Business Plan

Aly Young
Good Work Brewing
Longfellow neighborhood
Minneapolis, MN 55406
younga@stolaf.edu

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I.

Table of Contents

I.

Table of Contents .................................................................................................................................... 2

II.

Executive Summary ................................................................................................................................ 3

III.

General Company Description ............................................................................................................. 5

IV.

Products and Services ............................................................................................................................. 9

V.

Marketing Plan ....................................................................................................................................... 11

VI.

Operational Plan .................................................................................................................................... 23

VII.

Management and Organization ........................................................................................................... 25

VIII. Startup Expenses and Capitalization .................................................................................................. 26

IX.

Financial Plan ....................................................................................................................................... 288

X.

Appendices ............................................................................................................................................. 29

Page 3 of 34

II.

Executive Summary

Good Work Brewing, a local and sustainable brewery, will brew and market its beer to the people of the
Minneapolis/St. Paul area. Its goals will be to use Cradle to Cradle principles to produce its product with zero
waste and positive emissions: conviviality, good work, and waste-to-food processes.
The Beer
Good Works beer will be locally produced from all-local and sustainably grown ingredients, making it the
freshest beer in the Twin Cities. It will be a seasonally rotating lineup of classic, heritage, and innovative
recipes determined by brewmaster tastes and customer feedback.
Cradle to Cradle
Good Work will operate using Cradle to Cradle principles, meaning that it will produce beer that is of high
quality and value to the consumer, operate in such a way as to produce no harmful emissions (air, water, etc.),
and provide ecological and environmental benefits. Good Work plans to do this by selling its beer at its
taproom only, eliminating distribution-related emissions, and by making all glassware that holds its beer (pints
and growlers) completely and infinitely reusable. Initially, ingredients shipping will be through standard
ground transportation such as trucks, but Good Work will investigate ways of making the transportation
process carbon-neutral through alternatively-fueled vehicles or pre-purchased carbon offsets.
At the brewery and taproom, building materials and interior features will be reused and upcycled wherever
possible in order to make the most effective use of already existing materials. And finally, heat, electricity, and
water usage will be carefully monitored and purchased from renewable sources.
Conviviality
Beer has been a great unifier since the dawn of human civilization, and Good Work will honor the capacity of
drink to bring people together by providing an indoor/outdoor taproom in which customers can enjoy their
beer together. Good Work will go beyond the taproom environment to support community events and
projects, from music events to skill-sharing events to the establishment of community gardens. Its brewery
will be based in the Longfellow community of Minneapolis to support existing community building efforts
there and further the development of new projects.
Good Works cooperative model enables ordinary community members who want to support the brewery, get
rewards, and share in the businesss success to purchase member shares of the business. Members will get
special discounts, become a decision-making part of the company, and receive dividend checks at the end of
each year.

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Good Work
True to its name, Good Work will provide its all-local employee base with a living wage and engaging work in
their community. As employees of Good Work, people will be able to pursue their passion for good beer and
great communities and support themselves financially by doing so.
Waste Equals Food
Spent brewing grain has a multitude of uses as food for people and other animals. Dried and ground grain
can supplement flour for a nutty flavor in breads, cookies, and muffins, and Good Work will sell this valuable
ingredient to local bakeries so that it can be used to its full potential. Spent hops and yeast sediment are
valuable additions to a thriving compost pile, which Good Work will maintain in Longfellow so that
community members can use it to nourish their gardens.
Room to Grow
A full-scale, 10-barrel (bbl) brewery of this nature will become feasible only after a 2 to 4 year small-scale
experimentation phase. In this phase, homebrewers and beer enthusiasts in Longfellow will share the cost of
purchasing a 7.5 gallon all-grain brewing system. They will purchase ingredients for individual batches
together in a similar shared model, and will develop a repertoire of recipes that are favored in the community.
As brewers gain command of favorite recipes and share their beer with community members, brewers can
begin to reach out to potential investors, proving that demand exists for the product. After a 1 to 2 year
period of gathering funding, community members and brewers can begin the search for a suitable location
within Longfellow and can begin to build the full-scale brewery of their dreams.

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III.

General Company Description

Good Work Brewing will brew and sell beer made with local ingredients to the people of the Minneapolis/St.
Paul metropolitan area.
Good Work will provide indoor and outdoor spaces for customers to enjoy their beer, socialize with each
other, and build bonds of community. Since the beginnings of human society, people have come together
around fermented beverages, and Good Work aims to honor that age-old connection between people, drink,
and place.
The beer will be made in 10 bbl batches from local and sustainably produced ingredients. Good Work will
brew a batch 1 to 2 times per week, and will keg finished batches off in order to store and serve more
varieties of beer. Local ingredientshops, barley malt, and other specialty grainsare becoming more
common in Minnesota. The University of Minnesotas agricultural department is currently investigating hardy
strains of hops and barley as well as more efficient methods of growing these plants.1
Good Work will be based in the Longfellow neighborhood of Minneapolis for several reasons, namely its
proximity to cultural and dining centers of south Minneapolis; its large population of young people interested
in community development, and its emerging craft beer scene.

