Small Business Start-up: Craft brewery

Executive Summary

Craft Brewery will establish and operate a Modern Brewing pub. The licensing process will take into consideration the needs of craft beer drinkers, home-brewers as well as artisan brewing. As a business within the brewing industry, Craft Brewery will merge the experience of artisan brewers in providing quality brands, and through innovation and creativity in service delivery, Craft Brewery is expected to retain high profile among its competitors within the industry. The business is expected to acquire a small taproom that will help in building brewing skills among young professionals as well as serving customers efficiently. In addition, having a home-brewing library is projected important since the business must give its employees and other categories of stakeholders the opportunity to pick home-brewing as their hobby. On the same note, the business must develop a platform that will enhance collective ownership. As proposed by potential financiers, the business ownership structure should allow 30 artisan brewers whose production efforts shall be closely supervised by the operational manager.

Other than developing proper production strategies, Craft Brewery is expected to make improvements in its future product delivery by innovatively engaging in warehouse management. Craft Brewery should consider using in-store warehousing and online merchandizing in order to reach as many customers as possible. Moreover, the identified opportunity underlies the increasing global demand and pervasive reactions observed in the recent past among the lovers of beer and other related products. Such demands can only be satisfied through a combined production effort, an effort that is governed by developing a good business culture and unitary participation among various employees. With a cost estimate of 300,000 dollars, there is a need for proper allocation of financial resources in order to meet the business goals. Therefore, the mentioned aspects are core operational areas and as encrypted within the business mission and vision statement must be fulfilled by the management team.      

Company Description

Craft Brewery was a conceived idea by friends who wanted to collaborate and start a business that would bring their ambitions and priorities together. As already mentioned, each group advocated for the establishment of a brewing corporation since most companies within the brewing industry seemed to lack the most basic equipment that could be used to produce brands and to serve the various market segments with beers.

In relation to existing demands from consumers, Craft Brewery is considered the most befitting company since in addition to producing the most needed brands, the company will also operate as a beer incubator. As an incubator, the company is expected to mold new brewers and also developed new brands that are very distinct and differentiated.  With the allocated 500,000 dollars, Craft Brewery is expected to purchase a home-brewing kit that will cost approximately 200, 000 dollars. The new home brewing kit will serve an emerging technology within the company’s operations and every employee has to undergo relevant training in order to meet the production needs.

Apart from fulfilling the needs of customers, the company will offer an opportunity for investment since most of the funds to be used in accomplishing the project would be derived from shareholders, investors, and well-wishers. This plan is considered an injection into the national economy and once the company has established its branches in different markets across the world, the domestic employment and income levels are projected to improve. 

Several characteristics make Craft Brewery different from any other company within the brewing industry. Essentially, the company takes into consideration the interest of each category of stakeholders and serves the needs of every team member equally. The kind of services to be offered and the products the company is supposed to release to various markets are planned to meet the highest levels of preferences. With such a production plan, the product managers use every little opportunity to search for different markets for quality and best pricing policy. Still, on consumers, the company has categorized its customers based on income and preferences and therefore through product differentiation, it aims at producing products that satisfy the various groups as mentioned. In order to improve on sales, the company must adopt a pricing policy that is favorable to consumers. In addition to serving the interest of consumers, the company motivates its investors through higher interest and prompt payment of dividends. The company offers investment opportunities, such as shares, bonds, and debentures. These are financial securities that keep the company in good relation with its investors. Finally, the company management must ensure good relationship between the whole company and customer. On the same stance, demands by the company’s employees must be given the first priority since any drawback in performance levels of employees will replicate into collapse of every system within the company. Through regular performance evaluation and motivation, the company is expected to influence employees and improve product quality and quantity. In other words, Craft Brewery is supposed to enhance its competition by putting in place strategies to influence consumers, investors, and employees. Such strategies differentiate Craft Brewery from other companies within the same industry.

