How much does it cost to start a brewery? Starting any type of brewery comes with some serious costs. But with a bit of knowledge, the whole budget is more clear-cut. And you’ll be able to determine where to cut down costs. To truly understand the startup cost of a brewery, you need to create a brewery checklist. Operating costs and obtaining liquor licenses must be on your new list. Plus, the upfront cost of buying brewing equipment. Starting a brewery is a whole different ball game to opening a bar or restaurant.
In this guide, we have a rundown of all the brewery finance details - providing a clear idea of brewery costs. As a brewery owner, you have loads to think about. By the end of this article, you can formulate a clear plan forward. Setting up a brewery business is exciting, and by simplifying the most complex stage, you’ll be well on your way.
What Is the Average Cost To Start a Brewery?
The average cost to start a brewery is approximately $100,000 to $200,000. You’ll be well on releasing around 15,000 to 20,000 barrels a year at these setup cost prices. And you’ll tread the line between a microbrewery and a regional brewery - hopefully operating profitably nationally. Here is what your $100,000 to $200,000 will include:
Equipment. Equipment is a considerable portion of your brewery setup costs. We’ll go into detail later, but in summary, you’ll need things like a mash tun and fermentation tank. The smaller your brewery, the less equipment you’ll need. So calculate your output and go from there when buying equipment. An equipment budget starts at around $15,000 when setting up a brewery. However, it can quickly escalate to much more depending on brewery size and equipment quality.
Materials. You’ll also need to buy material in bulk upfront. Malt grain is typically $20 per ton, while yeast is the most expensive material at approximately $3,000 per ton. You can keep prices down by buying in bulk, just as long as you have storage - think silos and tanks. You won’t cover materials in your initial profit turnover. So prepare yourself to pay out of pocket for at least the first few rounds of materials.
Marketing. Marketing is something to pay attention to when setting up a brewery. Marketing covers everything from packaging to social media ads; the bigger your budget, the more potential you create.
Marketing strategies like captive portal WiFi, billboards, bar hashtags, and Instagram reels are all beneficial for growing your business. Be it brewery related or not. Some things like a reputation manager are ongoing as well. Dedicate a large chunk of your budget towards marketing and watch the benefits roll in.
How Does Brewery Type Impact Setup Cost?
The cost to start a brewery varies massively depending on the brewery type. There are four main classifications of brewery types:
- Nano brewery
- Regional brewery
- Large-scale brewery
The smallest, the nano-brewery, only produces around 1,000 barrels yearly, requiring less equipment and space. Whereas the large-scale brewery produces over 500,000 barrels a year. And therefore, it requires more equipment, space, and a hefty average sum of approximately $1,000,000 in setup costs.
If you run a brewpub, a nano brewery is a great option. While if you want an edgy independent brewery, then a microbrewery is perfect. Large-scale is akin to world domination and is best suited to the most ambitious of brewery owners.
Carefully consider which brewery type best suits your business model and existing business. The brewery type you choose will directly impact setup costs through sheer differences in demands.
Equipment Cost To Start a Brewery: A Setup Checklist
Our first consideration concerning ‘how much does it cost to start a brewery’ is equipment costs upfront. Equipment isn’t something to scrimp on, especially if anything breaks and you buy replacements. Equipment-wise, the cost to start a brewery is approximately $14,000. And that’s not including kegs. Here’s our breakdown.
Grain silos: $2,000 +
Grain silos hold the grain and high quantities of reserve materials on site for the brewery. Malt grain is the essential first ingredient when brewing beer, so it is vital to have proper storage for it.
Weighing systems: $200 +
We’ve all been there trying to bake cakes while guessing the ingredients. It’s a risky game and not one you should risk playing with your brewery - where weighing systems come in.
Mash tuns $3,000 +
Mash tuns are where grains and water mix to form a wort - a malt liquid combination before fermentation. The process uses an insulated chamber and is absolutely essential for breweries.
Pumps: $300 +
Pretty self-explanatory, pumps are vital for pushing the process forward and sending the beer from one stage to another.
Brew kettles: $1,000 +
Brew kettles boil the wort for 60 minutes. At this stage, add extra ingredients while reducing the original liquid.
Fermenters are huge tanks that culture bacteria on a massive scale. At this stage, the yeast converts sugar into alcohol as a byproduct.
Bright beer tanks: $3000 +
Again, this a self-explanatory piece of equipment to consider amongst the overall cost to start a brewery. Beer tanks are necessary to hold the final product.
