You know the difference between a porter and a stout. You understand nitro isn’t what dentists give patients. You cringe when someone says, “I’ll have an ‘Indian Pale Ale.’” Not only that, but you’ve been home brewing for a decade and all your friends say your Belgian wit is the bee’s knees.
No matter your pedigree, if you’re into beer, you may have been contemplating a career in craft brews for some time.
Despite the ubiquity of Colorado craft breweries, crafting your own brewery may not be as easy as you think.
For example, do you have the capital to pay for rent and equipment while waiting for federal approval to begin production? Are you going to procure a loan or rely on investors? Do you want to distribute or just be the neighborhood taproom? What’s going to set you apart from the two-dozen breweries already in business in Colorado Springs? Do you want a brewpub license so you can serve food or would you rather stick with the liquid? Do you have the time to oversee your operation, manage employees, source ingredients — not to mention produce, throw out and reproduce your main source of revenue over and again?
“It’s not always as fun as it sounds,” said Travis Fields who, with his wife Nicole, own Fieldhouse Brewing Company on South Tejon Street. “It’s an awesome job, but it’s challenging. The amount of work for the payoff — we’re 14 months in and just finally starting to break even. The summer’s been good, but last winter was really bad for us as far as sales go. We just weren’t established.”
On paper, there’s plenty to go around. The craft beer industry broke the billion-dollar mark in 2014 in Colorado. The state is often in competition with Oregon as to who can create the most craft breweries per capita in the nation, probably the world. And the trend doesn’t appear to be slowing.
“The Colorado Liquor Enforcement Division identified 309 manufacturing brewery and brew pub licenses as of August 2015, marking 178 percent growth in the number of breweries since the recession ended in 2009,” according to the Colorado Brewers Guild. But setting oneself apart in an ever-growing industry can be one of the biggest challenges.
“They say your business plan is obsolete the day you open, and that’s true,” said Chris Wright, owner of Pikes Peak Brewing Company in Monument. “But take your time and work through it. The ‘what-if’ scenarios of building your business are really important. They force you to think through all the possibilities.”
In addition, resources are abundant to help budding brewers avoid the pitfalls of starting a business. Many local brewers, for instance, welcomed the help of the Colorado Springs Small Business Development Center to assist in creating a business plan and conducting market research.
“They were a great resource and it’s free,” Wright said of the SBDC. “They are incredible people who have done this before.”
Steve Stowell, who plans to open his Triple S Brewing Company in downtown Colorado Springs next month, said he had six months left in the Army when he began his business plan.
“I was reaching out to [organizations] around here like the Senior Corp. of Retired Executives (SCORE), and the Small Business Development Center. I reached out to the [Colorado Springs Technology Incubator] and all of the entrepreneur groups around. I plugged into all of that. I have a business degree, but it’s 20 years old. I was getting a tune up,” Stowell said. “The financials became the go or no-go point. It was like, ‘Alright, how much money will this really take?’
Stowell looked at courting investors, but it was “too hard and too slow. You have to sell the person, take them to dinner, teach them, show them the business plan, have them pet the pony and convince them it’s a good deal. I did that with three to four people, but I needed 40 to 60 people at $5,000 each.”
Stowell was able to procure a $266,000 loan, adding his military background was a major benefit.
So you still want to own a brewpub? Or maybe just read about them? Be sure to check out this week’s Business Journal, which explores what it takes to open a craft brewery in the region. The craft beer Focus delves into how several local brewers began second careers in the industry, as well as how the local market holds up compared to the rest of the state.