challenges that may arise.

Tips for effective market research:

• Utilize online resources: Explore industry-specific websites, forums, and social media platforms to gather information about consumer opinions, trends, and preferences.
• Attend industry events: Participate in trade shows, seminars, and conferences to network with industry professionals and gain firsthand knowledge about current industry developments.
• Conduct surveys and focus groups: Engage with potential customers through surveys and focus groups to better understand their preferences and expectations. This will help you tailor your offerings to meet their needs.
• Stay updated: Continuously monitor industry news, market research reports, and competitor activities to stay ahead of the curve and adapt your strategies accordingly.

By thoroughly researching the market and competition, you will be equipped with valuable insights that will guide you in making informed decisions when developing your brewpub business plan.

Identify Your Target Market

In order to successfully establish and grow your brewpub business, it is essential to identify your target market. Identifying your target market will help you tailor your products and marketing strategies to attract and retain customers who are most likely to be interested in your specialty craft beers and dining experience.

Here are some important steps to help you identify your target market:

• 1. Conduct market research: Begin by conducting thorough market research to gain insights into the preferences, demographics, and behaviors of potential customers. This will help you understand who your target market is and what their needs and wants are.
• 2. Analyze your competitors: Study your competitors to identify who they are targeting and how they are positioning themselves in the market. This will help you identify gaps and opportunities that you can capitalize on to attract your own target market.
• 3. Define your ideal customer profile: Create a detailed description of your ideal customer, including their age, gender, location, interests, and buying habits. This will serve as a guide when developing marketing campaigns and product offerings.
• 4. Segment your market: Divide your target market into distinct segments based on factors such as demographics, psychographics, and purchasing behavior. This will enable you to tailor your marketing messages and strategies for each segment.
• 5. Consider niche markets: Explore niche markets within the craft beer industry, such as beer enthusiasts, home brewers, or those interested in sustainable brewing practices. Focusing on a specific niche can help you differentiate your brewpub and attract a loyal customer base.

Tips for Identifying Your Target Market:

• Use online surveys, focus groups, and interviews to gather customer feedback and preferences.
• Utilize social media analytics and customer data to identify trends and patterns.
• Attend industry events and conferences to network with potential customers and gain market insights.
• Stay updated on industry trends and consumer preferences to adapt your target market as needed.
• Regularly review and evaluate your target market to ensure your business is meeting their evolving needs and wants.

Determine The Location And Space Requirements

One of the crucial steps in writing a business plan for a brewpub is determining the location and space requirements for your establishment. The location of your brewpub can have a significant impact on its success, so it is important to carefully consider factors such as visibility, accessibility, and proximity to your target market.

When selecting a location, you should research the area to understand the demand for craft beer and the presence of competitors. Look for areas with a vibrant food and beverage scene, high foot traffic, and a strong customer base that aligns with your target demographic.

Besides choosing the right neighborhood, you also need to determine the specific space requirements for your brewpub. Consider the size of the brewing equipment, seating capacity for customers, and the layout of the space to ensure efficient operations. Adequate space is essential to accommodate brewing operations, dining areas, kitchen facilities, storage, and other necessary facilities.

Tips for determining the location and space requirements:

• Visit potential locations during different times of the day to assess foot traffic and overall ambiance.
• Take into account the availability of parking and public transportation options to ensure convenience for customers.
• Consider consulting with an architect or interior designer to optimize the layout of the space.
• Research local zoning and licensing regulations to ensure the location is suitable for operating a brewpub.
• Factor in room for future growth and expansion to accommodate increasing demand.

By carefully determining the location and space requirements for your brewpub, you can create a business plan that demonstrates a clear understanding of your target market and sets the foundation for a successful venture.

Conduct A Feasibility Study

Before diving into the creation of a brewpub business plan, it is crucial to conduct a thorough feasibility study to assess the viability of your idea. This study includes evaluating various factors that will contribute to the success of your brewpub venture.

First and foremost, you need to analyze the demand for craft beers in your target market. Understanding the preferences and trends of your potential customers will help you determine if there is sufficient demand to sustain your brewpub business.

Additionally, it is important to assess the competition in the area where you plan to establish your brewpub. Research existing brewpubs, bars, and breweries in the vicinity to identify their strengths, weaknesses, and unique selling propositions. This information will help you differentiate your brewpub and tailor your offerings to attract customers.

A feasibility study should also include an evaluation of the location and space requirements for your brewpub. Consider factors such as foot traffic, parking availability, proximity to other businesses, and the overall atmosphere of the area. The right location can significantly impact the success of your brewpub.

Furthermore, it is essential to analyze the financial aspects of your brewpub business. This includes estimating the initial investment required, projected revenue, and potential operating costs. By forecasting the financial viability of your venture, you can determine if it is feasible to proceed with your brewpub business plan.

Tips for Conducting a Feasibility Study:

• Engage with potential customers and conduct surveys to gauge their interest in craft beers and brewpub experiences.
• Visit and analyze existing brewpubs in different locations to gain insights into their operations and customer satisfaction levels.
• Consult with industry experts or hire a professional consultant to assist you in conducting a comprehensive feasibility study.
• Consider collaborating with local breweries or suppliers to gather market data and insights.

Conducting a feasibility study will provide you with valuable insights and data to ensure that your brewpub business plan is based on solid foundations. It will help you identify potential challenges and opportunities, enabling you to make informed decisions to set your brewpub up for success.

Develop A Unique Selling Proposition

Creating a unique selling proposition (USP) is crucial for any business, including a brewpub. Your USP sets you apart from competitors and communicates the value your brewpub offers to customers. Here are some key steps to develop a strong and compelling USP:

• Understand your target market: Research and analyze your target market to identify their needs, preferences, and desires. This will help you tailor your USP to resonate with your ideal customers.
• Highlight your unique strengths: Identify what makes your brewpub stand out and emphasize those strengths in your USP. Whether it's using locally sourced ingredients, employing experienced brewers, or incorporating innovative brewing techniques, accentuate the aspects that make your brewpub special.
• Focus on benefits: Instead of solely highlighting features, emphasize the benefits customers can experience by choosing your brewpub. For example, if you have a brewpub that specializes in pairing beers with gourmet food, emphasize the unique dining experience and the ability to indulge in expertly crafted beer and dishes.
• Show differentiation: Clearly articulate how your brewpub differs from others in the market. Whether it's through the use of unique flavors, distinct beer styles, or a cozy and welcoming atmosphere, highlight the factors that set you apart.
• Communicate your passion: Craft a USP that conveys your passion for brewing exceptional beers and providing an exceptional experience. When customers can feel your dedication and enthusiasm, it can help build trust and loyalty.
• Keep it concise: Your USP should be clear, concise, and easy to remember. Avoid lengthy or complicated statements.
• Test it out: Once you've developed your USP, share it with others and gather feedback. Tweak and refine it, if necessary, based on the responses you receive.
• Revise as needed: As your brewpub evolves and grows, periodically review and refine your USP to ensure it continues to resonate with your target market and accurately reflects the unique qualities of your business.

By developing a strong and compelling unique selling proposition, you can effectively communicate the value and differentiation of your brewpub to potential customers, helping drive their interest and ultimately, their patronage.

Create A Comprehensive Financial Plan

Creating a comprehensive financial plan is crucial when starting a brewpub. It provides a clear roadmap for your business's financial success and helps you make informed decisions regarding your budget, pricing, and profitability. Here are key steps to consider:

• Estimate your startup costs: Determine all the expenses needed to launch your brewpub, such as equipment, licenses, permits, and initial inventory. Research and consult with industry professionals to ensure you have an accurate estimate.
• Project your revenue: Develop a sales forecast based on your target market, competition, and pricing strategy. Consider factors like customer demand, seasonal fluctuations, and market trends. Be realistic and conservative to avoid overestimating your potential revenue.
• Calculate your expenses: Identify both direct and indirect costs, including raw materials, brewing supplies, rent, utilities, wages, marketing, and insurance. Remember to account for ongoing costs and any unforeseen expenses that may arise.
• Create a cash flow statement: Project your monthly cash inflows and outflows to track how money moves in and out of your brewpub. This will help you monitor your liquidity, identify potential cash flow issues, and make adjustments as necessary.
• Consider financing options: Explore different funding sources, such as personal savings, loans, investors, or crowdfunding. Evaluate the pros and cons of each option and determine how it aligns with your financial goals and risk tolerance.
• Establish pricing and profitability: Determine how much you will charge for your beers and food items to cover your costs and generate a profit. Research your competition and market trends to ensure your pricing is competitive and attractive to customers.
• Monitor and review your financial performance: Regularly review your financial statements, including balance sheets, income statements, and cash flow statements. Compare your actual results with your projections to identify any discrepancies and make necessary adjustments.
• Consult with a professional accountant or financial advisor to ensure your financial plan is comprehensive, accurate, and aligned with industry standards.
• Consider using financial management software or tools to streamline your budgeting, forecasting, and reporting processes.
• Regularly update and revisit your financial plan as your brewpub evolves and market conditions change.

Outline Your Marketing And Advertising Strategies.

Once you have conducted thorough market research and identified your target market, it is crucial to develop a comprehensive marketing and advertising plan for your brewpub. This will help you effectively promote your brand, attract customers, and create a strong presence in the industry.

The following are key components to consider when outlining your marketing and advertising strategies:

• Branding: Develop a unique and memorable brand identity that reflects the essence of your brewpub. This includes creating a compelling logo, designing appealing signage, and establishing a consistent visual style across all marketing materials.
• Online Presence: In today's digital age, having a strong online presence is crucial for any business. Create a professional website that showcases your brewpub's offerings, menu, events, and contact information. Utilize social media platforms to engage with your target audience, share updates and promotions, and build a community of beer enthusiasts.
• Local Partnerships: Collaborate with local businesses, such as nearby restaurants, hotels, or event organizers, to cross-promote each other's offerings. This can involve hosting joint events, featuring each other's products, or offering exclusive discounts to one another's customers.
• Promotions and Special Events: To attract new customers and keep existing ones engaged, plan promotions and special events. This can include hosting beer tastings, offering limited-edition beers, organizing live music performances, or partnering with local breweries for collaborative brews. Creating unique experiences will set your brewpub apart from competitors.
• Loyalty Program: Implementing a loyalty program can encourage customer retention and repeat business. Offer incentives, such as discounts, exclusive access to new releases, or free merchandise, to reward loyal customers and keep them coming back.
• Traditional Advertising: While digital marketing is essential, don't overlook traditional advertising methods. This can include placing ads in local newspapers, magazines, or radio stations. Consider participating in local community events where you can distribute flyers and promote your brewpub.

Tips for Marketing and Advertising:

• Stay updated with current marketing trends and adapt your strategies accordingly.
• Regularly engage with your customers through social media to build brand loyalty.
• Offer incentives for customers who refer their friends and family to your brewpub.
• Monitor customer feedback and online reviews to address any issues and continuously improve your offerings.
• Consider hosting beer pairing dinners or collaborating with local chefs to attract food enthusiasts.
• Invest in professional photography to showcase the ambience, food, and drinks of your brewpub. High-quality visuals are essential for enticing potential customers.

By outlining your marketing and advertising strategies, you can effectively promote your brewpub, attract a steady stream of customers, and establish a strong presence in the competitive craft beer market. Remember, consistency, creativity, and staying connected with your target audience will be the keys to success.

Establish Your Legal And Regulatory Requirements

When starting a brewpub, it's essential to ensure that you comply with all the relevant legal and regulatory requirements. This will not only help you operate within the confines of the law, but it will also protect your business and its reputation. Here are some steps to help you establish your legal and regulatory requirements:

1. Research Local Laws and Regulations: Familiarize yourself with the specific laws and regulations that govern the operation of brewpubs in your area. This includes obtaining the necessary licenses and permits to legally brew and sell alcohol. Consult with local government agencies, such as the Alcoholic Beverage Control (ABC) board, to understand the requirements and processes involved.

2. Obtain Required Licenses and Permits: Once you have a clear understanding of the legal requirements, start the process of obtaining the necessary licenses and permits. This may include a brewpub license, a liquor license, health permits, food handling permits, and any other permits specific to your location. The application process can vary, so be sure to follow all instructions and submit the required documentation.

3. Build Relationships with Government Agencies: Establish connections with local government agencies and officials who oversee alcohol regulations. This can help you navigate the licensing and permitting processes more smoothly and efficiently. It's also a good idea to maintain open communication with these agencies to stay updated on any changes or updates to the regulations.

4. Understand Tax Obligations: Research and understand your tax obligations as a brewpub owner. This includes sales tax, excise tax on alcohol, and any other applicable taxes. Consult with a tax professional to ensure that you comply with all tax laws and regulations.

5. Implement Safety and Compliance Measures: In addition to regulatory requirements, it's important to prioritize safety and compliance within your brewpub. This includes implementing proper health and safety protocols, ensuring fire safety measures are in place, and maintaining compliance with local labor laws.

• Engage with local professionals such as lawyers and accountants who specialize in the hospitality industry to ensure compliance with all legal requirements.
• Stay updated on any changes or updates to legal and regulatory requirements by joining industry associations or participating in relevant training and conferences.
• Establish a system for record-keeping and documentation to demonstrate compliance with legal requirements.

Formulate A Staffing Plan.

When it comes to running a successful brewpub, having the right team in place is crucial. A strong staffing plan will help ensure that all aspects of the business run smoothly and efficiently. Here are some important considerations to keep in mind as you formulate your staffing plan:

• Consider hiring individuals with a passion for craft beer and experience in the hospitality industry.
• Offer competitive wages and benefits to attract and retain top talent.
• Provide ongoing training and development opportunities to enhance employee skills and knowledge.
• Consider implementing a trial period to assess the suitability of new hires.

By formulating a well-thought-out staffing plan, you can build a talented and dedicated team that will contribute to the success of your brewpub. Remember, your employees are the face of your business and play a crucial role in providing an exceptional customer experience.

In conclusion, writing a business plan for a brewpub requires careful consideration and thorough research. By following the nine steps outlined in this checklist, aspiring brewpub owners can create a solid foundation for their venture. From researching the market and competition to developing a comprehensive financial plan and outlining marketing strategies, each step is crucial for success. Furthermore, establishing legal and regulatory requirements and creating a staffing plan are crucial for ensuring compliance and smooth operations. With a well-crafted business plan, brewpub owners can confidently navigate the complex and competitive craft beer industry and position their establishment for growth and profitability.+

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Brewery Business Plan Guide + Example

July 6, 2023

Adam Hoeksema

In this guide, we will navigate the process of creating a brewery business plan that reflects your  vision and entices potential stakeholders. Rather than viewing it as a chore that your lender may have tasked you with, embrace the opportunity to lay a solid foundation for your brewery's future growth.

Together, we will cover the essential components that make up a comprehensive brewery business plan, empowering you to showcase your brewery, analyze the market landscape, strategize marketing and sales efforts, and develop realistic financial projections. Your potential lenders will want to make sure your brewery plans are realistic and within industry averages as well!

This guide includes the following:

What Should be Included in a Brewery Business Plan?

• Conducting Market Research for Your Brewery Business Plan
• Creating Financial Projections for Your Brewery Business Plan

Example Brewery Business Plan

Brewery business plan faqs.

With that in mind as the path forward, let’s dive in. 

A brewery business plan should compellingly convey to investors and lenders why beer enthusiasts and other customers would prefer your brewery over competitors, why you or your team are the optimum choice to manage the brewery, and how the financial projections are tailored to secure a favorable monetary return on their investment. Below is a detailed blueprint of our complimentary brewery business plan template .

Brewery Business Plan Outline

I. Executive Summary

II. Company Description

III. Market Analysis

IV. Marketing and Sales Strategy

V. Operations and Management

VI. Financial Plan

• Startup Costs and Use of Funds
• Annual Sales, Gross Profit and Net Profit
• Key Financial Ratios
• Financial Summary
• Income Statement Annual Summary
• Cash Flow Statement Annual Summary
• Balance Sheet Annual Summary

VII. Appendix

VII. Conclusion

How to do Market Research for a Brewery Business Plan

Market research forms the backbone of any brewery business plan. Understanding your position within the market and establishing that there is adequate demand for your brewery's unique concept, location, and price range is key. Learn more about our approach to brewery market research here. Essentially, your goal is to grasp your competition, gauge potential customer footfall, identify an optimal location, and anticipate any seasonal fluctuations that could affect your business. You can learn more about our Brewery market research approach here, and below are some useful tools and methods for conducting market research for your prospective brewery.

What Will be the Cost to Advertise my Brewery?

We recommend Google Keyword Planner to aid you in identifying the ideal keywords to promote and attract customers to your brewery's website. This tool also offers an estimate of the cost per click when advertising using different keywords, as shown below:

What Keywords are Customers Using in Their Searches?

We rely on both Google Keyword Planner and Ahrefs to discern which keywords are directing traffic to your competitors' websites. You can run a report on a competitor's website to uncover the keywords they are ranking for and the volume of organic traffic each keyword generates. This information can be pivotal in streamlining your SEO strategy.

How Seasonal are Brewery?

We utilize Google Trends to examine the seasonality of your brewery concept. For instance, it can highlight that "Craft Beer Breweries" might not have stark seasonal patterns, whereas a brewery with a specialty in summer ales might exhibit pronounced seasonal trends.

How Many Customers Do my Competitors Receive Each Month?

Lastly, it's advantageous to generate foot traffic reports for your competitors to gauge the typical number of patrons they serve at their breweries. An example is shown below that presents the number of visits per month for a specific location:

In the end, the projected customer base for your brewery is a key assumption that will be foundational to your financial projections. Therefore, understanding your competitors' patron volumes can assist in estimating the potential traffic to your brewery.

How to Create Financial Projections for a Brewery Business Plan

Now, it's time to translate your market research into meaningful financial projections. Unlike other industries, the art of brewing introduces unique variables that shape revenue projections. While some breweries face capacity constraints, dictated by factors such as available seating, others may be limited by their brewing capacity and the ability to efficiently fulfill orders. Creating accurate financial projections is crucial not only to showcase your brewery's potential to repay loans but also to demonstrate an attractive return on investment to potential stakeholders.

• Estimate startup costs for your restaurant
• Forecast revenue including distribution, tap rooms, brewpub
• Project food, beer, and labor costs
• Estimate your operating expenses like rent and utilities
• Calculate how much investor or loan capital you will need to open

If you use our brewery projection template , you'll be guided through this process, ensuring your projections adhere to the format required by investors or lenders. Typically, startup brewery projections should include an integrated income statement, balance sheet, and cash flow forecast to provide a comprehensive financial overview.

Through thoughtful financial planning and accurate projections, you'll not only showcase the potential profitability of your brewery but also gain the confidence of potential investors and lenders. Let our brewery projection templates assist you in presenting a robust financial plan that sets the stage for a successful brewing enterprise.

Discover our brewery business plan template , available in a customizable Google Doc format, allowing you to tailor it to your specific needs. Accompanied by our video walkthrough, you'll receive guidance on adapting the plan to your unique brewery concept. 

Table of Contents

1. executive summary,  1.1. company overview.

Briefly introduce the company's background, products or services, and target market.

      -  Example: Barrel & Brew Co. is a boutique craft brewery located in Asheville, North Carolina. We are dedicated to producing exceptional handcrafted beers that showcase the artistry of brewing and embody the spirit of the local community. 

   1.2. Objectives

Outlines the company's short-term and long-term goals.

        - Example:  Establish Barrel & Brew Co. as a premier destination for craft beer enthusiasts in Asheville, achieving a 70% taproom occupancy rate within the first year.

        - Example: Long-term: Plan to expand our operations, opening additional taprooms in neighboring cities and maintaining strong customer satisfaction..

  1.3. Mission Statement

 Describes the company's purpose and core values.

        - Example: At Barrel & Brew Co., our mission is to create exceptional craft beers that captivate the senses and foster a sense of community. We are dedicated to promoting the art of brewing, supporting local farmers and artisans, and providing an inviting and educational space where beer enthusiasts can gather, share experiences, and appreciate the craftsmanship behind our beers.

  1.4. Keys to Success

Highlights the factors that will contribute to the company's growth and success.

        - Example: Barrel & Brew Co. thrives on the following key factors for success. We prioritize exceptional craftsmanship, ensuring our craft beers deliver unmatched quality and flavor. Our engaging taproom experience immerses beer enthusiasts through guided tours, tastings, and educational activities. Active community engagement through festivals, collaborations, and charitable support builds a loyal customer base. 

2. Company Description

   2.1. company history.

Provides context on the company's background and founding story.

        - Example: Barrel & Brew Co. was founded by Martin Holts, a passionate brewer with extensive experience in the craft beer industry. Inspired by his love for brewing and the vibrant beer culture in Asheville, North Carolina, Martin set out to create a brewery that would celebrate the artistry and flavors of handcrafted beers. 

   2.2. Legal Structure

 Describes the company's legal structure (e.g., sole proprietorship, partnership, LLC, corporation).

        - Example: Barrel & Brew Co. operates as a limited liability company (LLC)

 2.3. Unique Selling Proposition

  Emphasizes the company's competitive advantage or unique offerings.

        - Example: Barrel & Brew Co. distinguishes itself through its commitment to brewing excellence and innovation. We pride ourselves on crafting high-quality beers that showcase a harmonious blend of traditional brewing techniques and inventive flavors.

  2.4. Target Market

Defines the company's ideal customer base.

