Start a Microbeweries Business

   

(298). Start a Microbeweries Business

A microbrewery is one where the beer is brewed fresh. The brewmaster here can use a variety of ingredients to turn out a diverse selection of beers.If you’re a beer lover then you can turn this into a profitable business by learning how to start a microbrewery.  It’s possible to start and run a home based microbrewery with a small investment; over time you will be able to grow your business and experience reasonable profits. It has  a great potential in an exciting new industry that has all kinds of possibilities for growth, profit, and fun.

 

Imagine having your own profitable microbrewery business sharing your specialty craft beer with thousands of people. When you start a microbrewery, you will join an industry that has seen amazing growth in recent years, despite the downturn in the economy. Beer lovers are willing to pay higher prices for beer that is of superior quality and better taste than the cheap brews produced by the mega-breweries that dominated the beer market in years gone by. Surprisingly large numbers of entrepreneurs  have been starting microbreweries or brewpubs. Starting any business can be difficult and a microbrewery is no different.  Look at how other people started their microbrewery business and find out how you can replicate their success in your microbrewery.  The easiest way is to read brewing related magazines.  These will help you understand the techniques and methods which can be used to make your business a success. Make sure that your business plan looks at all aspects of your microbrewery such as set up cost, working capital, marketing, distribution etc.

You need two basic things to start a microbrewery: patience and beer brewing experience. Genuine passion and enthusiasm for the art of brewing beer is also very helpful. The following guidelines will teach you how to start a microbrewery.  

Know how to brew unique flavors of beer. If you don't already have experience in creating your own beer brewing formulas, take the time to develop some before starting your venture in earnest. You'll have a lot more success with your microbrewery right off the bat when you have a wide array of delicious beer varieties at your disposal.

Generate some buzz for your specialty beers. Invite friends and family members over to try out your brews. Throw events and invite the general public to sample your beer. Offer samples to popular bloggers and other influential people online in order to generate interest in your brews. If your beers' reputations are already well-established when you open your microbrewery, it will have much better chances for success.

Find a suitable place for your microbrewery. Ideally, it should be in an area that gets plenty of foot traffic. Isolated locations are not good options. At the same time, find a location whose monthly rent isn't exorbitantly high.

Study up on how other successful microbreweries got started. Invest in quality books on the subject. If possible, get in touch with microbrewery owners in your state or province to find out how they got the ball rolling on their ventures.

Acquire some start-up capital. Round up a few business partners who are willing to back up your venture financially. You need to be able to show a bank that you have the means to get started -- and that you are serious.

Create a topnotch business plan. Use a do-it-yourself business plan kit or hire a professional to do it for you. Make sure that you include plenty of clear details as far as start-up costs and expected revenues are concerned. Include statistics about the growing popularity of microbreweries to bolster your case.

Seek small-business financing. If your business plan is designed well enough, it should convince a bank to give you a small business loan. Small business credit cards are also worthwhile options to consider.

Buy some equipment. Initially, start with high-quality used microbrewery equipment. You will need kettles, kegs, steam-operated brewing systems, hot and cold storage tanks and fermenting machinery, at minimum. You will also need tables, chairs and/or booths for your patrons to use.

Start your microbrewery small, but always stay focused on expansion ideas. A modest start will keep you from spending too much early on in the process. In turn, your chances for success will sharply increase.

TIPS

• Make sure that you are fully aware of laws, regulations and ordinances in your local area concerning alcohol production. Take care to adhere to those laws at all times. Nothing can sideline a microbrewery like running afoul of the law.
• Be practical. Do market research about the local area before starting your microbrewery. If there's already a successful microbrewery in the area, is there enough interest out there for another one?

Things You'll Need

• Beer-brewing equipment (including, but not limited to, kettles, kegs, steam-operated brewing systems, hot and cold storage tanks, and fermenting Vessels)
• Beer-brewing ingredients
• Start-up capital
• Place to brew the beer
• Quality formulas and flavors
• A list of good reliable suppliers (hops, malt, liquor treatments, adjuncts, labels, chemicals .etc

Microbreweries - New in India

 

Microbreweries, brewpubs have recently been allowed in some States of India. A microbrewery has been installed in India's first brewpub at Hotel Galaxy in Gurgaon, Haryana. The Equipment was imported on turnkey basis from China.

Microbreweries are modern breweries with a two vessel combo brewhouse producing limited quantity of beer per day. The maximum amount of beer such a brewery can produce and still be classed as a microbrewery ,varies by region, is usually 5000L/day or 50HL/day. There is no bottling or preservatives in this beer. A variety of beers can be produced – lagers, ales, porters, stouts. Fresh beer is produced before you and you can drink it directly ( from the tap).

Microbreweries can be installed in restaraunts, pubs, hotels, clubs or malls. The space requirement is approximately 0.1 sq.mtr. per litre capacity (excluding malt milling and malt and other raw material storage ). Microbreweries can be designed for installation on single or split levels – as per customer’s requirement and availibility of space.

The microbreweries equipment is mainly imported into India. The equipment from Europe or other western countries is expensive when compared with Chinese equipment.The Chinese equipment quality and technology is very good with relatively simpler systems and ease in operation.

With the opening up of the microbreweries sector in some states in India there are many persons making a beeline to establish brewpubs. Most such persons have little or no knowledge about microbreweries or the beer making process. It being a new concept in India and therefore an attractive business venture, one finds many consultant companies mushrooming and offering turnkey projects and technical services.

Most such companies are offering consultancy and turnkey projects , with Chinese equipment, in India to set up these microbreweries. The installation, commissioning and training is part of the contract with the equipment supplier. You should know that its possible to get various qualities of equipment at varying price levels from China. Prices alone should not be the primary factor for buying the equipment. The quality of materials and technical specifications of equipment is very important. Beer production requires rust free and very hygenic conditions.

