The Story of Starting a Brew On Premises Business

    Posted by Pete Caputa on Apr 23, 2008 3:48:00 PM

    A few weeks back, Ray Schavone, owner of Deja Brew, sent me a great guest post "how to" article about starting a brew it yourself business. It was a great post with a lot of lessons for any business.

    I love "how-to" articles, but I like stories even more. If there's one thing a blog lends itself well to - it is storytelling. And people tend to relate to them. Maybe it stems from when our parents read us stories. I know that my son loves it when we read to him. 

    So, here's Ray's story. It's certainly entertaining and it reveals some great lessons too: 

    So you want to start your own business? Why? It's a lot more work than you might suspect. You'll have a jerk for a boss, and get to deal with everything, EVERYTHING, related to your business. You won't be able to call in sick, or take time off because the day is nice. And nobody, nobody, will sweep the floor as well as you will. Everyone else in your company will be an employee, and you know how much you care as an employee.

    Yeah, I was told all this and more, but went ahead and did it anyway. In some ways, I was lucky in my choice of business (beer, who doesn't like beer?). So how did it all start?

    Back in the middle ages, 1996 to be exact, I was down sized, right sized, laid off, use whatever term works for you, from the company I had worked for, for over 23 years. The company had been down sizing since 1987, and it became a rather depressing environment. I had been traveling to Canada on company business and had walked past a brew-on-premises operation one evening. It was intriguing to me as a home brewer, so I stopped in. Everyone was talking, smiling, having a beer or beers, good music in the background, and I fell in love. What a different environment from what I had been experiencing. So, a little bit of research, I found that there were some of these businesses operating in the U.S., and decided to check them out. I found one relatively close by, and spent a bit of time brewing there to get the feel for it. Same feeling to what I had experienced in Canada. It was a lot of fun...

    But, that day in 1996 came, and it was time to find something new. So, with my wife's blessing, I embarked on the road to open my own business, a brew-on-premise. I contacted several of the BOPs operating in the U.S. and just started asking the questions I needed to ask, what equipment they were using, how they were doing, what they would do differently. I bought a software package to write a business plan, followed the directions, and Voila!, a business plan.

    And so, shiny faced, full of enthusiasm and optimism, my newly printed business plan in hand, I gave a copy to a banker friend of the family, and anxiously awaited my funds. Well, the short story is he didn't approve my request or give me the funds. But he did give me some good advice; he told me that I needed an SBA loan.

    So I called the SBA. They told me I needed to go to one of their regional Small Business Development Centers, and have them help me with my business plan (but I have one! And I paid damn good money for that s/w package too). Ok, so I called the SBDC at Clark University in Worcester. I met with a wonderful and enthusiastic lady there (unfortunately, I don't remember her name, it was 11 years and many beers ago), who said she'd help me.

    BTW, if you are considering starting a business, I highly recommend contacting the SBDC at your nearest business school. What an incredible service they provide. FREE!!!

    Away we go, this wonderful lady became my drill sergeant. Questioned me on everything I wrote in the plan. Ugh.. But, she did put me in touch with an excellent business tax accountant who spent hours with me developing the financials of my plan... FREE! America, what a country!

    After a couple of months, my drill sergeant declared my plan to be ready. And off to the banks they sent me. They gave me a list of banks, with contacts, and I started calling. My first rejections were disappointments, but I was not fazed. By the 20th rejection, I was beginning to wonder. And then I read a story about Walt Disney being rejected by banks over 200 times for his Disney Land theme park. Onward I cried!

    Eventually, I found a bank that was interested. About 6 months after I started with my first plan, I had a funding commitment. Before the bank would give me the commitment, I had to find a location, and have a lease in place.

    And so the build out of the space began. It was undeveloped warehouse space. The building owner decided to pay for the build out. Sweet! The owner was building the space out for a couple of retail operations, and mine was to be the first.

    I contact the local Board of Health to review my floor lay out. They are very confused. (What are you trying to do?) I provide them with contact names for the BOH where similar businesses are located. At our meeting I laid out my floor plans, build out plans and the sanitizing chemicals I'd be using. They look at me and say, you know if everyone who needed BOH approval for a business in town came to us first, like you did, our job would be soooo much easier, and their approvals would go much faster. We love what you're doing, and we think you need to put a mop sink in here. Meeting over, approved.

    Find out I need a zoning variance for the business. Ugh.. Petition for the variance, go to the town meeting with the landlord, and my hot BOH approval. Variance granted. Yesss!