        - Example: Barrel & Brew Co. targets beer enthusiasts and craft beer connoisseurs in Asheville, North Carolina, and beyond. Our offerings appeal to individuals who appreciate the artistry, quality, and diverse range of flavors found in handcrafted beers. 

3. Market Analysis

3.1. industry overview.

  Presents a general overview of the industry, its trends, and growth potential.

        - Example: The craft beer industry in Asheville, North Carolina, is thriving, driven by the city's vibrant beer culture, tourism, and a strong community of beer enthusiasts. With a growing demand for high-quality and diverse craft beers, the industry presents significant growth potential for Barrel & Brew Co.

3.2. Competitor Analysis

 Evaluates the company's direct and indirect competitors, as well as their strengths and weaknesses.

        - Example: Direct competitors: Mountain Brew –  a local brewery located in Asheville, North Carolina, specializing in craft beers that celebrate the mountainous region.

        - Example: Indirect competitors: The Hop House – a popular brewpub and restaurant in Asheville, North Carolina. While they brew their own beers on-site, they also offer a wide selection of craft beers from other local and regional breweries. 

3.3. Target Market Analysis

Explores the company's target customers, demographics, preferences, and pain points.

        - Example: Barrel & Brew Co.'s target market includes beer enthusiasts, craft beer connoisseurs, and locals and tourists who appreciate the unique beer scene in Asheville. The target demographic comprises individuals aged 21 and above who seek flavorful, high-quality beers and enjoy exploring different beer styles and flavors.

3.4. Market Opportunities

Identifies potential opportunities for the company to grow within the market.

        - Example: There are several opportunities for Barrel & Brew Co. to thrive in the market. Firstly, by actively participating in local beer festivals, events, and collaborations with other breweries, Barrel & Brew Co. can increase brand visibility and attract new customers. Additionally, partnering with local restaurants and bars to showcase their beers can expand their reach and tap into new customer segments. 

Key Point  1

• Example 1: Conduct a competitor analysis to understand the strengths and weaknesses of existing breweries in the area. (e.g., Identify key competitors' offerings, pricing, and customer reviews to determine potential gaps in the market)
• Example 2:Analyze local beer consumption trends and preferences through surveys and market research. (e.g., Discover that there is a high demand for craft beers with unique flavors and local ingredients in Asheville)

4. Marketing and Sales Strategy

4.1. product or service offerings: .

Describes the company's products or services in detail.

        - Example: Barrel & Brew Co. offers a diverse range of handcrafted beers. Our lineup includes a variety of beer styles, from refreshing lagers to hop-forward IPAs and rich stouts. Each beer is meticulously brewed using high-quality ingredients and crafted to deliver exceptional flavor and aroma.

4.2. Pricing Strategy

 Outlines the company's approach to pricing its products or services.

        - Example: Barrel & Brew Co. employs a competitive pricing strategy that reflects the quality and craftsmanship of our beers while remaining accessible to our target market. 

4.3. Sales Strategy

  Explains how the company plans to generate sales and build

customer relationships.

        - Example:  To generate sales and build strong customer relationships, Barrel & Brew Co. focuses on creating memorable experiences for beer enthusiasts. Our taproom in Asheville, North Carolina, serves as a hub for beer tasting, socializing, and educational events. We prioritize customer engagement by offering guided brewery tours, hosting beer tasting sessions, and providing a welcoming and knowledgeable staff to enhance the overall brewery experience.

4.4. Distribution Channels

 Describes the methods through which the company will deliver its products or services to customers.

        - Example: Barrel & Brew Co. primarily distributes its beers through its taproom in Asheville. Customers can visit the taproom to enjoy our beers on-site, purchase cans or growlers to-go, and engage directly with our team. 

4.5. Promotions and Advertising

 Details the company's promotional efforts and advertising strategies.

        - Example: To increase brand awareness and attract customers, Barrel & Brew Co. employs a multifaceted approach to promotions and advertising. We leverage social media platforms to showcase our beers, engage with our audience, and promote upcoming events. We also collaborate with local food vendors, musicians, and artists to host unique experiences and create cross-promotional opportunities. 

Key Point  2

• Example 1:  Organize a beer tasting event showcasing the brewery's signature brews to attract beer enthusiasts and build brand awareness. (e.g., Attract 300 attendees to the event, generating positive feedback and inquiries about future offerings). Attend local festivals, events, etc to offer beer tastings and sale discounted beers
• Example 2: Collaborate with local restaurants and bars to feature Barrel & Brew Co.'s beers on their menus, expanding the brewery's reach and attracting new customers. (e.g., Secure partnerships with three popular restaurants, resulting in increased sales and customer referrals)
• Example 3: pre-sale “beer of the month” or mugs for a “mug club” to provide a discount for the first year (or lifetime) based on a pre-launch subscription fee
• Example 4: Social Media & Email signups. Build a local (and broader) following by documenting/sharing the process of brewing, building, launching the brewery. Collect emails to provide updates to local supporters

5. Operations and Management

5.1. brewery production.

Involves the brewing process, quality control, and packaging of the beers.

        - Example: Barrel & Brew Co. focuses on producing high-quality beers by adhering to strict brewing standards, conducting regular quality checks, and implementing efficient packaging and labeling processes.

5.2. Inventory Management

Refers to the management of raw materials, brewing supplies, and finished beer inventory.

        - Example: Barrel & Brew Co. maintains a comprehensive inventory management system to monitor stock levels, track ingredient usage, and ensure sufficient supply of brewing materials. This enables us to meet customer demand and optimize production efficiency.

5.3. Taproom Operations

Encompasses the management of the taproom, including customer service, beer pouring, and creating a welcoming atmosphere.

        - Example: Barrel & Brew Co. places a strong emphasis on exceptional customer service and creating a warm and inviting environment in our taproom. Our well-trained staff provides knowledgeable guidance on beer selection, offers a memorable tasting experience, and fosters a sense of community among our patrons.

5.4. Compliance and Regulatory Requirements

Involves adhering to local, state, and federal regulations related to brewing, licensing, health and safety, and responsible alcohol service.

        - Example: Barrel & Brew Co. ensures compliance with all applicable laws and regulations governing the brewing industry. We maintain proper licensing, prioritize health and safety protocols, and promote responsible alcohol service to uphold the highest standards of legal and ethical practices.

Key Point  3

• Example: Martin Holts, the owner of Barrel & Brew Co., has a decade of experience in craft beer brewing, including managing a successful brewery in a different location. His expertise ensures a deep understanding of brewing techniques, quality control, and industry trends.
• Example: The brewery's head brewer, Sarah Thompson, is a renowned expert in the craft beer industry, having won multiple awards for her innovative beer creations. Her expertise brings credibility and a competitive edge to Barrel & Brew Co.

5.5 Staffing and Human Resources

Covers the recruitment, training, and management of a skilled and dedicated team.

        -Example: Barrel & Brew Co. places great importance on hiring passionate and knowledgeable individuals who share our commitment to brewing excellence. We provide comprehensive training programs, offer competitive compensation, and foster a positive work environment to attract and retain top talent in the industry.

5.6. Financial Management

Involves budgeting, accounting, and financial analysis to ensure the brewery's financial stability and profitability.

        - Example: Barrel & Brew Co. maintains a robust financial management system, which includes accurate bookkeeping, regular financial analysis, and strategic budgeting. This allows us to make informed business decisions, manage expenses effectively, and pursue growth opportunities while maintaining financial sustainability.

All of the unique Brewery financial projections you see here were generated using ProjectionHub’s Brewery Financial Projection Template . Use PH20BP to enjoy a 20% discount on the template. 

6. Financial Plan

   6.1. startup costs.

  Provide a detailed breakdown of the total startup costs requirements, and where you plan for those funds to come from. You will also want to breakdown how the startup costs will be used including working capital to cover losses before the business breaks even.

        - Example: Creating a solid financial plan is crucial, and we are taking the necessary steps to ensure the success of Barrel & Brew Co. We have raised $150,000 through personal investment from Matin, and we are working with financial institutions to secure a business loan of around $500,000. By combining these funding sources, we are confident in our ability to meet the startup cost requirements and establish a strong foundation for Barrel & Brew Co. 

6.2. Revenue Projections

Provides an estimate of the company's future revenue based on market research and assumptions.

        - Example:  Barrel & Brew Co. projects $1,367,824 in revenue in the first year. The company anticipates steady growth in revenue over the initial five-year period.

6.3. Expense Projections

 Estimates the company's future expenses, including fixed and variable costs.

        - Example: Barrel & Brew Co.'s expenses include property lease, accounting, advertising, professional services, utilities, and more.

6.4. Profit and Loss Statement

Summarizes the company's revenue, expenses, and net income over a specific period.

        - Example: Barrel & Brew Co. expects to achieve profitability within the first two years of operation.

6.5. Cash Flow Projections

 Outlines the company's projected cash inflows and outflows.

        - Example: Barrel & Brew Co. cash flow projections account for seasonal fluctuations in sales and expenses.

6.6. Break-even Analysis

  Determines the point at which the company's revenue equals its expenses.

        - Example: Barrel & Brew Co. anticipates reaching its break-even point in year 2 of operation.

Watch how to create financial projections for your Brewery

Key Point  4 

• Example 1: Compare financial projections with industry benchmarks for breweries of a similar size and production capacity. (e.g., Aim for a gross margin of 50%, which is within the typical range for craft breweries)
• Example 2:  Consider potential market growth and expansion opportunities in Asheville, factoring in expected revenue increases from increased distribution and taproom sales.

7. Appendix

   7.1. supporting documents.

 Includes any relevant documentation that supports the information presented in the business plan, such as resumes, financial projections, market research data, and permits or licenses.

   7.2. Glossary of Term

 Provides definitions for industry-specific terms used throughout the business plan to ensure reader comprehension.

   7.3. References and Resources

Lists any sources or resources referenced during the preparation of the business plan, including industry reports, market research data, and relevant publications.

Key Point  5

• Example: Martin Holts and his family invest a substantial amount of personal funds into the brewery's startup costs, demonstrating their commitment to the business's success.
• Example: The brewery secures a small business loan backed by the collateral of brewing equipment, showing the willingness to assume financial risk and ensuring the lender's confidence in the venture.

How can I choose the ideal location for my brewery?

When selecting a location for your brewery, consider factors such as the availability of water supply, access to quality ingredients, proximity to your target market, zoning regulations for breweries, space for brewing equipment and storage, and the potential for a taproom or retail area.

What are the steps to start a craft brewery?

Starting a craft brewery typically involves conducting market research, writing a business plan, securing funding, obtaining necessary permits and licenses, sourcing equipment and ingredients, hiring staff, and marketing your brewery.

How can I finance my brewery startup?

There are various options to finance a brewery startup, including self-funding, bank loans, crowdfunding, seeking investment from private investors or venture capitalists, or applying for government grants or incentives.

What permits and regulations do I need to comply with to operate a brewery?

The permits and regulations for operating a brewery can vary depending on your location. Typically, you will need permits related to alcohol production and distribution, licensing for on-site consumption or retail sales, compliance with health and safety regulations, and adherence to labeling and packaging requirements.

About the Author

Adam is the Co-founder of ProjectionHub which helps entrepreneurs create financial projections for potential investors, lenders and internal business planning. Since 2012, over 50,000 entrepreneurs from around the world have used ProjectionHub to help create financial projections.

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How To Write A Comprehensive Brewery Business Plan

Starting a successful brewery is a big dream for many. To achieve this dream, you need to start with a solid brewery business plan.

Your business plan includes everything you need to organize before opening your business, from your business goals and operations to your brewery name, beer menu, and everything in-between. Getting this plan right is one of the most important steps toward your business's success.

In this guide, we’ll outline everything craft breweries should include in their business plan template.

What is a Business Plan?

A business plan is a document that lays out your entire strategy for starting a brewery. This includes business objectives, operations, and how your brewery will be profitable and viable. A business plan is a roadmap you follow when setting up your new venture.

Your business plan must include details of how you will set up your brewery and what you aim to achieve. Doing this helps you prepare for the new challenge and know what to expect throughout the entrepreneurship journey.

Why Do You Need a Brewery Business Plan?

Your business plan ensures you open up your brewery as smoothly and efficiently as possible. It helps you avoid surprises along the way, getting your establishment off the ground by following all the proper steps. A well-thought-out plan will boost the chances of your brewery’s success in a big way.

A brewery business plan is also necessary if you need to secure funding. Nobody will put money behind a new venture without a clear plan on how it will operate and what kind of revenue and profits are projected.

What to Include in Your Brewery Business Plan

There’s a lot to consider when you write a brewery business plan. To help you out, here are some of the essential features to include in this document:

Business Description Section

Start with an executive summary of your business. This should be a description with the basic outline of what your brewery business will look like, what it will do, and why it exists. The executive summary should include details like your brewery name, its purpose for being, and why you want to start it.

Also include the type of brewery you plan to start and the proposed size. Do you imagine a lively beer hall, a country brewery, a trendy gastropub? A clear concept and vision to work toward are essential. You should also include goals that you want to achieve.

The craft brewery industry is highly competitive, so it’s vital that your brewery stands out. Make sure to include your mission statement, what will make your brewery unique, and why this is important.

Business Operations Section

A vital part of the planning process is outlining exactly how your business will operate. When creating a plan for your craft brewery, try to detail exactly how the establishment will work - from sourcing ingredients to selling beer to customers.

Will you have a restaurant in your brewery? Will you sell beer to liquor stores, or will it only be available to consume on-site? If you do sell beer off premises, will you have sales reps? How far around the country do you plan to stock your beer? These are all important things to consider in your business model.

When you write a brewery business plan, include every detail of your operations. Think about transporting your beer, whether your brews will change over seasons, whether you will bottle or can your brews, and so on.

Management and Team Overview

A key part of your brewery business plan is outlining the people behind your business. You will need to have a plan for staffing and management requirements. Who will be in charge of which jobs? Having a clear management and staffing team structure will help you understand your brewery operations realistically.

You will certainly need a head brewer and a general manager. Depending on your business model, you might also need a chef/kitchen manager, a sales manager, and various support staff roles, such as assistant brewers, cooks, bartenders, and wait staff.

As a brewery owner, outline why you are the right fit for the job. Outline your brewery-related qualifications, experience, and interests. Repeat this for any other management positions that you have secured.

Menu Overview

If your brewery is going to be a success, it will need a great product. Carefully planned menus are vital parts of all breweries' business plans. Ideally, you should have already perfected your recipes and have some sample products and home brews available if you need to convince investors.

As a brewery, start with your beverage menu. Outline precisely what brews you will produce.

Will you have a flagship beer that your brewery is known for? Will you offer seasonal or limited-edition beers?

Make sure that the style of beers you brew makes sense to your location and target market. Having tried-and-tested recipes for your beers is essential. You will also need to know exactly what equipment you require for brewing all of your beers.

Then you will probably also need a food or snack menu. Some breweries are known for their food, while others serve light snacks to compliment their beers. Figure out a sample menu for your brewery and match it to your brewery concept. Will you do beer pairings? Will your brewery have a theme (like German or all-American BBQ)?

Again, testing this out and getting feedback on it is crucial. You will also need to make sure you understand the exact kitchen and equipment requirements for your menu.

You might be an amazing brewer with a killer business idea, but choosing the wrong location could be the downfall of your brewery. Location plays a massive role in the success of any brewery so try to be as specific about your location as possible in your microbrewery business plan. Take the time to carefully research different location options.

Ideally, you should open your brewery in an area with minimal competition and high demand. When choosing your business address, look for features like foot traffic, visibility, parking, and a great view. Some breweries are opened as “destination” breweries and could be in a remote or unique area that people want to travel to. Others do well in busy areas full of hungry and thirsty customers, like tourist destinations or shopping malls.

Of course, your brewery space will also need to be large enough to brew beer and seat customers or do tastings. However, some breweries have separate premises for brewing and serving the public.

Market Research

No business plan summary is complete without in-depth local market research. You need to understand your market and target customers. Use this to provide evidence of why your brewery idea will be viable. This should include an analysis of market trends, competitors, and customer segments.

Do some detailed competitive analysis of the area you plan to open your brewery. Understand who your main competitors will be and how your business will be different from them.

You will also need to understand the demand for a brewery. Asking locals and even sending out questionnaires can help here. You could also try to do a market or a “pop-up” brewery event in the area, partnering with another local business. This will help you understand demand and how people react to your craft beers.

Another central bit of market research is to create a detailed target customer persona. This should include your ideal clients' demographics, interests, income, age, and other relevant details.

Your competitive analysis section should also cover the general market price of craft beer and food in your area. When you conduct research, try to visit as many direct competitors as possible to understand how they operate, what they do well, and what you can do better.

A thorough market analysis will give you a good idea of the scale your brewery should operate at, who your potential customers are, and what new markets you could tap into.

Business Structure and Licenses

Outlining how your business will be structured is an integral part of any business plan. This needs to include who the business owners will be.

Some business structures include a sole proprietorship, a partnership, a limited liability company (LLC), and a corporation (C Corp). Choose the structure of your business based on how many people will be involved, how big the company will be, and how it will operate. The proper legal structure can have some significant personal and tax benefits.

When starting a brewery, include a plan for all of the licenses and legalities involved in the business. You will need permits for trading, selling food, and for brewing and selling beer. The specific requirements will differ between states. Contact your local government as early as you can to understand the specific legal requirements for your brewery.

Make sure to include the application process for these licenses in your timeline. You will also need to ensure these licenses, including a brewery license, are possible based on your business location.

Equipment and Setup

There’s a lot that goes into a brewery. Part of your brewery business plan is figuring out all the necessary equipment. This should be related to your menu, your brewery size, location, and how you plan to operate.

When planning your brewing equipment, consider the volume of beer you need to brew and have a clear plan for how you will be able to sell this. Your brewing capacity needs to be just right in terms of your business demand. If your capacity is too large, it will result in wastage. If it is too small, your brewing process won’t be able to hit demand, and you will miss out on revenue.

Beyond your brewing equipment, you might need kitchen equipment, a bar, tables and chairs, booths, glasses, a POS system , a coffee machine… the list goes on. Try to list every piece of equipment required for starting your business - from your mash tun right down to your coasters. All of these items need to be planned and accounted for. Getting this accurate is necessary for understanding what our realistic startup costs will be.

This might be quite a stressful part of our business plan, but it’s one of the most important things for all startups and small businesses to get right. Your brewery business plan must include accurate startup costs, predicted income statements, and financial projections. Quite simply, you will need to establish:

• How much capital is required to get the brewery started
• How much it will cost to operate the brewery
• How much revenue you can realistically expect to make each month (and year) after starting the business
• How much profit you will be able to generate

It seems simple enough, but a lot goes into this. You will need a clear profit and loss statement, realistic cash flow statements, and a pricing strategy that will work.

You also need to consider your cash reserves (you might not make a profit for a few months) and your stock and inventory. There is also packaging, software tools (accounting software, POS software, restaurant management software , etc.), payroll, and production costs. Let’s not forget to consider loan repayments, insurance, and other ongoing expenses.

If you pitch to potential investors or want to secure bank loans, you will need your financial plan to be absolutely watertight. This is what determines how viable your business idea is.

How will you attract customers once your business is open? You will need a clear marketing strategy. This could include a strong web presence , social media marketing, special promotions, eye-catching signage, a well-placed chalkboard, collaborations with other businesses, and more.

When establishing your marketing plan, keep your target customers in mind. The channels and strategies that your marketing plan includes will need to align with their interests.

Following these steps to draw up your business plan template should cover all the necessary details. Just remember that your brewery business plan is a working document. Dedicate enough time to creating your plan, and constantly update and improve it as you learn more about the market and industry.

Plan to host private events at your brewery? Get in touch with Perfect Venue to learn more about our event management software designed for breweries, independent restaurants, and hospitality groups.

Have thoughts on the article? Feel free to email us at [email protected] - we'd love to hear it!

Brewery Business Plan Template

Written by Dave Lavinsky

You’ve come to the right place to create your brewery business plan.

We have helped over 10,000 entrepreneurs and business owners create business plans and many have used them to start or grow their breweries.

Below is a brewery business plan example to help you write your brewery business plan:

Executive Summary

Business overview.

Mountain Craft Beer is a startup brewery located in Boulder, Colorado. The company is founded by Richard and Susan Williams, long-time craft beer enthusiasts who are ready to venture out and start their own brewing business. Richard has worked as a Brewmaster in a local brewery for over ten years. He has a Bachelor of Science degree in Food Science from the University of Colorado. Susan has a Masters degree in Business Administration from the University of New York. She has worked as a General Manager for a local restaurant and bar for the past five years. Now that the duo has obtained the experience and knowledge needed to run a craft beer business, Richard and Susan are ready to start a brewery of their own. Richard is confident in his ability to to manage the brewing process, while Susan is ready to take on the leadership role and manage all aspects of business operations. Richard and Susan will recruit a team of highly qualified professionals to help manage the day to day complexities of running a craft brewery – marketing and sales, accounting and budgeting, customer service, product management, and quality control.

Mountain Craft Beer will make unique craft beers that patrons can enjoy onsite or purchase through distributors. The Mountain Craft Beer brewery will provide a fun taproom tasting experience for guests to try out new brews. Mountain Craft Beer will be the ultimate choice in Boulder for its specialty craft beers made with premium locally sourced ingredients.

