Monthly Archives: April 2014

Webcam is up … and almost working perfect

We have added a webcam to our brewhouse, and after earning a undergraduate degree in this kind of thing, it is now live.  While there is nothing to see this weekend, and the feed needs a little refinement, we are now able to broadcast live the process of starting a brewery.

We hope that in combination with this blog, and the other information we have put into the world, we will encourage many others to follow their dream and start a craft brewery.  It is a labour of love, but something that you will never regret IMO.

Anyhow, we will be sure to post a schedule of when things are happening, so that you can watch the process of starting a brewery from the comforts of your own home.

Click here for the link and I promise that within a couple days the feed will be more clear.  For now, the camera is pointing to the South half of our warehouse, but as things happen it will shift back and forth between both areas, so you can see everything that is going on.

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Floorplan Update and Best Practices

Some of you may have come across a story written by Greg Clow of Canadian Beer News.  If you live in Canada and you are serious about beer, you should be checking his website on a regular basis.  Click here to link with our story and Canadian Beer News.  His article focused on Strange Fellows operations and what our full floor plan will look like when complete.

I have included both the layout we have moved forward with as well as the side profile of the space, so you can get a sense of the way our operations will look.  Not unlike anything else we put out there, things will change somewhat as we move ahead; however, 90% of what is on paper here will be represented in our build-out at the space.  Once you commit to submitting building, electrical and mechanical permits, you are also committing to what you have on paper.  So in other words, the size of a window in our tasting room that overlooks the brew house may get bigger, but we have committed the location for the bathrooms, the trade waster interceptor and the trenches.

Brewhouse Layout March 2014

Brewhouse Profile March 2014

We have allocated a total of $12,500 for permits throughout this process.  I have blogged about them a little bit under The Process of Starting a Craft Brewery, subcategory X:  Government Stuff.  There are lots of permits you need and getting them all in a timely manner is important.  To be honest, the process of preparing for permits and approval is one of the keys to getting this process right.  In short, for your business to move forward you need to submit for your permits in a timely manner, with information that is well thought out, thorough and correct.  Changes or missed steps here will cost you down the road.  Read more about permits at the page linked above (and I will add more details in the next week).

Anyhow, coming full circle here, our floor plan was a real labour of love.  Like any decisions you make with a partner, there is give and take.  However, when you add in an architect, mechanical and electrical engineers, a general contractor and your finances, you get a mish-mash of opinion and information.  You can never make a decision without effecting every other decision you have made in the past, and every other decision you will make in the future.

Some of the keys when creating a floor plan are as follows:

  • Keep everything as central as possible.  The longer runs you have for any electrical or mechanical, the more cash you will bleed.  For us, moving our main electrical panel 10 feet saved us $3,000.  So you can see that small changes can make a big difference.
  • Plan for the future, but prioritize getting to day 1.  It is important to think a couple of steps ahead here, at least that is what I have heard from other breweries, but don’t lose sight that you need to get to day 1.
  • Look to save money at every step.  Ok, maybe you are better at this than I am, but we are in full cash saving mode, and we feel like we have been for a long time.  Any chance we can save money on something, we are doing it.
  • Tasting room and Retail area.  A huge part of all these breweries starting up in Vancouver is the ability to sell your products from your business.  It takes what was once an impossible task, and makes it so much more realistic of an opportunity.  So make sure you design a space that works for your brewery.  For us we wanted something intimate, open to the brewery, and simple.
  • Work with sub trades early in the process.  You don’t have to pick who you are working with, but bouncing plans off them will give you real world answers to questions you have.  It was also help you find savings and efficiencies in your space.
  • Another dilemma on decisions.  You can have things done quickly, you can have things done for your budget, and you can have things done inline with your dreams, but at best you will get 2 of these things, but most of the time you will only get 1 of these things.  What will you pick?
  • Call the room where you mill your grains a “grain cracking room”.  Trust me on this one, it will save you a bunch of headaches at the City
  • Depending on if you are focusing on production or focusing on tasting room/retail sales, your layout may be different.  For us, we are a production brewery first, so the layout and design of the space tried to take this into account as much as possible.  Process workflow, material in and material out, future expansion are all important to us, and are reflected in our space.
  • Keep your cooler close to the tasting room.  Iain has so much experience with this kind of thing, that he is adamant that these 2 things need to be connected.  He talks about the shorter the run of lines, and being able to connect our taps to tanks instead of kegs will save us heaps of time.