A few words to the new aspiring entrants in this field :-
Choosing your Consultant company -- Do not go by just website or catalogues or meetings. Check out their past performance. Ask for detailed resume of the Brewing technologists/technicians of these Consultants. Ask for references.
Assessing the Chinese equipment manufacturer -- Visit the factory in person and see for yourself the equipments in production and in finished stage. Ask for customer profile of the supplier and of years of experience in the field of manufacture and overseas turnkey projects. Ask for detailed equipment list and technical specifications of materials and physical technical specifications. Ask for testing methods of equipment in production and in-house test reports ( the information would be in chinese language, however, its still possible to understand the basic information).
Equipment material ( Tanks, pipelines, valves etc.) where the beer passes should be stainless steel SUS 304 only. The outer of tanks can be other material according to price and customer requirements ( however, for Brewpubs I would recommended to use SUS 304). Plastic pipelines material wherever required and used must be Food Grade only.
Equipment List must include the brewhouse tanks, fermentation tanks, ice water tanks, bright beer tanks, CIP (clean-in-place) tanks, Filteration machine ( Indian tastes prefer filtered beer ), PHEs (Physical Heat Exchangers), Refrigeration machine ( get an extra one as standby since its a very important requirement in beer production), Boiler (if using steam), Electric Cabinet with all controls, PLC touch type process controller (using Siemens or equivalent technology), all necessary pipelines, valves, motors, pumps, gauges, meters, electric wiring, beer dispensing equipment. Necessary spare part items also must be specified.
Discuss the production capacity and production process base of the quoted equipment.Cycle time for brewhouse, fermentation tanks, holding time of ready beer.
Surface finish to be specified by client.
RO water is required for beer production in areas where water supply does not meet standards. This is to be provided by the client.
Client must have atleast two reliable staff for operation of brewery to undergo training from equipment suppliers technicians. The training should include assembling of the equipment, process of beer producing, filteration and storage, beer dispensing, cleaning and hygeine, record keeping of process and raw materials. Educational background of these personnel should be atleast science graduates. 

Making of India’s first microbrewery 

Prateek Chaturvedi remembers the day he kicked a Rs 36-lakh-a-year job at Procter & Gamble's Singapore office to join a microbrewery in the city's Clark Quay area as a part-time waiter. As an intern at 'Brewwerkz', he earned no money, worked inside the brew house and even got a chance to manage the place when the manager was away.

"The experience was tough, but invaluable. I wanted to understand how they ran the business and got to know it inside-out," says Mr Chaturvedi. Around the same time, his colleague at P&G, Suketu Talekar, returned to Pune and started studying the Maharashtra state's liquor licensing policy. Soon, Chaturvedi would join him, and the two would launch Doolally, India's first microbrewery.

It was at Brewwerkz that the two IIM graduates, then posted in P&G Singapore, used to hang out in the evenings.

One heady evening, an idea started brewing. As Mr Talekar remembers, "We thought aloud that if the beer at a microbrewery was so good and if this was something that had not been introduced to India so far, maybe it was time to do so as growing incomes and rising consumer aspirations in urban India made it a winning idea." That same day, the two decided to quit their jobs and start working on their project.

A microbrewery is one where the beer is brewed fresh. The brewmaster here can use a variety of ingredients to turn out a diverse selection of beers. Mr Talekar remembers the challenges, "The existing licenses allowed breweries to either manufacture, distribute or retail their beer; the microbrewery business model is one where we had to do all three. Eventually, after fourteen months, the brewery license was modified to accommodate microbreweries like ours."

One of the key learnings for Chaturvedi was the importance of both maintaining the quality of beer and changing the types of brews. To ensure this, they reached out to Oliver Schauff, a noted brewmaster based out of Germany and offered him equity stake in the company. By September 2006, the team was in place. They also zeroed in on Pune to launch since it offered a comparative low cost base.

They needed to raise around Rs 2.5 crores to make their dream a reality. The investments came from angel investors Mahesh Murthy, Sharad Khadakia and Pramod Choudhary (of Praj Industries) who put in around Rs 1 crore.

To save on costs, they built the brewhouse locally instead of importing it. All the raw material such as iron and steel was sourced from Laxmi Road area in Pune and were machined in local workshops. The location for their first microbrewery was the upmarket Corinthians Club. While the brewery infrastructure costs are borne by Doolally, the restaurant is managed by the bar and around 15% of the revenues are shared with the bar. By October 2009, their first microbrewery opened doors to the public. They project revenues of Rs 1.9 crore in 2010-11, with a growth rate of 15-20%. Mr Chaturvedi and Mr Talekar project a breakeven in around three years.

The brewmaster prepares different flavours. "Apart from the Lager, we offer flavours such as Wheat Beer, Santa's Ale, the English Brown Ale and the Greenlandic Ale," says Schauff.

For the immediate future, Talekar indicates which path he's leaning towards. "Karnataka, Punjab and Delhi-NCR now have all been issued microbrewery licenses. We want to gain first mover's advantage and build our brands there."The Doolally brew has certainly seen the two experience a high so far, and they will be trying to emulate microbreweries of the West, many of them, which have successfully launched million dollar IPOs. Until then, raise a toast to the health of enterprise.

Microbeweries Machine Manufacturer 

Canadian Clear International Ltd 

Mr. Sathish Kumar (Vice President)
No. 149, Poonamallee High Road,
Kilpauk
Chennai, Tamil Nadu - 600 010, India
Telephone:+(91)-(44)-28362461/ 28362469