Product Offering

The following are the products and services that Mountain Craft Beer will provide:

• Craft beer tasting
• Barrel-aged beer
• Seasonal IPAs
• Seasonal Ales
• Branded merchandise and apparel

Customer Focus

Mountain Craft Beer will target all individuals over the age of 21 in Boulder, Colorado. They will target locals and tourists. They will also target all beer-drinkers from seasoned connoisseurs to individuals brand new to craft beer, and everyone in between. No matter the customer, Mountain Craft Beer will deliver the best customer service, unique product offerings, and craft beer tastings led by friendly, knowledgeable staff.

Management Team

Mountain Craft Beer will be owned and operated by Richard and Susan Williams, long-time craft beer enthusiasts who are ready to venture out and start their own brewing business. Richard has worked as a Brewmaster in a local brewery for over ten years. He has a Bachelor of Science degree in Food Science from the University of Colorado. Susan has a Masters degree in Business Administration from the University of New York. She has worked as a General Manager for a local restaurant and bar for the past five years. Now that the duo has obtained the experience and knowledge needed to open their own business, Richard and Susan are ready to start a craft brewery of their own. Richard is confident in his ability to to manage the craft brewing process, while Susan is ready to take on the leadership role and manage all aspects of business operations.

Success Factors

Mountain Craft Beer will be able to achieve success by offering the following competitive advantages:

• Friendly, knowledgeable, and highly qualified team of brewing professionals that will create unique flavors and blends, lead tasting experiences, and serve as informative guides providing the best customer service around.
• Unique product selection made with premium locally-sourced ingredients. New beers will be introduced each month and rotating seasonal selections will be renewed based on popularity.
• Mountain Craft Beer will be able to offer the best pricing in town because they will save on shipping costs by using local suppliers. The savings will be passed on to customers.

Financial Highlights

Mountain Craft Beer is seeking $500,000 in debt financing to launch its brewery business. The funding will be dedicated towards securing the facility and purchasing brewing equipment and supplies. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and association memberships. The breakout of the funding is below:

• Build-out of the facility: $100,000
• Brewing equipment, supplies, and ingredients: $240,000
• Three months of overhead expenses (payroll, rent, utilities): $140,000
• Marketing costs: $10,000
• Working capital: $10,000

The following graph below outlines the pro forma financial projections for Mountain Craft Beer.

Company Overview

Who is mountain craft beer.

Mountain Craft Beer is a newly established craft brewing company in Boulder, Colorado. Mountain Craft Beer will be the ultimate choice for craft beer enthusiasts in the area. Mountain Craft Beer will provide an exclusive selection of craft beers, with new editions being introduced monthly and rotating seasonal selections that will be renewed based on popularity. Their exclusive, customer-centric approach combined with their use of locally sourced ingredients will make them a unique alternative to the typical craft beer experience. Mountain Craft Beer will be able to cater to their customers with unique product offerings and informative beer tasting events led by a team of highly qualified brewers. Mountain Craft Beer’s mission is to provide a fun and welcoming experience for its customers while delivering highly sought after creations that can’t be found anywhere else.

Mountain Craft Beer History

Mountain Craft Beer is owned and operated by Richard and Susan Williams, long-time craft beer enthusiasts who are ready to venture out and start their own brewing business. Richard has worked as a Brewmaster in a local brewery for over ten years. He has a Bachelor of Science degree in Food Science from the University of Colorado. Susan has a Masters degree in Business Administration from the University of New York. She has worked as a General Manager for a local restaurant and bar for the past five years.

Since incorporation, Mountain Craft Beer has achieved the following milestones:

• Registered Mountain Craft Beer, LLC to transact business in the state of Colorado.
• Has a contract in place to lease the brewing facility.
• Reached out to numerous contacts to include craft beer enthusiasts, former customers, and friends and family networks to create excitement for the new brewery.
• Began recruiting a staff of brewers, sales associates, and marketing professionals to work at Mountain Craft Beer.

Mountain Craft Beer Services

Industry analysis.

The global craft beer industry is valued at $95BM. Beer is known for being the oldest and most broadly consumed beverage in the alcoholic category worldwide. The craft beer segment of the retail beer market in the United States has been growing steadily over the past ten years. In 2012, craft beer accounted for approximately 10% of the market. By 2021, this number increased to 26.8% of the market.

The U.S. brewery industry first became popular in the 2000s and hasn’t stopped growing since then. In 2006, there were approximately 1,400 breweries across the country. As of 2020, this number has grown to over 9,000.

The primary driver for growth in the United States craft beer market is the public’s increasing desire to find new and innovative drinks. The three most popular types of craft beers are pilsner, ale, and lager. Lager is the most popular of the three. Craft brewery industry operators can maintain a competitive advantage in the market by producing unique flavors and catering to their customers’ tastes.

Customer Analysis

Demographic profile of target market.

The precise demographics for Boulder, Colorado are:

Customer Segmentation

Mountain Craft Beer will primarily target the following customer profiles:

• Residents 21 and over of Boulder, Colorado and surrounding areas
• Tourists 21 and over of Boulder, Colorado and surrounding areas
• Craft beer connoisseurs and enthusiasts (21 and over)
• Craft beer newbies (21 and over)

Competitive Analysis

Direct and indirect competitors.

Mountain Craft Beer will face competition from other companies with similar business profiles. A description of each competitor company is below.

Boulder Brewery

Boulder Brewery is a newly established craft beer brewery and gastropub located in Boulder, Colorado. Boulder Brewery is owned and operated by a team of professional brewmasters and chefs. The brewery offers onsite craft beer tastings and has a full restaurant open seven days per week. Boulder Brewery also sells its craft beer to distributors. The brewery promises to provide unique flavor blends and premium exotic ingredients.

BC Craft Beer Company

BC Craft Beer Company is a Colorado-based brewery that provides fresh craft beer blends. BC Craft Beer Company provides a comprehensive menu of ales, pilsners, lagers, and other beers on site and available to order online. The owners of BC Craft Beer Company are former brewmasters so they understand how to create fine craft beers from scratch. Customers can depend on their unique brewing process to achieve one-of-a-kind drinks. By choosing BC Craft Beer Company customers know they are getting the highest quality ingredients and specialty beverages they can brag about. BC Craft Beer Company uses holistic inspections and quality control measures to ensure each batch exceeds the most stringent quality standards.

Crafty Colorado Brews

Crafty Colorado Brews is a trusted Colorado brewery that provides superior service to patrons in Boulder, Colorado and the surrounding areas. The company makes small batches of seasonal drinks onsite. Products include pale ales, pilsners, and lagers. Crafty Colorado Brews hosts craft beer tasting events onsite and also distributes its products to local restaurants and liquor stores.

Competitive Advantage

Mountain Craft Beer will be able to offer the following advantages over their competition:

• Friendly, knowledgeable, and highly qualified team of brewing professionals that is able to create high quality, unique flavors using locally sourced ingredients and cater to customers’ preferences.
• New flavors developed each month and rotating seasonal selections that are renewed based on popularity.
• Mountain Craft Beer offers the best pricing in town. Their pricing structure is the most cost effective compared to the competition.

Marketing Plan

Brand & value proposition.

Mountain Craft Beer will offer the unique value proposition to its clientele:

• Highly-qualified team of skilled employees that is able to lead fun tasting events and provide insightful information to craft beer enthusiasts and novices alike.
• Unbeatable pricing to its customers – Using local suppliers allows the company to save on shipping costs and pass these savings on to its customers.

Promotions Strategy

The promotions strategy for Mountain Craft Beer is as follows:

Word of Mouth/Referrals

Richard and Susan Williams have built up an extensive network of craft beer enthusiasts and industry professionals. They plan to leverage this network to help them promote the new brewery.

Professional Associations and Networking

Mountain Craft Beer will become a member of Colorado Brewers Guild, Brewers Association, and the Master Brewers Association of the Americas. They will focus their networking efforts on expanding their customer network.

Print Advertising

Mountain Craft Beer will invest in professionally designed print ads to display in programs or flyers at industry networking events, magazines, direct mailers, and newspapers.

Website/SEO Marketing

Mountain Craft Beer will utilize an in-house marketing director to design the company website. The website will be well organized, informative, and list all of Mountain Craft Beer’s current product offerings. The website will also list contact information and upcoming tasting events.

The marketing director will also manage Mountain Craft Beer’s website presence with SEO marketing tactics so that anytime someone types in the Google or Bing search engine “Colorado craft beer” or “brewery near me”, Mountain Craft Beer will be listed at the top of the search results.

Social Media/Influencers

The marketing director will create a brand presence across multiple social media platforms such as Facebook, Instagram, Twitter, and TikTok. These accounts will be updated regularly to maintain an active social media presence. The company will work with social media influencers who will help to promote its products.

The pricing of Mountain Craft Beer will be moderate and slightly lower than competitors so customers feel they receive value when purchasing craft beer from the company.

Operations Plan

The following will be the operations plan for Mountain Craft Beer.

Operation Functions:

• Richard Williams – Co-owner and Brewmaster who will oversee all brewing staff and manage the product development process.
• Susan Williams – Co-Owner and Operations Manager who will oversee all staff (outside of brewers) including sales, marketing, accounting, and maintenance employees.
• Ben Smith – Staff Accountant will provide all client accounting, tax payments, and monthly financial reporting.
• Michelle Miller – Marketing Director who will provide all marketing promotions for Mountain Craft Beer.
• John Davis – Maintenance Director who will provide all maintenance for the facility.

Milestones:

Mountain Craft Beer will have the following milestones complete in the next six months.

8/1/2022 – Finalize contract to lease facility

8/15/2022 – Finalize personnel and staff employment contracts

9/1/2022 – Begin build-out of the brewery

9/15/2022 – Begin networking at industry events

9/22/2022 – Begin moving into the facility

10/1/2022 – Mountain Craft Beer opens its brewery for business

Financial Plan

Key revenue & costs.

The revenue drivers for Mountain Craft Beer are the fees charged to customers in exchange for the products and fees charged to enter exclusive tasting events.

The cost drivers will be the overhead costs required in order to staff a brewery. The expenses will be the payroll cost, rent, utilities, craft beer ingredients, and marketing materials.

Funding Requirements and Use of Funds

Key assumptions.

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.

• Number of Beers Sold Per Month: 3,000
• Average Fees per Month: $15,000
• Office Lease per Year: $100,000

Financial Projections

Income statement, balance sheet, cash flow statement, brewery business plan faqs, what is a brewery business plan.

A brewery business plan is a plan to start and/or grow your brewery business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can  easily complete your brewery business plan using our Brewery Business Plan Template here .

What are the Main Types of Breweries?

There are a number of different kinds of breweries, some examples include: Microbrewery, Nano brewery, Brewpub, Taproom Brewery, Regional Brewery, and Contract Brewing Company.

How Do You Get Funding for Your Brewery Business Plan?

Breweries are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding. 

This is true for a brewery business plan, microbrewery business plan, or a craft brewery business plan

What are the Steps To Start a Brewery Business?

Starting a brewery business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Brewery Business Plan - The first step in starting a business is to create a detailed craft brewery business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.  

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your brewery business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your brewery business is in compliance with local laws.

3. Register Your Brewery Business - Once you have chosen a legal structure, the next step is to register your brewery business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your brewery business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Brewery Equipment & Supplies - In order to start your brewery business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your brewery business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful brewery business, brewery business planning and crafting a beer business plan :

• How to Start a Brewery Business
• How to Start a Brewery

Where Can I Get a Brewery Business Plan PDF?

You can download our free brewery business plan template PDF here . This is a sample brewery business plan template you can use in PDF format.

Brewery Business Plan Template

Written by Dave Lavinsky

Starting a brewery business plan? Let us help you get started with your business planning and tap into your potential for growing a successful business.

Over the past 20+ years, we have helped over 5,000 entrepreneurs and business owners create business plans to start and grow their breweries. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a brewery business plan step-by-step so you can create your plan today.

Download our Ultimate Brewery Business Plan Template here >

What Is a Business Plan?

A business plan provides a snapshot of your brewery or microbrewery as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan

Source of Funding for Breweries

With regards to funding, the main sources of secure funding for a brewery are bank loans and angel investors.

Banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable, but they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business.

Angel Investors

The second most common form of secure funding for a brewery is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding or, like a bank, they will give you a loan. Venture capitalists will generally not fund a brewery. Private equity investors would consider a brewery or microbrewery business plan for funding if it has already reached a considerable scale.

Creative Funding Example

Liam Mulhall, CEO of Blowfly Beer, developed a customer base before a single drop of beverage had been brewed. He used the internet to include customers in the design process, allowing them to vote on everything from the label design to the ingredients. Throughout the process, he developed a loyal group of over 10,000 customers before he even began operating. In addition to selling Blowfly Beer, Mulhall also sold equity in his company to these customers-every time they bought a carton!

Blowfly’s innovative strategy had other benefits, as well. Because of the unique offering, they developed a sales base of very loyal customers, and their advertising expenses were essentially zero. Word of mouth allowed them to promote their registered customer base from an initial 140 people (friends of the founders) to more than 10,000. These customer-owners eventually began to receive dividends based on the sales of the beer. This created a further incentive to buy, drink, and recommend Blowfly to their friends.

Finish Your Business Plan Today!

How to write a brewery business plan.

All business plans should include the following 10 sections:

Executive Summary

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of brewing company you are operating and the status; for example, are you a startup, do you have a craft brewery that you would like to grow, or are you operating a chain of brewpubs.

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the craft brewery industry. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing strategy and plan. Identify the key members of your team. And offer an overview of your financial plan.

Company Analysis

For example, you might operate one of the following 6 core types of breweries:

• Microbrewery: which is a brewery that produces less than 15,000 barrels of beer per year and sells 75% or more of its beer off-premises.
• Nano brewery: a brewery that produces less than 15,000 barrels of beer per year
• Brewpub: which is a restaurant-brewery combination that sells 25% or more of its beer on-site and offers food service
• Taproom Brewery: which sells 25% or more of its beer on-site, but does not offer food services
• Regional Brewery: a brewery that has annual beer production of between 15,000 and 6,000,000 barrels
• Contract Brewing Company: a business that contracts with another brewery to produce its beer

In addition to explaining the type of brewery you operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to questions such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include sales goals you’ve reached, new store openings, etc.
• Your business structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

While this may seem unnecessary, it serves multiple purposes.

First, researching the brewing industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards lighter beer consumption, it would be helpful to ensure your plan calls for plenty of lighter brew options.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your brewery business plan:

• How big is the brewery business (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your brewery. You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local or regional population.

Customer Analysis

The following are examples of customer segments: college students, sports enthusiasts, soccer moms, techies, baby boomers, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of brewery you operate. Clearly, baby boomers would want a different atmosphere, pricing, and product options, and would respond to different marketing promotions than college students.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the customers you seek to serve. Because most breweries primarily serve customers living in the same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

With regards to direct competition, you want to detail the other breweries with which you compete. Most likely, your competitors will be other breweries and brewpubs located in your region.

Indirect competitors are other options that customers have to purchase from you that aren’t in the same target market or industry but may offer similar products or services. This primarily includes restaurants (for brewpubs) and other products (spirits, wine) for microbreweries. You need to mention such competition to show you understand that not everyone who drinks alcohol frequents a brewery.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What products do they offer?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide superior brewery products or services?
• Will you provide brewery products that your competitors don’t offer?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

Marketing Plan

In the product section, you should reiterate the type of brewery that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, will you brew IPAs, pilsners, stouts, etc.?

Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections, you are presenting the menu items you offer and their prices.

Place refers to the location of your brewery. Document your location and mention how the location will impact your success. For example, is your brewery located next to a heavily populated office building, or gym, etc.? Discuss how your location might provide a steady stream of customers. Also, if you operate or plan to operate kiosks, detail the locations where the kiosks will be placed.

The final part of your brewery marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

• Making your brewpub’s front store extra appealing to attract passing customers
• Establish a web presence
• Social media marketing
• Event marketing
• Advertising in local papers and magazines
• Reaching out to local bloggers and websites 
• Local radio advertising
• Banner ads at local venues

Operations Plan

Everyday short-term processes include all of the tasks involved in running your brewery such as brewing beer, serving customers, procuring supplies, keeping the store clean, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to serve your X,000th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch in new markets.

Management Team

Ideally, you and/or your team members have direct experience in the brewery business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in breweries and/or successfully running retail and small businesses.

Financial Plan

Income Statement

An income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to create a sales forecast. For example, will you serve 100 customers per day or 200? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheet

While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $100,000 on building out your brewery, that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement

Your projected cash flow statement will help determine how much money you need to start or grow your business and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt. For example, let’s say a company approached you with a $100,000 brewing contract, that would cost you $50,000 to fulfill. Well, in most cases, you would have to pay that $50,000 now for supplies, brewing equipment rentals, employee salaries, etc. But let’s say the company didn’t pay you for 180 days. During that 180 day period, you could run out of money.

In developing your Income Statement and Balance Sheets be sure to include several of the key start-up costs:

• New location build-out including design fees, construction, etc.
• Cost of brewing equipment
• Cost of ingredients and maintaining an adequate amount of supplies
• Payroll or salaries paid to staff
• Business insurance
• Taxes and permits
• Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your store design blueprint or location lease.

Micro Brewery Business Plan Conclusion

Putting together a business plan for your brewing company is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the brewery and microbrewery business, your competition, your business operations, and your potential customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful brewery.

To further help you, we have other articles on key aspects of how to start your brewery . and running it effectively. Specifically, our brewery marketing plan will help you develop the best promotions strategy. Our brewery startup costs post will let you know what costs to expect.

Microbrewery Business Plan FAQs

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You can download our example brewery business plan PDF template here . This is a sample business plan template you can use in PDF format.

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Brewery Business Plan

Things to Consider Before Writing a Brewery Business Plan

Now you might want to get started as soon as possible. But before you start working on your business plan keep the following things in mind:

Decide on a menu and acquire resources

Though a lot depends on individual demands, having a certain set of items and proportions that work is important for a brewery business.

Moreover, it is also important to know what works best for the majority of your customers so you can have a handy set of ingredients.

Above all, you need to maintain a combination of quality and cost-effectiveness while acquiring ingredients for your brewery.

Stay up to date with your consumer’s preferences

The main purpose of a brewery is to provide a quality customer experience. What sets a brewery apart from a usual bar is the experience that comes with selecting your ideal flavors and proportions.

Hence, knowing what your customers want, things that influence their tastes, and what motivates them to change is essential for your business to succeed.

Know your competitors

Knowing what your competitors are doing is essential to do better than them. The brewery business is huge but it is also very competitive at the same time.

Hence, it is essential to stay a step ahead of your competitors for your business to thrive.

Write Your Business Plan

Reading sample business plans will give you a good idea of what you’re aiming for. It will also show you the different sections that entrepreneurs include and the language they use to write about themselves and their business plans.

We have created this brewery business plan  template for you to get a good idea about how perfect a brewery business plan should look and what details you will need to include in your stunning business plan.

Then again it’s no surprise because the demand for unique and different things is growing irrespective of the business. And a brewery can offer just that for beers.

Brewery Business Plan Outline

This is the standard brewery business plan outline which will cover all important sections that you should include in your business plan.

• Mission Statement
• Vision Statement
• Products and Services
• Customer Focus
• Management Team
• Keys to Success
• 3 Year profit forecast
• Startup cost
• Industry Analysis
• Market Trends
• Market Needs
• Target Market
• SWOT Analysis
• Marketing Strategy
• Ongoing Customer Communications
• Pre-Opening Events
• Online Marketing
• Pricing Strategy
• Operation Functions
• Administrative Functions
• Important Assumptions
• Brake-even Analysis
• Profit Yearly
• Gross Margin Yearly
• Projected Cash Flow
• Projected Balance Sheet
• Business Ratios

After getting started with Upmetrics , you can copy this sample brewery business plan template into your business plan and modify the required information and download your brewery business plan pdf or doc file.

It’s the fastest and easiest way to start writing your business plan.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

Download a sample brewery business plan

Need help writing your business plan from scratch? Here you go;  download our free brewery business plan pdf  to start.

It’s a modern business plan template specifically designed for your brewery business. Use the example business plan as a guide for writing your own.

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Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

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Brewery Business Plan

There is no question that there has been an increase in the number of craft breweries around the United States over the last several years. In 2018 alone,  1,049 new breweries opened  while 219 closed their doors forever. With over 25.9 million barrels of craft beer sold in 2018, commanding over $27.6 billion in revenue, there’s no wonder that entrepreneurs are launching more breweries than ever. Unfortunately, setting up a brewery can be expensive. Often, entrepreneurs must seek the funds of investors to support the launch of their craft beer business. To meet and attract investors, they need a strong brewery business plan that supports their case and showcases the potential of their idea.

Writing a business plan for a brewery is a bit different than writing for other types of businesses. Even when compared to other food & drink venues, breweries have several unique factors that should be addressed as a strategy is devised.

In the following post, we will explain everything you need to know about creating an awesome investor-ready brewery business plan.

Download our winning brewery business plan template here!

The Brewery Business Plan Format

The layout for a brewery plan will typically follow that of a standard business plan. However, because of the unique nature of a brewery business, the approach to each section may be considerably different. Here are a few tips as you write through each section of your brewery business plan.