What really gets us excited about our space is the connection between the tasting room and the brewery.  When you are sitting in our tasting room, you will quite literally be 10 feet away from the brewhouse.  Want to watch Iain add hops to a brew, just sit back enjoy your beer and watch from your perch.  You will also be able to have a first hand view of the barrel storage area, which we think is a really cool thing.  We also think the art gallery will add a nice connection to the local community, and we hope the growler and retail area will have good process flow so as to not back-up too much.

As I have always said, Iain is really good with this kind of thing, so if you have questions about how to lay your brewery out, feel free to contact us.  At the end of the day, follow your instincts on the way things should be.  Whether you have experience with this kind of thing or not, make sure you follow what you would want as a consumer.  You will deal with enough people along the way that aren’t into craft beer (like contractors, architects, etc) that their opinion will help to balance yours out.  Stay positive and you will find the way.

 

 

 

 

 

 

 

 

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A Crushing Day for Us ….

Well, the last 36 hours has been full of angst on behalf of both Iain and myself.  We finally received a detailed budget from our general contractor, and to put it bluntly, we are going to be way over budget on building our brewery.  It is an extremely bitter pill to swallow, especially after the increases we have made throughout this process to our budget.  At the end of the day, we are building a much larger brewery than we anticipated, and with a larger brewery comes bigger costs.

When I look back at my old copies of the business plan, I have to chuckle to myself as I once thought the retrofit of a warehouse, not including equipment, was going to cost about $400,000.  I look at that number and can’t help but think how naive I was.  That is both a good thing and a bad thing.  If I knew how much this endeavour was really going to cost I might have passed on following this particular dream.  I thought the $400,000 was enough to put up some walls, trenches, upgrade power, and put all the equipment in.  Boy was I wrong.  This was about 2012 when I was really starting to get into planning this brewery

Fast forward to late 2012, and after much encouragement from other brewery owners that I met with, we increased this amount to about $550,000.  In my mind, this was an increased of about 30% over my initial budget, and I thought this would be plenty.  But as you learn more about what is required to retrofit a warehouse, the number keeps getting chipped away.  All of a sudden, the additional money that came with a bigger budget seemed to have disappeared.

Fast forward again to early 2013, and it was time to increase the retrofit budget again.  It just seemed impossible that with tasting rooms and their pending approval, along with the realization of additional costs with most spaces, that we could retrofit a space for any less than about $650,000.  At the time, this seemed like a good number, and even included a sprinkler upgrade and water line upgrade.  We figure we would be free and clear, so we charged ahead with this number in our mind.

It was at this time we started to inquire with investors about financing our brewery.  We based many assumptions on this cost, including how much we needed to raise from angel investors.  $650,000 seemed like our golden ticket to get everything we wanted.  So we charged on and hoped that we could what we wanted for this amount.

Then in the summer of 2013 we found what would eventually become our warehouse.  It was bigger than we really needed, but it gave us an excellent location, and most importantly a great landlord that wanted a brewery in his building.  We had our architect in, a couple contractors, some sub trades, engineers, etc and they all pointed to a retrofit cost of about $725,000, depending on a lot of things, such as electrical upgrade and flooring.  I have written about these items in the past, and they were huge uncertainties with out space.  So we moved forward with a newly increased budget of about $725,000 for a retrofit.

So fast forward to this week.  We met with our architect and general contractor to discuss the quotes they have received from sub trades (like mechanical contractor, electrical contractor, concrete slab specialist, etc) and also the budget from our general contractor on all the little things that make up our brewery.  All of this information, along with our wishes and desires, was put into a spreadsheet and at the very bottom of a huge excel file, there sat what was the anticipated retrofit cost of our brewhouse.  The total estimated cost for our retrofit was (drum roll) …. $925,000. 

