If you are looking to start a microbrewery, you have probably been motivated by the sudden surge of interest in quality beer. Now more than ever, people are not satisfied with the large corporation beer that the previous generations have been drinking. This, in particular, is why there are quite so many microbreweries in the Ontario area. At last count, there were over 150 breweries in the region. If you want to join this industry, here are some of the things that you will need to know about:
The Total Cost Involved
Starting a microbrewery is certainly not a cheap venture. You are going to need a considerable amount of start-up capital, depending on the size of the brewery. Furthermore, you will need to set up your microbrewery before you can receive your Excise Duty License from the proper authorities. This means that this is money that you will need to have on hand, as you will not be able to earn any income until much later on.
It is difficult to pinpoint just how much you may require to set up a microbrewery. This size of brewery typically means that you will be producing more than 3000 hectolitres of beer but less than 400,000 hectolitres. Therefore, there is a large range that you can fall into. However, on average, you will certainly require more than $400,000 for the most basic of expenses.
Once you have decided just how much you want your microbrewery to produce, you will then be able to determine the equipment you will need. If you are not planning to produce much beer, you will not require enormous pieces of equipment. For instance, you may be able to get away with purchasing just a fifteen barrel system. This cost may be further lowered if you are able to get these items second hand.
In addition to the equipment, you are also going to have to think about where you are going to set up a microbrewery. While you can lower expenses by renting out a space, you will still need to customize it to fit your needs. This typically involves making structural changes to the space as well as adding the necessary physical reinforcements.
Unless you are independently wealthy, you are going to require a business loan of some form. Now, there are several ways that you can go about getting one. As a small business owner, you may be able to receive a loan from the Canadian Bankers Association (CBA) or the Business Development Bank of Canada (BDC). The Canada Small Business Financing Program may be able to offer you up to $500,000 in loans. If you are an individual between the age of eighteen and thirty four, you may be eligible for a loan from the Canadian Youth Business Foundation. In Ontario itself, you can apply for the Community Futures Development Corporation, although the limit is about $250,000.
As you are looking for a large amount of money, the above options may be more suited to your situation. Nonetheless, you still have the option of borrowing from friends or family. You can also choose to get assistance from angel investors or venture capitalists, depending on your business plan.
You are going to require a unique marketing plan if you want to stand out from all of the other microbreweries in Ontario. In order to this, you will need to conduct careful research on the beer and brewing industry and determine what your niche is. This will be useful for several reasons. First, it will help you get the necessary investors and loans that you will require to get started. Also, even before you start selling your beer, you are going to need to market it first. Therefore, you need to come up with an enticing and solid marketing plan if you are going to be successful in either of those segments.
Getting Your Beer in LCBO and Beer Stores
There is just one more step left to complete, and this is to make sure that your beer ends up in the right place. This means that you are going to need to get your beer on the shelves of the LCBO and menus in bars. While the LCBO is quite encouraging of small breweries, there are many processes that you will need to go through.
To start with, you will have to apply to LCBO’s Trading Partner Access Request system (TPAR). Once this request is granted, you will have to access several web-based systems. This includes the New Item Submission System (NISS). After this, you will have to officially apply to this authority. It is then a long list of items including taste testing, composition analysis, evaluations of the marketing strategy, and then the ordering of the beer.
To get your craft beer into bars, you are getting to need to target the right bars. Find out which outlet will benefit most from selling your kind of beer and convince them to give it a try. Of course, if you are lucky or if you have executed your marketing plan well, you may have bars and restaurants calling you.
These are just a few of the steps that you need to focus on if you are planning on opening up a microbrewery in Ontario.