Interested in starting a brewery?
When we began our journey of opening a small microbrewery we thought: "Wouldn't it be great if there was a guide to the alcohol and beverage laws for breweries?"
So we created one...
21 Questions About Opening a Brewery in the United States is written to help:
a home brewer with a great recipe interested in opening a "nano" brewery
a brewpub owner looking to start packaging and distributing brewery
an entrepreneur wanting to expand into brewing
We outline the:
required steps a new brewer has to take before opening
potential snags in the distribution process
differences in regulation between other industries and the beer industry
If you are interested in starting or expanding a brewery in the United States, 21 Questions About Opening a Brewery in the United States can provide you with a solid foundation on the alcohol and beverage laws of the United States.
What you can expect to learn from 21 Questions About Opening a Brewery in the United States:
Startup issues to consider:
Will you need investors to start up your brewery?
Make sure that all of your investors have clean criminal records. Also, many states require license holders, and everyone with an interest in the business, to have good moral character, which may or may not be defined by the state laws.
Will your brewery be a package brewery or a brewpub?
While the licensing is the same at the federal level, there are typically different licenses available in each state for manufacturing beer. Each license allows the brewer to manufacture beer, but each has different benefits, restrictions, and nuisances depending on the state and specific license. A brewpub in one state might have all the rights of a package brewery, but might be significantly restricted in another state.
Do you intend to self distribute your beer?
Depending on which state you open a brewery in, you may want to review your business plan. Most states do not allow manufacturers to sell directly to consumers. Generally, licensees may not hold more than one class of license, and may not perform the functions of another licensee class (such as selling to consumers). Even the federal laws place restrictions on manufacturers rights with respect to retailers.
Cost issues to consider:
What kinds of costs should you include in your capital needs budget?
In addition to license fees, some states have administrative fees associated with issuing a license. There may even be county and municipal fees to take into account. General manufacturing costs as well as insurance costs (general liability, and dram shop (liquor) liability) also need to be considered.
Does your budget include how much tax is charged on each beer sold?
The IRS collects an excise tax on all beer removed from a brewery, as does each state. In addition, there are sales taxes in each state, and local county and municipal sales taxes to be aware of.
Practical issues to consider:
Do you think of beer as a tasty alcoholic beverage made from malt, hops, water, and yeast?
The United States as well as each state specifically define what ingredients constitute beer, and what makes a beer beer rather than wine or liquor.
Do you already have a brand name and label design in mind?
There are various federal, and, of course, some state regulations on what can and cannot appear on alcoholic beverage labels or promotional materials. In some cases, these regulations might restrict the name of the brand.
Are you purchasing an existing brewery and manufacturing license?
You will still need to independently qualify for a federal as well as a state license. In most cases, you will not be able to legally operate the brewery until you are issued a license.
Do you want to expand into additional markets?
Most states require that you distribute through a wholesaler, and may also require you to register as a foreign alcoholic beverage manufacturer with the state licensing board. Some states even require that you register your brands and receive label approval before your brand may be sold in that state.
21 Questions About Opening a Brewery in the United States will help you understand the issues you face as a brewer opening, or expanding, a brewery. It will help you ask the right questions, and know where to find the answers, potentially saving you money in the process. Most importantly, it will help you free your time to focus on creating innovative business ideas.
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