This weekend is the Great American Beer Festival, an event I wouldn’t have missed for just about anything, however I won’t be there this year. A lot of friends and past students will be and I wish them luck.
If you haven’t been to one, it’s a trip for sure. Each night with 20,000 people drinking beer, thousands of volunteers, and hundreds of breweries. It’s crazy. I especially love how in the middle of the chaos the Denver Bagpipe Band starts marching through the hall. The whole place is deafening.
My first GABF was in 1994. It was in a smaller venue. My fist medal, a bronze for IPA was in ‘95, and you received your medal on a little corner stage in the hall and Charlie Papazian actually shook your hand, not a fist pump as he would famously do later because his hand was wearing out.
I’ve watched the industry grow from the inside and now we are at a plateau and folks are wondering if the magic is fading. I don’t think so. I think it’s maturing and the breweries that are striving are maturing as well. The days of just brewing beer and the people flock to your door are over however.
This may sound like a downer but it’s not. There are excellent opportunities to start a brewery. For one, just google breweries for sale. There is a huge list that shows up, which means great opportunities to buy an existing brewery and put your stamp on it, which is much easier than opening one from scratch.
For example just think of the restaurant business. They have been around forever and they continue to open and close all the time, yet they never go away, and the person who knows what they are doing can be very successful because they understand what it takes, while the ones that fail are clueless. I see it all the time.
There are lot’s of keys to success in the brewing business, but for me it comes down to the following:
Brew good beer (duh)
Have value - the perception the customer feels they are getting their money’s worth
A great Oyster. This is unbelievably important.
Low rent. Keep your rent or mortgage below 7% of your gross sales. 10% is the upper mark, and really anything beyond that and you are working for your landlord or bank.
Keep good clean books, tracking your money every day, doing monthly inventories, etc.
Have a tight Business System that operates your day to day business. This is my number one piece of advice.
Have a good exit strategy, for how you mature out of the business, because eventually you will.
If you develop these skills, there is no limit to what you can do in the brewing business. Really, growth is unlimited, or just be super happy with one simple pub and a great life. And go to the GABF and hang out with like-minded brewers. It’s a great industry to be in - still.
