Starting up a new brewery can be a daunting task especially with the economy still being in a less than desirable state and increasing competition from other new breweries, in excess of 1,400 breweries now operate in the UK. So what motivates people to do this? And what challenges and potential pitfalls do they face? I asked a local brewery owner, Richard Kruller from Steadfast Brewing Co., these very questions.
To start a new brewery in the face of increasing competition means you must be extremely passionate about what you do, what is the source of your passion? And what is your point of difference to what is already on the market?
I have worked in restaurants for most of my career. I can honestly say that most of that time I have enjoyed it. I really love it when you engage people who are also passionate about what they are eating and drinking. Informing them of ingredients, cooking methods, their quality and also helping choose the drinks that will match their food, whether that be beer or wine. When I first started at the Cambridge Chop House I offered real ale to someone who responded by saying they didn’t like ale! To me that’s like someone saying they don’t like cheese or wine or food!! Of course you do, you just haven’t had the one that suits you yet. Needless to say that by the time he left he was converted having enjoyed two pints of different local ales we had on. Now I love it when someone says that to me. Challenge accepted.
What is different about what we want to do? Well mainly that we shall be using the decoction technique of brewing with a double brew pot. Basically this set up allows us to split the brew and treat each portion separately. This will enable us to “cook” the brew, experiment, enhance and balance flavours even at low ABV’s. We shall not be using any isinglass finings, (made from Sturgeon swim bladders) It’s not something that we want or think needs to be in beer. It could mean that some of the brews are hazy but we would rather have that and a great flavour unsullied by fish guts. It will also mean our beer will be suitable for vegans and vegetarians. We can condition the beers for longer if we think it needs to drop clear. We are also going to keg our brews. This doesn’t mean we can’t or won’t produce a cask. But means we can condition our beers to perfection in our tanks rather than having a live secondary conditioning out of our control in a cask. Kegs also keep the beer consistent over the time they are used, which can be a problem for many venues that serve cask. We also believe that some beers are better served a touch colder than the traditional cellar temperature.
So far to date what are the major challenges you have faced in trying to start up a new brewery? And how have you overcome them?
The biggest challenge I would say has been my own initial lack of understanding of how investment works. How you go about meeting the right people who are interested in investing in you. I am lucky as I have met a very useful chap who has helped guide me, and pushed me to know the answers to the questions investors will expect me to know. Plus how long it all takes to chase and bring the many different quotes together to work out exactly how much it will cost to set up and run a brewery. Lots of people are interested in you but very slow in giving you an actual price for a service. I am not funding the set up myself so I have to be very accurate on my forecasted running costs.
Ideally I want to can rather than bottle our beers. The can is much lighter and a better shape than a bottle. So it’s much easier to store, transport and quicker to chill. Also it doesn’t allow light to damage the contents and has a more effective seal so the contents stay fresher. The only drawback is that I am struggling with the suppliers of the cans as they only want to sell me 400’000 at a time! Not ideal for a start-up micro-brewery. In the USA lots of micro-breweries are using them so there must be a UK solution soon.
Starting up a brewery in spite of the recession must be difficult how has it been to generate the necessary funding to get your company off the ground?
Well I still haven’t actually received funding as yet so ask me again in three months!! I am very positive, and it has been my own tinkering with the set up I want, and the resulting change in cost that has delayed the start up so far. There are a couple of government incentives for start-up companies that I could take advantage of. I qualify for a 25K start up loan at 5% interest over 3 years, although I may refuse this if I can get full funding without it. Most importantly however is registering for the SEIS (Seed Enterprise Investment Scheme) which massively reduces the financial risk an individual my take by offering large tax breaks to investors including an immediate 30% “cash back” from their next tax bill (for example turning a 90K investment into a 60k one).
Have there been any specific regulations that you have had to meet that you weren't aware even existed?
Not that I wasn’t aware of. But I did go on a “Start-up brewing” course run by a company called Brewlab in Sunderland. They were extremely helpful in making you aware of any potential pitfalls. What has recently arisen were the potential copyright issues in designing my new branding. I want to be extremely careful as I need the brand to be capable of going national (one day international?) without a hitch.
All breweries are measured on the quality of their products, how have you found generating your own recipes?
Indeed and quite rightly so too. Not being a brewer myself I have only a couple of options to produce and deliver the beers at a quality I demand. That is to learn pretty damn quick how to brew or to start up with someone who can. Thankfully for all concerned (including any potential investors out there) I have chosen the latter. I have been very fortunate to find an exceptionally talented young brewer who has agreed to join me in my venture. I spoke of the quality and beer types I wanted to achieve and together we have designed a brewery to enable us to deliver it. My initial budget for the brewery was about 100k. Now it’s over three times that but capable of producing any beer style and at premium quality. As for recipes, we both have types of beers we would like to explore and so will enjoy the experimenting immensely. We are both particularly fond of a great Stout and dark lager so expect to see some of that fairly early on.
To be able to produce your beers regularly at a larger scale getting hold of the ingredients to make your beer is a key requirement for brewing. How are you looking to create a reliable and sustainable supply chain?
It is obviously something that will be incredibly important for us, especially as we shall not compromise on quality. Consistency in brewing is absolutely essential. I am guilty of trying a single poor beer from a brewery and have not revisited any of their beers for many years after. I believe many people are the same. So we need to get it right from day one. We only want to use roasted malt from traditional floor malting’s. But I am confident there is the supply for us in one or two of the few remaining top malting’s. Hops are more difficult as I would really like to use all English from small farms. But until they can guarantee the consistency over several years or more then we will only be able to use them for specials. And then what happens if one of the specials becomes our top seller?! It’s a potential problem. But we shall have to build up relationships with the growers and other suppliers until we are happy with the quality and service that they can provide. We would love to be completely organic but I’m worried that it would limit our product range too much. There will definitely be at least one organic beer on our list though.
Hopefully this has given an insight in some of the things to consider and the work that goes into getting a brewery off the ground and to producing beer. I'm going to keep an eye out for Steadfast Brewing Co and will write a post in the future as to what progress they have made and was there anything they would do differently. If you would like to know more about Steadfast Brewing Co. you can do so at their website www.steadfastbrewingcompany.co.uk