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
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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!