Executive Summary

Seed and  pre-seed investors  receive business plans constantly, and often, they don’t make it through the first few pages. The executive summary is probably the most critical part of your document. Essentially, this summary is the pitch that sells investors on reading the rest of the plan! With so many breweries launching, your executive summary must effectively explain what makes your brewery special. After reading your summary, investors should be able to clearly recognize what factors make your brewery unique and why consumers would choose to patronize your establishment over another. In general, your executive summary should sum up the major concepts that are explained throughout your plan. If delivered successfully, investors will be excited to continue reading your plan. *Tip*  Although the executive summary is presented first in your brewery business plan, you should write it last. This way, you can ensure that it follows your strategy perfectly and that it mentions all notable details.

Brewery Details

This section introduces readers to your brewery concept and the products that it will offer. There are four major parts to a brewery details section: 1) Description:  Explain how the brewery concept was conceived and the milestones that have been achieved to date. Milestones can include things such as finding a location, securing advisors, or establishing beneficial relationships. 2) Mission Statement:  Write a statement that explains what your brewery stands for, who it serves, its beliefs towards quality craft beer production, and the type of experience you hope to provide to guests. 3) Products & Services:  List out the different products and brands you serve. Explain what makes these products unique from competitive breweries. Whether your product is more flavorful or fresher, this is the section to describe why your product is special – if it is in fact special. Don’t just stop at the product itself, but also consider the type of unique experience that your customers can expect when frequenting your brewery. 4) Key Success Factors:  This section describes the factors that must be accomplished in order for you to successfully launch and operate a brewery. Major key factors for brewery success include things like finding the right location, having the right brewing process, choosing the right equipment, and building a repeat customer base.

Market Research

Unfortunately, not every market is ripe for a brewery. In some markets, there just aren’t enough ideal consumers to keep a brewery at a meaningful capacity. It’s important to know who your customers are, how many of them exist within your specific region, and how many you can attract to your brewery each day, week, or month. Start your research by performing a  target market analysis  to estimate the size of your serviceable obtainable market. Unless you can find the research to prove that there is both a large market and a high demand for a brewery, investors will hesitate to invest their capital. Assess the demographics of your target consumer. Use research from reliable resources like the Census to accurately estimate how large your market really is.

Competitive Analysis

No matter how great your beer is, your brewery will face some level of competition. Even if you are the only brewery in town, competition will come from local bars, restaurants, and local stores that sell craft beer. On a secondary level, there will also be competition from distributors of mass-produced domestic and imported beers. Make sure you identify all of your players within your local competitive landscape. Assess what customers enjoy about these venues and what they dislike.  Perform a SWOT analysis  on your brewery business and detail the advantages you have over other breweries, bars, beer suppliers.

Marketing Strategy

Having the best brewery in town is meaningless if you can’t get customers through the door. Unfortunately, just existing isn’t enough – competition in the food & beverage industry is usually quite extreme and customers have many options to choose from. Decide how you will introduce your brewery to potential customers. Whether it’s local marketing with newspaper ads in a community newspaper or directory, or online using social media – an effective strategy must be implemented to succeed. Consider how you will market your brewery, how much you will invest into each method, and how many customers you will attract with your intended budget. Furthermore, answer the following questions:

• How will you ensure that customers are satisfied enough to give your brewery great ratings and reviews?
• How can you upsell to help increase the value of each customer on each visit?
• How can you ensure that customers will return to your brewery on an ongoing basis?

Operational Strategy

Planning a brewery is tough, but operating one is far more challenging. There are many factors that go into operating a brewery on an everyday basis. The operational strategy for your brewery plan should include the following elements:

• Location:  Explain where your brewery will be located, how big the facility will be, why it is the perfect location, how you will renovate the location, and more.
• Quality Control:  Maintaining product quality is essential for a brewery. Failure to stay on top of things could lead to food inspection violations. Detail the steps you will take to ensure that a high-quality standard is met at all times.
• Customer Service:  Breweries are service-based businesses, too. Customer service is key to ensuring that visitors are satisfied enough to return in the future. Describe how you will deal with customer service and how you will handle any customer complaints.
• Sales Process:  Explain the process of how a customer receives your product from the moment they walk into the door. Who seats them? Who serves them? How are they served? How is payment collected? What happens after they leave?
• Staffing:  Lastly, explain your staffing plan. Consider each individual you will need to hire to operate your brewery properly. When will you hire them? How will you train them? How much will you pay them?

Financial Projections

Finally, investors want to see the financial viability and potential of your brewery. Prior industry research should help you minimize assumptions as you build your financial model. Once you have identified all major expenses (such as equipment and staffing), be sure to identify minor expenses, too (such as equipment maintenance, cleaning supplies for the bathroom, soap to wash dishes with, and etc.). Your financial model should be realistic and should replicate the strategies described in your brewery business plan. It should showcase realistic growth, and should be based on real data and statistics – not fluffed up with too many unproven assumptions.

Special Considerations

While the  business plan format  of a brewery plan may be similar to every other plan, there are several special considerations that must be made. There are some challenges that are exclusive to food & beverage businesses, and some that are exclusive to breweries specifically. Here are three special considerations you should make when writing your brewery plan.

Pay Attention to the Details

Breweries have only recently began to explode across the country. Investors will either be experienced with breweries and extremely familiar with the associated details, or they will be clueless about what it takes to run a brewery. Either way, it is important that you are able to consider and communicate each detail clearly. Interview brewery owners who are not competitors – such as those operating in other regions. Ask if they can share their experience and have them look over your financials to make sure you aren’t forgetting anything. When starting a brewery, research is everything – and sometimes, you won’t find all the answers through an online search. Build relationships within the industry and use those relationships to to your advantage as you plan your brewery.

Consider the Community

Knowing your customer is essential to establishment and growth. The most loyal customers will generally come from the surrounding community. The better you know the community, the more effective you will be in serving your customers. Look into other food & beverage businesses that have launched within the area. Pay special attention to the ones that didn’t succeed. What factors led to their success? Why did other bars and restaurants succeed instead? Interview potential customers within the community. Ask them what they like about current options and what they’d like to see in a new brewery. The feedback will not only help you develop a business that the community supports, but it will also help you validate your concept to investors.

Know Your Numbers

If there’s one thing you want to be extremely detailed about – it’s your numbers. Finding out that your strategy isn’t viable during the business planning process may sting, but finding it out post-launch can completely derail your business. Every financial model will have some level of assumption built into it. Having too many assumptions though will turn a brewery financial model into a pipedream. When you write your brewery business plan, research as deeply as you can to find out the real numbers associated with starting and running your business.

Need Help With Your Brewery Business Plan?

Writing a brewery business plan can be an extensive challenge for an entrepreneur. At ThinkLions, we have written dozens of business plans for breweries and other food & beverage businesses – and we know what it takes to get your brewery funded. Need help?  Contact us  today and let us help you write the best brewery business plan possible!

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Key Elements of a Brewery Business Plan

Whether you’re in the initial phases of starting a brewery or looking for expansion opportunities to grow your brewery’s footprint, a business plan can help you get there. The business plan is a written document that outlines every detail of your brewery business. It includes goals, products and inventory, organizational structure, sales, accounting, and more.

Before hitting the ground running, it’s important to understand where your business sits currently. Then create a plan for what you want to achieve over the next few years. A business plan not only allows you and your team to be on the same page but also offers a look behind the curtain for potential investors or loan providers you might be considering for additional funding .

Keep in mind that your business plan shouldn’t be set in stone. As your brewery grows, you may need to tweak and pivot your growth plans — and that’s alright! Think of your brewery’s business plan as a living document that needs to be updated annually to align with your growing company.

As you navigate this guide, fill out and share this free business plan worksheet to set goals for your brewery in stone.

Table of contents

Executive summary, company description & analysis, market analysis, organizational structure, product inventory, marketing and sales, funding request, financial projections, pro tip: stick to your brewery’s business plan with business management software, business decisions, what to include in your brewery business plan.

When crafting your brewery’s business plan, there are a few elements that should always be included. But it’s important to remember that while there are general templates to follow, your business plan is for your brewery. Which means you can customize it however you see fit.

A few sections you should consider including in your brewery business plan are: 

Every business plan should begin with an executive summary. This provides a high-level overview of your brewery’s history, mission, team, location(s), growth goals, and financial goals. Remember that this is a summary. You don’t need to go into too much detail in this section because you’ll be digging deeper into these topics throughout the rest of the business plan. 

What makes your brewery unique in today’s market? Think of what was your motivation behind opening your doors in the first place? What benefits are you trying to provide to your customers? Are you a microbrewery, a taproom brewery, or a regional brewery? Does your brewery or staff have any awards or achievements that help you stand apart from competitors? What milestones have you achieved or major sales goals have you hit? Use this section to share who your brewery is and what the motivations are behind what you do.

Over the past few years, the craft brewing industry has become more and more saturated. Whether you were the first or the last brewery to join your local market, it’s important to know where you stand among them. It’s helpful to include a market analysis in your brewery business plan to understand what your competitors are doing well and where there might be gaps that you can take advantage of. How many beers are they offering on their menu? How often does their menu rotate? Do they offer monthly beer clubs or memberships? Do they have a customer loyalty program? Are they offering tours of the brewing process? Are their craft beverages in local grocery stores or only for purchase from their taproom? Understanding where your competitors stand allows you to make informed business decisions and successfully navigate a competitive market.

Whether you manage a small team of brewers or run a larger scale operation with a team of 20+ individuals, there is likely some form of organizational structure in place. Clearly outline the structure of your team based on the business sectors of your craft brewing business. List out the leadership team and those that report to them.

As a product-based business, having a pulse on your inventory is of the utmost importance. Without the right materials in stock, you won’t be able to brew your products or package the beer for consumption. Having a proven process in place for product inventory ensures that your brewery will remain operational. Avoiding the potential for a pause in production that could stunt your growth goals.

Create a plan that improves the visibility of inventory for every member of your team. If you’re low on a product, how will your team find out about it? What will be the process to ensure that additional supplies and materials are purchased? Along with being able to track your inventory quickly, a strategic brewery business plan also needs a process for you to accurately forecast inventory orders. While inventory management will help you know when things are low, inventory reorder forecasting will help you determine the most effective timeframe for when purchases need to be made.

When it comes to marketing your business to drive additional revenue, take the time to ask yourself the following questions:

• What is your current marketing strategy to drive new business?
• How do you plan to make a new customer a repeat customer?
• What will you do to stay top of mind with your existing customers?
• Where should you be marketing your brewery within the community?
• How will your brewery distribute your products?
• Is there a process in place to handle sales orders and invoices?
• Where will you house important customer order history details?

Think through the above questions so you can fill in any gaps that will help you accomplish your goals quicker.

If the purpose of your business plan is to attract additional funding to help you expand or grow your brewery’s reach, then you will want to include a funding request section. In this section, you would explain how much funding you are requesting. Also how the funding will be put to use. This allows investors to get complete visibility into where their money is going.

As a brewery owner, you understand that your success is often defined by the company’s profits and revenue. Gather a few bank statements, income statements, cash flow statements, loan information, and any additional documents that can help demonstrate your brewery’s profitability. Keep in mind that there’s a lot that goes on behind the scenes of running a brewery. With so much on your plate, using accounting software is vital to keeping accurate records and checking in on how the business is doing.

While these will clearly show where your brewery currently stands, it’s also helpful to include projections of where you expect to be financially in the next five years, ten years, etc. Using these projections, you can create realistic goals. Broken down into quarterly sprints, that will help you reach them more successfully.

To wrap up your brewery business plan, attach any supporting materials within the appendix. This can be anything related to your business, ranging from awards and certifications to resumes of the leadership team.

Watch this short video from CPA Kary Shumway for his expert advice on creating a brewery business plan. For more detailed guidance — including sample plans, templates, and financial planning worksheets — you can sign up for his Brewery Business Plan course.

There are a lot of moving pieces that need to remain in sync if your brewery is going to successfully reach your business goals. From inventory management to sales and accounting, brewery management software allows you to track every aspect of your business more quickly and effectively — keeping you on track.

While there isn’t a one-size-fits-all product out there, your brewery management software should be able to help:

• Track your inventory and prompt you when you’re running low
• Monitor your inventory with the click of a button to confidently fulfill orders
• Calculate production costs for upcoming batches using historical cost data
• Create sales invoices and sync them with your company’s accounting software
• Report on and track your sales and production metrics in high-level dashboards
• Provide visibility into business metrics when on the go via any device

Even with the best staff, mistakes can happen that jeopardize sales and hurt your revenue. Utilizing brewery management software equips your team with everything they need to make informed decisions that benefit your brewery.

Read more: How to know when you’re ready to invest in tech »

Why Your Brewery Needs a Brewery Business Plan

Experiencing growth is exciting for any business owner. It can also leave you with long days and sleepless nights if growing pains are involved. Crafting a solid business plan for your brewery helps equip you with a sensible growth strategy for you and your team from day one. While it’s a great tool to use to ensure you’re on track to meet your goals, your business plan can also be used to show your team and potential investors how profitable and successful your brewery is. 

As a brewery owner, you want to do everything in your power to keep your business operating smoothly. In order to maintain a successful and profitable business, you need to outline growth goals to work toward. Do you plan to stay in one location? Are you looking to expand the number of taprooms over the next few years? Consider how many individuals you currently employ and the number you expect to hire as your sales targets are met. Will you distribute your beer only onsite at your location? Will you offer your selection across regional grocery stores and restaurants as well? Determine realistic goals for your brewery and set a timeframe in which you hope to achieve them. This added layer of visibility into your business’s future will hold you more accountable as you work to hit quarterly benchmarks. Creating the perfect roadmap for success. 

Whether you plan to expand production within your current facility or invest in additional locations, the financial feasibility of these strategies will depend on how much revenue you bring in over the next few years. You have the option to extend the timeframe on your growth goals if sales aren’t hitting the mark. You can also outsource additional funding opportunities to help you grow your brewery. With a solid business plan in place, you’ll have the toolkit needed to demonstrate to loan providers why they should feel comfortable betting on your craft brewing business.

Owning a brewery is an extremely rewarding opportunity, but that doesn’t mean it’s always going to be a breeze. Throughout the years, you’re going to need to make tough decisions — and sometimes you need to make them quickly. By taking the time to put together a business plan for your brewery and updating it regularly, you’ll have a pulse on operations and goal tracking at all times. Because of your visibility into every aspect of the business, you’ll be able to make confident and informed decisions that benefit your brewery.

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How to Start a Brewery: Growing Your Own Craft Beer Business

Anthony St. Clair

28 min. read

Updated March 18, 2024

Free Download:  Sample Brewery Business Plan Template

In 2018, there were more than 7,450 breweries in the U.S.—well over than the historic high of 4,131 breweries in 1873, according to the Brewers Association . In such a crowded market, making good beer and opening the doors isn’t enough anymore.

But, the good news is, if all those people could start a brewery, then you can too—as long as you know what you’re getting into and have a solid business plan for your brewery.

From running coolant pipes to navigating regulations, starting a brewery is a messy, convoluted job full of twists, turns, delays, setbacks, and surprises—but it’s also one heck of a ride.

In this guide to starting a brewery, we’re going to talk with brewers who’ve been-there-done-that, and we’ll get insights from experts in supporting industries such as insurance and finance, as well as discuss regulatory issues.

While it may be your dream to brew great beer, this guide will help introduce you to the business side of craft beer.

This guide will cover the seven essential steps to starting a brewery:

• Planning a brewery
• Finding a brewery location
• Choosing brewery equipment
• Building relationships with vendors and the local community
• Funding a brewery
• Obtaining insurance before opening a brewery
• Keeping regulations in mind when starting a brewery
• Step 1: Planning a brewery

No matter its size or age, every brewery was once a startup.

ColdFire Brewing , a 10-barrel brewery, came online in December 2015, founded by Dan Hughes and his brother Stephen. They’re constantly hard at work on business development and recipe formulation, navigating bureaucracy, and enduring the inevitable delays that come with brewery construction, equipment delivery, and regulatory approval.

“We began to get serious about starting our brewery several years ago, and we were still working out details as we prepared to open our doors,” says Dan.

The Hughes brothers developed a solid business plan and built a core team to bring their vision to reality. Backed by a team of private local investors , ColdFire gained access to additional capital through an SBA loan .

While Dan heads up operations, his brother Stephen is head brewer, and their team also includes directors of finance and brand, respectively.

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Watch your finances

Having a key financial person in place has helped them get better at monitoring cash flow and their overall financial status and needs, says Dan. Most small businesses and startups that are looking to grow— hire a new employee , or buy a new piece of equipment, or open a new location —need to think hard about cash flow, or making sure they have enough money in the bank to meet payroll and other financial obligations.

Review your business plan regularly

Committing to regularly reviewing your business plan and financials is a good step toward making more informed, smarter spending decisions, that can have a big impact on a new business’s long term viability. Forcasting, and then comparing your actual results against your projections on a regular basis, will help you spot any issues before it’s too late to do something.

If you don’t have a business plan yet, don’t skip it

If you don’t have a business plan for your brewery just yet, don’t skip it. Planning is proven to help you grow 30 percent faster . Plus, if you’re going to seek a loan or investment, your funders will expect you to have one. If you’re not sure what you should include in your plan, check out brewery sample business plans on Bplans. You can download them for free to help you get started. Here are two of our most popular example plans:

Sedibeng Breweries

About the plan: Sedibeng Breweries is a medium-scale brewery located in the growing industrial center of Selebi Phikwe, Botswana. Initial plans are to produce three main lines of beer. These products will be distributed to remote yet extremely viable areas, where the market is appreciative of readily-available, good-quality brew.

Martin Cove Brewing Company

About the plan: Located in Medford, Oregon, Martin Cove Brewing Company has been a successful microbrewery for the past three years. This year, Martin Cove Brewing Company will gross $520,000 in sales. With this money, they plan to expand its distribution to selected metro areas within the state of Oregon. In addition, they will introduce a new product, a traditional German Marzen-style lager.

Dan Hughes’ advice on starting a brewery

1. the most important detail is defining a clear vision.

“We know what kind of brewery we want to create and we have tried to let that vision drive all of our decisions.”

2. There has to be a commitment to the craft

“We find this opportunity to open a brewery a privilege, and we certainly aren’t doing this for the money. In fact, we’re taking a significant pay cut to have the privilege to open a brewery. We do so with a vision toward creating a quality brewery that honors the traditions of those that have gone before us.”

3. Every relationship is important

“When you build a few good relationships, suddenly they open the door for more relationships, and that pattern has only continued to hold true.

“Our bank had heard of us before we ever met them, and our landlord had been approached by other breweries in the past. Fortunately, we have always found it important to treat people well and listen to good people who have good advice. That has ended up serving us well.”

4. Prepare for license and regulation challenges

“They take time—so much time—to file, follow through, and gain approval. Having been planning this for so long, we kind of knew what we were getting into and have thus far been able to get through most of these challenges to-date. But they all take so much time.

“With that said, the federal license, or TTB [Alcohol and Tobacco Tax and Trade Bureau] permit, was the longest and most arduous. The more complex the operating structure of a business , the more information and time required.”

• Step 2: Finding a brewery location

From land use to public taste, the location where you plan on opening a brewery is a crucial decision. Generally, brewers want to set up shop in their own backyard.

Here are some questions to consider:

• What are the relevant local and state laws affecting breweries? (And there will be plenty—brewing is one of the most regulated industries in the country.)
• Where in your area will you find land or a building with the right zoning, size, facilities, and access for bringing in raw materials, attracting customers, and/or shipping out finished beer for distribution?
• What local favorites will you need on tap to appeal to the market, and where can you innovate to stand out?
• Will you only brew ales, or will you also make space for lagers, a barrel-aging program, and so on?
• What type of brewery will you be: production brewery or brewpub?
• How wide do you want to grow production and distribution, or do you want to focus on selling over your own bar?
• Do you want to scale to multiple locations?
• What construction will be needed to get the doors open on your first location?

All these questions and more will influence the right space for your brewery. However, the main thing is to start with the right space—and one that will be bigger than what you think you will need, says Jason Jordan of Propel Insurance.

“I cannot tell you how many brewers I have talked to in year two to three in business,” he says, “and they all said their biggest regret was not getting a bigger space that they could grow into.”

However, brewers also need to be willing to take a hard look at where they want to locate and do their homework to make sure they can establish a successful brewery there. Word of mouth is no substitute for market research , says Ben Price, co-founder of Hard Knocks Brewing, a small brewpub in its second year of operation.

“The single biggest mistake I have made was locating my business in a town that could not care less about craft beer,” says Ben. He recommends brewers use data firms such as Insightics to see where and how people spend their money in an area.

“You’re looking for a number of 70 percent or more within five miles of the zip code you desire,” says Ben. “I made the mistake of trusting in word of mouth. You want locally oriented people, people who want a good product, made local.”

• Step 3: Choosing brewery equipment

Your initial system will likely be seven to 15 barrels, but run your own numbers. Figure out how much you’ll need to have in production at a time to be profitable.

What you need to know about buying new

A new system might be subject to delays, especially if demand from other breweries is high, but you’ll be able to design to your needs and specifications, and you’ll have support when issues arise (and they will).

“You’ll probably start with a seven-barrel system, spend anywhere between $130,000-$175,000 new,” says Patrick McCarthy, who works in the financial sector and aids breweries with capital and business planning.

Is it a good idea to buy used brewing equipment?

A used system might be through the door quicker and might save you money up front, but make sure you’ve thoroughly reviewed the system and seller—and remember that when you have problems, you’ll likely be on your own to fix them.

“Used systems are almost as expensive, so you’re really not saving anything, but you might get it sooner than ordering new. Some folks cut corners by ordering equipment made offshore. Many brewers avoid that due to perceived qualitative differences,” says Patrick.

