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Business Plan


WI Distiller

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Hello everyone.

I've been lurking around the ADI forum and website for a while now. I'm in the very early stages of opening a small distillery, and was curious if anyone on here had a sample business plan I could look at just to give me an idea of the structure and some of the numbers you used.

Any help is greatly appreciated.

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Hello everyone.

I've been lurking around the ADI forum and website for a while now. I'm in the very early stages of opening a small distillery, and was curious if anyone on here had a sample business plan I could look at just to give me an idea of the structure and some of the numbers you used.

Any help is greatly appreciated.

Go to the SBA for the format. For everything else you need to do your own market research in your own region. Plus the business plan must be your plan and not anyone elses. There are plenty of format go bys out there. Erase all of the data, start reasearching, go to the sba score office for help if you wish. They have cheap bp classes. If you try to cut corners on the bp you business will most likely fail. Good luck.

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I am in the exact same situation. It would seem that there are some industry standards that could be applied; with variations of course such as equipment costs (depending on what you decide to purchase), rent, etc. However, insurance, marketing, standard salaries, type and number of employees needed for a successful operation, etc. should be known to industry insiders.

It would be very helpful if someone who put together a successful small operation was willing to share his/her experience.

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Salaries? Boy, that would be nice.

Phillip, all the things you mention are common expenses - but the amount of the expense can vary dramatically. It varies with location, personal cleverness, location, size of business, location, sweat equity and the skills you bring versus hiring, etc.

I think there is a lot shared on this site already - though scattered here and there through the topics. And I also think there is a strong sentiment here that there is _great value_ in doing the foot-work research yourself.

One of the best resources is to get out and meet other distillers. Brewers and vintners, too. There's a lot of overlap. But not complete. Most will take some time to chat - at least once - out of courtesy to folks following their own footsteps. And answer the occasional email question. But don't expect detailed lessons on industry practice and customs for free.

Besides, travelling around to distilleries is a decent vacation.

WI Distiller, I maintain a mailing list for WI distillers. Not that it sees much activity when the legislature isn't mucking around with the rules (or we want them changed). You can contact me off forum.

Oh, and one tip - making the product isn't the hard part. Selling it takes even more creativity, luck, perseverance, sweat, time, etc.

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Salaries? Boy, that would be nice.

Phillip, all the things you mention are common expenses - but the amount of the expense can vary dramatically. It varies with location, personal cleverness, location, size of business, location, sweat equity and the skills you bring versus hiring, etc.

I think there is a lot shared on this site already - though scattered here and there through the topics. And I also think there is a strong sentiment here that there is _great value_ in doing the foot-work research yourself.

One of the best resources is to get out and meet other distillers. Brewers and vintners, too. There's a lot of overlap. But not complete. Most will take some time to chat - at least once - out of courtesy to folks following their own footsteps. And answer the occasional email question. But don't expect detailed lessons on industry practice and customs for free.

Besides, travelling around to distilleries is a decent vacation.

WI Distiller, I maintain a mailing list for WI distillers. Not that it sees much activity when the legislature isn't mucking around with the rules (or we want them changed). You can contact me off forum.

Oh, and one tip - making the product isn't the hard part. Selling it takes even more creativity, luck, perseverance, sweat, time, etc.

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It would be very helpful if someone who put together a successful small operation was willing to share his/her experience.

But what is in it for the guy who put together the small operation? I'm that guy. I'd be willing share my experiences, and by share i mean sell. I have a 75 page business plan complete with financial projections and shareholder subscription agreements that i used to successfully fund raise the $ required to start an operating distillery. It's exactly the type of information you are looking for. I'd let that go for a price.

PM me if you are interested.

-Scott

Ammdended July 2012 ---> Yeah, once upon a time I thought selling my BP was a direction I wanted to take, but I've since changed my mind. Still getting requestes every now an then, thanks, but I've rescinded the offer. Best to write your own BP without question. -Scott

Edited by Scott @ Twenty2Vodka
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But what is in it for the guy who put together the small operation? I'm that guy. I'd be willing share my experiences, and by share i mean sell. I have a 75 page business plan complete with financial projections and shareholder subscription agreements that i used to successfully fund raise the $ required to start an operating distillery. It's exactly the type of information you are looking for. I'd let that go for a price.

PM me if you are interested.

-Scott

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Wow, certainly a lot of cynicism out there. Maybe I should explain myself a little bit more.

I have been in the brewing industry for 3 years, working as a professional brewer and writing for professional and homebrewing magazines. My interest in distilling is more recent, but I have been doing preliminary research on the distilling industry for the past month or so. I have met with three professional distillers, all in different phases of operation (newly open, open a few years, fairly old) and have been in email contact with many others in the industry.