In every production process, the main objective is to maximize profit. In this connection, the company is expected to identify its consumers and produce those products that best satisfy the needs of customers. Identification of consumers according to age, social status, and taste is considered important towards the operations of the company. The company serves customers from the age of 21 and above. Since the company produces different products, there are possibilities of serving the existing markets. The most appealing markets for the company are high consumers of craft beer, mild taste consumers, and other beer drinkers.          

Market Analysis

According to the report released by the US Brewers Association in 2011, metro Detroit Michigan was ranked as number 14 in terms of market operations and capital gain per Brewery. The city of Michigan currently has over 102 Breweries, which makes the beer consumers to have comparative advantage as far as consumption is concerned (Daniels & Brewers Association, 2006, p. 23). Even though the research by the USBA shows an increasing trend in the number of breweries, the companies venturing into the business have not yet identified one important need among beer lovers. The metro Detroit Michigan is considered an area with unquestionably lacking locally-brewed beer and craft beers. By looking at the map of metro Detroit Michigan in figure 1 of the appendix, we can locate various breweries and brewpubs, which are concentrated at the center with only one brewery towards the north and northwestern part of the map. This information reveals that the area is not well served by breweries and brewpub (Daniels & Brewers Association, 2006, p. 24). Thus, the main concern is to establish a craft brewery with several outlets and warehouses located in the region. This will help in whipping out market deficiencies and high prices created by few breweries in the northern areas of Michigan.

As seen from the map, one can say that there is high demand for craft beer and establishing one such brewery in the area would help quench the needs of local consumers. By establishing a Craft Brewery in Michigan, the company will be providing remedy through a unique supply of locally made beer so that the entire Michigan community can truly enjoy at relatively lower prices.

With the few craft breweries like the Twin Pints Cooperative, one can get the idea that consumers are willing to consume more of craft beer from their reliable suppliers. This shows that consumers are slowly drawing their attentions from consumption of mass produced beer while increasing their demand on craft beers and microbreweries. As reported by USBA, between 2011 and 2010, while the entire US beer market was tailing at 1.3 percent and 1.2 percent, the craft brewing industries were making progress with an emergent growth of 13 percent and 12 percent respectively. This information might not be unique to craft brewers since a similar report had been released by IBIS-world in late 2011. The report by IBIS-world stated that the craft brewing industry has been on its peak since early 1990s with greater positive deviations. This report reveals that the craft beer market has been growing at the rate of about 4.5 percent every year with slight negative deviations. At higher levels of market research, the company realized that young beer drinkers between the age of 21 and 24 might give a better opportunity for the Craft Brewery to expand market operations and become one of the leading producers of the most preferred beer brand (Daniels & Brewers Association, 2006, p. 24). As quoted from one consumer, “despite economic challenges, job losses, and other social constraints, craft beer remains the best and will continue to experience dramatic growth.” 

A clear definition of the beer market operation since the end of prohibition of beer and alcoholic drinks in USA is shown by figure 2 and 3 of appendix. Related to the study conducted by USBA, though the beer industry has seen significant growth since 1980s, higher percentage of the beer manufactured between 1980 and 2000 and distributed into various domestic markets happened to be from Budweiser, Miller, and Coors who are branded as craft breweries. At significant level, the same growth in beer industry is not shown throughout within the two graphs. The possible cause could be a fall in demand for other beer brands, and a shift in demand towards the craft beer produced by few existing industries (Daniels & Brewers Association, 2006, p. 25). In other words, all the mentioned evidences point to the fact that as much as brewing companies are trying to reach every consumer of craft beer, the instantaneous growth in population outweighs the much effort put by producing companies. This is a perfect illustration of market gaps that can only be bridged through proper analysis and efficient production strategies.

