Brewing a Profitable Business: 8 Financial Tips for Starting Your Own Brewery

Understand Your Costs

To run a profitable microbrewery, you need to understand your costs. This includes the cost of ingredients, brewing equipment, rent, utilities, salaries and marketing expenses. Make sure you factor in all of your costs when pricing your beer to ensure you’re making a profit.

One of the main startup costs for a brewery is equipment. More expensive equipment can be of a higher quality (i.e. less time before repairs) or generate a high quantity of beer (more turnover in a shorter time frame). It’s up to your business model to decide what kind of start-out costs will be necessary.

Focus on Quality

Affordable options don’t mean skimping on quality. In the craft beer industry, quality is essential. If your beer is not up to par, customers won't return. Make sure you invest in high-quality ingredients and equipment and that you brew consistently good beer.

This is also why it’s best to start out with simple crowd pleasers with a bit of a twist. If you’re making a pale ale, why not take inspiration from an older recipe? A good story goes a long way in ensuring people remain interested in your craft. Whether you’re chasing firsts or spending time discovering lost recipes, make sure your beer lives up to the legends you’re spinning, otherwise customers will spend their money elsewhere.

Get to Know Your Regulars

If your business is customer-facing, make sure you engage with your customers frequently. The beer industry is known for being friendly and welcoming, so you want to make sure that people see your business the same way.

Offer tasters of new products, keep in conversation with your friends, family and locals that support you. This gives you a constant source of external information and a perspective on your business that could be invaluable. It also ensures that you have regular customers that you can maintain a baseline of profit from.

Keep Your Accounting in Order

Working in the brewing industry can be tiring, and admin and accounting may take a back seat in the beginning. This is a huge mistake and one you need to ensure doesn't happen to you.

Keeping accurate financial records, sticking to your budget and implementing proper accounting procedures such as invoice processing and pay runs is crucial. The more on top of your accounting you are, the easier it will be to ensure you maintain a consistent cash flow. Plus, you’ll know exactly what financial position your new venture is in at all times.

Starting a new brewery is daunting and exciting, but if you follow these eight financial tips, you’ll find that the money management side of it is far more manageable.