How can I start distillary business with lower investment?

[Brandon G. Walke]

I'm searching a business opportunity. One of my friend suggested about distillary business. How much can i earn from this annually? What is competition level? Is it logical to start minimum investment? send me your suggestions.

[scohar]

You'd better do your research, or you'll lose a lot of money. The distillery business is no easy business to get into. The regulations (state, federal, local) are enormous, and the up front investment cost is huge, even if done on a small scale. Don't expect a lot of specific answers to a broad question like you posed. You'd be better off reading through this forum and its archives as much as possible to get a sense for what you're trying to accomplish before investing a single penny in the idea.

[BWFiggins]

I'm searching a business opportunity. One of my friend suggested about distillary business. How much can i earn from this annually? What is competition level? Is it logical to start minimum investment? send me your suggestions.

Brandon, it's spelled distillery, and money can be made from owning one only after you sink considerable amounts of time, energy and cash sourced from your pocket and that of others.

Along the way, you or someone else in the organization (or someone that you hire) will need to become an electrician, a steam-fitter, a metallurgist, a process engineer, a mathematician, a legal compliance expert, a talented distiller, a master blender, a skilled market strategist, a tireless salesman, oh, and much less important, a perfect speller.

Most people who embark upon the foolish notion of distilling are compelled to do so because it is in their gut, and it just won't go away.

It will start as a highly interesting and very expensive sideline that may not provide a paying job for you for several months or years to come.

Keep at it with determination and make big strides into your market, and if you are a good businessman with a sought-after product, you may have what it takes.

To conserve operating capital, some design and build their own distillation equipment, but this is not for everyone.

Others might have a ready source of inexpensive but good quality wine to distill.

Just be smart about your inputs and don't scrimp on the quality of your outputs.

Remember that the public only beats a path to your door in cleverly worded fables.

In a world of so many choices, the traits that will give you an edge are charisma, drive, integrity, talent, great brand name(s), product(s) of the highest quality and salesmanship.

You will need them all!

[mavnkaf]

Brandon, it's alot like the aircraft business, start out with a lot of money, working it down to some money! Untill you get a better business plan. No market.. and you know rest.. So find new makets, sell your lees/ stillage to farmers!

Cluse less

Marc

Ps. Pretty lame answers

[ckrogstad]

Brandon, it's alot like the aircraft business, start out with a lot of money, working it down to some money! Untill you get a better business plan. No market.. and you know rest.. So find new makets, sell your lees/ stillage to farmers!

Cluse less

Marc

Ps. Pretty lame answers

No shit!

I was going to say, "It'll cost you just $1MM to buy the old Michter's plant, probably $5-7MM to get it operational, $1-1.5MM per year for 4+ years inventory build, then a well funded sales and marketing plan (say, $1-2MM). Revenue will be somewhere in the neighborhood of $10-20MM per year at a 15-20% net. Its really no different than flipping a used Gulfstream."

Get busy!

[will]

Brandon,

This is for a different kind of person.

People who start distilleries operate at a different level than asking others: "How much can i earn from this annually?"

Go find a job.

Will

[Copperstill]

I'm searching a business opportunity. One of my friend suggested about distillary business. How much can i earn from this annually? What is competition level? Is it logical to start minimum investment? send me your suggestions.

Brandon,

I apologize for the haters not everybody on this forum is like that. I mistype things from time to time myself. Most of the people on this forum really don't know what their are talking about when it comes to how to run a profitable distillery. There are few examples, so people are pretty much blazing their own trails. The next 5+/- years will show who really knows what they are doing. They do have one thing right, it takes a considerable amount of capital to get going. I recommend that if you think this might be the industry for you go out and get yourself a industry job. Every wine maker I have met who owns their own winery started at someone else's.

Good luck.

[Wilder]

I have been doing soom numbers crunching, and it is my estimate that it would depend on what part of the country in which you live. I believe a small distillery with a capacity of 150 gallons a week could be done with a budget of 50,000 to 75,000 thousand dollars easily. This would be, if you have building skills, and metal working skills and a working knowledge of the formulas that you will clear throught the TTB.