    We started by measuring, and drawing chalk lines on the floor to separate the spaces. We took several half walls down, put metal studding up for the walls, and then one day... Bang! The brick façade came down, and windows and door went in. Hey, this is starting to look real!

    Rough plumbing goes in. Hey! Why's the plumbing for the toilets next to the door, and the sink is on the far wall? Answer: We didn't want to jack hammer through 8 inches of re-enforced concrete to put the toilets on the back wall. BTW, did I mention the landlord was doing the build out? You get what you pay for.

    The brewing equipment starts to arrive. Yeehaw! Time to get my contractors in and get everything connected. My brother in law is a plumber and he's doing the job. Free! Cost of materials only. Great stuff! And what a maze of plumbing is needed. Carpenter arrives, and my specific build out starts. Oh, I'm getting excited now...

    Plumbing is complete. Get the plumbing inspector out.. Who did the plumbing? I tell him. He says, "Boy, those are great guys aren't they?" Confused look on my face. Yeah they sure are... Ok, so what does this do, what does that do type questions. I go through the entire water flow with him. Jeez, they do great work, he says.. Plumbing approval in hand.. I'm getting more excited every day.

    My build out is finished, sign is up. It's spring time in New England, and I'm feeling good... I'm outside sitting on the tail gate of my pick up truck, eating a sub, and a man walked over to me and says "hey, you know what's going on here?" Sure do, and I proceed to explain it to him. He hands me his card. He's an advertising exec from a regional newspaper. We talk a bit, and off he goes. Now that the sign is up, this becomes a daily occurrence. Some one stops in, asks what's going on, and proceeds to tell me I *need* to advertise with them, it'll be great for my business. Oh boy, this is getting old fast.

    So, I call the first advertising guy that stopped by, and talk to him for a bit. (BTW, if you haven't figured this out, this is a very unique business. I'm the only one in Mass doing this, and one of 50 in the U.S.) So, I play the news worthiness of my venture to him. He let's me know editorial and advertising departments are somewhat separate, but he'll talk to one of his friends who's a reporter for the town I'm in. He drops by, and writes an article on us. A very nice article too. About a half page in the paper. The phone starts ringing. Oh boy, oh boy, oh boy... So, I call the advertising exec up, and let him know what happened, and that clearly, advertising in his paper would do me good. We set up a year long advertising campaign.

    And so, I start this approach with everyone else that tells me I *need* to advertise with them. I'm very unique, do a story on me first. If I get a response, then you're a good advertising vehicle for me. Some are willing to do this, some are not. It's ok with me, if they want my money, they play by my rules. Hey, I'm really starting to like this owner position.

    Last item is the fire inspection before we can open. They want additional sprinklers installed. Landlord calls the plumber to install them. Plumber cuts the water main to install the sprinklers, stops in the store and says, Sorry Ray, but we're not installing anything until we get paid for the rough work we did... OMG... We have no water, period. No flushing, no washing of hands, and certainly no brewing. Issue resolved, 2 days later the new sprinklers are in, and the fire department completes their inspection.

    We are good to go!

    We have a soft opening, testing the systems, brewing some beer to sample at our Grand Opening.

    Grand opening arrives, it's a pretty nice turnout, and about 200 people come through the door to see what we're about and sample the wares.

    Day 1.. Do I hear crickets chirping? That's ok, we've just opened.

    Day 2.. Damn those crickets are loud. Hey, it's just day 2.

    Day 3.. Turn up the music, and can't hear the crickets. But, I'm thinking, what have I done? I've got a loan payment due the end of the month

    Day 4.. Hey, let's play some cards, the music sounds good, and we've got some beer & wine.

    Day 5... The phone rings! Our first appointment!! Another appointment and another!

    Day 6.. More appointments.. This is starting to feel better..

    10 years and 10 months later.. We're still here. We still have local towns people stop in and ask us how long we've been opened. Really? I've never noticed you before!

    And oh, the stories we could tell over those 10 years. I do want to say, that the local town officials were incredibly supportive of us during our start up, and continue to be so. And we've got a great landlord, very responsive if there's a problem. We got to profitability pretty quickly, and remain so. One of the best things about our business is the people we get to meet. Our customers are with us for 2 hours during the brewing cycle, and two weeks later, are in for another two hours to bottle. We've made some wonderful friends over the years. Thank you all for all your support!

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    Topics: small business marketing, storytelling, marketing a small business, blogging for business, business ownership

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