Situation Analysis

PEST and SWOT analysis

Craft Brewery is expected to serve the growing market of USA with different types of beers. As the case stands, the studies conducted by the company’s product developers reveal that currently, the American domestic market is underserved by brewing companies and brew bubs, and this makes consumers to seek for beers from outside the country. Factors, such as production deficiencies, high pricing, poor customer relations, and low quality products among other factors discourage consumers and keep them off from consuming some of the locally brewed brands. For Craft Brewery, tools, such as PEST and SWOT remain important in analyzing the business environment and areas for improvement in order to meet the demands of local consumers alongside retaining a higher competitive profile. Tables 1 and 2 below shows PEST and SWOT tools of analysis as used by Craft Brewery in controlling production processes.

Table 1: PEST tool of analysis

Political Situations	Economic Constraints	Socio-Cultural Impacts	Technological Factors
US as a nation is considered to have a very stable political environment. The country imposes reasonable taxes on brewing companies and products. The recent economic policies increases ability to raise capital or credit for investment purposes The US government prohibits a two-tier distribution system since it results in poor quality products	The country experience higher unemployment rates and lower consumer confidence. This makes consumers to go for luxury items like beers and other drinks. In overall, craft beer is at its mature stage growth and retains the largest share of alcohol and markets. Craft beer experiences instant market growth. Craft Brewery offers a positive outlook and might give the expected level of returns. There is a need to build confidence among consumers by releasing high quality products.	Craft beer consumers seem to have brand loyalty and will always consume from their preferred producers. The middle class consumers increase their level of consumptions as much as the products released to them are of higher quality and charged at relatively lower prices. Craft beers increases the pride in USA made products by local companies and this is relevant towards market improvements. Craft Brewery will facilitate growth towards healthier lifestyles. The production process has a focus on environmental protection and conservation.	The company uses digital social network to make its consumers aware of the products. Craft Brewery aims at making greater brand width for streaming media. This would mean that the fewer majority of the population uses modern technologies to make communications and to get information on available products.

The PEST control identifies those factors that will facilitate business growth as well as possible constraints the company might end up facing. As seen in the above table, the macro-environment, such as political factors, economic factors, socio-cultural factors, and technological factors prove that Craft Brewery has several opportunities for investment. These factors are important and therefore a company that aims at making higher returns from its invested capital must be familiar and within the bounds of the mentioned factors.

Table 2: SWOT tool of analysis

Strengths	Weaknesses	Opportunity	Threats
Craft Beer has a mild flavor, which is preferred by most beer drinkers. The brand name clearly defines the form of business and therefore is recognized by most consumers. Craft Brewery keeps in contact with potential customers. In this case consumers feel strong self-presence. The company is locally owned and managed, and thus the products released matches the taste of local consumers who therefore make comparisons to the products made outside the country. With the proposed production plan, the company aims at becoming the most recognized producer of beer brands.	Developing a middle flavor can result in possible turn-off in craft brewing. Instances of low profit margins might result into complete failure. The company might lack instant access to existing markets. The company may not be in a position to expand to new geographical areas due to high shipping cost and imposed taxes.	Craft beer market segment is rapidly growing and requires improved production. Craft Brewery is to establish its operation with the notion that craft beer is currently one of the most selling type of beer. The company expects to gain from repeated buying since there is high demand. The need to improve distributions compel the company to expand and establish its branches in other areas. The company observes a growing market segment of microbrew.	Imposing higher taxes on alcohol drinks. Unstable prices for other brands of alcohol. Beer market seems oversaturated than except the traditional brewing. Product imitation that sell at extremely lower prices. Increasing competition in production of craft beer. Technological changes in production process that require high installation costs and regular training.

Organization and Management

Craft Brewery operates under outlined business structure. The company is segmented into procurement department, production department, sales and marketing department, and communication department. Under each department, the company has managers responsible for activities and they operate in liaison with the top company managers (McKinney, 2003, p. 36). From the top management, the company has the position of the president, legal and regulatory officer, financial management officer, production operation officers, marketing and brand management officers, advisors, and references.

