In 2019, the United States consumed approximately 2.74 million 2.25 gallon cases of beer. That’s a staggering amount. It’s enough to get you drunk speculating over how you can claim a piece of this beer pie. And you can claim a piece of this beer pie. These days, beer drinkers have become more discerning. They won’t mind ditching the mainstream brand they’ve been used to in favor of a craft beer from a small brewery. That right there is your business opportunity.
Yes, building a craft beer business from scratch is a viable entrepreneurial idea. And if you’re a beer aficionado, this is your chance to finally turn your passion into a money earner. As they say, the most successful business people are those who have unlocked what they care most about and built their brand around it.
But first things first. You need to have the right foundation for this business idea to work. Here are the essentials.
Learn about craft beer
Sure, you down countless bottles or cans of beer weekly. That does not make you a beer expert. If you want to turn your love of beer into a profit-making venture, you need to learn the ins and outs of craft beer.
For starters, as of 2020, the U.S. beer market hosts 8000 breweries. That means the competition’s quite challenging. But you can always stand out regardless of how saturated the market is. You can enroll in a beer school so that you’ll know what you’re doing. You’ll have a better chance of concocting a competitive product line.
Choose a business model
Joining the craft beer market allows you multiple options when it comes to a business plan. You can build a brewpub and serve 25 percent of your beer concoctions in your pub/restaurant. Or you can be a craft beer manufacturer and work for clients who will brand and market your supplies. That makes you a contract brewing company. If you want to start in the most modest way possible, you can put up a microbrewery.
A microbrewery cannot sell more than 15,000 barrels of beer annually. You can have a taproom onsite for beer selling. You need 75 percent of your products sold offsite.
Brand like a pro
You need to give your craft beer a personality. That’s important if you want to stand out in a saturated market. This is where branding comes in. You need to have an unmissable and memorable name. The same rule applies to your logo. Ideally, you come up with a catchy tagline that will feature in all of your marketing collateral. Choose where you want to situate your product. Is it hip? Is it classy? Where does it fall on the consumer character spectrum?
Closely related to branding is packaging. You can sell beer in a mug and straight from a tap at your production site. Those you need to send to vendors should either be bottled or canned. Either way, you need bottles and cans that are consistent with your branding. And you need a piston filler to ensure that you’re dispensing accurate amounts of that precious liquid in each bottle or can.
You need to market your craft beer aggressively. Do not rely on the adage that says if you build it, they will come. Go to them. Let your target market know you’ve arrived.
Learn about the rules you need to adhere to. Keep in mind that craft beer production is part of the alcohol industry. That’s regulated by both state and federal laws. You need to have a good grasp of self-distribution laws, which are state-specific, barrel cap laws, and brewery sales and sampling laws.
You also need to work out what licenses and permits you need. Think Brewer’s Notice which you need to procure from the Alcohol and Tobacco Tax and Trade Bureau (TTB). Plus, come up with vendor and employee contracts. These documents are vital for compliance.
It’s one of the most exciting things to be able to turn your passion into a business. To profit from something you care about is rewarding in more ways than one. If you love beer, a craft beer business is right up your alley. So if you have enough money saved for capital, it’s time to take the jump.
But don’t make the jump with blinders on. Follow the recommendations above, and you will be guided accordingly. Lastly, treat your beer business like serious business. Sure, you’re selling beer. But you should be doing it completely grounded and sober. Otherwise, you’ll get a hangover from a financial loss.