Pressure fillers (for glass bottles): $2,000 +
Pressure fillers are how you specifically fill glass bottles of beer. A pressure filler retains carbonation when it fills bottles.
How To Save on The Cost to Start a Brewery
You now have the average cost to start a brewery plus a rundown of upfront equipment costs. How can you save money in this setup process? Luckily, the answer is long–there are many ways to keep costs low when starting a brewery.
The first way to save money is by buying stainless steel equipment, not copper. Copper is much more traditional and is also said to boost yeast health, which is excellent for fermentation. However, it is also lots more expensive. So to cut corners, avoid buying secondhand and instead purchase stainless steel. There’s only a marginal difference in performance, saving you a hefty sum.
Second, consider opening a nano brewery or microbrewery to start with, rather than jumping large-scale immediately. Starting small will allow you to grow your brewery business, reinvesting profits gradually. This tactic is much more low risk and will save you money upfront. A nano brewery produces less than 1,000 barrels a year but costs between $10,000 and $50,000 in setup costs. While a microbrewery produces between 1,000 and 15,000 barrels a year, it only costs $50,000-$200,000 to set up. ‘Go big or go home’ doesn’t apply to brewing beer.
Lastly, lock in those trade prices as soon as possible. And make sure to claim business costs from your annual tax bill. If necessary, get an accountant or advisor, and they can help you lock in the best brewery finance deals.
What Is the Cost to Start a Craft Brewery?
So, what is the cost to start a craft brewery? And how does this differ from the average cost to start a brewery? Great questions. Firstly, let’s define the term craft brewery. A craft brewery is a blend between nano and microbrewery. It is a small-scale, usually independent, brewery that traditionally makes beer. The beer is made in small quantities and typically without automated equipment - adding a ‘craft’ element to the process.
So, what is the cost of starting such a brewery? The startup cost will be between $10,000 and $60,000, depending on the quality of the equipment you purchase. Operating costs should be low, but remember that it is more labor-intensive than automated brewing. So allow for more staff hires or be willing to dedicate a substantial proportion of your own time.
Staff costs are especially the case if you want to run brewery tours or beer-tasting events (events especially attract customers). We’d recommend it, though, as these strategies provide fantastic marketing and a source of revenue. Marketing should still be necessary for craft breweries despite them not being large-scale. In fact, you should market them even more because you’ll be relying on local and regional sales. Plus, people treat your craft brewery as a tourist destination.
What Is the Microbrewery Setup Cost?
When asking what the cost to start a brewery is, it’s essential to consider brewery type. A microbrewery setup cost is meager in comparison to larger breweries. And it’s feasible with as little as $50,000 - much less than the millions that large scales demand upfront.
You’ll likely produce between 1,000 and 15,000 barrels annually with a microbrewery. With these barrel numbers, you can get away with just a couple of each machine and equipment piece. Because of this, you won’t need as much building space to house the brewery. This could lower your rent or reduce the prices of the properties you want. Brilliant, right?
Upfront materials and ingredients costs will be lower for a microbrewery producing fewer barrels. And with fewer barrels to make, you’ll require less staff to monitor the process. And fewer packaging designs.
Furthermore, with an independent microbrewery business model, you’ll likely want to work with local suppliers. Your transport costs will be much lower, and you’ll operate on a maximum of regional level. As a whole, microbreweries are fantastic, low-to-mid-level budget options when entering the brewing world. You can’t go wrong with a microbrewery if you are just starting your brewing business.
How Great Is the Cost to Start a Brewery?
How great exactly is the cost to start a brewery? People may unhelpfully quip the phrase ‘how long is a piece of string,’ but you can get a clear idea. To start a brewery, you need a minimum of $15-20,000. This budget can cover basic equipment, initial materials, packaging, and marketing. But if you’re going hard with your brewery setup, you can budget over $1,000,000 on setup costs. Go in with a benchmark setup cost figure of around $20,000, but know the sky’s the limit.
Do you want extra assistance with budgeting to open a brewery or investing in different forms of marketing? At Beambox, we are always excited and happy to assist you with setting up and marketing your business. As experts in WiFi marketing and social media marketing, we can help your brewery in your journey to success.
Beambox offers the best all-in-one WiFi marketing platform. Forget all the marketing drama amidst the budgeting for the cost to start a brewery. We utilize a multi-strategy approach to connect, attract, and keep customers. Start your Beambox free trial today, and let us help you maximize your social media and brewery potential.
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