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Starting a new shop

Now, before I get into this I am not wanting to undercut what NB is doing in anyway, I am just thinking about fulfilling a possible need in my local area.

Specifically, my area (central valley of California) is seriously lacking in the area of shops that offer brewing equipment. There is one down in Bakersfield that is associated with Lengthwise Brewing, and there may be something up in the Fresno area, but there really is nothing in between.

Now, I am not looking, at least at first, to offer ingredients, as I am sure there is a whole bunch of stuff to learn in regard to that (suppliers, etc…). I am, however, looking to open a brick-and-mortar store that would offer such items as fermenting containers, brewing pots, burners, bottles (of various sizes), etc…

Has anyone here ever been involved in this kind of thing? If so what were the pitfalls you ran into when setting and running such an enterprise?

Any guidance would be greatly appreciated. This really is just in the thought stage, so the more research I am able to up front the less time and money I hope to waste down the road.

Thanks for any replies.

See if you can hook up with a beer brewz supply store

My first question is, would you be able to compete with online suppliers of the same equipment?

No i dont think. The online bullshit is killing everyone and stores

Online is going to be your biggest competition. Since I can go on Amazon and find multiple sources for a piece of equipment and get it in a couple of days, the draw for local places is either an impulse buy, great service, or good advice. I get most of my advice here, tbh, so service and loyalty are why I shop at my LHBS. Are there lots of homebrewers in your community? Maybe look for a Facebook homebrewing group to see what’s up there.

Ooh, just thought of something… do you know any manufacturers/tinkerers/makers? If you can be sole distributor for your buddy who presses cheap kettles, or puts together awesome burners, you might have an in.

Offer classes so you will always be bringing in new brewers who need guidance and equipment.

Check into this at the AHA. @denny, wasn’t there a study done by AHA about the successes or failures of LHBS?

I do think it will mostly cater to those who need things right away. For instance I was in need of additional bottles yesterday when I was bottling my last batch. Glad I had a growler on hand to put the rest into.

I was also thinking of being a good place, locally, to go to for people to get some good tips and even provide some classes, as @brew_cat mentioned.

Thanks for the tips, though I am still looking for anyone who may have already tried this and find out what worked and what didn’t.

Of course the main competition will be online stores, which is why I would stick with equipment supply, and not recipe stuff, as I am sure that stuff can expire rather rapidly which would leave to throwing money down the drain on lost inventory. Equipment doesn’t really have a shelf life.

You may want to try searching the AHA, or just googling for some small neighborhood supply shops that are far away. Most people who want to run a LHBS are the types who like to give advice and help grow the community. Since you obviously wouldn’t be directly competing with someone far away, their willingness to provide advice may extend to running the business.

Honestly though, I think only having gear, and not ingredients will make the business less viable, not more. How often does one buy a new pot or burner? Malted barley is pretty stable, as is DME. Yeast and LME are good for months, at least.

I have 2 shops within driving distance, neither is particularly convenient for me, both are higher priced than what NB says, but they look better once shipping gets added to NB’s price. I have never gone to either shop looking for gear; only ingredients. I have bought gear from both, but it was always an impulse while shopping for ingredients. “Oooh, line cleaner, I think I may be low, better get a bottle while I’m here…”

Both shops I go to also sell raw coffee beans as well as roasting/grinding equipment, so they tap into tangential markets; never a bad idea. Given California’s recent ballot initiative, there may be people interested in supplies for yet another tangential market… gardening supplies, pots, hydroponics, fertilizer, … hookahs. Personally, that would be a turn-off for me, but I’d suspect I’m in the minority on that point.

If your not selling ingredients you will be useless to most home brewers. You won’t make money selling ingredients but it will get people in your store. Are there alot of homebrewers in the area? How long have you been brewing? Arr you knowledge enough? These are questions you need to answer. One of the stores near me that is doing very well does a big wine making sales. That should be popular in Cali. Again classes and community involvement. Alot of stores do tastings also. It’s not a shoe store you need to be very active in marketing yourself as well as your products. Not a big profit probably more a labor of love

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Yeah, they have a lot of info available.

Knotical,

I think you’ll find it can work if you can be creative about it.

The AHA shop surveys will show a consistent, almost predictable, level of sales that hasn’t really fluctuated all that much in recent years. The profit is not huge by any means, but I have talked with a lot of mom and pop owners who do well against the online competition for several reasons:

  • a person to talk to for advice, etc
  • ingredients can be touched, smelled, even tasted, and milled right there
  • timeliness - ‘oh no! my yeast pack i bought online didn’t inflate!’ and it’s brew day
  • peers
  • equipment I can lay my hands on, or even see demonstrated

Think about:

  • smart classes will bring in new people, and keep the experienced ones interested
  • can you organize some events/competitions?
    -bring in a pro or two every once in a while
    -support/create a local club and let an experienced outsiders teach a specialty class
    -frequent buyer discounts
    -your own shop recipes
    -and make all your specialty grains the same per pound price

Margins are good. The markup on homebrew equip/supply is WAY better than retail beer sales. But beware who you are sourcing from and rules they want to play by. Be careful how you order so you don’t have to buy a pallet worth of stuff, just to get some rubber stoppers you forgot the 1st time. Minimum orders will kill cash flow.

Good luck!

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