The emergence of more microbreweries is one of the fastest-growing trends in the country. According to the Brewer's Association, the amount of microbrew beers rose by 18 percent from 2013 to 2014 while retail dollar values increased by 22 percent. This was the first year that microbrews made up 11 percent of the beer market, while the beer market as a whole only rose by 0.5 percent.
To get in on consumers' interest in craft beers, many restaurants across the country are developing their own lines of specialty, home-brewed beers.
The benefits of adding a brewery to a restaurant
Adding a small batch brewery to a restaurant can be a great way to expand a brand and appeal to consumer trends. The industry as a whole was worth $19.6 billion in 2014, according to the Brewer's Association, which could make restaurant-branded beer sales a great source of revenue for the business.
"Breweries serve as a wider tourist destination."
It takes a good deal of money, time and planning to start a microbrewery, however. Many of these initial costs are for obtaining the space and the staff to operate it. Many restaurants are in a good position to start breweries because they already have a location, though some may need to expand their property to fit the new equipment.
Restaurants also have an advantage when starting this venture because they already have vendor connections. While the existing vendor relationships may not be able to provide all of the new supplies that are needed for brewing, they can offer valuable connections to getting new partnerships. Restaurateurs also already have delivery systems in place and can more easily expand their current operations than those starting entirely from scratch.
Additionally, breweries serve as a wider tourist destination. Offering tours, educational information about the brewing process and tastings create more reasons for patrons to visit an establishment. Customers who want to visit a craft brewery will be likely to have a meal at the restaurant while they are there. Owners can also incentivize customers to visit the eatery by offering packages that include tours, tastings and meals to boost sales.
Considerations for opening a brewery in a restaurant
Like any new business venture, there is a lot of planning and financing that must go into adding a brewery element to a restaurant. Zoning laws and health codes will be different for a brewery than for the restaurant, for example. It's important for owners to research the local requirements for adding this element to their eateries.
CNN Money emphasizes that new brewers also need to consider their product carefully.
"If you're not in this to make quality beer, then don't waste your time," microbrewer Michael Kane told the source.
Because the market is growing, it's becoming more competitive. New brewers need to take the time to experiment and test out their recipes before introducing their new product to the public.
The article clarifies, however, that increased competition does not mean an over-saturated market yet. Though there are more than 3,000 microbreweries across the country, most only produce fewer than 15,000 barrels of beer each year and do not have a wide distribution network. That makes 2016 a great year to get into the microbrew market while it is still on the rise and the market is not too crowded.
Brewing equipment financing
The biggest cost that new brewers will need to worry about is the equipment. This can be a large initial cost, so financing plans could be critical to small restaurants that don't have tens to hundreds of thousands of dollars to spare, depending on the size of the operation they want to start. Owners need to decide the volume they want to begin with so they can figure out how many vats to order and how complex and automated they want their system to be.
Hospitality and restaurant industry piece brought to you by Marlin Equipment Finance, a nationwide provider of commercial lending solutions for small and mid-size businesses. Marlin's equipment financing and loan products are offered directly to businesses, and through third party vendor programs, which include manufacturers, distributors, independent dealers and brokers in the security, food services, healthcare, information technology, office technology and telecommunications sectors.