The company’s president is assigned the duty of project management, facilitation of meetings, ensuring complete company networking as well as developing the company’s strategic production plans. According to the company employment regulations, the president must have two years work experience in financial management (McKinney, 2003, p. 36). In addition, the president demonstrates through action successful project management and planning. The legal and regulatory officer is responsible for documentation of licenses during pre-development stages. On the same note, the legal and regulatory officer ensures that the company operates within its jurisdiction and any contract signed must be fulfilled. This goes hand in hand with the procedures for loan application and sales of company shares and debentures. Any person occupying the position of Legal and regulatory officer must demonstrate outstanding knowledge in federal brewing regulations. The office of financial management is responsible for financial planning, financing through capital allocation, and bookkeeping. The officer in charge of the company financers must be accountable at all levels of production and must show relevant knowledge in bookkeeping. Such accounting knowledge must be relevant to international principles of accounting.

Production operation is one of the important offices recognized in the production of craft beer. The most important position is the office of production operation. The officers in charge of the production operation are responsible for purchasing of brew-house during pre-development stage, and after the establishment of the company, the officers ensures that brewing is in progress and according to the standards required. Since the production process is the most sensitive area in the whole company system, the company managers must ensure that the position of production operation is taken by an experienced manager with relevant knowledge in product development and strategic planning (McKinney, 2003, p. 38). Marketing and brand management officers are assigned the duty of ensuring that the company products reach the targeted markets. Similarly, the marketing and brand officers are responsible for the recruitment of sales representatives, market research, and analysis. The same office takes full charge and acts as communication department in order to link the company with both internal and external environments. The final position is taken by the advisors who also operate as company referees both at the planning stage and during production. The team of advisors helps in developing trust among employees, consumers, investors, and lenders (Richardson & California State Polytechnic University, Pomona, 2003, p. 40). Apart from offering the necessary advices, the company advisors and references assist in product planning and policy development. The combined efforts of the mentioned officers allow the company to structure its production plan for the purposes of high performance and value creation. Since the company is motivated by quality products, production specialization and job specification are considered important in making sure that each department functions according to the company’s outlined objectives. To some extent, the structure of the business and the level of experience managers are expected to portray in their operations make Craft Brewery different and unique. The business structure thus gives the company an additional advantage by offering a strong base for competition.   

Service or Product Line

Craft Brewery has developed a product and service plan capable of giving consumers the long needed unique taste at relatively lower prices. The company’s product mix and services include tap-room pint sales that give consumers the opportunity to enjoy their drinks, club subscriptions that offer consumers with the opportunity to obtain craft drinks on credit, homebrew rentals, and artisan brewing. In developing the product, the company works from an inclusive approach and gives potential consumers opportunity to participate by giving their views over the company’s product and areas that need adjustment (Richardson & California State Polytechnic University, Pomona, 2003, p. 40). This ensures that the unique craft brand created is completely a creation of consumers and therefore is highly received by consumers. Otherwise mentioned, consumers must be offered good services, such as security, clean environment, and good customer relations. 

Every product released into the market is expected to last for a period not exceeding 2 years before further improvements are made. This allows Craft Brewery to keep in pace and be relevant to current production methods according to the changing tastes and consumer preferences. Making adjustment in product quality, quantity, and company’s packaging methods keeps lovers of craft beers in pace with other beer brands across the region. According to the company’s product manager, consumers are the first priority in this line of production and must be viewed differently from other groups of stakeholders.

The company’s products must follow relevant production stages, such as market research, planning, production, introduction into the market, and constant distribution through an endless supply chain. During market research, the company tries to incorporate the demands of consumers depending on the gaps identified in other related products. The planning stage enhances proper product design, packaging, and final branding. All these stages require high levels of expertise and job experience in order to produce flavored craft beer. 

