Breweries that open without a bottling/canning line

I think it could be more risk with distribution. Breweries make significantly more money on over the bar sales versus distribution. Plus, the initial capital needed for distribution is much more. Seems like the most popular breweries don't even distribute I.e HFS, treehouse, trillium. Yes, the bottle or can but they are sold at the brewery only, I believe at least. If you sink all that money and then fail it hurts a lot more. Plus, brewery only growler fills = whalez bro.

 

I will echo that brewery-only growler sales and typical bar/tap serving is maybe a safer way to start financially, plus if the brewery is any good they can jump on the hype train right off the bat.

 

If you've ever looked into it, modern day canning/bottling lines are ridiculously expensive. The capital needed to outright buy that equipment in the past has probably broken more than one start-up brewery. In my experience the places that start up as brewery only slowly build a name (often times if you look at a map the successful ones are within easy travel of a larger successful brewery like they are piggy backing) and eventually there popularity warrants an income that can afford the bottling equipment. I think "local" being popular is also driving, in some sense, an I'm more local than you mindset. And another factor, advertising wise, is the internet; sure if you see an interesting new brewery at a bottle shop you might check them out, but word of mouth on places like BA here is free and can really bring in business. An example near me is Austin Street Brewery, no canning or bottling (still as far as I know), but they are conveniently located a step away from Allagash, Bissel Brothers, and Foundation and they pick up a lot of business from the other breweries. They could dump a ton of money on a bottling line or they can just continue to sell beer for what is probably a pretty good profit to curious customers of the other breweries.

 

A small brewery can only make so much beer. Selling it at retail means twice as much money as selling it retail.

There are mobile canning companies across the country. When they are ready. They can start canning.

 

Craft beer is growing fast, but the number of breweries today suggests a bubble . Brewers like OH and Treehouse brew fantastic beers, but use scarcity to stimulate word-of-mouth. With taproom-only beer at Treehouse, and cans only on sale at OH, the taprooms enjoy lines around the block. It's their right to distribute any way they want. If you're Harry Winston, you don't put your jewelry on sale at Macy's.

 

If you can get folks to come to your brewery and buy everything in growlers, crowlers, or hand bottles you get to keep all the profit instead of the small percentage of profit you get from distro. Plus, in NY and some other states, you can self distribute if you don't sell it all at the brewery. There are pluses and minuses to choosing either of these ways, but it is much less financially risky to hand bottle and keg all your beer for sale at brewery and self distro.

 

Second this.

We have a fairly local start up (less than 2 years old) that self-distributes in kegs, is successfully growing, has a very congential tap room and looking forward to acquiring their first packaging line when money allows (they made sure they would have the space). They also have a tie to a couple of restaurant type places who rely on them for most of their beers. And have been getting their some of their beers on tap in a some other places that serve food and have several taps. Seems to be working well for them.

 

This is probably the least risky way to do it because you are not tying a bunch of money up in packaging equipment. Next to a bomber, selling it by the glass from your own tapline is the easiest way to generate money.

 

There is a brewery near me (Midnight Brewery) that does not can or bottle. They do distro kegs to a few local spots, but the large amount of their beer is sold through their front doors. They opened up about the same time as Hardywood and could have easily been lost in the wake of Ardent, Triple Crossing, The Answer, LCCB, etc., but they have maintained a decent business. What's even more amazing is that their flagship beer is a Kolsch and didnt' make an IPA of any sort until last year. They have developed a nice following by having music and food trucks in a an area largely underserved when it comes to middle aged crowd gathering places. Think they found their niche in making approachable beer for folks that want something a bit more out of their beer than say, fizz, but don't want to get punched in the mouth with hops, booze or sourness.

 

These guys have been successful at it for almost 10 years.

 

You make much more profit selling your products at your brewery- no distributor and no retailer. Also selling at your location you can make smaller batches, experiment, and you have more control over the experience and quality of how people enjoy your product.

 

While bottling and canning respectively now, my two local breweries in Trillium and Tree House seem to have done just fine without doing so initially.

 

You're going to see more of it. Altamont Beer Works in Livermore is one of my current favorites doing this.

It's not necessarily more profitable, but drastically trims packaging costs and loss (beer that doesn't sell or is returned). It helps the bottom line and the fact that beer stays closer to the source means it's fresher.

You also help establish a presence within the community and region.

Brew, keg, fill glasses and growlers....

Repeat.

 

How long was Jackie O's successful before they started canning?

 

Yeah they bottle. I've had bottles of Rockville Red and Not My Job down here in Norfolk.

 

I had thought that I had heard something about them starting bottling recently (maybe heard it through a 2nd party) but couldn't quickly confirm it. They did manage to flourish for several years without it though. Glad they can spread their wares a little further now!

 

it is very common for start ups to not have cans or bottles here in MI. Some reasons are that breweries can self distribute up to 1000 bbls. Kegs are used in many for serving their bar, so they can distribute half or 1/6 bbl kegs.

The highest margin is for the beer sold over the bar. But you can only sell so much over your bar in a small town. If you can brew more and distribute up to 1000 bbls, why not send the rest out and make more money? Over 1000 bbls you need to contract with a distributor here.

Many of the established breweries have vintage bottlong lines, and I think that type of equipment is not readily available anymore, as the supply has been used up. Parts shortages would be another deterrent. Shelf space is getting tight, which makes getting into bottles not so attractive.

Profits in distributed bottles and cans? There is a lot to be made, if you can make a lot and distribute. Why do you think big breweries have high speed bottle and can lines?

 

The exact numbers do vary, but consider this.
At the brewery, they can sell you a pint of beer for $4 (for 16 ounces of beer).
If they bottle it, they might sell you a 6-pack for $10 in the taproom (where legal)
If they distribute they might sell that 6-pack to the distributor for $4.25, who sells it to the retailer for $6.50, who then sells it to the consumer for $10.
They make much more profit selling it themselves. The only way to make good money on distribution is to make a lot of beer, but it's much less efficient.