How Ninkasi Brewing grew their brewing capacity

Ninkasi Brewing began in 2006 on a 15-barrel system and produced 1,650 barrels. In 2018, Ninkasi sold 90,000 barrels and was the thirty-fifth largest brewery in the U.S., and the fourth largest in its home state of Oregon, after powerhouse brands such as Deschutes, Rogue, and Full Sail. In April, 2019, the brewery sold its majority stake to a larger organization.

Co-founders Jamie Floyd and Nikos Ridge leased their startup system from a family running a German restaurant out of a former brewpub. While brewing and self-distributing their beer, Floyd and Ridge purchased property where they could relocate and expand operations. They moved into their current location with a 20-bbl brew system, three 60-bbl fermenters, and one 20-bbl fermenter. A year later, they replaced the 20-bbl brew system with a 30-bbl system, followed by another expansion a year and a half later to 50 barrels. Today they use an 80-100-bbl brew system, but the 50-bbl is still online for special brewing projects and research-and-development beers.

“We continually planned for growth and capacity, catching up the entire first seven years of being open,” says Jamie. “In a way, it’s easy to build out in this way, as you always need something, so it becomes more about the funding and the logistics.

“We continually made beer while switching out new systems and adding capacity and infrastructure. One of our greatest strengths was our ability to work around the construction we were doing.”

• Step 4: Building relationships with vendors and the local community

Starting a microbrewery and brewing great beer is not a solo endeavor. It is a constantly coordinated, ongoing set of relationships with customers, government officials, craftspeople, and your internal people.

Find trusted advisors

“The number one piece of advice I give new brewery clients that are in startup stages is to engage your main business vendors early on in the process and find the right people to serve your needs,” says Jason Jordan.

“You need trusted advisors that are proven in the beverage industry and have a decent portfolio of brewery clients. This would be the architect, business lawyer, intellectual property attorney, banker, insurance broker, real estate agent, label maker, hop grower, malt supplier, tank fabricator, and accountant.”

Hire the right team

Relationships and keeping an ear to the ground are key not only to establishing your brewery, but in how and when you grow. Jason Carriere, the owner of Falling Sky Fermentation Supply Shop and co-founder of Falling Sky Brewing , has gone through many twists and turns since Falling Sky opened its first Eugene, Oregon brewpub location in 2012. Since then they’ve opened a second location, a pourhouse that focuses on food production, and a third location, a pub and pizzeria on the University of Oregon campus.

“I’d been running the homebrew shop for a while,” says Jason. “I’d already seen several of my best employees move on to become brewers around town, so I thought I’d look seriously at making that expansion ourselves, keep the team together, make it so homebrewers who worked at the shop could have a way internally to go pro.”

In their first year of production, Falling Sky produced 800 barrels, and they produced 1,300 in 2015—and that’s while getting underway on construction for their third location, moving the homebrew shop, and expanding their current brewhouse.

Know your customers and your financials

Jason believes strongly in “knowing who your customers are and what they want,” balanced with skill and consistent craftsmanship instead of novelty. “I’m not a big believer in recipes, or special combinations of hops no one has thought of,” he explains. “Breweries don’t really win customers with one beer, but they can lose customers with one beer.”

When it comes to growth, Jason advises a thorough understanding of the brewery’s production numbers and financials , balanced with an on-the-ground understanding of daily operations.

That then informs your instincts and intuition. And all this must be tied together with ongoing communications with staff, business partners, vendors, and other key people affecting your business.

“You wouldn’t want to expand if your brewery is at 60 percent capacity and you have empty tanks sitting around,” Jason says. “You also have to have your pulse in the community and the industry to know whether or not you’re saturating certain things, or if you hear about people wanting your beer but not getting it. But it’s all about how we’re going to expand. Just because someone in a market wants your beer, doesn’t mean it’s part of your strategy.”

Be open to opportunities

You also have to be aware of opportunities that arise, though, even if it’s unexpected—and that brings intuition, opportunity, and relationships back in play.

“We had no five-year plan to open a third restaurant, but when we got approached by the University of Oregon, we listened,” says Jason. “It was one of those things where we didn’t really want to expand, but it was far enough in the future that we could plan it through without a rush. Our second location was more rushed.

We were busting at the seams at the brewpub, especially with the kitchen, so the deli expansion was more to let the pub do more of what it needed to do again. The second location had a bigger kitchen, cold storage, etc., to handle making fries and ketchup. It was a combination of good opportunity and vision.”

But that doesn’t mean it was easy. “It was scary, I’m not gonna lie,” says Jason. “When we first did the deli, it looked like a very bad idea for a few months. But it turned around.”

Don’t second guess—trust your team

Jason and his team are not prone to regrets or second-guessing. Not that everything has always been easy or rosy, but he credits solid planning and teamwork with being able to make key moves without looking back and wondering.

For Falling Sky, that includes a strategic decision to focus on location sales instead of wider distribution. “I’m not a big second-guesser. When I make a decision, it’s because I feel confident about that decision, and I’ve thought through the consequences and I’ve come to terms with the consequences of choosing one option over another,” says Jason. “I’m confident in our decision to focus on selling beer over our bar versus the shelf wars and SKU wars.”

Step 5: Funding a brewery

Sure, at its heart beer is made from water, malt, yeast, and hops—but there’s an invisible yet crucial fifth ingredient: money.

Form a relationship with the right bank

Raising capital for any business can be a difficult process, and breweries are no exception. In his various roles in the financial industry, Patrick McCarthy has most recently worked as Vice President Commercial Relationship Manager with Bank of the Cascades , which has 35 companies from the craft beverage industry as customers.

Over the years, institutions he’s worked with have directly banked six breweries, a cidery, and a kombucha producer, and Patrick has also advised dozens of startup breweries, from reviewing business plans to helping prospective brewers network with key people.

Patrick sees his role not just as analyzing a business plan or crunching numbers. “You want to be helpful and move the whole business along,” he says. “If a business comes into the bank that’s wonderful, but at the least you’ve made some friends.”

Here is Patrick’s overall advice for startups to make sure they’re not only brewing quality beer, but keeping solid books:

1. Banks are not consistent sources of startup capital

A new brewery is probably not going to a bank for a startup loan (banks usually come into play for capital to fund growth once a brewery is more established). Friends and family are the most common backers, and many startups bootstrap . Some cities, such as Portland, Oregon also have what Patrick calls “beer angels”—private angel investors who understand the beer business and invest in select breweries and cideries.

Loans from the Small Business Administration (SBA) can also be a good avenue, but from “bank to bank the SBA program is used differently,” says Patrick. “Some bankers have a great deal of interest, knowledge, and depth, and can be a champion for a startup brewery. But a lot of banks look at breweries as restaurants and avoid them, or want to see them in business three to four years before they invest.”

2. Be realistic about your business potential

When Patrick looks at a new business, here are some of the things he looks for to inform his sense of the brewery’s chance of success:

• Do they know how to make good beer? Have they made good beer elsewhere? Won awards?
• What is their brewing experience? If someone’s been a garage brewer for five years, that’s different from someone who’s been brewing at an established brewery for the past 15 years.
• Do they have good credit? If not, why not?
• How much skin do they have in the game financially? Will they be able to handle delays? Do they have access to contingency capital?

3. There’s no one model—or one business plan—for breweries

Each brewery will have its own unique business model and business plan . Before opening a brewery, prospective brewers have to figure out the right business model for their plans, location, interests, startup resources, and long-term vision.

Typical models include taphouses, production breweries, and full brewpubs. There’s also a new phenomenon called an “alternating proprietorship,” says Patrick, where brewers brew part-time on someone else’s system.

Within any model, there are things breweries can focus on to stand out and increase revenue. “Some brewers emphasize food in part because the food dollar can translate into more dollars profit for beer,” says Patrick. “Managing your own distribution is ideal. There are overhead tradeoffs, but I’m seeing it more and more.” Exports are becoming another component, he observes, with international markets such as Japan becoming thirstier and thirstier for American craft beer.

“Everyone’s trying to find what they can afford, what works,” he explains. “Merely making good beer isn’t enough anymore. There’s way too much good beer out there to stand out immediately.”

Even if you’re not seeking funding, it’s still a really good idea to create a Lean Business Plan  that you can use to help navigate your business as challenges and opportunities arise. The benefit of a Lean Plan is that it’s meant to be reviewed and changed regularly, so you’re not just taking a snapshot of your business and goals once, and then shelving it for five years.

4. Cash must be available to cover costs and offset delays

On an industry-wide basis, for small to medium-sized breweries, the ratio between sales and fixed assets is typically for every $6 of sales, a brewery has $1 of fixed assets.

Estimate brewery startup costs

Start with estimating your startup costs . A new and growing brewery’s biggest costs tend to be the brewing system (e.g., $130,000–$175,000 for a new seven-barrel system) and tenant improvements to the property (which in Patrick’s experience in Oregon, including Portland markets, has typically ranged $200,000–$350,000).

“It’s expensive to alter a commercial space that doesn’t have drains, certain water lines, the required electrical, ventilation, etc.,” he explains. “Many also put in a back bar, seating, etc.” Costs vary by scope, location, and market.

Anticipate delays and setbacks

“Problems with licensing or permitting with the city that cause delay of opening can be extremely expensive,” says Patrick. “Every day they can’t pour their own beer is catastrophic financially. That’s the biggest risk I’ve seen in startup stages: timing.”

Delays are a reality in startup breweries. Brew system fabrication and delivery can take longer than the agreed timetable. Regulatory or permit approvals can drag on for months. Construction can hit unexpected snags. Make sure your financial reserves can handle delays and extra costs.

“Seasonality matters too,” explains Patrick. “You want to have the doors open when the beer-drinking season gets started. Winter months are usually the slowest for a brewery. You want to be open by April or May. Ideally, that’s not always in your control due to startup delays, but starting with April to May you want to operate during those busier months.”

5. Treat your accounting with as much respect as your brewing

“I’ve passed on a brewer that didn’t respect the accounting process,” says Patrick. “The brewers are focused on their first love, which is making delicious beer. Accounting isn’t necessarily the top and foremost in everyone’s mind, but in this situation, it was irresponsibly ignored. You can’t let the accounting take a distant back seat.”

Just as quality control is essential for good beer, you have to make sure the books are balanced and the financials are being tracked well. “Accounting keeps you out of trouble,” says Patrick. “It helps you plan, helps you get a return, and ultimately helps you generate revenue.”

Metrics: Know your numbers

Okay, so understanding your financials is important, but what do you need to track in order to understand the financial health of your brewery?

Here are the numbers, metrics, and other indicators Patrick says brewers should monitor:

• Breweries should typically break even or generate a small profit by the first six to 12 months of operation. “They’re at least breaking even, but they’re not paying themselves much yet.”
• Between 12 to 18 months, there should be a 10 to 15 percent bottom-line  profitability . “If I’m used to seeing all models being profitable two years out by at least 10 to 15 percent,” says Patrick, “then if you’re not, I need to understand why or how you’re going to get there.”
• Beyond that, examine year-round profitability on a quarterly basis, with a focus on being profitable annually, and at least breaking even quarterly.
• If food is part of the business, are food costs (food-cost-percent and food labor) being contained at 20 to 25 percent of food revenues?
• Are you at capacity or will you be at capacity soon? What do you need for equipment for the next six months to keep up with demand?
• Cash flow. What is your financial liquidity, especially at the end of each quarter and at the beginning of the fourth quarter, given that winter is often a slower season?
• What is your leverage, the ratio between total liabilities and net worth? “There’s no magic number,” says Patrick, “but the greater the leverage the greater the risk in the business model. If someone is exceeding three-to-one, two-to-one, I have to take a harder look at it. Sometimes that can be a fleeting ratio and adjusts. If the leverage is pushed out, I need to understand why. Is it losses? Is it mismanagement?”
• Is it time to scale? If the balance sheet is showing that you have $7 to 8 sales for every $1 assets (and $6 sales for every $1 assets is typical), Patrick says it’s time to examine scaling.

As you find your stride in a profitable bottom line , you’ll also examine increasing efficiency. For example, as production volume increases, breweries typically purchase a grain silo. “They can buy in bulk, easily cut grain expense by two-thirds,” says Patrick. “Grain silos tend to pencil out quickly. It’s an exciting step up.”

The same thinking applies across the brewery. “At some point when you get larger, you’ve got more money to squeeze that remaining five percent profit out of your beer.”

Putting together a  sales forecast and a cash flow forecast that you monitor at least monthly can be really helpful. Running a business or Lean Plan review meeting that also covers your financials is a great way to hold yourself accountable.

• Step 6: Obtaining insurance before opening a brewery

Breweries need various insurance, just like any other business. A brewery with a large employee roster and a fleet of self-distribution vehicles will have different needs from a three-person production-only startup. Find an insurance agent you can trust who preferably has experience working with breweries or wineries.

No, insurance is not as sexy as deciding which new “it” hop is going to be the feature of your new IPA, but if a brewery doesn’t keep current on their insurance needs, says Jason Jordan at Propel Insurance, then they are asking for trouble.

Note: Insurance and bond requirements vary by state, locality, and type of brewery, so make sure you’re talking with your insurance agent and even your lawyer  for what’s right for your operation and where you’re planning on starting a brewery.

The biggest concern is the lease contract with the landlord, says Jordan. “That can be boilerplate or have a myriad of different insurance coverage and limit requirements to comply with.”

Here are other areas of coverage Jordan says a brewery might need, which will vary depending on the operation:

• Business income and extra expense coverage
• Backup of sewer and drains
• Equipment breakdown coverage (depending on the age of their brew system)
• Property insurance on all equipment and business property
• Key man insurance via a buy-sell agreement (if the brewery has multiple partners)
• Market valuation coverage (for offerings such as a barrel aging program)
• Product recall coverage “is sometimes a concern”
• Crime coverage for theft of money and securities
• Commercial auto insurance is key if expanding into or starting to self-distribute product
• Workers comp is mandatory if employees are on the payroll, which also necessitates employment practices liability insurance (known as EPL insurance or EPLI) to cover hiring and firing practices

A brewery’s most common claims tend to relate to workers comp injuries, such as employees straining a muscle or hurting their back lifting heavy items, says Jordan. Lost product from a power outage or mechanical breakdown of a glycol chiller is another common problem, as are backups of sewers and drains (causing damage to the space and interruption of business, equating to lost revenue.

Luckily, once you are up and running with your insurance, “the needs don’t change a lot from a brewery or brewpub that produces 500 barrels a year to 25,000 barrels a year,” says Jordan. “The biggest concern is keeping up with values on equipment for new purchases and expansions to make sure the brewery is adequately insured at the time of a loss. Brewery owners are notorious for brewing good beer and not for keeping up to speed on calling their agent to make changes.” Stay on top of it to help keep your costs lower in the long run.

• Step 7: Keeping regulations in mind when starting a brewery

Of course, there are laws and regulations—and brewing is a highly regulated industry. Your brewery will need approvals and compliance with relevant local, state, and federal authorities, such as your state’s alcohol oversight organization and the federal Alcohol and Tobacco Tax and Trade Bureau, or TTB.

In Oregon, for example, the Oregon Liquor Control Commission (OLCC) mandates a producer carry a $300,000 limit for liquor liability. At the federal level, the TTB requires all new breweries that want to offer beer for sale to submit a Brewer’s Notice. The TTB has a Beer FAQs webpage outlining what you’ll need to do when starting a brewery to have the proper federal approvals.

[Tweet ““No matter how much you think you know, you will have more to learn.”- Jamie Floyd, @Ninkasi”]

“No matter how much you think you know […] you will have more to learn,” says Jamie Floyd, co-founder of Ninkasi Brewing. “It changes and evolves and you have to know the people who are making the changes and you have to be ready to change as a company. If the FDA decides we need to put nutritional info on our bottles you have to do it. It’s the law. You will have to figure it out and pay for it.”

Get to know your legislators

Jamie also recommends getting to know your legislators at all levels of government and working with trade groups that try to update and influence state and federal policies related to the regulation and taxation of beer.

The growth of the industry is also leading to regulations being modified state to state, says Patrick, “if not to encourage craft beverages then to make it a more viable business model.”

Be ready for compliance and paperwork-based delays

In the meantime, compliance is not necessarily easy or fast. “Some of it is more the tediousness of the paperwork. Make one small change, file everything over again,” says Jason Carriere, co-founder of Falling Sky Brewing.

“TTB is known for a lack of timely responses. We submitted our application for the third expansion nearly two months ago, and we’re not even supposed to call and check the status for ninety days. Then when you do call, you sit on hold for two hours to find out where your application is in someone’s stack.”

Don’t forget federal obligations

Breweries also need the Brewer’s Notice. “That’s a brewery’s permission from the federal government to brew commercially,” says Jason. “It involves taxes, a bond you have to pay that serves as insurance for paying beer taxes. You complete an environmental impact statement for water and environment. It’s permission to make an alcoholic beverage and pay the taxes on it in the U.S.”

While starting a brewery requires lots of dedication, capital, vision, and red-tape navigation, it is also a booming industry and brewers who have a solid plan and stay their course have a solid chance of success. “The numbers are proving themselves: Craft beverages are here to say,” says Patrick. “There’s bound to be a slowdown eventually, but there’s one to two breweries a day opening across the country. People want it, and if people want it, people will supply it.”

And that someone could be you.

Clarify your ideas and understand how to start your business with LivePlan

Anthony St. Clair is a business copywriter, author of the Rucksack Universe travel fantasy series, and a craft beer writer specializing in Oregon. Learn more at anthonystclair.com.

Table of Contents

• Dan Hughes’ advice on starting a brewery
• Step 5: Funding a brewery

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How To Write a Successful Brewery Business Plan + Template

Creating a business plan is essential for any business, but it can be especially helpful for brewery businesses that want to improve their strategy and/or raise funding.

A well-crafted business plan not only outlines the vision for your company, but also documents a step-by-step roadmap of how you are going to accomplish it. In order to create an effective business plan, you must first understand the components that are essential to its success.

This article provides an overview of the key elements that every brewery business owner should include in their business plan.

Download the Ultimate Brewery Business Plan Template

What is a Brewery Business Plan?

A brewery business plan is a formal written document that describes your company’s business strategy and its feasibility. It documents the reasons you will be successful, your areas of competitive advantage, and it includes information about your team members. Your business plan is a key document that will convince investors and lenders (if needed) that you are positioned to become a successful venture.

Why Write a Brewery Business Plan?

A brewery business plan is required for banks and investors. The document is a clear and concise guide of your business idea and the steps you will take to make it profitable.

Entrepreneurs can also use this as a roadmap when starting their new company or venture, especially if they are inexperienced in starting a business.

Writing an Effective Brewery Business Plan

The following are the key components of a successful brewery business plan:

Executive Summary

The executive summary of a brewery business plan is a one to two page overview of your entire business plan. It should summarize the main points, which will be presented in full in the rest of your business plan.

• Start with a one-line description of your brewery company
• Provide a short summary of the key points in each section of your business plan, which includes information about your company’s management team, industry analysis, competitive analysis, and financial forecast among others.

Company Description

This section should include a brief history of your company. Include a short description of how your company started, and provide a timeline of milestones your company has achieved.

If you are just starting your brewery business, you may not have a long company history. Instead, you can include information about your professional experience in this industry and how and why you conceived your new venture. If you have worked for a similar company before or have been involved in an entrepreneurial venture before starting your brewery firm, mention this.

You will also include information about your chosen brewery business model and how, if applicable, it is different from other companies in your industry.

Industry Analysis

The industry or market analysis is an important component of a brewery business plan. Conduct thorough market research to determine industry trends and document the size of your market. 

Questions to answer include:

• What part of the brewery industry are you targeting?
• How big is the market?
• What trends are happening in the industry right now (and if applicable, how do these trends support the success of your company)?

You should also include sources for the information you provide, such as published research reports and expert opinions.

Customer Analysis

This section should include a list of your target audience(s) with demographic and psychographic profiles (e.g., age, gender, income level, profession, job titles, interests). You will need to provide a profile of each customer segment separately, including their needs and wants.

For example, the customers of a brewery business may include:

• People who live near the brewery
• People who are seeking unique beer flavors or other properties
• People who buy beer from the brewery’s website or through a distributor

You can include information about how your customers make the decision to buy from you as well as what keeps them buying from you.

Develop a strategy for targeting those customers who are most likely to buy from you, as well as those that might be influenced to buy your products or brewery services with the right marketing.

Competitive Analysis

The competitive analysis helps you determine how your product or service will be different from competitors, and what your unique selling proposition (USP) might be that will set you apart in this industry.

For each competitor, list their strengths and weaknesses. Next, determine your areas of competitive differentiation and/or advantage; that is, in what ways are you different from and ideally better than your competitors.

Below are sample competitive advantages your brewery business may have:

• Brewery has a unique brewing process that results in a better-tasting beer.
• Brewery is family-owned and operated; customers can visit the brewery to see how their beer is made.
• Brewery offers a wide variety of beers, which appeals to different customer segments.
• Brewery beers are sold in local restaurants and bars, making it convenient for customers.
• Brewery offers tours of the facilities, which educates customers about the brewing process and creates a memorable experience.

Marketing Plan

This part of the business plan is where you determine and document your marketing plan. . Your plan should be clearly laid out, including the following 4 Ps.

