Category Archives: Brewhouse

Finish of the Tasting Room

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So I received some amazing feedback from readers on what is important in a tasting room layout, and key attributes of the space.  It has proved very helpful in helping to construct a space that meets the desires or craft beer enthusiasts and also those who will be visiting our space.  However, the progress we have made has naturally led to another huge question:  What do you want in the finishing of the space?

Does an ultra modern space like 33 Acres go over well, or would you prefer a look and feel like Brassneck.  Are there other tasting rooms outside of Vancouver and BC that stick out for you?  Tell me what you would like to see?

  • Minimalistic/Stark
  • Traditional
  • Modern
  • Ornate
  • Made to feel like a bar
  • Left to feel like a warehouse
  • Repurposed materials

More than talking about our space, I would love to know what other restaurants, bars, and spaces in Vancouver you like.  Of course our space will have a personality of its own, but we are keen to know what direction you think we should go with the finish.  As always, thanks for the thought and the feedback.

Demolition Day …

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Its a day we have long been waiting for.  Demolition.  Today we get to take out our frustrations and anger with the swing of a sledgehammer and the power of tools.  I will be sure to take video and photos of our work and post them here later on this weekend.

We hope with the demolition of our space, we will start fresh and instil some positive energy and feelings into this space.  We have already had a small ceremony to start the process of removing unwanted spirits, and creating our own guardian spirit in its place.  We understand removing what was there will help a lot in the progression of this.  After demolition is complete we have scheduled a local shaman to come in and perform a ceremony to finalize the process of removing the old and negative spirits.

Anyhow, demolition day is a big day in the life of any renewal, and for our brewery it is going to be no different.

Tasting Room Feedback Please

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We are in the middle of planning the exact layout and functionality of our tasting room for the brewery.  There are a lot of variables that go into the fit and finish of the space, not the least of which is the experience of all our supporters/patrons.  A close second would be the amount of money we have left over at the end of this process to finish the space.  As such, and likely because you have more experience than anyone visiting tasting rooms in Vancouver and beyond, we want your feedback and help so that we build a functional, interesting and immersive space the first time around.

So given this, please pass along your feedback.  You can send it directly to me at startingacraftbrewery@gmail.com or you can post a comment below.  I want to know everything!  The good, the bad and the ugly on anything and everything.  If you need some help with what we are looking for, here are some items we are looking to get feedback around (don’t feel limited by my list, you can push any information you think is relevant our way):

  • How much separation between tasting room and brewery: Brick wall, no wall, or glass window, etc.
  • What kind of seating do you want:  Bench, smaller tables, long communal tables, bar seating, lots of standing room areas, etc
  • Do you want TV’s?
  • What do you want to see on the walls?  Artwork, Descriptions of the brewery equipment?
  • What works and doesn’t work in a growler fill area?
  • Would separate bars for Growler and Tasting Room sales be a good thing?
  • What are best practices for growler fill areas?
  • What is the average price of growler fills and pints in the tasting room out there?
  • What kind of food would you want to see on a menu given there would be a very limited kitchen?
  • Would you want pre-filled growlers so you could just switch your empty out for a new one, making your stay very quick?
  • What would your expectations be around brewery tours?
  • Do you care about the details/finishing of the space?  Concrete floors OK, if we are broke are picnic tables OK, etc?  In other words does a tasting finished like P49 matter versus one finished like 33 Acres?
  • Anything else come to mind?  I want to hear it.

So that is it.  In the future, we are likely going to hold another focus group on a bunch of stuff around our space, and what we learn from your feedback now will help set the stage for that.  Thanks for our help and feedback, it means more to me than you can imagine.

Asbestos!

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Well, one thing we didn’t think about was Asbestos in our space.  We just assumed that there would be none as it was just a small part of the building that was ‘finished’, with the rest of the warehouse concrete floor, concrete walls and a wood ceiling.  Prior to any demolition in an building, you need to get an environmental test completed ($750 minimum charge), with the results forming the basis for what you do.  Find no asbestos and you can destruct at your leisure.  But if you find asbestos, the challenge of demolition grows.

So we had our test completed by Dan from DG Environmental, and the results were sent back to us just a few days ago.  ASBESTOS!  Great, just what a new brewery needs …. an additional cost that just wasn’t anticipated or expected.  It looks like we have it in 4 different areas, and it simply becomes another line item in our budget for retrofitting our space.  Our next step is to get remediation companies into our space for approved removal of the stuff.  This work is full on!  We are talking special this, expensive that, on site showers, blowers, etc, etc.  When you hear stuff like this, I just see dollar signs.