It is hard to put into words what was going through my mind when this was presented.  It was like someone kicked me in the stomach …. and then kicked me again.  It was awkward for our architect and our contractor, as they could see that what I had believed and what I had assumed was wrong.  I must have looked like a deer in headlights.  Even now, I am fully consumed by frustration and anger that I just can’t seem to shake.  How is it possible that I ever thought $400,000 was enough?  It just seems plain old absurd!

We are so deep into this process, so far down the road, that there is no option but to find solutions.  For starters, it is very likely that the tasting room will have picnic tables and used chairs, be lacking any real artwork and design aesthetic, and have very little “extras” that other tasting rooms might have.  We have also had to dial back a few optional pieces of equipment that we hoped to have for the brewery.  Essentially, there will be a cascade of changes that are mostly out of our control, in addition to some extra cash that we need to raise from investors.

If I could pass some information onto others, I would make note of the following costs you might be looking at:

  • Electrical Upgrade – $75,000 and up
  • Mechanical – $125,000 and up
  • Tasting Room – $50,000 and up
  • Labour costs – $100,000
  • Development and Building Permits – $10,000
  • Concrete – $25,000 and up
  • Boiler and Installation – $35,000
  • Contingency – Easy 10% of your budget
  • Architect Fees – $25,00 and up
  • Engineer Fees – $20,000 and up
  • Management Fee (from General Contractor) – Cost plus 10%
  • Epoxy Flooring – $15,000 and up

Of course there is a long list of other small items, and they have all creeped up in cost, as we have a 9,000 square foot space.

In another few months, I will be sure to post all of our business plan online, so you can see for yourself what all the details in starting a brewery are.  For now, just know that what you think things will cost, will likely double from your initial estimates.  Just hope and pray that you have way more money than you need, or at least a network of people who would be able to offer some financial support to your business.

I hope to have some answers to our dilemma early next week, and I will pass along any notes I have on how to find savings in a budget that doesn’t seem to have a lot of wiggle room.

 

Bottle vs Can for a Craft Brewery

One thing we have long struggled with is the type of packaging we are going to put our finished product in.  Speaking with other craft breweries, we are not alone in the uncertainty we face in making this decision.  I have summarized the pros and cons of each decision, and I hope at the end of the post, you can give me some feedback on what is the best in your mind.  Starting your own brewery is a great thing, but it is important to have a firm sense of what you want, and merge that with the financial and marketplace dynamics you face.  In other words, what you started out wanting may not be what you end up with.

Really there are 2 choices that you can put beer into.  Either cans or bottles.  Before I dissect each of the options, here are some general comments.  I had long thought that cans were the clear environmental choice, but a few articles haver pointed me back in the direction of uncertainty.  Click here to read one article.  So with no clear winner on the environmental side, what about taste.  I hear anecdotally that people can taste the plastic in cans.  Does this mean they don’t pour the beer out of cans into a glass (yikes).  Also there is the image.  Is the wider market really ready for high quality craft beer in cans?  I know Steamworks and Central City have their beer in cans, and by all accounts do very well, but could you imagine a much smaller player, like 33 Acres or Bridge Brewing putting their beer in cans?  Would it make a difference at all to your perception of them.

Cans:   Cans are a good option for a brewery for a variety of reasons, but there are some downsides to them, which I have tried tried to summarize below.  Essentially, there are 2 options for can sizes 355ml or 500ml.  The smaller can is more North American while the larger can has a much more European feel to it.

  1. More transportable and lighter than bottles
  2. Beer keeps better in cans than bottles
  3. Per unit cost is less expensive than bottles
  4. About 66% of all beer sold in BC is sold in cans
  5. Government liquor stores want new listings in cans
  6. Canning lines are more expensive than bottling lines and notoriously more finicky.  We have quotes for a canning line at $90,000, and the price can go sky high from there
  7. Minimum orders for cans are about $30,000
  8. You need to figure out what beer you are going to sell and then hope the market likes it, as production time for cans is much longer
  9. Image of someone drinking from a can doesn’t always conjure up quality craft beer
  10. Lead time for can orders is much longer than a bottle label order
  11. A couple different sizes of cans which completely change the look and feel of the marketing

Bottles:  On the other hand, bottles are a great option for a new brewery, as the 650ml bottle is the standard size for craft beer, and is well established in the BC marketplace.  Not unlike cans, there are both pros and cons to packaging beer in bottles.