I think it could be done for less, but some here think the only way to do this is to buy a 200,000 dollar still.

I am in the process of getting everything together at this point. Three teir states like GA are the most expensive. Good luck.

Wilder

[Chip Tate]

50-75k sounds way low to me for any commercially viable distillery, but to each his own . We built our own distillery and it took significantly more. Don't forget that once you have a functional distillery, you've only just begun to spend money. Of course, it depends on what you're making too as to how much it costs to get to break even.

[cowdery]

People usually get into this because they have an irrational and unexplainable passion for it, not because they went looking for a sound business opportunity. I compare it to the Richard Dreyfuss character in Close Encounters of the Third Kind. For one thing, this whole craft distillery thing is so new, there aren't any good road maps. Maybe someday someone will sell an off-the-shelf "kit," like buying a fast food franchise, but it's not there yet. Probably 2/3 of the people here, who have distilleries going, are still trying to figure out out to make them profitable.

[delaware_phoenix]

I started my distillery with about $50K. But I bought a tiny toy still (30 liters), had dirt cheap rent, and live in a village where much of the main street is boarded up/unused and they didn't care what I did. I also wasn't starting from an 8% mash, and so have to reduce my raw materials by 80%.

If you want 150 gallons of fine spirit (let's say whiskey), you're going to need to start with a lot of mash/wash at 8% to get there. Berglund says in a spirit run you'll get about 30% as 120 proof heart and another 20-25% as tails. So just right there you need 450 gallons of low wines. So if you have a 50 gallon still, you could expect 15 gallons heart per run. Thankfully when you bottle you can reduce your 120 proof heart to 80 proof and be just the same as lots of other brands. So you need to only make 110 gallons.

So far you need 7 spirit runs a week with a 50 gallon still. And we haven't even begun to distill the mash. You can do it faster if you have a 100 gallon still, but that may well blow the budget cause you also need lots of fermenters and a mash tun and lots of other equipment.

Maybe there are folks on the board who can tell us how to produce 150 gallons a week with a small still. I'd like to know how to do that. Maybe my numbers are all wrong.

[scohar]

I started my distillery with about $50K. But I bought a tiny toy still (30 liters), had dirt cheap rent, and live in a village where much of the main street is boarded up/unused and they didn't care what I did. I also wasn't starting from an 8% mash, and so have to reduce my raw materials by 80%.

If you want 150 gallons of fine spirit (let's say whiskey), you're going to need to start with a lot of mash/wash at 8% to get there. Berglund says in a spirit run you'll get about 30% as 120 proof heart and another 20-25% as tails. So just right there you need 450 gallons of low wines. So if you have a 50 gallon still, you could expect 15 gallons heart per run. Thankfully when you bottle you can reduce your 120 proof heart to 80 proof and be just the same as lots of other brands. So you need to only make 110 gallons.

So far you need 7 spirit runs a week with a 50 gallon still. And we haven't even begun to distill the mash. You can do it faster if you have a 100 gallon still, but that may well blow the budget cause you also need lots of fermenters and a mash tun and lots of other equipment.

Maybe there are folks on the board who can tell us how to produce 150 gallons a week with a small still. I'd like to know how to do that. Maybe my numbers are all wrong.

From our experience, your numbers are pretty accurate. It's a tough business to do on a dime. (Notice I say 'business'... if you want to do it as a hobby, well, that is another matter entirely.)

[Wilder]

I started my distillery with about $50K. But I bought a tiny toy still (30 liters), had dirt cheap rent, and live in a village where much of the main street is boarded up/unused and they didn't care what I did. I also wasn't starting from an 8% mash, and so have to reduce my raw materials by 80%.