All of this means that the contingency bucket we have with $100,000 in it, is likely going to be about $50,000 to $100,000 short.  At our current rate of spend, we are in need of an additional $100,000 of funding as more things come up that weren’t expected.  So what do we do?  Well, we raise more money, as there running out of cash just isn’t an option.  This means that each of our investors ownership in the company will be worth less than we had originally indicated.

It is frustrating for a variety of reasons, not the least of which is I feel like I am letting down those who believe in me.  I based estimates of what this project would cost to get off the ground on those who have experience in doing this.  In fact, these people encouraged me to raise our cost estimates.  At one time we thought it would take $1 million, then we raised the estimate to $1.2 million, then we raised the estimate again to $1.4 million, and most recently we raised the estimate to $1.5 million dollars.  To now think that it may cost $1.6 million dollars is a hard pill to swallow, but one that I realize is a lot more likely than not.

So when life gives you lemons, its time to make some lemonade, and that is exactly what I plan on doing.  Having additional costs and budget concerns early on will make us even more vigilant in keeping all unnecessary costs down.  I wonder if anyone will care about sitting at a picnic table at our brewery to drink our beer?  The bottom line is that we need to find savings throughout our operations, and that means really hard conversations and choices.

So back to the asbestos.  Really, this isn’t a big deal when you look at the problem in its own silo.  An extra $7,500 overall is not a huge concern, but when you get a few more overspends like this, it can become a really big deal.  All of a sudden you have an extra $50,000 in costs that you need to pay for somehow.  I am sure through this process we will find some cost savings, but I really question if we will find enough to balance out the extra items that are popping up.

Sneak Peak at our Plans!

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OK, I can’t release all the plans for our space, but I sure can give you a “teaser” of what things may look like.  More will come when we actually sign a lease …. which should be the topic of my next blog.  “Lack of signing a lease stress.”  Anyhow, hopefully those who know the rules around brewery lounges in Vancouver will appreciate the connection we are going to have.  The brewhouse is literally within arms length of the tasting room!

Sneak peak brewery

Finally, answers to our Electrical Nightmare ….

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I have begun to realize that not everyone who is helping to get this brewery off the ground is willing to work until 2am, or makes this job the sole focus on their day.  In other words, answers that I expect within a couple weeks, sometimes take the better part of a month.  Sometimes these answers are not needed, so the time to get a response is not important.  But it seems like we need most of these answers in a timely fashion, and they set in motion a cascade of changes elsewhere, and each successive change is just as important as the last.

One of these huge considerations is the electrical issues for our space.  I have blogged about it, and it seems like we have been close to an answer for the past few weeks.  This is likely the biggest and most important answer we have been waiting for throughout this process, as our decision to lease the space rests on the advice and information we gather.  A bill of under $100,000 and we are golden to carry on.  Anything over this and we have a tough decision to make, and anything well over this means our dream is going to be dead in the water.  Additionally, we have already extended our contract to lease our space with the landlord past what we agreed to.  We were supposed to give our landlord an answer if we wanted the space by the end of November and we asked for a month extension, given the electrical issues and the lack of an answer around our Development Permit.

So here we are at this point.  We have 2 weeks to decide if we want the space, as the landlord requires an answer by the first week of January.  We have received our development permit from the City of Vancouver, so we are able to brew beer in this space.  We need to submit our building permit drawings to the City of Vancouver, and we need to find a solution to the lack of electrical power our space has.

Well as of yesterday, we found a solution to our electrical problem.  It looks like we are going to cut the power to the whole building, and re-run new power that will be sufficient for everyone, including our brewery.  This means that instead of getting a bill for well over $100,000, we should now come in around $60,000-$80,000 on this fix.  We are still a little upset by the amount we have to spend, but it beats the alternative, which is a pad mounted transformer, and the cost of which is about $250,000.

This means that all we have to do is hammer out the final details of our lease with the landlord, and we are going to lease this space.  I can’t actually believe this is about to happen!  Its almost like I have to pinch myself.  I know there are a few key points to be ironed out with the landlord, like tenant versus landlord improvements, personal guarantee (not unlike a kick to family jewels) length, but most of the important items have already been agreed upon.  In fact, our landlord has been very helpful and accommodating in working with our needs and challenges.  While his patience has started to wear thin, we hope that he still wants to complete a deal with us, and dot all the i’s and cross all the t’s.

