Brewery Frustrations

A wee humble pub

Just for fun I asked a question on Facebook Brewery in Planning; “What is the most frustrating thing about running a brewery, or trying to open one. The responses - there were a bunch - were pretty funny, predictable and from what I’ve seen, true.

In almost every response, I had a similar story. But I would say the number one gripe was government. Not just taxes and forms to fill out, but dealing with bureaucracy. During our Immersion Course I always tell the student that he/she will experience some rule thrown at them from their local or state government, that will make no sense to them. But it is better to not fight it. Oh the stories I could tell.

But I’ll skip mine. Here’s a good one however. A friend was opening a brewery and spending down all his resources. He had to submit architectural plans to the building department. They took their time but approved them and stamped the plans and the building permit. When the project was almost complete, the building inspector came in and said “You need a firewall dividing this space.” My friend said it was a clear story with 24 ft high ceilings and to have a fire wall would cost tens of thousands. In spite of the approved plans that showed no firewall, now the county wanted one. My friend gave up on the project rather than continue to deal with the building department.

On the other hand I had a friend who had no problem at all. In fact the building inspector thought the brewery was so cool, he offered to help with some of the construction. You just never know.

For your federal license, I have found the TTB (Tax and Trade Bureau) to be really easy to deal with. I’ve never had a problem with them, and now that the process is done online, it’s really a piece of cake. You still need to fill out all the paper work. If you fill out something incorrectly, they tell you what the problem is, then you submit the corrected version and that’s it. In addition it’s all free.

Your state licensing could be a whole other issue. I live in a good beer state (Colorado) and it couldn’t be simpler here. Not so much in other states.

Employees are the other big issue. In fact I think it’s your number one headache. If you are a brewery in planning just copy what we did with the original Colorado Boy in Ridgway. It only has 23 seats inside, and 4 picnic tables outside. Most of the time besides the brewer, there are two servers, both serve and tend bar, and host, and bus. One of them is the lead shift manager too. There are also two kitchen people. That’s it. They are only open from 4 to 8, and it’s packed during those times. Everyone works their butts off, but they share tips and make gobs of money. It’s an easy peasy place to operate.

If you can’t or don’t have a small place, then you need to have a really tight business system that includes lots of checklists and audits. You actually need this in any size of business. Communication and respect is so important with employees, but who am I kidding, that will only get you so far. It’s just part of the deal that you will deal with some employees who are dicks. A piece of advice I got when I was a young manager and sweated over letting someone go. Keep repeating this mantra. “5 minutes of agony, a lifetime of ecstasy”. It may be difficult to get rid of the bad ones, but once they walk out the door you will feel so much better, and, your other employees will too.

Another issue that was brought up was having difficulty finding a location. There is a lot to unpack with this and I will devote a whole newsletter to it next week.

And finally how to deal with a partner. Partners are a necessary evil when you get started. The sooner you can get rid of them the better. I will say some partnerships work great I personally know some, and then there are The Rolling Stones.

If you are a brewery in planning and have a partner, spend the time at the beginning of your project and think through all the ways you can unravel the partnership legally and equitably. In other words, how does a buy out work? How do you value the business? Can a partner be bought out over time, and when would this happen? Certainly not three months after you are open, but a vesting period of at least a couple years.

Oh yeah, and have in writing what your jobs are and how many hours the partners are expected to work. This is very important.

I hope this isn’t discouraging if you are planning a brewery. The fact is this would be the same in any business. The difference with our business is it is essentially a fun job. It’s not easy to be a business owner, but it is way more satisfying than working for someone else. Plus, owning your own business gives you equity, which is the best way to create wealth for you and your family. Unless you are a brain surgeon, you most likely aren’t going to get rich earning paychecks.

Shoulders back, chin up, and head to the brewery. What a great life.