• Product/Service : Detail your product/service offerings here. Document their features and benefits.
• Price : Document your pricing strategy here. In addition to stating the prices for your products/services, mention how your pricing compares to your competition.
• Place : Where will your customers find you? What channels of distribution (e.g., partnerships) will you use to reach them if applicable?
• Promotion : How will you reach your target customers? For example, you may use social media, write blog posts, create an email marketing campaign, use pay-per-click advertising, launch a direct mail campaign. Or, you may promote your brewery business via word-of-mouth marketing.

Operations Plan

This part of your brewery business plan should include the following information:

• How will you deliver your product/service to customers? For example, will you do it in person or over the phone only?
• What infrastructure, equipment, and resources are needed to operate successfully? How can you meet those requirements within budget constraints?

The operations plan is where you also need to include your company’s business policies. You will want to establish policies related to everything from customer service to pricing, to the overall brand image you are trying to present.

Finally, and most importantly, in your Operations Plan, you will lay out the milestones your company hopes to achieve within the next five years. Create a chart that shows the key milestone(s) you hope to achieve each quarter for the next four quarters, and then each year for the following four years. Examples of milestones for a brewery business include reaching $X in sales. Other examples include adding new brewing equipment, launching a new product line, or opening a new location.

Management Team

List your team members here including their names and titles, as well as their expertise and experience relevant to your specific brewery industry. Include brief biography sketches for each team member.

Particularly if you are seeking funding, the goal of this section is to convince investors and lenders that your team has the expertise and experience to execute on your plan. If you are missing key team members, document the roles and responsibilities you plan to hire for in the future.

Financial Plan

Here you will include a summary of your complete and detailed financial plan (your full financial projections go in the Appendix). 

This includes the following three financial statements:

Income Statement

Your income statement should include:

• Revenue : how much revenue you generate.
• Cost of Goods Sold : These are your direct costs associated with generating revenue. This includes labor costs, as well as the cost of any equipment and supplies used to deliver the product/service offering.
• Net Income (or loss) : Once expenses and revenue are totaled and deducted from each other, this is the net income or loss.

Sample Income Statement for a Startup Brewery Business

Balance sheet.

Include a balance sheet that shows your assets, liabilities, and equity. Your balance sheet should include:

• Assets : All of the things you own (including cash).
• Liabilities : This is what you owe against your company’s assets, such as accounts payable or loans.
• Equity : The worth of your business after all liabilities and assets are totaled and deducted from each other.

Sample Balance Sheet for a Startup Brewery Business

Cash flow statement.

Include a cash flow statement showing how much cash comes in, how much cash goes out and a net cash flow for each year. The cash flow statement should include:

• Cash Flow From Operations
• Cash Flow From Investments
• Cash Flow From Financing

Below is a sample of a projected cash flow statement for a startup brewery business.

Sample Cash Flow Statement for a Startup Brewery Business

You will also want to include an appendix section which will include:

• Your complete financial projections
• A complete list of your company’s business policies and procedures related to the rest of the business plan (marketing, operations, etc.)
• Any other documentation which supports what you included in the body of your business plan.

Writing a good business plan gives you the advantage of being fully prepared to launch and/or grow your brewery company. It not only outlines your business vision but also provides a step-by-step process of how you are going to accomplish it.

A well-executed business plan will give you the best chance at success and keep you organized and on track as your brewery company grows.

Now that you understand how to write a brewery business plan, it’s time to get started on yours.  

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The financial plan for a brewpub.

Running a successful brewpub involves more than just brewing great beer; it's also about making informed financial decisions.

In this post, we'll delve into the key components of creating a financial plan that can set your brewpub on the course to prosperity.

From calculating your initial investment to handling ongoing operational costs and forecasting revenue growth, we're here to help you navigate each aspect.

So, let's embark on the journey to turning your brewpub vision into a financial triumph!

And if you're looking to obtain a comprehensive 3-year financial analysis of your venture without crunching the numbers yourself, please download our financial plan designed specifically for brewpubs.

What is a financial plan and how to make one for your brewpub?

A financial plan for a brewpub is an essential tool that outlines the financial aspects of your brewing business.

Think of it as crafting a brewing recipe: You need to understand the resources you have, the type of brews you want to create, and the costs involved in crafting your unique beers and ales. This plan is crucial when starting a new brewpub, as it turns your passion for brewing into a well-structured and feasible business model.

So, why create a financial plan?

Envision yourself preparing to open a vibrant brewpub. Your financial plan will help you grasp the expenses associated - such as renting your pub space, purchasing brewing equipment, initial costs for quality ingredients, employing staff, and promotional expenses. It’s like ensuring you have all the right brewing supplies and funding before you begin your brewing journey.

But it's more than just adding up costs.

A financial plan can provide insights similar to perfecting a unique brew recipe. For example, it might reveal that sourcing exotic hops is prohibitively expensive, leading you to find excellent local varieties instead. Or, you might realize that having a large team of brewers is not necessary during the initial phase of your operation.

These insights help in avoiding overspending and overhiring.

Financial plans also serve as a forecasting tool for pinpointing potential risks. Let’s say your plan shows that reaching your break-even point – where your income equals your expenses – is feasible only if you sell a certain amount of beer daily. This insight points to a risk: What if your beer sales don't meet the expectations? It pushes you to think about alternative strategies, such as hosting events or offering special brewpub experiences, to boost revenue.

How is this different for brewpubs compared to other businesses? The key difference is in the nature of the costs and the revenue patterns.

That’s why our specialized financial plan is tailor-made for the brewpub industry . It cannot be applied generically to other types of businesses.

Brewpubs face unique expenses like quality brewing ingredients, regular maintenance of brewing equipment, and specific health and safety regulations. Their revenue patterns can also vary – think about how special events or seasonal brews might increase sales, while other periods could be slower. This is different from, say, a technology store, where products don't have a limited shelf life and sales trends might be more consistent.

Naturally, our financial plan takes all these specific factors into account. With this, you can easily create customized financial projections for your new brewpub venture.

What financial tables and metrics include in the financial plan for a brewpub?

Creating a financial plan for a new brewpub is an essential step in securing the success and sustainability of your business.

Understand that the financial plan for your future brewpub is more than mere numbers on paper; it's a comprehensive guide that steers you through the early stages and aids in maintaining the business over time.

Let's begin with the most fundamental element: the startup costs. This covers everything required to open your brewpub for the first time.

Consider the expense of leasing or buying a location, brewing equipment, initial inventory of brewing ingredients and beverages, furniture, décor, and even the signage outside your brewpub. These costs provide a transparent view of the initial investment needed. We have already detailed these in our financial plan , saving you the effort of searching elsewhere.

Next, factor in your operating expenses. These are ongoing costs incurred regularly, such as salaries for your staff, utility bills, brewing supplies, and other day-to-day expenses. It's crucial to accurately estimate these expenses to comprehend how much your brewpub needs to earn to be profitable.

In our financial plan, we've input all necessary values, offering a realistic representation of what to expect for a brewpub. Naturally, these can be adjusted in the 'assumptions' tab of our financial plan as needed.

A key table in your financial plan is the cash flow statement (included in our financial plan). This illustrates the expected flow of cash in and out of your business.

It provides a monthly (and annual) breakdown that encompasses your projected revenue (the income you anticipate from selling beverages and food) and your projected expenses (the costs of operating the brewpub). This statement is crucial for foreseeing periods when you might need extra cash reserves or when you're ready to consider expansion or upgrades.

Another vital table is the profit and loss statement, also known as the income statement, which is also part of our financial plan.

This essential financial document reflects the profitability of your brewpub over a specific period. It lists your revenues and deducts expenses, indicating whether you're generating a profit or incurring a loss. This statement is particularly important for assessing the financial health of your brewpub over time.

Lastly, the break-even analysis (also included, of course) is indispensable. It calculates the amount of revenue your brewpub needs to generate to cover all its costs, both initial and ongoing. Understanding your break-even point is critical as it sets a definitive sales target.

We've also incorporated additional financial tables and metrics in our financial plan (provisional balance sheet, financing plan, working capital requirement, ratios, charts, etc.), offering you a comprehensive and in-depth financial analysis for your upcoming brewpub.

Can you make a financial plan for your brewpub by yourself?

Yes, you certainly can!

As mentioned above, we have developed a user-friendly financial plan specifically designed for brewpub business models .

This plan includes financial projections for the first three years of operation.

Within the plan, you'll find an 'Assumptions' tab that contains pre-filled data, addressing revenue assumptions, a detailed list of potential expenses relevant to brewpubs, and a hiring plan. These figures can be easily customized to match your specific project needs.

Our comprehensive financial plan covers all essential financial tables and ratios, including the income statement, cash flow statement, break-even analysis, and a provisional balance sheet. It's fully equipped for loan applications and is user-friendly for entrepreneurs at all levels, including beginners, with no need for previous financial expertise.

The process is automated to simplify data entry and eliminate the need for manual calculations or complicated Excel tasks. Just input your data into designated fields and choose from the provided options. We have streamlined the process to make it approachable, even for those new to financial planning tools.

If you encounter any challenges, please feel free to contact our team. We ensure a response within 24 hours to help solve any issues. Additionally, we offer a complimentary review and correction service for your financial plan once you have completed all your assumptions.

What are the most important financial metrics for a brewpub?

Succeeding in the brewpub industry requires a deep understanding of both the craft of brewing and the intricacies of financial management.

For a brewpub, certain financial metrics are particularly crucial. These include your revenue, cost of goods sold (COGS), gross profit margin, and net profit margin.

Your revenue encompasses all income from beer and food sales, offering a clear insight into the market's response to your brews and dishes. COGS, which covers the cost of brewing ingredients, food supplies, and direct labor, is essential for understanding the direct costs associated with your offerings.

The gross profit margin, calculated as (Revenue - COGS) / Revenue, shows the efficiency of your brewing and cooking processes, while the net profit margin, the percentage of revenue remaining after all expenses, indicates the overall financial health of your brewpub.

Projecting sales, costs, and profits for the first year requires analyzing various factors. Begin by examining the local market and your target demographic. Estimate your sales considering elements like location, local competition, and pricing strategy.

Divide costs into fixed costs (such as rent, utilities, brewing equipment maintenance) and variable costs (like ingredients, hourly labor). Be prudent in your estimates and factor in seasonal variations in sales and costs.

Creating a realistic budget for a new brewpub is vital.

This budget should cover all anticipated expenses, including rent, utilities, brewing and kitchen equipment, initial inventory, labor, marketing, and an emergency fund. It's also crucial to set aside funds for unforeseen expenses. Maintain a flexible budget and regularly review and adjust it based on actual performance.

In financial planning for a brewpub, key metrics include your break-even point, cash flow, and inventory turnover.

The break-even point indicates the volume of sales needed to cover your costs. Positive cash flow is critical for daily operations, while a good inventory turnover rate suggests efficient management of your brewing and food supplies.

Financial planning can vary significantly between different types of brewpubs.

For instance, a brewpub focusing on craft beers might prioritize high-quality ingredients and a unique customer experience, leading to higher costs but potentially higher pricing. In contrast, a more mainstream brewpub might focus on volume sales with more standard brews and food offerings.

Identifying signs that your financial plan may be unrealistic or incorrect is key. We have outlined these indicators in the “Checks” tab of our financial model, providing guidelines for promptly correcting and adjusting your financial plan to achieve relevant metrics.

Red flags include consistently missing sales targets, rapidly depleting cash reserves, or inventory issues, such as stock running out too quickly or accumulating unsold. If your actual numbers consistently deviate significantly from your projections, it's a clear sign that your financial plan needs to be revised.

Lastly, the primary indicators of financial health in a brewpub's financial plan are a stable or increasing profit margin, healthy cash flow that comfortably covers all expenses, and consistently meeting or surpassing sales targets.

No worries, all these indicators are included in our financial plan , allowing you to adjust them as needed.

You can also read our articles about: - the business plan for a brewpub - the profitability of a a brewpub

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• Business Plans Handbook
• Business Plans - Volume 11
• Brewpub Business Plan

Hopstreet Brewery

32 Battery Way Charlotte, NC 28202

Zachary David Robinson

The Hopstreet Brewery is seeking an outlay of $280,000 from investors. This amount will be used to get a loan so The Hopstreet Brewery can purchase everything the brewpub needs to get started. This amount will give The Hopstreet Brewery the 20 percent it needs to acquire a $1.4 million loan from the bank.

EXECUTIVE SUMMARY

The Hopstreet Brewery will be formed to bring patrons a warm and inviting dining experience like no other. The Hopstreet Brewery will feature an eclectic array of homebrewed beers and great food with something for everyone.

The Hopstreet Brewery will be a brewpub incorporated as a limited liability company. The business location will be in Noda in Charlotte and will be completed in spring 2006.

The head of The Hopstreet Brewery management team will be CEO and brewmaster Matt Hanson. Matt has received his brewing certification and has thorough experience of brewpubs. The rest of the management team will consist of a general manager and a kitchen manager/head chef. Aiding the management team are advisors who have restaurant and business experience.

Noda is a residential and commercial area that is being developed just a few miles away from downtown Charlotte. Nearly everything in Noda will be within walking distance. In fact, there will be over 900 residential units within a five–minute walking distance of the Hopstreet Brewery. Ultimately, Noda will be a thriving town of more than 4,000 residents and hundreds of businesses. Noda will be completed in nine phases, with a carefully planned mix of homes in addition to a large town center and four neighborhood centers. 500 homes will be completed in each phase with each phase taking 1–2 years to complete. The project is set to be completed in 2017.

The Hopstreet Brewery will serve a wide selection of homebrewed beers including ales, pilsners, and lagers. The Hopstreet Brewery will also feature a traditional American menu with appetizers, sandwiches, and main and side dishes. There will also be German specials present on the menu. These items are unique and could even be added to the full menu.

There is a lot of competition in food and drink industry. There are a few brewpubs, many bars, and many restaurants in the Charlotte area. However, The Hopstreet Brewery has competitive advantages that will help the brewpub meet or beat the competition.

Brewpubs and microbreweries are growing tremendously in popularity. After meeting all requirements in a site assessment survey, the location of The Hopstreet Brewery should provide a great marketing opportunity. Furthermore, there are many attractions close to The Hopstreet Brewery. From 2003 to 2004, the brewpub industry experienced a growth rate of 4.6 percent. The craft beer industry has become accustomed to growth; the industry has grown every year for the past 35 years. Average beer sales at brewpubs for 2004 were $341,480. Moreover, most brewpubs have a 40:60 alcohol to food sales ratio, meaning it is likely that average food sales was around $512,000.

The marketing strategy of The Hopstreet Brewery is a combination of billboard advertisements, mailings, newspaper ads, kiosks, and promotion at local events. The Hopstreet Brewery will use the services of The Scout Group to help with sales strategy. In addition, The Hopstreet Brewery will use advertisements, a frequent dining program, specials, a happy hour, group events, pub crawls, brewpub tours, and sponsorships to get customers in the door and keep them coming back. Pricing of Hopstreet Brewery products will be based on competition, cost, and demand.

The Hopstreet Brewery is seeking an outlay of $280,000 from investors. This amount will be used to get a loan so The Hopstreet Brewery can purchase everything the brewpub needs to get started.

Vision: To bring a warm and inviting atmosphere to Noda and the surrounding Charlotte area.

Mission: The Hopstreet Brewery Brewery in Noda at Charlotte is dedicated to bringing patrons a warm and inviting dining experience like no other. With an eclectic array of homebrewed beers and great food, everyone will be able to find something they like.

Tagline: The Hopstreet Brewery, a place for good beer, good food, and good fun.

ORGANIZATION

Company name.

The Legal Name is: The Hopstreet Brewery, LLC.

Legal Form of Business

The Hopstreet Brewery is incorporated as an LLC located at the address: 32 Battery Way, Charlotte, NC 28202.

The location will move to Noda upon completion.

Management Summary

The Hopstreet Brewery management will primarily be the duty of CEO, Matt Hanson, with the aid of experienced business professionals Jason O'Connor, Richard Vanderburg, Jeff Wolpe. Also, part of the management team will be the Head Chef / Kitchen Manager and a Restaurant / Bar Manager who will be identified later.

Matthew Hanson, CEO and Brew Master BA in German, Duke University, Graduating 1994: Emphasis in Teaching.

The CEO, Matthew Hanson, is from Raleigh, North Carolina. Matt has a brewer's certification from the VLB Berlin three–year program and a teaching certificate from Duke University

Matt's brewing experience is evident from the several years that he spent in Germany. In fall of 1994, he began an apprenticeship for Bierbrauerei in Frankfurt, Germany. Most of his schooling was in Berlin, Germany, but halfway through the three year program, he moved to a smaller brewery that better reflected the kind of operation that he wanted to run. This brewery was in Hamburg, Germany, a part of the Munster Brauhaus.

While at the Brewery in Hamburg, Matt rotated through all aspects of the brewery including: Brewhaus, malting, machine maintenance, filtration, bottling and kegging, bar construction and maintenance, and the laboratory and laggering department. In a one year period, all areas of the brewery were visited twice.

Matt next attended school in Berlin at the Versuchsndashund Lehranstalt fur Brauerei (VLB). This included both theoretical and practical classes in brewing techniques and other related areas to brewing. Schooling was twice a year for a period of 6 to 8 weeks.

In 1996, Matt moved to a family owned pub–brewery in Hamburg, Munster Brauhaus. There, he attended the same kind of school as in Berlin. New responsibilities in Hamburg included all aspects of brewing with a few exceptions (i.e. did not have a laboratory or a maintenance crew). Also, responsibilities included gastronomical aspects such as cooking for the pub, giving small tours, bartending, filling and tapping kegs for guests, working at festivals serving the brewery's beer and working with open fermentation. The final practical examination took place in the Beck's Brewery in Bremen.

In 1997, Matt returned home to receive his teaching certificate. Currently, he is teaching at Charlotte Community College, as well as serving on the Charlotte City Council. On the council he serves on several boards, including: Arts and Culture, Streets, Grant Review Committee, Finance and Audit, Community Center Site Selection Committee, Public Safety, and Technology Committee.

Jason O'Connor Has been running his own businesses for the past 25 years. Currently owns a Subway sandwich restaurant and is on the Board of Directors for the City Planning Committee. Has experience in the restaurant industry.

Richard Vanderburg Has been working as an entrepreneur for most of this life. Has had many successful entrepreneurship relationships in business and politics, has completed marketing plans for businesses and established a number of highly profitable companies from the ground up. Has lots of start–up and business experience.

Jeff Wolpe Developer of Noda, Charlotte. President of Prestwick Homes, one of the largest builders in the state. Lots of business experience and will have major effects on area.

Donald Bilson Sales representative for Food Services LLC. Has 26 years experience in restaurant and food industry.

Matt Hanson, CEO/Brew Master

• Responsible for maintaining the vision, mission, and philosophy of the company
• Oversees the brewery as a whole, maintaining the integrity of the operations along with the marketing and sales through advisors
• Handles all phases of the brewing cycle for the all beer produced on site
• Responsible for the investor relations of the company

General Manager

• Handle customers
• Handle employees—both front of the house and back of the house
• Prepare paperwork, i.e. count inventory and calculate food cost, complete product ordering, and prepare labor schedules for both FOH

Head Cook/Kitchen Manager

• Head of the kitchen
• Handle all aspects of food preparation
• In charge of kitchen staff, organization, inventory, and orders

General Restaurant Staff

• Bussers / Dishwashers (2–4)
• Servers (3–5)
• Hosts / Hostesses (2–3)
• Bartenders (1–2)
• Sous chef (1)
• Line Cook (1–2)
• Prep Cook (1–2)

Company Attorney

• Responsible for establishing an LLC business form
• Prepare and file necessary legal documentation
• Responsible for contractual relations with investors and potential investors
• Responsible for all legal proceedings
• Assist in directing the finances for the brewery
• Manage all budgets, projections, and all statements necessary for tax filings
• Assist in preparing financial reports to help make business decisions

BUSINESS OVERVIEW

Brewpub description.

A brewpub is a restaurant and microbrewery combination that makes its own beer and sells the majority of its beer on premise. A brewpub is also referred to as a home–brew house and a house brewery. The first American brewpub opened in 1982. As of July 2003, the Association of Brewers estimated over 1,000 brewpubs in the United States alone. There are brewpubs in many other parts of the world, although not commonly called "brewpubs." Brewpubs are especially popular in European countries, but are growing rapidly in popularity in the United States.

The Hopstreet Brewery will follow these characteristics by offering German craft beers and traditional American food with German specials (if these specials are popular enough, they will be added to the menu).

The Hopstreet Brewery will open in May 2006. For the first couple years, only the bottom floor will be available for business and the second floor will be "white boxed" until further phases of Noda are completed.

Location—Noda at Charlotte

The location of the Hopstreet Brewery is Noda at Charlotte. Noda is a residential and commercial area that is being developed just a few miles away from historic Charlotte. Noda's style is new urbanism and somewhat resembles traditional European architecture. Nearly everything in Noda will be within walking distance. In fact, there will be over 900 residential units within a five minute walking distance of the Hopstreet Brewery.

Ultimately, Noda will be a thriving town of more than 4,000 residents and hundreds of businesses. Noda will be completed in nine phases, with a carefully planned mix of homes in addition to a large town center and four neighborhood centers. 500 homes will be completed in each phase with each phase taking one–two years to complete. Of the 500 homes released for sale, 450 homes have already been sold and the second phase will be released for sale in June 2005. In addition, there are already 26 businesses open. The project is set to be completed in 2017. Developer Carl Knutser's vision is for Noda to be one of the most recognized neighborhoods in the country and this seems possible as sales are more than double original expectation.

