What do you include in your microbrewery business plan? We will take a closer look into the key components of a craft brewery business plan as well as the importance of drawing up one.
Why is a microbrewery business plan important?
A brewery business plan is a useful tool that can help you to secure the necessary funding needed to efficiently start and operate your craft brewery. A brewery business requires a lot of investment, as well as high taxes, are charged and the costs of obtaining business permits and licenses to be allowed to operate in the area you have chosen as the base of your microbrewery operations
A microbrewery business plan provides a sense of direction It guides both management and employees on what to do to ensure the day-to-day operations of the business are done efficiently and effectively to contribute to the overall growth and success of the business. Remember, your craft brewery business plan is essential in increasing the likelihood of success for your microbrewery.
“Make sure you have a solid business plan and good corporate documents. They are important to properly set in place and complete so that everyone involved knows what the road map is and how you handle any disagreements should they arise.”
- Dan Schwarz, founder and CEO of Lift Bridge Brewery in Stillwater, Minnesota.
8 Components of a good microbrewery business plan
Executive summary
This section provides an outline for the contents of the whole microbrewery business plan. It is the most important section of the business plan as it enables the reader to save time in getting the whole view of the business plan by providing a summary of the main areas of the business plan. Keep in mind that this section is to be written last after you have completed the rest of the business plan and make it convincing enough to the readers to motivate them to read through the rest of the plan.
Business overview
In this section, you are to provide a detailed description of your business including information about the microbrewery such as business legal name and trade name, business address, the nature of the business to be done, and date of registering the business. Give a list of products and services that you want to offer. When providing a description of the business, including details on the microbrewery concept and brand you have in mind that you want to bring to life. Most importantly, provide a mission statement that summarizes what your craft beer business will achieve. In addition, mention the business goals that will help you realize the mission you have set out for your craft brewery. These goals could either be short-term, mid-term, or long-term depending on the timeframe you have set to accomplish them.
Industry overview
It’s important to show that you have an inner understanding of the overall beer industry and the microbrewery sector that you want to focus your efforts. You can do this by describing the nature of the beer industry and the microbrewery sector, the main players, and industry trends. Make sure to include the most recent statistics including demographic, economic, social, and cultural factors that will play a role in making your microbrewery business a success. Moreover, highlight the relevant government regulations and legislations that govern the industry. Provide details on the impact that the legislation and regulations will have on your craft beer business.
Market analysis
The goal of this section is to provide proof that there is demand for your product in your target market. You want to prove that there is a demand for beer in your target market. The best way to conduct your market analysis is to do a competitor analysis where you locate your potential competitors in the microbrewery space. After identifying your competitors, list down their strengths and weaknesses. Use the information you have gotten about your competitors to explain to investors why your microbrewery will stand out from the competition.
In addition, a description of the target market that you intend to serve is important to mention in your market analysis. Use demographic characteristics such as age, gender, and income levels to give a clear picture of your customer persona. . You can get this information from external sources that are reliable e.g. Statistics Canada. When describing your target market, keep in mind that customer segments have unique profiles therefore you should select the ones that have the highest preference for your products and services.
Marketing plan
You should aim to show how you are going to attract and retain customers, and grow the business. Returning customers are key to keeping the doors to your business open for a long time. Explain the marketing strategies you will use to keep customers coming for your craft beer. Describe the channels you intend to advertise your business. You can choose between traditional media and online/digital media to get the word out A mix of both traditional and digital media is more effective in reaching a larger audience.
Pricing policy and selling methods should also be included in the marketing plan. Your pricing policy should factor in various costs involved in bringing your beer to the market and be competitive when compared to your competitors. Moreover, align your beer pricing to the financial projections in the financial plan section of your microbrewery business plan. Selling methods refer to the ways you will use to generate revenue from the sale of your beer products. One of the common selling methods in the beer manufacturing industry is personal selling where you sell directly to your customers. Explore other selling methods that will bring more revenue into the business.
Operations plan
Your microbrewery business plan should contain an operations plan that lays down the blueprint for the daily operations of your brewery. You will need to document the controls and systems you intend to establish in your brewery operations. This ensures that brewery operations are conducted in a systematic manner before the start of operations.
Provide details on the business suppliers and a description of the items that they will be supplying. i.e. raw materials, manufacturing technology, and brewing equipment among others. Additional areas covered in this section include inventory management, operations workflow i.e. beer manufacture and delivery processes, distribution strategy, and logistics i.e. beer packing and shipping. Other business areas that fall under this section are business support functions such as accounting.
Include environmental compliance subsection within the operations plan showing the impact of your microbrewery business on the environment. It should also explain how the business intends to deal with waste produced from the beer manufacturing processes and other environmental issues affecting the industry. One way of demonstrating your craft brewery’s compliance to environmental regulations governing the industry is by developing an environmental code of conduct that guides everyone in the business is going about disposal of waste and conservation of the surrounding environment affected by business operations.
Management and human resources
Provide information about the people who will be required to operate your microbrewery including microbrewery/pub manager, bartenders/baristas, table attendants, accountants, and cleaners. List all of the personnel required to take charge of brewery operations at your microbrewery and the duties and responsibilities they are to be accountable for.
Your human resource policies and procedures should includeweekly operational hours, vacation programs, training and development plans, remuneration and benefits for all employees, and health & safety guidelines to be followed at the workplace.
Financial plan
A microbrewery business plan is not complete without a financial plan. This is the last section of your business plan. Provide all-important financial numbers to be reviewed by investors in order to make a decision on whether or not to put money into your craft beer business. You will need to provide financial projections for your business for the first three to five years of operations. Financial projections include estimated revenues, expenses and profits on both monthly and yearly basis within the selected timeframe. It should also have information on your revenue model i.e. how you generate sales from the beer sold, financing plan i.e. sources and amount of funds needed to start the business.
Your financial plan should have three main financial documents: profit/loss statement, balance sheet, and cash flow statement. Additionally, you can include a break-even analysis to show how long the business is expected to start making a profit and generate returns for investors. Put in relevant tables, graphs, and charts to give a pictorial representation of your financial projections. These can be placed under the Appendix section after this section.
3 Things to do before writing your microbrewery business plan
- Do research on the microbrewery industry to obtain all information you can on the industry. This will enable you to get all you need to start your very own brewery business.
- Get first-hand information from other microbrewery owners by asking as many questions about the business. It will help you to differentiate between the do’s and don’ts in establishing your craft beer business
- Figure out unique names for the various beer brands and do some research to determine whether the names you have chosen are intellectual property belonging to other microbrewery companies. This will save you time and money on marketing and promotion using intellectual property that you are not allowed to use in the first place
At Vaisus, we create detailed, customized, and high-quality funding business plans. We have successfully helped multiple businesses develop bank, investor, and grant-ready business plans and proposals. Schedule a callback and speak to one of our consultants.
