How Much Does It Cost to Start a Microbrewery?

Building a commercial brewery is a noble and exciting endeavor. For many, it is a dream they feel ready to realize. But starting a microbrewery isn’t cheap and easy.

I founded two breweries in Asheville, NC (Green Man Brewing Company and French Broad Brewing Company) and I was active in the early brewing scene there from 1997-2006.

Starting a microbrewery costs around $300,000 – 350,000. This likely includes a mixture of new / used equipment, possible non-union labor, and a lot of personal elbow grease.

The resources needed to be a successful commercial brewer are as follows:

  • A solid business plan
  • A reliable equipment source
  • A partner with business acumen
  • A handful of proven recipes that you have mastered on a small scale
  • Resilience and determination

 

Pricing of your System

Pricing depends on two major factors, size of system, new or used.

When I began commercial brewing in the mid 90’s the US industry was already gradually declining in numbers.

It had peaked out in the high 3,000s.  Few anticipated where it would go from there.

This chart illustrates the meteoric growth of American craft brewing in the last ten years.

brewery count in USA
Brewery count: 2014-2018. Source: Brewer’s Association of America, 2019

 

The following numbers are estimates based on research and personal experience in microbreweries.

They are an estimate only, averaging the price of new and used equipment.

Many breweries gather their equipment from a variety of sources, not one simple turn-key operation.

This is for a production/ packaging brewery, not a brewpub.  There can be an attached retail taproom, depending on state law.


On the same topic: Microbrewery Equipment List: All You Need to Get Started


 

Production (15 bbl. estimated size)

Brewhouse- Kettle, Mash/ Lauter. Hot/ Cold Liquor tank $35,000.
Cylindro-conical fermenters – 4 $48,000
Brite Tanks – 2 $16,000
Hoses, pumps, heat-exchanger, hardware $6,000
Plate and Frame filter $5,000
Temperature Controls $3,500
Glycol Cooling System $13,500
Subtotal $127,000

 

Packaging

Keg Washer $12,500
Kegs (5 and 15.5 US Gallon) 300 5s, 150 15.5s $15,000
Canning Line $45,000
Walk-In Cooler (10’ x 20’) $20,000
Subtotal $107,500
Total- Production and Packaging $234,500

 

There is one company I trust above all others based on business experience and personal relationships.  

Applied Beverage Tanks have been industry consultants and manufacturers for 30 years.

They have set-up over 200 new brewery operations worldwide and provided various services to hundreds more in the United States.

I met them in 1999 when I was undertaking my second brewery, French Broad Brewing Company.

I would trust no other.

brewhouse system
4 vessel brewhouse (courtesy of Applied Beverage Tanks)

 

Investment

If you are truly serious about starting a small-scale craft brewery you will need outside investors or collateral for the bank to loan against.

Brand-new brewery equipment can cost between a one hundred thousand dollars to a few million dollars.

If you are considering starting from scratch, renting a location, doing the build out and properly outfitting it, be prepared for a long process, if not in actual time, but complexity.

If you already have a restaurant and you are interested in starting up a brewpub this could potentially cut some of the costs if you have the extra space and friendly lease arrangement.

Personal savings up front is absolutely essential as banks and investors want to see that you have some skin in the game.  Your willingness to risk is a measure of your character and dedication.

This represents a basic setup outline to take you through the set-up and the first year of your microbrewery operations.

 

Consulting

If you are not a professional brewer nor brewed commercially before it will be a good idea to hire a professional brewing consultant to help you through your first 30-90 days.

The help of a consultant ranges between $75-150 an hour.

A consultant will:

  • Assist with final walk-throughs of the ATF and city inspectors
  • Help scale up your recipes.  This is not always a direct translation by weight.
  • Learn the new system.  Teach you the motions.
  • Discuss with you each step of the process and how it is different from a home scale
  • Demonstrate fermentation, conditioning, carbonation and packaging using temperature control.  This is a major distinction from homebrewing.
  • Give potential customers confidence that you are on the right track.
  • Perhaps stay on and be your brewmaster

It is vital to have a veteran presence in the brewery when starting out. 

There will be problems.

There always are, no matter how expensive or sophisticated a brewing system may be, nor how perfect the recipe is.

Have someone with you that has experience problem solving.

This will cushion the blows of setbacks that inevitably come with any new start-up.

brewmaster consultant

 

Business team and business plan

Put simply you need a good banker, lawyer, and accountant.

Unless they come from within your immediate investment group, make sure you have these three professional services lined up.

You have the best idea, you have money and desire, and you need a business plan.

Without a solid logical plan, your dream is just a dream, no matter how much money you throw at it.

Write a good plan, be deliberate and patient, and get feedback from experts.

Apply metrics and make it work on paper before you break ground or buy item one.

I cannot emphasize this enough.  I was a risk taker, and it was a rocky road.

 

Planning, construction, and permitting

Construction will take 90 days minimum. 

It depends on how much DIY you employ.

On both of my breweries, Green Man and French Broad Brewing Company, I did much of the work myself, so it took much more time.

Green Man was on schedule, FBBC was delayed.

I did however save big money, over $50,000 on the FBBC set-up.

Tasks will include painting, sheetrock, pouring concrete, sweating copper, running PVC lines, electrical wiring and refrigeration.

I knew some of the contractors personally, so I would be their helper to either save time, or they would pay me, thereby off-setting the cost.

State and Federal permits are essential for legal operations and I do not recommend brewing one drop of anything without them.

State paperwork is easy and straightforward.  Most NC paperwork took no more than a week or two to process.

City permits can take longer, depending on the relationship you or your contractor have with the inspection office.

The federal brewing permit comes under the jurisdiction of the ATF (Bureau of Alcohol, Tobacco and Firearms- and Explosives).  I think it is much easier these days.

Still, I would calculate 3-5 months for full permitting and compliance.

This usually includes an onsite visit.  It is a complicated application process.

Give yourself at least a month to get everything together.

 

Making your commercial brewery a reality

Be prepared for a long road, full of challenges, and make sure you have a good team in place.

Know your strengths and your limitations.

Depend on one another and play the long game.

I wish you all the success and brewing happiness you can manifest.

It is an exciting journey.

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