I was not hoping to find a cheat sheet that would let me breeze through my business plan; rather I was simply thinking that the more information I have, and the more people's previous experiences I could reference, the stronger my plan would be. I am familiar with the SBA site and am using it.

What's in it for you? Nothing at all, other than helping out someone who is in the same situation you were once in. I guess I thought that was sort of the point of online forums, to help other people and share your experiences.

Thank you all who posted so far for your help.

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What's in it for you? Nothing at all, other than helping out someone who is in the same situation you were once in. I guess I thought that was sort of the point of online forums, to help other people and share your experiences.

What I'm offering you is value for value, not a cheat sheet, and not a feeling of whatever. Declare up front in an actual business transaction that the other party has nothing to gain and see how far it gets you. Call it cynicism, or a reality check, but please don't try to convince me that i'm better off helping you for the sake of the feeling of helping you. That feeling doesn't fill my oil tank, or pay my employees.

Expect to get more actual assistance with specific questions. Especially if the answer, and the discussion leading to the answer, builds the general wealth (read knowledge-base) of the forum. That is the point of of online forums like this, and the motivation for people who are busy running operating distilleries to contribute.

Best of luck in your business,

-Scott

Edited to remove offer to sell my BP, see above post too....carry on.

Edited by Scott @ Twenty2Vodka
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First of all (as mentioned by others), do your own business plan. There is a major learning curve that you set yourself up for when you have to do it from scratch. A business plan is a business plan, a monkey could do one. If you take someone else's business plan, you run the risk of copying them in ways that can be detrimental to your individual circumstances. However, in doing all of the research and pricing you get very good at being ACCURATE to the costs. It only takes one major screw-up on your projections for you to get shot down in the start-up phase(s). If you aren't able to set up your own business plan with financials, then you need to get someone on board who can do it. As said before, just cause you can make good hooch and think up a smart name for a product doesn't mean you can run a federal and state-licensed distilled spirits plant. IMHO, if you don't know enough about distilleries to figure out some basic projections for start-up costs, GO VISIT SOME AND SEE WHAT THEY HAVE AND HOW THEY MAKE THEIR PRODUCTS. You can only get so much by staring at a computer screen or talking on the phone.

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Something to consider: we want to build our industry and see it thrive. We are also competitors. Asking for numbers gets into sensitive business information. I find it much easier to ask things like 'have you had better experience with one insurer versus another?' or 'does a distillery need any special coverage compared to a winery or brewery?' rather than 'how much does insurance run you'.

Not that the other questions aren't business info, but I think questions with numeric answers put people on guard.

You also need to consider the venue of discussion. For instance, meeting notices of the WI Winery Association all have a notice at the bottom to remind people that a number of topics are off limits for antitrust reasons - both during the meeting, but also during breaks and such.

If there isn't legalese like this buried in the ADI rules now- there likely will be before long.

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Paul,

As I said before, I had no intention of NOT writing my own business plan or not doing my own research, and I have already visited three distilleries and plan to visit more. I simply felt that the more information I had, the more examples I could reference, the better off I would be.

During my preliminary research I have found quite a few business plans online from wineries and breweries, from folks who started successful businesses and have posted their business plans online, free of charge, simply to help others who might want to start a similar business. Anyone with common sense would know that they can't simply copy and paste their name into one of these and call it their own; markets are too different and always changing, and no two businesses are the same. I just thought that since I couldn't find any distillery business plans online I'd see if anyone here was willing to post one. If no one is, that's fine, I'll just continue on my path. I respect that people might be protective of some of the information in their plans; no hard feelings.

Thanks to everyone who has taken the time to post, or who has contacted me offering help.

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  • 3 months later...

WI, I'm new as well. One thing I've found extremely useful is creating a kind of conversions spreadsheet. When you start with knowns, like grain weights (56 lbs of shelled corn per bushel) and weights, measures and costs for bottles, labling, etc (much longer list), you can quickly start to see the output into a business plan for any number of production levels at the click of a button. It will then tell you how much grain your need to purchase and store, how much it will be, how many bottles, labels, toppers, boxes, etc you need. It's like making a big old calculator that changes hundreds of fields output all at once. Start there, and you'll start to fill in the wholes and come up with a decent plan. Just a thought :)

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If you want to open a dry cleaner, or a car wash, or a convenience store, or any one of dozens of other common small businesses, there are indeed readily available roadmaps and templates to follow. Micro-distilling is different, mainly because it is so new. The people who are doing it are figuring it out as they go because there really aren't any roadmaps or templates for them to follow. That's not to say you can't learn from people who have gone before you, but be prepared for a lot of ambiguity because it simply hasn't been standardized yet, and may not be for many years. At this point it is impossible to even say that operating a micro-distillery can be a viable business proposition long term. There simply isn't enough experience. No one really knows.