I don’t want to get ahead of things, so I will leave our latest bit of good news at that.  I have learned from my mentors and peers that a deal is not done until you get a key to the front door, so I will not presume anything.  What I do know is this:  The lows we felt about things after our floor issues popped up, and then our electrical issues came to the front, have all been offset by the development permit we received, and then the answers around the electrical.

With any luck, we will have a firm deal in early January, submit our building permit application in 8 days, and start working on our brewery sometime in early March.  Should all this come together as we hope, we should be open for business sometime in August 2014.  Thats right, in about 8 months our brewery will be producing beer and slinging it to eager locals before you know it.

Given the amount of work to do, and the mountain we need to climb in order to get everything ready, I am going to take this Christmas break to relax and enjoy some time with my family.  The way things are shaping up, I may not see to much of them from February to August of next year.  Happy holidays to everyone that reads this blog and I hope you have a fantastic end to 2013.

Success …. Development Permit! Now what?

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Today was a great day in our world:  We received news first thing this morning about the status of our Development Permit that was submitted to the City of Vancouver about 14 weeks ago.  Our permit was approved via rubber stamp by the City, which paves the way for us to move forward with permission to brew beer at our desired location.  In other words, from the City of Vancouver’s point of view, brewing beer in our chosen location is something we can do, should we want to do it.

I often hear that it is important to celebrate your successes, no matter how small, as you need to draw upon these when you are slugging it out in the trenches.  So tonight I have a smile.  Tonight, I feel like the dream of opening my very own craft brewery is one giant step closer to reality.  Tonight, I still feel in control of my own destiny.  Tonight, I feel re-energized and ready for the next challenge that I will face.  Tonight …… well if I keep going on it will soon be tomorrow morning.

While this success is great, we still have other challenges that are right before us.  The most important of those is finding a solution to this electrical issue.  We are underpowered at our space, and we are searching for economical ways around it.  It is painful to know that every conversation you have with electrical engineers and other professionals costs money, but what other options are there?

The latest update on the power is that we should know this week about what options are available, and then we can decide whether or not we want this space.  If we can keep the bill under $100,000, then I think we are going to move forward.  However, if we can’t find a way to keep the bill under this number, then I think we walk away.  Hydro and our electricians are busy scurrying around getting answers.

All the while this is going on, we are still working away on our building permit submission.  We have (rightly or wrongly) assumed that we will find an answer to the electrical issues, and given that we need to have a full set of plans ready for building permits ASAP.  Time is the big enemy here, as every delay in submitting our building permits is another day more that money just goes out the door.  If we can’t get our brewery up and running by August 1st, then we run the risk of needing more loans and lines of credit, and we also run the risk of missing out on the busiest time of year for breweries …. Summer.

Needless to say, with this small win, we are one step closer to making this dream a reality.  Tonight we celebrate, as tomorrow there is even more work to do.

Electrical Follow-up … Even more “Shocking”

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When you sit at home thinking of what it would be like to open a craft brewery, you don’t think about stuff like this.

If you read my last post on the electrical issues with our space, you would know that our electrical bill went from an anticipated $30,000 for a simple upgrade the transformer on the power pole, to almost $120,000 for a pad mounted transformer.  It turns out we can’t put a pad mounted transformer in the parking lot, as our landlord needs to keep these spaces for tenants in our building and other buildings he owns in the area.  In fact, he has already received a variance from the City of Vancouver for the number of parking spaces he must to have, and anything that takes away from this number is not permitted.

This results in messing this situation up even more, just when I didn’t think it was possible for this process to go off the rails any further.  Now instead of a $120,000 bill, which believe it or not we think was actually doable, we are now looking at a substation.  Holy crap, I think building an actual Submarine station would cost less than this thing.  Initial estimates for a sub station in our building are about $250,000.

Unless we can find a economical solution to this problem, there is no question about it, we are done with this space.  When you consider that we spent about 8 months on this space, hundreds of hours of time and effort laying out the space, getting quotes, planning equipment, designing tasting room, etc. it seems almost surreal that this is happening.  It doesn’t end there.  Financially, we spent over $30,000 in fees, permits, lawyers, engineers, accountants, architects and other misc items.  When you add all this together, it’s really painful to have reached this conclusion after so much.  But at the end of the day, it is better to walk away without $30,000 than it is to walk away with a business that failed to get off the ground.