Marketing and Sales

A close investigation reveals that through strategic planning and rigorous marketing, the company could sell up to 10,000 barrels of craft beer. According to the report released by the Brewers Association, the craft beer market appears saturated and therefore any company that aims and making greater sales must consider using conservative promotional methods in marketing (Daniels & Brewers Association, 2006, p. 23). With such a step, Craft Brewery aims at reaching its sales target of 10,000 within the first cycle of its production as well as controlling 30 percent of the total market. In order to beat one year minimum of 10, 0000 barrels of craft beer, Craft Brewery must put in place strategic efforts of promotion with the following outlined objectives:

• Reaching a minimum of 10,000 barrels of beer within the first year of establishment through proper expansion into new retail centers. In the second year, the sales volume should grow up to 20,000 on minimum.
• Enhancing consumer loyalty through quality products.
• Being innovative and creative in order to ensure constant release of new brews into markets.
• Adopting lower cost packaging with an aim of increasing the company’s overall profit margin. In such a case, the aim is to allow occasional brand promotion without possibly hurting the company’s returns.
• Enhancing market expansion through advertisement.
• Increasing the company’s exposure through increased advertisements and promotional activities. The main goal in this case is to reach the monthly limit of 700 new customers.
• Monitoring growth through conducting promotional events within social media and other social sites.

In order to achieve all these objectives, the company must develop a promotional budget based on tasks and objectives. Such a budget should follow the defined key objectives, assigned tasks, and various costs involved. In relation to the above argument, the company’s managers should adjust the promotional budget to a level that best fits Craft Brewery.

Marketing Mix

Craft Brewery will put in place various promotional plans for its products while following the concepts of direct and indirect methods of communication between the company managers, intermediaries, and end consumers (McKinney, 2003, p. 38). This is because the company reaches consumers through a multi-level chain of product delivery and therefore must create a kind of push and pull demand for its products. The push factor is developed through personal contact with the customer during selling, and at the time the product is under promotion while the pull factor is created through advertising, promotions as well as improving public relations (McKinney, 2003, p. 38). Some of the promotion strategies followed by Craft Brewery include:

• Sales marketing- through sales marketing, the company aims at capturing the attention of sales representatives, company distributors, and various retailers. At this level, the company needs to increase sales in order to ensure that the final consumer gets the product.
• Direct marketing- under direct marketing, the company implores the use of media and other incentive means in order to make the products reach the final consumer. For Craft Brewery, the use of radio, print media, sponsorships, and company blogs makes the company brand to stick in the mind of consumers thus their urge to taste and continue consuming the company products increases.
• Company’s product- in one way, the company’s products and methods of packaging is a form of advertisement. Under product and packaging, the company identifies one weakness of consumers and develops a unique brand and packaging plan such that a consumer concerned with the outlook of the brand container easily recognizes craft brand for consumption.

With an aim of reaching the largest portion of the population, the company plans to use in-store merchandising, sales representatives, and online merchandising. Through in-store merchandising, the company allows direct interaction with customers and conducts a one on one transaction. The company sales management must understand that physical contact with customers must build high levels of trust since among consumers and in case of any problem in product quality, consumers can trace and find their distributors (McKinney, 2003, p. 43). Sales agents are representatives who have the legal right to conduct sales on behalf of the company. Through sales representatives, the company is in a position of reaching many consumers within the shortest time possible. On the same note, sales agents make the company products reach those groups of customers who would want to remain secluded from the most popular consumers of beers and other related products. Since the Craft Brewery wants to build a good rapport with its customers, the sales agents must undergo proper training and skill impartment. The actions of sales agents in the field should create a positive impact and leave consumers with the urge to consume more of the company’s products (McKinney, 2003, p. 44). Online merchandising might not be common to the company though the sales strategy offers an opportunity to integrate technology in the distribution process of the company’s products. Better still, the company can use the Internet and social sites to communicate with customers, and through well-established website, customers can order for products, which are then delivered physically to consumers. If Craft Brewery is in a position to apply the three sales strategies mentioned, the company will be in a position to make greater returns and high levels of profits as projected.         