Seating in the first year will include the main floor with approx. 2,280 sq. ft of customer space and a beer garden. The second floor will be "white–boxed" until The Hopstreet Brewery is able to receive adequate customers. The beer garden will consist of 12 tables, but will only be available weather permitting. The bulk (or maybe all) of the kitchen will be off the back of the building. There will be approximately 12 seats along the bar, 18 tables, and additional space. It is estimated that there will be at least 87 seats. There will also be a public swimming pool located beside The Hopstreet Brewery which could be an area where customers could be served. This will allow for more seating. Depending on the season, we are hoping there will be approximately 135 seats in warm months and 87 in cooler months for year one.

The plan is to open the "white–boxed" second floor in year two or three. This area will be approximately 1,500 square feet and should allow for seating of 50 additional customers.

Decorations

The exterior decoration will be painted stucco, 2.5 stories in height, and Central European in design. The interior decor will be warm–natural–stone, wood, and brick in design. There will be wall hangings and memorabilia decorating the walls. The brew system will be shown off in a bay window that runs two stories tall. There will be a lodge–feel upstairs, supported by fire places, a small band stage, and large windows.

There will be on–street parking in front of The Hopstreet Brewery, a free public parking lot in the back, and on–street parking throughout the community.

The Hopstreet Brewery will feature numerous types of beers brewed on–site by Matt Hanson. To suit the tastes of everyone, The Hopstreet Brewery will also serve a few Anheuser–Busch products. Many breweries only serve the beer that is produced on–site, but to maximize business sales and profits, serving other beers and an assortment of liquor is a must.

Craft beers will be brewed in a one–of–a–kind system. The system will be the Kupferversion mit zwei Kupferhauben purchased brand new from SBP Breweries. The Hopstreet Brewery will use a 2500 bbl. system. This system comes straight from Slovakia and is made of copper giving it a beautiful and unique look. The cost of this system is 323,200 Euro ($417,006 US). The Hopstreet Brewery will make this system easily viewable to anyone in the restaurant, so they can enjoy its beauty and know where the beer they are drinking is coming from.

The Hopstreet Brewery will also make the presentation of beer a highlight. Unlike other drinking places, beers will be presented the way they were meant to be. Beers will not be served in the same simple glass; each beer will be presented in its own unique way according to tradition.

Main beers that will be brewed by The Hopstreet Brewery

• Pilsner (Pils)—Served in a tall, thinner–walled glass, this is the most "elegant" beer. It is bottom–fermented, has the most "bitter" taste (i.e. the most hops content) and is light in color. Ca. 5% alc./vol.
• Lager—Lager is a generic name for bottom–fermented beer. Pilsners are also lagers, but a lager is usually less bitter. The lager can be served in a number of glasses and the beer served by our brewery will be like the German, "Helles" beer: a light colored, somewhat malty beer. Ca. 5% alc./vol.
• Dunkeles—A Dunkeles is the same as a lager, however, the color is darker and the beer is a little sweeter due to the residual sugars and caramelized malt. This beer will be served in a round beer glass that is, perhaps, known for being the "typical beer glass". Ca. 5% alc./vol.
• Hefeweizen (a.k.a. Weizen or Weiss)—Hefeweizen is a beer served in a tall, wide–mouthed glass so that the head of the beer can reach a nice three–fingers height. This beer may contain slightly more alcohol at ca. 5.5% alc./vol. and will be made with barley malt and wheat malt (50/50). This is an ale (top fermented beer) and has a stronger flavor. This beer will be served more in summer and offered with banana juice or a slice of lemon. *Instead of brewing separate flavored beers, most of the flavor will be added by syrup to the Hefeweizen after brewing: this allows a wider range of flavoring (and makes the hard–headed brewer feel better about not brewing "candy beer"…)
• Koelsch—Koelsch is an ale yeast beer known in the Cologne Germany area and served in small, cylinder–style glasses. It is somewhat like a wheat beer. It is lightly colored and will contain a little less alcohol. Ca. 4.5% alc/vol.
• Alt Beer—Beer served in small glasses or special alt glasses that have a curvilinear line to them; darker in color; about 5%, ale yeast.
• Bitter Ales—Such as: Pale Ale (served in "water–style glass"). Ca. 5% alc./vol, light colored.
• Dark Ales/Stouts—These beers are a lot like the brand Guinness, which is an Irish beer. Ca 5% alc./vol. This beer is very dark and black in color and served in a English Pint Glass.
• Berliner Weiss—This beer is close to the Lambic style beers of Belgium. It is an ale yeast, lightly colored and soured with lactic acid. By itself (some like it this way) it may not be a very good tasting beer. This beer is served in a low, very–wide mouthed glass ("Pott" in German) and comes with a "Schuss" or shot of Waldmeister/Woodruff syrup or Himbeer/Raspberry syrup. The beer then takes on a green or red color, respectively.

Additional beers to be served are seasonal, specialty beers:

• Schwarz Beer—"Black" beer, lager yeast (bottom fermented), Ca.5% alc./vol. Served in a large "tulip" styled glass. This beer is a little sweeter than most.
• Doppelbock—A German strong beer that can be light, but is usually dark, and has at least 6% (usually Ca. 6.5% alc./vol). Served in a thick–rimmed glass or stoneware mug.
• Keller Beer—A lager that is unfiltered and cloudy—otherwise is very much like a lager in all ways.
• Hefedoppelbock—A rare wheat beer, ale, but the alcohol content is much higher at around Ca.6.5% alc./vol. Can be dark or light and served from Weizen glass.
• Stein Beer—This is a malty beer that is made by throwing a hot stone into the mash; this helps caramelize it and it becomes sweeter. This beer is considered a lager.
• Vollmond Beer—Really, just a gimmick, this beer is brewed under the full moon to give it mystic powers and make you drunk. It is a lager or really any kind of beer you brew in the middle of the night. We think this would be good for October.

The Hopstreet Brewery will also carry an assortment of hard liquors and wines. The selection of the liquors will be much the same as a standard bar or restaurant.

The Hopstreet Brewery will also be a restaurant serving the general public at lunch, dinner, and after hours. There will be a full menu serving traditional American foods as well as German specialties and other seasonal dishes throughout the year.

Along with sales from the restaurant, we will also sustain revenue with growlers (glass jugs of beer filled on–site), bottled beer, keg beer, and promotional items, such as glasses, hats, key chains, bar towels, golf balls, clothing, and other trinkets.

Concept Menu

As stated, The Hopstreet Brewery will carry traditional American food with German specials. Most of the regular menu items will be similar to other brewpubs, restaurants, and bars. The menu may have a few additions or subtractions in the near future. Also included is non–alcoholic beverages offered.

Appetizers:

• Nacho Platter —Nachos topped with ground beef, shredded lettuce, tomatoes, cheese, black olives, chopped green onions, jalapenos and sour cream
• Buffalo Wings —One pound of spicy hot wings served with celery and ranch or blue cheese dressing
• Homemade Giant Onion Rings —battered in our special beer batter and deep fried to golden perfection
• Bite–Sized Soft Pretzels —served with sweet, hot, and horseradish mustard. A way to enjoy the little Kraut in all of us
• Toasted Ravioli —This favorite is served with marinara sauce and fresh parmesan cheese
• Homemade Potato Chips —Thinly sliced fresh—a basket full
• Small salad —Fresh field greens served with fresh Farmers' Bread
• Chilli —Our own special recipe served with chic peas, black olives, and topped with shredded cheese

Sandwiches:

Served with Fries, Homemade Chips, or Hot German Potato Salad

• Hamburger —Thick 1/2 pound hamburger topped with lettuce, tomato, onion, pickles, & lettuce
• BBQ Hamburger
• Swiss and Kraut Burger —Our hamburger topped with Swiss cheese and finest sauerkraut
• Steak Sandwich —Marinated steaks served with grilled onions and grilled to perfection
• Pulled Pork Sandwich —Slow–cooked pork roast pulled and covered in bbq sauce
• Hand–Cut Cod —battered in our own special beer batter and served on your choice of wheat or white bread
• Reuben —Corned beef served on rye bread with Swiss cheese, sauerkraut and Thousand Island dressing

Main Dishes:

• Chicken Salad with Peanut Sauce Dressing —Iceberg lettuce covered in our own special peanut dressing and chicken strips
• Brick Oven Pizzas —Pizzas served with your favorite toppings including: pepperoni, sausage, chicken, mushrooms, onions, black olives and peppers
• Schimmelpizza —Pizza topped with garlic, onions, artichoke hearts and mozzarella cheese
• Reuben Pizza —If you like reubens, then you'll love this Italian twist. Thousand Island dressing is the base on this pizza complete with caraway-seed encrusted dough; topped off with corned beef, sauerkraut, and Swiss cheese
• Sausage Rigatoni —Lean, fresh sausage in a red or white sauce and topped with fresh parmesan. Served spicy upon request
• Pork Steak —Slow grilled served with your choice of two sides. BBQ or dry
• Pork Cordon Bleu —Fresh pork chop filled with ham and Swiss cheese, breaded and fried
• Grilled Chicken Breast —Served with your favorite two sides and small salad
• Smoked BBQ Ribs —Served with your favorite two side dishes
• Ribeye Steak —Served with baked potato, broccoli and dinner salad

German Cole Slaw; German Potato Salad; Baked Potato; Salad; Chips; Green Beans; Mashed Potatoes; Noodles; Broccoli; Onion Rings; Sauerkraut

Just For Kids:

Chicken Strips; Grilled Cheese; Hamburger; Pizza; PB&J Sandwich

Sodas; Iced Tea; Locally Roasted Coffee; Milk; Apple Spritzers

German Specials (appearing at different intervals)

• Landjaeger with farmer bread and mustard served on wooden board (this is a German Summer Sausage)
• Cheese and Sausage Platter
• German Farmer Bread served with "hausgemachter braunschweiger" and chives
• Schupfnudeln Mit Sauerkraut
• Pflammkuchen
• Radish and Salt
• Deutscher Salat —German Salad

Allgauer Cheese Soup; White Asparagus Cream Soup; Dumpling Soup; Chili Con Carne; German Potato Salad Soup

• Bangers and Mash —Six Nuernberg sausages served on a bed of kraut
• Schnitzel —Pork cutlet
• Rhineland Pork —Smoked pork chops served on a bed of our special kraut
• Rinderrouladen Maultaschen —German–style ravioli stuffed with hamburger and spinach
• Weisswurst —served with large soft pretzel and sweet mustard
• Turkey Leg Dinner
• Trout and Boiled Potatoes —served with German cream sauce
• Flammkuchen —pizza base but instead of a tomato sauce, the crust is covered with creme fraiche, bacon, onions, garlic, and cheese
• White Asparagus —served wrapped in Black Forest Ham
• Bratwurst Dinner
• Wurstsalat mit Kaese (Schweizer Art)

Spaetzle; German Farmer Bread; German Potato Salad (warm or cold); Schupfnudeln and Kraut; German Salads; Fried Eggs; German Broth

The general menu will remain relatively unchanged throughout the course of business. However, as demand for special dishes are assessed, they might become available on the regular menu. The Hopstreet Brewery is also working on a system where leftover food items can be used in certain dishes the following day. These items might be used to make a soup, side dish, or other dishes. It is estimated that The Hopstreet Brewery will have $20,000 worth of inventory at any one time (includes food, spices, etc.).

The Hopstreet Brewery will audition for a chef who has experience cooking German food. If a German chef is unattainable, The Hopstreet Brewery will find an American chef who is willing to learn.

COMPETITION

Competition can be broken up into three categories: brewpubs, bars, and restaurants. The Hopstreet Brewery will essentially be competing in all three categories which are somewhat related.

All brewpubs in the Charlotte area are going to present some competition. There are no other planned brewpubs for Noda, so the listed brewpubs are the competition.

Competition: Brewpubs

The Hopstreet Brewery has some tough competition in this area, especially Tarheel Tavern. All of the brewpubs analyzed have a strong location and convenience. Tarheel Tavern is located in historic Saint Charles; Charlotte Brewpub is located in downtown Charlotte surrounded by huge businesses; and AleHouse sits on the water, attracting passing consumers. The Hopstreet Brewery will have a location that is better than these competitors though. The Hopstreet Brewery will be located in Noda, an area of soon to be some 4,000 residents. As The Hopstreet Brewery is being erected, the amphitheater, public swimming pool and stores will be nearing completion. The Hopstreet Brewery also shares the area of Charlotte with Tarheel Tavern. Charlotte is growing rapidly and contains many attractions such as Wild William's WaterPark and the IMAX theater.

Cost of products will be similar to these brewpubs, above average. The average meal price at these brewpubs is $8 to $10. The selection of foods at The Hopstreet Brewery will be different than competitors' American menu food and German specials will be served. In addition, The Hopstreet Brewery will also feature homebrewed beers different from others. To set itself apart in this category, The Hopstreet Brewery will offer beer with a longer ripening period (a minimum of 21 days versus 14) and a happy hour sampling special. The sampling special will feature a "shot" of every beer to give the customer a taste of everything. The brewing experience of Matt Hanson should also help set Hopstreet Brewery beer apart. Matt spent many years in Germany to receive his brewing certification and worked at numerous German breweries, giving him the knowledge and background to create great beer and run the brewpub.

Notice that no brewpub competitors have unique presentation for their products. This will be a selling point for The Hopstreet Brewery. All beers are meant to be delivered in a certain way. Serving beers in proper drinkware will stick out in the customer's mind. For example, the tall, widemouthed hefeweizen glass and the mini hammer tapped keg will be identifying factors for customers.

The Hopstreet Brewery will use these features to share the Charlotte market with Tarheel Tavern, and capture the Noda market. These features will be attraction points for The Hopstreet Brewery to take customers away from Tarheel Tavern and bring them to the Hopstreet Brewery.

Of the 26 businesses to open in Noda in phase one, there are no true bars besides The Hopstreet Brewery. This is good news because The Hopstreet Brewery could be one of the few drinking places close and the only within walking distance of many. There are numerous bars/pubs in the Charlotte area, however. Only some of these present competition because most people are not willing to drive long distances to get to a specific bar. There are over 50 bars within a ten mile radius of the Hopstreet Brewery. All of these undoubtedly demonstrate at least some competition. The ten closest bars to The Hopstreet Brewery represent more competition than others. These bars include:

Competition: Bars

The only bars that stand out from the crowd in this table are Maria's and FlimFlam. Maria's is, in fact, more of a restaurant than a bar and FlimFlam is part of a restaurant chain. After these two, all of the other bars seem to be average at best. The Hopstreet Brewery will by no means, be an average bar. The food and selection at most of these bars is lackluster and offers nothing unique. This will be an area for The Hopstreet Brewery to capitalize on.

A "beer" heading was not added to this group because none of these bars serve their own beer. They all serve generic products like Bud Light and an occasional microbrewed beer like Charlotte Brew. Therefore, fresh homebrewed beer is another area favoring The Hopstreet Brewery.

In addition, the atmosphere at a lot of these bars was nothing worth noting. Most of them were smoky, unclean, and just not really a fun place to be. However, some of these bars continue to be local hangouts, something that will take time for The Hopstreet Brewery to accomplish. Also, some of these bars have very low prices that will be unmatchable for The Hopstreet Brewery, but the food is not as quality. Furthermore, none of these bars have any unique presentation, giving another advantage to The Hopstreet Brewery.

Restaurants

There are three restaurants that will be completed by the time of the opening of The Hopstreet Brewery. These restaurants are: Tony's BBQ & Grill, Fast Chinese, and Pizza–To–Go. Fast Chinese and Pizza–To– Go sound generic, but Tony's BBQ & Grill could pose as competition. Besides these, there are many restaurants close to The Hopstreet Brewery. Many of these restaurants, though, are considered fast food, and therefore are in a different category than that of The Hopstreet Brewery. More upscale, sit–down restaurants present more competition. Nearly 75 percent of the 50 closest restaurants to The Hopstreet Brewery are fast–food joints. The ten closest, besides those that have already been stated, are listed below.

Competition: Restaurants

Similarly to bars in the area, a lot of restaurants located close to The Hopstreet Brewery are just okay or poor. The Hopstreet Brewery should not have much trouble beating out these weak competitors, but will have trouble with some of the better restaurants. The goal of The Hopstreet Brewery will be to achieve equality with these restaurants, because they are local favorites and have been in the area for a long time.

The Hopstreet Brewery will beat out all of the restaurant competition in alcohol category. The Hopstreet Brewery will serve a large selection of homebrewed beers that will be unmatchable by these restaurants. Once again, The Hopstreet Brewery must make use of its delivery and presentation as an advantage to this group. Also, these bars and restaurants will lack the brewpub experience that is evident at The Hopstreet Brewery.

MARKET ANALYSIS

After much research and analysis, The Hopstreet Brewery should have only minor problems in competing in the brewpub, bar/pub, and restaurant industry. There are only three brewpubs in the Charlotte area and the production of craft beers has grown seven percent over the past year. Furthermore, the niche market expanded three percent last year.

The brewpub is not the smoky, dirty bar where you cannot take your family, and it is not the expensive restaurant where you wouldn't take your friends. Brewpubs offer a family oriented atmosphere suitable for family and friends. They offer good food and quality unique beer. This is why brewpubs and small breweries are growing tremendously in popularity (seven percent production growth from 2003 to 2004) with over 1,400 nationwide.

Noda is projected to have annual economic impact of $315 million. This will be cash flow on which businesses in Noda can capitalize on. Other than The Hopstreet Brewery, only three are restaurants and only one of these restaurants is similar to The Hopstreet Brewery (sit–down family restaurant). This means that once phase one is complete (Spring 2006), The Hopstreet Brewery will be one of the main options for the 450 resident homes of Noda.

A site assessment survey was done by the American's Brewers Guild which surveyed successful brewpub operations and identified some important site characteristics that were believed to have contributed to the businesses' success. This assessment follows.

Site Assessment

As you notice, The Hopstreet Brewery meets every requirement, and many with ease. Many of these requirements are explained or analyzed throughout the plan. There are some, though, that will be explained here. For instance, University of North Carolina at Charlotte is located close, satisfying the college requirement. There are many sporting facilities including Charlotte Family Club and the Noda YMCA. Furthermore, The Hopstreet Brewery is located in downtown Noda and has an abundance of offices just a few miles away on Battery Way that employs thousands of workers. As Noda grows, The Hopstreet Brewery will beat these requirements with even more ease. The fact that The Hopstreet Brewery more than meets these requirements is in an indication that there is a market for a second brewpub in the area.

Attractions At–Hand

Attractions and amenities close to The Hopstreet Brewery will increase the number of consumers in the area and, therefore, increase the market. The amenities located within a short distance of The Hopstreet Brewery include:

• Wild William's WaterPark
• IMAX Theater
• North Carolina University at Charlotte
• Highway I-85
• Brookfield Mall
• Highway I-77
• Charlotte Airfield

All of these locations are recognizable consumer hot spots. Highways I-85 and I-77 are traveled by thousands of people every day. On interstate 85 at Battery Way, 28,506 cars traveling east and 30,849 traveling west pass by per 24 hours on average. Also, according to the Charlotte Department of Transportation, close to 20,000 vehicles travel on Battery Way each day. After the completion of Noda, this number is sure to rise.

The IMAX Theater attracts 54 million people annually. Wild William's WaterPark in Raleigh is the single largest attraction in the state and attracts four million people alone; it has even been called the most visited waterpark in the United States. Judging by the success of the Raleigh–based location, the Charlotte store should continue to gain popularity. As you will learn later, The Hopstreet Brewery already has plans to market there.

Charlotte already has a strong tourism industry; 1,600,000 already visit this historic city annually. These amenities, though, are an extra source of tourism. Take for instance, Ameristar Casino, which attracts over ten million visitors on an annual basis. Moreover, most people who fly into North Carolina travel through Raleigh–Durham International Airport, which is also close to The Hopstreet Brewery and where marketing will take place (see Marketing Strategy).

Brewpub Industry Analysis

The Hopstreet Brewery falls within the brewpub industry. There is no specific "industry" for this category yet, as it is relatively new. Therefore, there is no specific SIC code. For now, it is appropriate to place the brewpub under the drinking place code 5813 and the restaurant code 5812.

The craft beer segment includes brewpubs, microbreweries, and specialty brewers. Craft beer (micro-brewed beer) is the fastest growing segment of the beverage alcohol industry in the United States. There was a seven percent growth rate for craft beer volume in 2004, nearly double the growth rate posted in 2003 of 3.4 percent. More specifically, there was a 4.6 percent growth rate for brewpubs. "Craft beer volume growth outpaced that of imports, large brewers, wine and spirits in 2004," said Paul Gatza, Director of the Brewers Association. "The craft beer segment continues to show healthy and steady growth with many individual brewers enjoying double–digit volume increases," said Charlie Papazian, President of the Brewers Association. For 35 years, the craft beer industry has shown growth each year. "Americans increasingly prefer the flavor and diversity of fresh, locally– made beers," says Papazian. "Many Americans first discovered full–flavored beers at local breweries and now the diverse and exciting choices among those flavorful brews have become a regular part of their lifestyle." The continuance of the rising growth rate of the craft brew industry means good things for The Hopstreet Brewery. Growth is expected for the 2005 and 2006 years, and The Hopstreet Brewery will benefit from that growth.