We have our last ditch effort to find a solution on Wednesday of this week.  I hope that the people we have relied on so much throughout this process are able to come up with a creative idea that works for everyone involved.  One thing is for sure, I won’t be getting much sleep tonight.

The Damn Electrical Nightmare that is our Space

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Just when you think all is well, and you are about to move onto making things work and realizing your dream, something comes up that threatens to derail all that we have worked for …. for the time being.  We have recently discovered that we don’t have enough power to our space.  We thought that 400 amps was going to be enough, but it appears that we will need more than this.  What does this mean to our ability to lease this space?  What does this mean to my dream?

The process of leasing a space is filled with many potholes and roadblocks.  Finding a space in the right location, with the right layout, at the right price, with a landlord that wants a brewery in their space, for the right amount of term, in a city with limited quantity and quality of commercial space is not unlike finding a 4 leaf clover:  Tough on the best of days.

We really thought we had found the right space for our project.  We found a commercial space that is located exactly where want to be, with the perfect amount of space for our operations, a decent rate, with an amazing landlord, who would like us to be there for up to 20 years.  It felt really good to find this space.  We negotiated a lease for the better part of 4 months, and finally came to an agreement on terms about 4 months ago.  Our agreement allowed us a 3 month period that we could apply for a DP, and carry out some due diligence on how this space would work for us.

Our first hurdle was to apply for a Development Permit, which we have successfully done.  Though we haven’t officially heard back from the City of Vancouver on the outcome, we don’t see any reason why we can’t move ahead.  Our second hurdle was the floors.  Oh yes, the floors.  Essentially, the substrate of our floors was subsiding, which means that our floor is dropping and dropping.  Like all problems, you can fix anything if you throw enough money at it.  We had some contingency in our retrofit budget , so we figured that we could overcome the flooring problem with more money.  About $30,000 to be exact.

Well we just came across our third hurdle, and it is a little bigger of a nut than our second.  We thought we were free and clear with the electrical in the building.  We have 400 amps available, and we always thought it would be enough for our needs.  In the past week it has become apparent we need at least 500 amps and preferably 600 amps.  It would be simple to say why the hell didn’t you know that 400 amps was insufficient?  The problem is until you make choices on your space, you don’t know what your exact load is going to be.  Draws on power are HVAC, Refrigeration, Tasting Room, Offices, Kitchen, etc.  The problem is that we made assumptions for this power based on a 6,000 sq ft space.  Now that we are entertaining a space about 9,000 sq ft, you can basically multiply all your power needs by about 1.5.  You can see how we ended up here.

OK, so no problem for a power upgrade but just running more power to the building from the pole out back!  Wrong.  The power poles that supply our building already have 3 transformers on the pole, which means that this pole is maxed out.  Crap.  This leaves our option to get additional power either putting in a Pad Mounted Transformer for about $120,000 or putting one on the roof of the building for even more.  What the F#$%!  This absolutely blows.  So now, after all the time and work (never mind money) we have put into this space, it looks like we are about to walk away.  While we would like to make this space work, we just can’t afford an extra $120,000 bill.  We might be out about $30,000 so far, but it is worth it to lose this money in order to not lose our shirts down the road.

So we now have a huge decision to make!  Option A is to drop another $120,000 and push ahead with this space, realizing our dream.  Amortizing $120,000 over 20 years is only $6,000 per year, which in the grand scheme of things isn’t that much.  Option B is to walk away and find a space without the number and cost of upgrades this space needs.  We would go into this process knowing full well that it could be another 6 months before we find another space that works really well for us.

We have another 2 weeks to make our decision, before the subject period on our lease expires. In other words, our landlord will want us to piss or get off the pot with regards to his space in 14 days.  Looks like there will be a lot of sleepless nights coming up.  If you have any advice for us, please contact me to pass it along.  It would be greatly appreciated.  Until next time …..

General Update on Things

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I have received some feedback lately around wanting a general update on our progress.  There seems to be genuine interest in how the overall project is going versus what we are encountering on a daily basis.  As such, this post is a little more of a general update on our progress rather than a general rant about this process, or a specific detail of things.