Financial Projections

This section gives an overview of financial projection for Craft Brewery. The company’s financial projection includes an estimated start-up cost that will be used to purchase equipment that will be used in producing craft beer. In addition, the financial projection entails per unit cost of barrels, the rate of production in the first year of establishment, and an estimated revenue for the first financial year. The cost and revenue estimates in this section of the plan give a safer range of production and forms the initial starting point for the company. As such, the company needs to purchase and install large equipment to be used in direct manufacturing. Given the size of the manufacturing equipment, the company will need about 500 square feet for a brewery and this is the size craft the Brewery intends to work within. This piece of land the company will either lease from the county commissioners of metro Detroit Michigan or from individuals. After the company has acquired the needed piece of land, equipments like loading dock, gas cylinders, commercial electricity, and sewerage must be put in place to allow constant production and release of beer. Table 3 below represents an estimated company’s fixed cost of about 150,000 dollars, including the capitals to be used in installing brewing hardware and common equipment for loading the barrels. Other than the fixed cost, the company’s variable cost for the first time installation is expected to rise to 74.11 dollars as shown in table 4. This would mean that an investment plan of 300,000 dollars is enough to cater for all the expenses of the company within the first year of production. For the subsequent years, the company can rely on its returns and investors.

Table 3: Fixed Costs for the First Year of company’s operation

Item	Amount ($)
Brew equipment and installation Home-brewing kit Equipment depreciation Delivery equipment such as trucks and dolly Yearly insurance Yearly rent Legal fees Sales and marketing Total fixed costs for the end of the year	150,0000.00 200,000.00 11,000.00 10,000.00 3,890.00 26,000.00 4,000.00 21,000.00 425,890.00

Table 4: Variable Cost per Unit of Production

Particulars	Costs ($)
Direct labor Malt Hops Yeast Filter media CO2 Water Electricity Natural gas Cleaning chemicals Sewerage charges Federal excise tax State excise tax Miscellaneous Total units cost	33.95 17.50 2.00 0.15 0.50 0.30 0.50 2.00 0.70 1.50 1.56 7.00 6.20 0.25 74.11

In the first time product, the company aims at releasing about 1,000 barrels into different markets. This would mean that the company would use 74,110 dollars to produce all the 1,000 units of barrels. The company’s total cost of production is therefore fixed costs plus variable cost. That is to say;

Total Cost = Fixed Costs + Variable Costs

Total Costs = 295,600.00 + 74,110 = $ 300,000

The company is optimistic that within the first year of operation, the costs used in production will be regained plus additional benefits. This counts to the observed market trends and high level of demand for craft beer. Currently, the company operates on an approximated standard sale of 2.9667 per barrel of craft beer. If the company sets craft beer prices at 100 dollars, this would mean that the revenue per unit of craft beer is about 296.67 (2.9667 x 100) dollars. For the first 1000 units produced, the company makes a total sale of 296,670 dollars. From these sales, the only amount deducted is the variable costs and dividends paid to both shareholders and investors. Part of the remaining revenue is used to settle loans, provide maintenance services to the company equipment while the rest of income is kept as retained earnings. Basing our arguments on current market operations, Craft Brewery offers the best opportunity for investors and other company’s stakeholders.