Brewpubs have helped revive the beer and drinking places industry. There were a total of 986 brewpubs operating in the United States in 2004. This number includes the 51 brewpubs that opened their doors for the first time in 2004. Listed in the table below are annual beer sales for the brewpub industry.

Annual brewpub sales: Beer

Food sales for the brewpub industry were a little harder to come by. Although brewpubs are known more for their beers, food actually accounts for more sales than beer. Brewpubs in the Charlotte area reported a 40:60 ratio of alcohol to food sales. No specific industry food sales were attainable, so the following data was calculated using the previously stated ratio.

Annual brewpub sales: Food

End Consumer

The end consumer of The Hopstreet Brewery can be broken down into three groups: locals, brew nuts, and visitors. Locals will be accounting for most of the business, but brew nuts and visitors will make up a respectable proportion. We expect locals to account for at least 80 percent of business, visitors 15 percent and brew nuts 5 percent.

Locals include people living in the Charlotte area, but more specifically citizens of the Noda development. Brew nuts are people who are basically obsessed with microbrewed beer. They will travel long distances just to try out a new beer. After visiting The Hopstreet Brewery, these nuts will forever remember not only our delectable beers, but the presentation of these products the way they were meant to be. Visitors are people visiting the Charlotte area. As you have already learned, there are various attractions close to The Hopstreet Brewery, so there will always be people going in and out of the area.

The majority of Hopstreet Brewery customers will be over the age of 21. However, these adults will bring their family and friends with them who may or may not be 21 and many others will visit who are not 21. In addition, even though people from every income level drink beer, our target group is those with income of more than $30,000. In the end, it should be noted that people may not come to enjoy Hopstreet Brewery beers, they may simply come because they enjoy the food, atmosphere, and company.

As described, our end consumer is made up of three different groups. To determine the amount of locals we may encounter, radial studies must be completed. Within a 1–mile radius of The Hopstreet Brewery there are 9,732 adults over the age of 21; 64,977 within a 5–mile radius; 253,434 within a 10–mile radius; and 574,995 within a 15–mile radius. Moreover, more than two thirds of these people have an average income of over $30,000.

The demographic of the brew nut is hard to nail down. These are just people who love trying beer. This group is made up of people over 21, but mostly males. Some brew nuts are willing to travel further than others, so the general market is as large as the entire country.

The demographic of the visitor group is just that, a visitor. More than two thirds of adults in the United States aged 21 and older traveled in 2004. That makes visitors a very large group (greater than 125 million). Charlotte alone had over 1.5 million visitors last year, and that was before the construction of Noda.

MARKETING & SALES

Marketing strategy.

The marketing strategy of The Hopstreet Brewery is to uphold to the strictest standards of quality and family fun while serving up excellent food, beer, and atmosphere. This will provide the company with a strong reputation and encourage customers to tell others about their experience. The Hopstreet Brewery must prove itself among the many brewpubs, bars, and restaurants in the Charlotte area. When restaurants and drinking places open, people want to try them out immediately and first impressions can make or break companies in this industry. Therefore, The Hopstreet Brewery will make sure every experience is a positive one. The Hopstreet Brewery will focus on serving the finest beers and delivering them in a fashion unlike any other location. Also, the selection of foods will make sure there is something for everyone and leave the customer craving for more.

The Hopstreet Brewery will use traditional and nontraditional marketing efforts to promote the brewpub. Traditional marketing efforts will include billboard advertisements, direct mailings, and newspaper spots. Nontraditional marketing consists of indirect marketing. The combination of these marketing efforts will be used to create a "buzz" that will generate word–of–mouth marketing in the general public.

In the fall of 2005, billboard advertisements will be done promoting all of Noda. Many of these signs will contain advertisement for The Hopstreet Brewery. These signs will be located on highways 85 and 77, and other major roadways in the Charlotte area. The Hopstreet Brewery will also make use of billboard advertising independently around the same areas. The amount or placement of these billboards will not be assessed until Noda advertising has begun. The Hopstreet Brewery would like to have an advertisement on 370 east and west, 70 east and west, and two on Battery Way/Airport Road in each direction. The plan is to have these advertisements present three months before opening and have them remain until they are inefficient. In addition, Hopstreet Brewery owner, Matt Hanson, has already been in contact about having the brewpub added to the list of restaurants on highways 85 and 77.

There are currently over 5,000 people on the Noda mailing list which keeps interested consumers up to date with what is going on in Noda. It has already been mentioned in this mailer that a brewpub will be open in Noda phase one. Now that more information is available about The Hopstreet Brewery, advertisements and articles will begin appearing in this mailer by summer 2005. This mailer is designed and maintained by Noda development and will cost The Hopstreet Brewery nothing. The Hopstreet Brewery will push to have as many references as possible in this mailer. The Hopstreet Brewery will also begin placing advertisements in the Charlotte newspaper about the brewpub's 2006 opening. An ad or two will be placed in the Sunday newspaper starting a month before opening. These ads will contain a coupon so The Hopstreet Brewery can gauge their effectiveness and determine how long they should use newspaper advertising. Furthermore, the business section of the Charlotte newspaper often features articles about the opening of new businesses, and The Hopstreet Brewery is likely to be featured shortly before opening. There will soon be a daily Noda newspaper and The Hopstreet Brewery will do likewise with this newspaper.

Many different kiosks have been seen at Wild William' WaterPark in Charlotte, marketing and offering samples of products during events. The Hopstreet Brewery is in the process of setting up a kiosk at spring 2006 events. Hopefully, alcohol will be permitted at this event. If not, The Hopstreet Brewery will focus on handing out coupons, fliers, and merchandise. Wild William' WaterPark is a huge attraction and will offer The Hopstreet Brewery a lot of public visibility. Another strong place to advertise is Raleigh–Durham International Airport. The Hopstreet Brewery plans to have advertisements visible to customers as they pick up their luggage and walk out the door.

The Hopstreet Brewery will also participate in local events such as Oktoberfest and parades both before and after opening. At these events, merchandise, coupons, and fliers will be handed out. Moreover, The Hopstreet Brewery will hand out these things as much as possible at as many places as it can to give the brewpub as much promotion as possible.

Sales Strategy

The sales strategy of The Hopstreet Brewery is direct sales to customers from the brewpub. The main selling point will be beer, but food will be the second attraction. Focus, therefore, will be sale of these two groups at the brewpub. All advertising within the brewpub will be endorsement of Hopstreet Brewery products, events, promotions, and specials. There will be no advertising for products like Anheuser–Busch.

Part of The Hopstreet Brewery's sales strategy will be completed by MarketGroup Inc. MarketGroup Inc. specializes in converting first time customers into regular visitors. MarketGroup Inc. will send personalized letters, birthday coupons, emails, web promotions, etc to Hopstreet Brewery customers. The effectiveness of this will be measured by the amount of customers using these coupons or customers noting they received a letter. The cost of this service is $350 a month. The Hopstreet Brewery will begin use of this service a few months after opening, and if it proves not to be cost effective, the brewpub will no longer use the service. MarketGroup Inc. has helped develop customer bases for many prominent Charlotte restaurants like Nook in the Square, Cathy's Cafe, and Dimanto's Italian Eatery.

The Hopstreet Brewery will complete a number of sales strategies on its own too. The brewpub will feature advertisement coupons in newspapers and mailings on a weekly basis. The Hopstreet Brewery will also offer frequent dining programs where after a customers has seven main dish items, he or she will be able to receive a free dish of choice.

The Hopstreet Brewery will have specials within the brewpub. There will be many daily specials that will include German dishes, but many will simply be discounts on regular menu items. The Hopstreet Brewery will also have happy hour specials with half price appetizers and beer from three to six o' clock every weekday. Likewise, a happy hour sampling special will be offered which will incorporate shot size samples of every craft beer.

The Hopstreet Brewery will offer to serve as a meeting place for local groups. The Hopstreet Brewery will contact church groups, senior clubs, tourist groups, and dating services about having events at the brewpub. The groups will receive discounts on all food and beverage items during the meeting, coupons for future use, and a tour of the brewpub.

The Hopstreet Brewery will also encourage pub crawls where people are driven around to different bars/breweries. These are usually set up by a group of people looking to try out different drinking places. The Hopstreet Brewery will periodically mention pub crawls in its advertisements and promote it at the brewpub. Moreover, there will be frequent tours of the brewing process where consumers will get a sample of freshly brewed beer at the end. In addition to these strategies, The Hopstreet Brewery will also be available for rental and catering upon request.

The last marketing/sales strategy that The Hopstreet Brewery will take on will be sponsorships. The Hopstreet Brewery will sponsor events at the local amphitheater such as concerts and pageants. The brewpub will try to be active in every event that takes place at the amphitheater because it is located only a few steps from The Hopstreet Brewery. The Hopstreet Brewery will also sponsor local sporting events and teams. This will include charity sporting events, softball leagues, and tournaments. The Hopstreet Brewery will use this form of advertising because it is relatively cheap and can serve as a strong form of advertisement.

The pricing of products at The Hopstreet Brewery will be based on three measurements: competition, cost, and demand. All three of these measures will be important for The Hopstreet Brewery to realize its greatest profits.

Pricing of Hopstreet Brewery beer and food will be very similar to competition. If our prices are too high, consumers will choose to take their business elsewhere. If prices are too low, The Hopstreet Brewery's profit margin will not be utilized to the fullest. Much of our pricing will be based on the pricing of items at Tarheel Tavern because they will be a main competitor of The Hopstreet Brewery, and because it too is a brewpub.

Also considered when pricing, will be the cost of the goods sold by The Hopstreet Brewery. All products require different goods, quantities, and effort to be made. Obviously, products with higher priced goods, quantities, and effort are going to command a higher price.

The final factor considered in pricing will be demand. A lot of this demand will be based on consumer input. The Hopstreet Brewery will monitor sales to see which goods are selling better than others. As stated earlier, if some goods are not selling up to standards, they might be removed from the menu. Likewise, The Hopstreet Brewery would like to measure the price sensitivity of its customers. This will be done by making occasional price markups and markdowns on selected menu items. This will survey how much consumers are willing to pay for certain items.

From our research, most sales in the brewpub industry come from food items. However, the greatest profit margin is incurred from alcohol sales, mainly house brewed items. Pricing will change from time to time due to certain conditions, but will remain the same for the most part. Pricing will be reviewed on a monthly basis at a minimum.

Alcohol prices will vary depending upon competitor pricing, size, and cost of goods. The Hopstreet Brewery will price its beers similarly to competitors. Furthermore, larger beers will be more expensive, but will be a better deal per ounce than smaller beverages. The price of ingredients also plays a major role in the price of beer. Labor will not be included in cost of goods, because it will be performed by owner and brewmaster Matt Hanson.

RISK FACTORS

Obviously, there are many risks entering into the drinking place and restaurant industry. Many startups immediately fail and many are still losing money. Possible risks The Hopstreet Brewery faces have been considered and are being planned for. There are also many opportunities that The Hopstreet Brewery can capitalize on.

• Lack of business. If The Hopstreet Brewery is not receiving sufficient business, major problems would arise. The outlook, however, looks very strong and there is a healthy market for brewpubs at the moment.
• Missing inventory. The average alcohol shrinkage of a bar is 20 percent due to too many bartender freebies, mispourings, and incorrect orders. This can cost any business a lot of revenue. If it is noticed that an unreasonable amount of inventory is missing, The Hopstreet Brewery will likely hire PubCo to manage their liquor inventory. PubCo specializes in reducing shrinkage and saving owners plenty of money.
• Competitors in Noda. After the development of each phase of Noda, there will be more competitors in the area. In phase one, there will only be three other restaurants in Noda, and two are more fast–food type. This leaves Marbella as the only direct competition. As new restaurants open in Noda, The Hopstreet Brewery will already be firmly established and ready to take on new competition.
• Possible problems with brewing systems. Problems have arisen in other microbreweries with system problems preventing the production of beer. We plan on purchasing new, top–of–the–line equipment to reduce this risk.
• Overhead costs exceeding sales would pose a problem if it occurred consistently. If the cost to maintain the equipment, building and other overhead costs exceed sales, The Hopstreet Brewery would be in serious disarray. The Hopstreet Brewery will fight this by reviewing finances on a monthly basis at a minimum and hiring an accountant.
• Management and staff problems. Employees will initially be given a chance to settle disputes and correct mistakes depending on severity. However, some mistakes, such as stealing and harassment will result in immediate firing.
• Competitive reaction. Competitors in the Charlotte area might react adversely to The Hopstreet Brewery. They might try to undercut pricing or partake in interfering with possible Hopstreet Brewery consumers. The Hopstreet Brewery does not want to go to war with any of its competitors. Actions to prevent this might be forming strategic alliances or supporting competitors.
• Poor reviews in press. This would pose a major problem for The Hopstreet Brewery because the brewpub is counting on positive reviews to promote business. If this does happen, The Hopstreet Brewery will make greater efforts to improve the brewpub and its products like hiring a new chef or offering more discounts to get consumers back in the door.
• Liquor related problems. Drunk–driving and other liquor related problems are often troublesome for drinking places. To prevent this, servers will be trained to determine when someone has had too much too drink. The Hopstreet Brewery will also call cabs, family members, or drive people to make sure they get home safely. However, much of The Hopstreet Brewery's customer base will live in Noda, and most residents will be within a ten minute walk.

Opportunities

• Expansion. If The Hopstreet Brewery is highly successful, another brewpub may be opened in another area.
• Introduction of new products. It has already been explained that if a German special item is extremely popular, it would be added to the menu. Furthermore, The Hopstreet Brewery will be constantly evaluating sales of items to determine if there is enough demand to add an item to the menu. This could include beer, an American dish, or a German special.
• Development of surrounding area. The area of Charlotte is growing extremely fast and Noda will eventually have a population of over 10,000. The Hopstreet Brewery is right in the middle of this fast growing area and could see a large increase in customers upon completion of each phase. In addition, The Hopstreet Brewery may be able to sell products to water park guests, amphitheater spectators, and maybe even develop another beer garden.
• Product sales outside of the brewpub. The Hopstreet Brewery will monitor sales of its products to determine the feasibility of sales at other bars, restaurants, and stores.
• Strategic alliances with other businesses. The Hopstreet Brewery will try to form alliances with others to promote business. This could be beneficial to both sides. Businesses could advertise for each other, give away coupons, encourage consumers to visit, etc.

Investor Information

The Hopstreet Brewery is seeking an outlay of $280,000 from investors. This amount will give The Hopstreet Brewery the 20 percent it needs to acquire a $1.4 million loan from the bank. Investors will be paid back over a maximum 20–year period on a monthly basis. Please see financials for more details.

Forecasted income statement start-up operations

Forecasted annual income statement

Forecasted year 1 income statement

Forecasted year 2 income statement

Forecasted year 3 income statement

Projected sales detail

Break-even forecasted annual income statement

Forecasted year 1 break even income statement

Forecasted year 2 break even income statement

Forecasted year 3 break even income statement

Break even projected sales detailed

Forecasted cash flow start-up operations

Year 1 forecasted cash flow statement

Year 2 forecasted cash flow statement

Year 3 forecasted cash flow statement

Balance sheet

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US Department of Labor recovers $125K in back wages for 23 workers after finding Lexington pub, restaurant operated invalid tip pool

Employer:                             Krafty Draft Brew Pub LLC

                                                269 Charter Oak Road 

                                                Lexington, SC 29072

Investigation findings:  U.S. Department of Labor  Wage and Hour Division investigators found the Lexington pub and restaurant distributed earned tips with traditionally non-tipped employees, such as dishwashers and cooks and, by doing so, operated an invalid tip pool. The division learned that the employer used earned tips to cover most of the servers’ gross pay and failed to pay a cash wage of at least $2.13 per hour directly to tipped employees as required. These actions violated the  Fair Labor Standards Act , as did the employer’s failure to keep accurate record of tips earned and hours worked by employees. 

Back wages recovered:         $125,819 in back wages for 23 workers

Quote: “Pay practices a business chooses to use must meet legal requirements. In this case, we found that — while allowing some employees to take home more than federal minimum wage — Krafty Draft Brew Pub ignored its obligation to pay their share of its workers’ income and passed that responsibility to its customers,” explained Wage and Hour Division District Director Jamie Benefiel in Columbia, South Carolina. “Employers unsure of their legal obligations should contact their local Wage and Hour Division office for assistance. That’s the best way to ensure that they pay employees all of their rightful wages.”

Background:  Employers can contact the Wage and Hour Division at its toll-free number, 1-866-4-US-WAGE.  Learn more about the Wage and Hour Division , including its  search tool  to learn if you are owed back wages collected by the division. Workers and employers alike can  help ensure hours worked and pay are accurate by downloading the department’s Android and iPhone Timesheet App available for free in English or Spanish. 

A 32-year market vet warns the S&P 500 is set to fall 50%-70% in the years ahead with valuations at historic highs — and says that an imminently weakening labor market will be the catalyst for the crash

• Jon Wolfenbarger warns against long-term investment in the stock market due to high valuations.
• Wolfenbarger believes a weakening labor market and impending recession could trigger a sell-off.
• While some indicators suggest an economic slowdown, consensus views remain optimistic.

There has seldom been a worse time to invest money in the stock market for the long term, according to Jon Wolfenbarger .

That's because valuations are historically elevated today, and over the period of around a decade, they carry significant weight in determining return outcomes. According to Bank of America, valuation levels explain 80% of the market's return over a 10-year period.

There are many ways to measure valuation levels in the overall market. Wolfenbarger, the founder of investing newsletter BullAndBearProfits.com and a former investment banker at JPMorgan and Merrill Lynch, cites John Hussman's ratio of the market cap of all non-financial stocks to the gross value added of those stocks. Hussman says it's the most accurate indicator of future market returns that he's found.

Right now, the metric shows -5% returns annually over the next 12 years. In the chart below, the valuation measure is shown in blue and is inverted, and actual subsequent S&P 500 returns are shown in red.

Other valuation measures are also hovering at historically high levels. The so-called Warren Buffett indicator of total market cap-to-GDP well exceeds dot-com bubble levels and is reapproaching its 2022 highs. And, the Shiller cyclically-adjusted price-to-earnings ratio is above 1929 levels and trails levels only seen in 1999 and 2021.

Based on historical long-term returns when valuations are this high, Wolfenbarger said that the S&P 500 is likely to suffer a long and drawn-out sell-off. By the bottom of the market cycle, the index will have likely fallen 50%-70%, he said.

While it sounds like a doomsday call, it's important to remember that these kinds of scenarios have in fact played out in recent decades. Stocks took two years to bottom when they crashed almost 50% after the dot-com bubble. They took a year-and-a-half from peak-to-trough in the Great Financial Crisis. And nine years following the dot-com bubble peak in 2000, the S&P 500 was still down about 50%.

Why will stocks crash?

Valuations by themselves aren't typically a good enough catalyst for a stock-market sell-off. Another look at the Bank of America chart above shows they matter very little in the short term.

A sufficient catalyst, Woflenbarger said, is weakening in the labor market and a subsequent recession, which he believes is about to unfold.

Wolfenbarger shared with Business Insider multiple indicators he's watching that show the unemployment rate could rise in the months ahead.

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The first is the National Federation of Independent Business' hiring plans index. Its three-month moving average has surged, indicating the unemployment rate could soon follow.

Second, The Conference Board's Employment Trends Index (in blue) has declined in recent years. Historically, this has meant trouble for total non-farm employment in the US, which has not yet unfolded.

Third, the number of US states with a rising unemployment rate is spiking, meaning that the overall unemployment rate should see further upside.

And fourth, about five quarters after the US Treasury yield curve inverts (using the 10-year and 2-year durations), unemployment has historically started to tick up. April will mark the start of the sixth quarter since the yield curve officially inverted, which according to the indicator's founder, Cam Harvey, is when the curve stays inverted for a duration of three months.

The US unemployment rate is already on a slight uptrend, having climbed from 3.4% in April 2023 to 3.9% as of February. According to the Sahm Rule, named after former Fed economist Claudia Sahm, once the three-month moving average of the unemployment rate moves up by 0.5% from its low over the previous 12 months, the US economy is in a recession in real time. The indicator has a perfect track record of identifying downturns. Today, it sits at 0.27.

Wolfenbarger's views in context

Wolfenbarger's stock market call is on the more extreme end of Wall Street outlooks. Fellow market bears Jeremy Grantham, John Hussman, and David Rosenberg have all stuck to their significant downside expectations. But most top strategists at major banks see limited downside from here, if any at all. Many, including Goldman Sachs' David Kostin and Bank of America's Savita Subramanian, have had to revise upward their 2024 targets already this year.

Wolfenbarger's recession call is also out of consensus these days, with many bearish forecasters abandoning their downbeat outlooks. But many see slower growth and a softening labor market going forward, even if that doesn't mean an outright recession.

This week, Pantheon Macroeconomics Founder and Chief Economist Ian Shepherdson laid out several reasons he sees unemployment ticking up in the coming months.

For example, layoffs are rising, which is usually followed by rising unemployment claims.

"For the first time in this cycle, an array of indicators point tentatively to a meaningful slowdown in economic growth, driven by the consumer, and a clear weakening in the labor market, as soon as the second quarter," Shepherdson said in a client note.

For now, however, bad data simply hasn't shown up yet, and bulls have ridden the wave to all-time highs — a trend that could very well continue. Only time will tell how Wolfenbarger's forecasts hold up in the near- and long-terms.

Watch: How bitcoin halving affects crypto prices

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