Estimate on monthly utility expenses

[kevbrew]

I was hoping that someone out there might be able to help me out. I am trying to estimate (broad ballpark) what a 15 BBL brewery would cost in terms of utilities per month. Assuming 2 brews/week running a full glycol system with all the normal ammenities of a small production brewery. I am trying to figure what utilities/water/trash removal and any other monthly expenses might cost. Thank you all for your help!

Cheers,

Kevin
brewkev@gmail.com

[jwalts]

Hey Kevin,

You could estimate your brewing utilities by multiplying your local utility rates by these numbers, taken from the JV Northwest brewing website:

Water - 6 to 8 barrels used per barrel brewed
Sewer - 5 to 7 barrels treated per barrel brewed (water usage rate - barrels brewed)
Electricity - 20 to 35 kWh per barrel brewed
Natural Gas - 2 to 3.7 therms per barrel brewed

However, your non-brewing operations will consume a significant amount of utilities. The Brewers Association's Packaging Breweries Survey recently released these numbers, as percentages of total expenses, for breweries that annually produce 5,000 barrels or less:

Raw Materials - 24.5%
Labor (including benefits) 22.7%
Insurance - 6.5%
Excise Taxes - 4.4%
Other Taxes (income, payroll, sales) - 5.1%
Utilities - 6.4%
Packaging Materials - 13.2%
Beer Freight - 2.7%

Percentages of total expense are pretty useless for making startup projections, but treating them as percentages of total revenue should be close enough for a profitability-challenged new brewery. Some of these expenses are easy to calculate from your expected beer production (e.g. excise taxes) and others will depend heavily on your bottling/kegging/tap room sales mix (e.g. labor), but the survey results should at least get you in the bleacher seats. You should also note that this isn't a complete list of brewery expenses, hence them not adding up to anywhere near 100%. Building rent/mortgage payments, for example, don't fit into any of these categories.

Joe