So as you likely know, we have submitted a development permit to the City of Vancouver for a space in East Vancouver.  On Thursday of last week, we were told we’ll be given an answer on this permit in the next couple weeks.  We are waiting for this permit, as we can’t lease the space we are interested in without first getting approval to brew there by the City.  In Vancouver, the only buildings that you can outright lease and know with certainty you can brew is M2.  The trick is that there isn’t a lot of M2 zones, and the buildings we were looking at in M2 just weren’t right for us.  So we ended up in an I2 zone, which is one where brewing beer is conditional upon submitting a development permit.  Any potential for us to use this space hinges on getting this permit, so we are waiting with fingers crossed to get good news.  As of Nov 18th, no news!

Another big process is collecting and securing money from investors.  Luckily, an investment in our brewery is eligible for the eBC tax credit, which basically means that 30% of each investors money is returned to them in the form of a credit from the government of BC.  It looks like we need to raise over $1,100,000 so everything we can do to help secure “financial partners” is welcomed with open arms.  We are going to be collecting money in the next 2 weeks from our investors, so I hope that what people have committed is what they are going to offer us.  If not, I am sure I will post something around my frustration with this.

Financing is another part of the business that is really important.  We will need both an operating loan and a line of credit in order to make the business float during the crucial first couple years.  Opening a brewery can be a recipe for financial hardship, as the line between profit and loss on a monthly basis is razor thin.  If sales fall behind a little bit, and costs are a little higher than expected, money can go out the window very quickly.  Luckily for us we were approved for a loan and line of credit to make our finances come together.  These will total about $450,000, and when added to the money we are raising we feel like we should be in a good position to make things work.

The layout of our space and submission for building permits is something we have been working very hard towards.  In fact, this has taken the majority of our time of late.  With the arrival of our Development permit by the end of November <fingers crossed>, we would like to have our building permit submission ready to go.  This means that we need to have the layout of the space virtually complete, have the work needed by engineers complete, have all the drawings and work from our architect complete, and to have all other inputs ready to go.  It seems really easy when I sit here and type this, but the reality is that there are so many moving parts to this, that it is incredibly complicated and difficult to carry out.  Finalizing the layout of our space has taken us over 8 weeks, as there are SO MANY variables to consider.  For example: Needs now versus in the future when we grow, tasting room connection to brewing space, retail area, production flow and functionality, the location of existing services, proximity of different spaces that need to be connected, etc, etc.

Equipment is something that we need to have ready to go, so that we can be sure it is ready in time for production.  We have looked to China, Europe, Canada and the USA for our brewhouse and tanks.  To be honest, I can see why this step can be either really easy, or one of the most difficult steps.  No two quotes seem to be alike, and the unknown factors of quality, timeliness of delivery, and follow-up support make these intangibles even harder to gauge in terms of importance.  A big hurdle to buying Canadian is the price.  Companies like Newlands and Specific Mechanical are local and have a good reputation in the business, but their prices are among the highest.  Moreover, it sounds as though some of the other start-up breweries have experienced some trouble with them.  Then there are the systems from Europe, where the quality is top notch, and the price matches.  Moving East to China, the land of cheap equipment, but one where the after sale service is poor, and other local breweries have experienced trouble with having to repair brand new equipment.  All of these things make choosing one company to work with very difficult.  At the end of the day, it is a balance between all these things, and hopefully one company stands out as the best.  At this point, we have no idea which one it will be.

Another huge part of this process is our name.  For the time being we are letting this one go for a few weeks.  While we don’t have an official name yet, the focus groups we ran were instrumental in getting us closer to making this choice.  The only problem is that we are putting out other fires that are more important at this time.  Things like financing, layout, legals, accounting, etc.  We anticipate having our name by the end of the year, and that should give us 8 months to create a brand around this.  I hope this is enough time and that we make decisions that are based on sound principles.

The legal side of things is something we kind of let slip and caused us a lot of grief and unnecessary stress.  In order to raise money and run a proper incorporated company you need to have:  A shareholders agreement (aka a partnership agreement), a subscription agreement, a set of articles for your company, and a share ownership agreement.  All of these documents are tedious to create, and require the hard work of a legal team.  Reviewing and revising take a lot of time and mean that you are continually working on getting these documents ready so that you can raise money, and provide a framework to investors on how your company will operate.

There are literally hundreds of other little things to do, some of which are major and some of which are minor pieces of major components.  There seems to be nothing that isn’t important in some way to the overall picture of this brewery.  To be honest, I would love to find the time to blog about all these things, but I just feel too much pressure to write about them, rather than working away at them.