Funding Request

With the projected startup costs, variable costs, and fixed costs, the company needs to build a strong base for funding for at least the first three years of operation. In every aspect, the company management must keep clear record of the company’s cash inflows and outflows. For an improved investment portfolio, the company must keep in pace with its financers until the total yearend profits for the first three years can better sustain subsequent years costs of production. Based on the mentioned cost estimates, Craft Brewery needs an initial amount of at least 500,000 dollars. Out of 500,000 dollars, the owners’ contribution will be 200,000 dollars while the remaining 300,000 dollars can only be obtained from loan, shareholders, and investors. Even though the company owners can make part of the contributions towards the business, this might be expensive in the long run and therefore to ensure that the business is stable and sustainable, the second alternative is to develop a loaning plan based on the cost requirements. Alternatively, the company can sell its bonds and other securities to the public in order to obtain the required funds. The company can obtain loans from commercial banks, financial institutions, SACCOs, Private Organizations or from individuals. While seeking for loans, the managers must be well informed about the challenges they might experience in case the business fails to pick up. Loans might not be the best alternative in this case since it might pose constraints to the progress of the company (Richardson & California State Polytechnic University, Pomona, 2003, p. 44). If the company sells its securities to the public, the payment period can be prolonged in order to allow the company to expand its production processes. In either case, the terms of payment must be made clear to each part in which case the company must make an agreement in writing to repay the loans plus all the accrues when due.   

How to Make the Business Plan Stand Out

The only way to make a business plan outstanding is by conducting proper evaluation of the plan and ensuring that every proposed strategy meets the basic rules of profit maximization and high competitions (Kamara, 2008, p. 97). A company that is capable of competing favorably is capable of putting other firms under threat in which case the affected firms must adjust their production approaches to meet the new market development. Craft Brewery must link its performance to marking efforts, new pricing strategy, and every promotional plan (Kamara, 2008, p. 97). Merging the company’s objectives with the proposed production plans allows managers to cross-examine their customers in order to determine whether or not consumers are in a position to access communications made by the company. In addition, the company must ensure that information received by its potential customer is capable of changing consumption attitudes (Kamara, 2008, p. 98). In other words, the company’s information should be in a position to build brand awareness while giving a new face to the company through higher brand preferences.

Conclusion

In general, the analysis compiled in this business plans shows that opening a microbrewery is a viable plan and a business opportunity that is not yet fully explored. The Craft Brewery section of the brewing industry illustrates an emerging business growth that has been in existence for several years but not yet dominated, and is still accounting for only 7 percent of the total beer market (Calagione, 2011, p. 88).  If we compare metro Detroit Michigan to other cities like San Diego where we have over 40 brewing companies and Los Angeles with over 25 breweries, there is a need to increase the amount of craft beers served to Michigan markets. Metro Detroit Michigan was identified as the most viable location for the craft beer since the city has a higher population made up of younger groups. In addition, majority of the residents are middle income earners and thus can afford a luxury life (Calagione, 2011, p. 88). 

High performance levels of the company predict improvements in market operations. The production process reveals that the company is in a position to produce 10 barrels. In three weeks, the company would be in a position to produce over 1000 barrels, which would replicate into a minimum of 12000 barrels very year. Since this figure is above the company’s projections, Craft Brewery can break even within the first year of production (Calagione, 2011, p. 89). The company’s initial costs still remain 500,000 dollars and therefore if the company can obtain the funds from external sources, the first year projections will be met with even higher profits. However, the company can only achieve its production goals through a combined effort of every stakeholder.        

References

Calagione, S. (2011). Brewing up a business: Adventures in beer from the founder of Dogfish Head Craft Brewery. Hoboken, N.J: Wiley.

Daniels, R., & Brewers Association. (2006). The Brewers Association’s guide to starting your own brewery. Boulder, Colo: Brewers Publications.

Kamara, L. T. (2008). New business beginners’ guide: Tools for a new business. Denver, Colo: Outskirs Press.  

McKinney, A. (2003). Real business plans & marketing tools: Including samples to use in starting, growing, marketing, and selling your business. Fayetteville, NC: PREP Pub.

Richardson, R. S., & California State Polytechnic University, Pomona. (2003). A business plan for a microbrewery. Pomona [Calif.: California State Polytechnic University, Pomona.

Appendix

                        Figure 1: Breweries and Brewpubs in metro Detroit Michigan

	Figure 2: USA Beer Supply and Market Growth

Years