One young micro-distiller, who is pretty well established, told me recently that a colleague offered the opinion that the industry is entering its middle phase. I could not disagree more. I would characterize this as still the beginning of the beginning. Nothing is established. Nothing is "known." Everything is still up for grabs. That's both exciting and frightening. If looking at so much unknown is more frightening for you than stimulating, then micro-distilling may not be for you.

I have joked that for some of the early entrants the steps seemed to be:

(1) Come up with cool name.

(2) Buy a still.

(3) Read the instructions for the still.

(4) Have business cards printed up indentifying yourself as Master Distiller.

(5) ?????

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(4) Have business cards printed up indentifying yourself as Master Distiller.

Awesome! Like other people, I did this and should change it. Should read more like janitor, sales guy, accountant, landscaper, maintenance, tech repair....and oh yeah, I'm learning my craft of distilling too.

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(3) Read the instructions for the still.

There were supposed to be instructions with my still?!? laugh.gif

I think people are a little surprised when I tell them I'm also the janitor, delivery gal, etc.

I agree with Chuck, this is still the very beginning.

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  • 1 year later...

Paul,

As I said before, I had no intention of NOT writing my own business plan or not doing my own research, and I have already visited three distilleries and plan to visit more. I simply felt that the more information I had, the more examples I could reference, the better off I would be.

During my preliminary research I have found quite a few business plans online from wineries and breweries, from folks who started successful businesses and have posted their business plans online, free of charge, simply to help others who might want to start a similar business. Anyone with common sense would know that they can't simply copy and paste their name into one of these and call it their own; markets are too different and always changing, and no two businesses are the same. I just thought that since I couldn't find any distillery business plans online I'd see if anyone here was willing to post one. If no one is, that's fine, I'll just continue on my path. I respect that people might be protective of some of the information in their plans; no hard feelings.

Thanks to everyone who has taken the time to post, or who has contacted me offering help.

Hi WI distiller, are you a fully paid up member of ADI, because if you are there are sample business plans on this website that you can access and download as a full member. I sympathise with what you are trying to do. There is a welter of information and tasks to perform and finding a shortcut for anything is a huge relief. I think your request was perfectly legitimate and understandable, but guys might be a little reticet to send you the whole shooting match! Perhaps if you address problem areas individually and ask for help, you would get a more enthusiastic response. Having said that, I am flabergasted by the helpfulness and good nature on this forum. Networking is so important for us all to develop this passion into a forceful industry and most people get that on here. Good luck, either way.

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There is a major learning curve that you set yourself up for when you have to do it from scratch.

As one going through this process right now I say "amen" to that but I'm not sure that's such a bad thing. Being forced to dig more seeply into sizing of equipment and realistically looking at necessary production volumes to be successful (hopefully) has really been an eye opener. The amount of work required to get up and running is indeed monumental and costs to do it right can be pretty suprising. If you have no real distilling experience it also doesn't take long to realize theat you don't necessarily know WTF your doing!! :-)

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Am trying to figure what it would cost to produce a 1 Liter bottle of vodka so I can determine if a profit can be made selling to local bars and retailers. It looks like the material and labor costs would run around $9. What is hard to figure is how much of the bottle (what the standard expenses ought to be for success) you can allocate for start up costs: [equipment costs, construction/renovation, etc.] & recurring costs: [rent, utilities, insurance, etc,]. If I can determine that, I can know what we can spend on rent, a still system, etc. Can anyone share their understanding?

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This must be the most naive post I've read on ADI (and that includes my own).

I'd say if you plan on selling your vodka for 12.99, you better have really low rent. and no air conditioning.

On the other hand, if you sell for 79.99, the sky's the limit.

helpful?

fyi, retailers don't want a 1L bottle

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OK!

That was nice and snarky, wasn't it?

But I just guzzled half a bottle of $9 vodka, so I'm more relaxed. I am now typing in a prone position.

so...

1. if you make one size, use 750ml not 1L

2. $9 material and labor cost? -- a] that must be an awfully fancy bottle and b] you're going to pay yourself a wage right off the bat? That is certainly optimistic.

3. it should go without saying that one's construction, renovation, rent, utilities, etc. costs will be site specific, with regions of the country varying dramatically

4. affordable costs will depend upon your selling price and

5. what volume you are able to sell

6. what is your definition of success? -- a] not losing money b] I'm rich! c] somewhere in between

In short, I don't think there is a standard rate of expenses for success.

gotta love these zombie threads

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Just a note, I have heard from my limited experience in talking with distributors that retailers prefer a 750 mL or 375 mL bottle, but many restaraunts prefer the 1L. It's a little off topic form the OP, but wanted to throw it in based on the above comments.

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