If you want 150 gallons of fine spirit (let's say whiskey), you're going to need to start with a lot of mash/wash at 8% to get there. Berglund says in a spirit run you'll get about 30% as 120 proof heart and another 20-25% as tails. So just right there you need 450 gallons of low wines. So if you have a 50 gallon still, you could expect 15 gallons heart per run. Thankfully when you bottle you can reduce your 120 proof heart to 80 proof and be just the same as lots of other brands. So you need to only make 110 gallons.

So far you need 7 spirit runs a week with a 50 gallon still. And we haven't even begun to distill the mash. You can do it faster if you have a 100 gallon still, but that may well blow the budget cause you also need lots of fermenters and a mash tun and lots of other equipment.

Maybe there are folks on the board who can tell us how to produce 150 gallons a week with a small still. I'd like to know how to do that. Maybe my numbers are all wrong.

You hit the nail on the head. A 400 gallon still is what I had intended to try. The 150 per week is what I thought I could do based on this size still.

[cowdery]

I'm not a distiller but I talk to a lot of them. Everybody I know wants a bigger still. The problem is that it's virtually the same amount of work whether your still is 50, 100, 250 or 500 gallons. Yes, a bigger still is a bigger initial investment, and will increase your materials cost, but your time and energy is the value-added and if you can produce twice as much product doing the same amount of work? Well, that's not hard to figure out.

[Wilder]

Unlikly spot to find gold in the form of starting you business, but here it is listen and don't just dismiss offhand.

http://www.bobparson...&ci=13338&id=-1

[toivo]

i read a great post on here the other day if i could remember what topic it was in i would tell you but ive been reading so much to hell if i can remember the guy said he started with about 20k in equipment not all of us have 500,000 to dump in it is possible to start bare bones look for deals on building materials look on craigs list if your lucky like i am and dont have to lease a building thats a big dent in the costs having friends in different trades who are willing to help you is a+ when people hear you are building a distillery i have found they are more than willing to help in any way they can get to know any distillers around your area they may be willing to buy in bulk with you or sell you grains enzymes ect becuase they get more than they can use #1 make friends a lot of them brew up a few kegs of beer and have a work party

[Charles@AEppelTreow]

To be honest, I'd like to be able to _sell_ 150 gallons a week. If I could do that, I'd then work on making it.

Probably why I'm still a chemist.

I liked the note about all the different jobs you have to do yourself or hire out. But it's an underestimate.

Making a product is only the beginning. I started a craft cidery for less than 35 k$. But have no cash on hand to do marketing, now that I really want to.

[delaware_phoenix]

Selling 150 gallons a week, I'd love to have that much sales a _month_! I'd be peachy if that happened.

One thing is to trade expenses and equipment with labor (yours, or other free labor).

[SailingMoonshine]

Unlikly spot to find gold in the form of starting you business, but here it is listen and don't just dismiss offhand.

http://www.bobparson...&ci=13338&id=-1

Great find. "Tell them to @#&^ Off!" HAHA!

[Guest Liberty Bar - Seattle]

Brandon, as I was building my business plan and setting costs, as I went past half of a million dollars and still had lots of expenses to add to the list, I kinda thought that maybe I should take a really good look at what I wanted to do.

In my opinion, unless one has either a good amount of money to invest and/or a secondary income stream to put food on the table, one should think very, very seriously about starting a distillery.

One thing that perhaps you should think about is the Contract Distillery option. There are issues relating to that, too - but!then you can save your start-up investment to product development and marketing, instead of building a whole distillery.

This is a very difficult business in a difficult market, and while there's tons of room for new products, it's tough to get in there. I am reached by no less than three or four new products per month who want to get on my shelves (I own a bar in Seattle), and I add maybe two to three per month...if that.

Another issue is, have you ever operated your own business? That's a whole different issue. A distillery should probably NOT be the first business that someone owns and operates...

[bluestang50]

I am in the process of getting everything together at this point. Three teir states like GA are the most expensive. Good luck.

Wilder

What do you mean by "three teir" states like GA? Are you having to pay taxes at the state, county, and city level?

EDIT

Never mind I found the three tier system for alcohol distribution.