  1. About 33% of all beer sold in BC is sold in bottles
  2. A beer bottle doesn’t put off any odd tastes, whether perceived or not
  3. A beer label allows for more colours and detailed artwork
  4. The amount of time needed for artwork and printing is much shorter than producing cans
  5. Bottling lines are less expensive than canning lines, and you can buy change-over parts to switch between bottle sizes
  6. We have quotes for bottling lines at about $60,000 and the price can go way up from there
  7. There is a much wider variety of bottles available to put beer into (all are in ml):  330, 341, 350, 500, 650, 750, 1000
  8. Government liquor stores are trying to get out of bottles, so a listing with BCLS is much harder to obtain
  9. In my opinion, a bottle of beer put out a different image than a can of beer

So you can see how we are conflicted on the decision that we are going to make.  We have flip-flopped back and forth from cans to bottles and we have really wrestled with the decision.  What would you do?  What would you want us to do?  The trouble we now have is that we can no longer waffle on this decision.  We need to place our order so that we can get our equipment in time for the launch of our brewery.

So vote here, and let me know what you think.  I would love to hear from you as well.

Marketing Update – Website, Blog, Social Media, etc

It seems there have been 2 buckets that I have been working in lately:  Fixing the warehouse and building our brand.  I love the physical aspect of working in the brewery, and I am sure you would too.  What I have found is that when you build a company, its hard to see progress and win the little battles that make up the war.  For instance, when it came to picking a name, it took literally hundreds of hours of work and effort, and you don’t see any milestones along the way.  One day you just have a name.  But when you have a physical project like constructing a brewery, its easy to see progress along the way, and I like that.

We have been busy painting the warehouse lately.  The amount of time and energy this has taken astounds both of us.  We have had great help from family and friends who are incredibly supportive of our journey.  Without their help from the get-go, none of this would be possible, and I am sure this is going to continue onwards in the future as well.  Even with this help, we have spent 2 weeks preparing the space for painting and first coat of primer.  I guess that is what happens when you have a 9,000 square foot space, with 19 foot ceilings.

inside brewery pre paint

 

 

 

 

 

 

 

So when we are not going up and down the forklift preparing walls for paint, and applying paint, we have been busy with organizing what our brand will look like.  That means meetings, meeting and more meetings.  I have come to realize that it is incredibly important to express how you feel in a positive and straight forward manner.  When it comes to the way I feel about something, I owe to my partner and the business to say what I need to say, all the while improving the relationship with my partner and leaving my influence on the business.

We have picked a logo, and it may not be finalized, it will look similar to this.

SF-logo#8-max-res

 

 

 

 

 

 

Online I can understand why people are torn between the 2 logos we had everyone vote on, but when you see them on a bottle printed out, the decision was quite easy.  The text on the other option seemed too small, and didn’t stand out on the  bottle like this logo.  So thank you to everyone for your feedback and input into our decision.  The results were virtually even on our blog and also the Vancity Buzz poll, so at the end of the day, we had to make the decision.  There might be people who strongly dislike our image and brand, and we have quickly come to realize that we are ok with that.  But we have also come to realize that our brand is so much more than a logo.

All of our social media is now live:

Twitter:  Strange_Fellows

Instagram:  strangefellowsbrewing

facebook:  strangefellowsbrewing

We are busy working on our landing page for the website, and it will likely be another couple weeks before we have something up and running.  Until then, the main contact points are the above …. and of course this blog.  As Iain so shrewdly put the other day, he is the one doing all the work in starting a brewery, and I am the one telling everyone about all the work he is doing in starting a brewery.  Seems like a good set-up to me!

Your feedback is always welcome and helps us to know what we are doing well and what we can work on.  Should you think of anything we can do to make this company better, we would love to hear from you.