Mission Statement
The mission of Good Work Brewing is to support the Longfellow community by providing meaningful work
brewing beer from local ingredients, and to honor the ecological cycles inherent in brewing by managing
resources intelligently.
Goals
Good Works goals are to build an environmentally, economically, and socially sustainable business that
supports local growers and builds community in Longfellow.
Objectives

Overland, Adam. Research In Locally Made Ingredients. The Growler. Vol. Issue 22 May 2013.
http://growlermag.com/the-botany-of-beer/
1

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Good Work will measure progress towards its goals by keeping track of how many local employees are hired
(with the goal being 100% within the Minneapolis-St. Paul boundary), what percentage of its ingredients are
locally and sustainably grown (with an initial goal of 75%, but an end goal of 100%), and how successful its
community initiatives (gardens, compost program, event sponsorship) are.
Business Philosophy
In business, it is crucial to serve the needs of customers and to provide them with a way for their wants to
serve a greater social and environmental good. In the words of St. Olaf professor Jim Farrell, such a business
makes it easy for people to be good. In this case, Good Work meets customer desires for high-quality beer
and a pleasant social environment while providing employees with stimulating work and a living wage.
Revenue from tap and growler sales support growers who are producing hops and grain with sustainable
practices and enable Good Work to continue producing a high-value product that restores the land that
supports it.
Target Market
The brewery will market its beers to Longfellow community members and the Minneapolis/St. Paul area,
with a main focus on high-quality, locally made beer made through environmentally restorative processes.
Inside the Craft Brewing Industry
The craft beer industry has been steadily growing since 1980, when craft brewers sought to break away
creatively and commercially from the giants of American brewingamong them Anheuser-Busch, Coors, and
Miller. While larger breweries focused mainly on the American lager style and competed on the basis of price
alone, craft breweries chose to direct their attention toward fresh, local ingredients; strong malt and hop
flavors; and experimentation with new and heritage recipes.2
While beers position in the overall alcoholic beverages market has been slipping since the mid-2000s, the
craft beer industry has demonstrated steady growth at the same time, with dollar sales increasing 58%
between 2004 and 2008.3 In 2013, the industry showed growth of 18% by volume and 20% in dollars;
previously, in 2012, growth was 15% by volume and 17% by dollars.4 The primary components of this

Stack, Martin H. A Concise History of Americas Brewing Industry. EH.net. http://eh.net/encyclopedia/a-concisehistory-of-americas-brewing-industry/

2

State of the Craft Beer Industry: 2013. Demeter Group Investment Bank.

Brewers Association | Facts. Brewers Association: A Passionate Voice for Craft Brewers. Updated 17 Mar 2014.
http://www.brewersassociation.org/pages/business-tools/craft-brewing-statistics/facts
4

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growth were current craft drinkers purchasing more craft beer as well as new craft drinkers replacing their
other alcoholic beverages with craft beer. Five of the ten fastest growing beer brands are craft breweries:
Dales Pale Ale, Lagunitas, Ranger, Torpedo, and Shiner Light.5
As of March 17, 2014, 304 new microbreweries had officially opened in 2013 and 20 had closed in the same
year. Many of these brewery closures likely occurred because the businesses were undercapitalized and needed
more funding than they had allocated. There were 2,768 craft breweries operating during some or all of 2013.
The craft brewing industry had a retail dollar value of approximately $14.3 billion in 2013, and it currently
provides an estimated 110,273 jobs in the U.S.
Trends in the craft brewing industry include more hop-driven styles; heritage and unusual recipes including
sour beers and beers fermented with fruits and spices; and experimentation with alcohol content ranging
from high-alcohol brews (sometimes called barleywines) to low-alcohol session beers. In order to
experience desired flavor and mouthfeel characteristics, many current craft beer drinkers, especially
Millennials, favor choosing beer by style first, then brand. The barley industry in Minnesota is poised to grow,
given increased research by the University of Minnesotas agricultural division into disease-resistant and highyield barley varieties. According to Paul Kramer, Vice-President of Malting Quality at Rahr Malting in
Shakopee, locally grown barley could save malters and brewers $1 per bushel in transportation costs.6 The
increased attention paid to the barley industry as well as the popularity of hop growing from commercial to
community hop farms suggest that locally-grown ingredients will become more readily available to satisfy
consumer demand for all-local beer. Good Work will be poised to capitalize on these trends by staying
connected with customers and homebrewers to learn what styles are in demand and by building a strong
relationship with local growers to obtain the highest-quality ingredients.

Core Competencies
The brewerys strengths include its zero-waste, positive-emissions structure; by offsetting its carbon emissions
with credits, transporting ingredients by alternative means, and repurposing its waste to nourish biological
and technical cycles, Good Work stands out as a completely unique Minnesota brewery.

State of the Craft Beer Industry: 2013. Demeter Group Investment Bank.

Overland. Research In Locally Made Ingredients.

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Further strengths include Good Works ability to adapt brews to seasonal and regional ingredients and tastes
with its small brewing capacity; locally-hired employees who are connected to and invested in the life of their
community; cooperatively-owned structure that enables community members to have a stake in the company
and share in its success; and close proximity to the market (customers who live in South Minneapolis and the
surrounding area).
Legal Form of Ownership
The brewery will be classified as a cooperative corporation in order to allow for community ownership. I
have chosen this form so that community members can become literally invested in Good Work, become more
enthusiastic about the workings of the business, and share in its success. For a one-time purchase of a $50
share, people can become members of Good Work to receive special membership discounts and patronage
refunds at the end of each year.

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IV.

Products and Services

Good Work will produce a seasonally rotating lineup of three to five beers made with local ingredients. Initial
styles will be within the following range:
Klsch: A light, dry, and bready ale with mild hop bitterness. (Year-round)
Stout: A dark, robust, relatively bitter ale. Smooth and full-bodied; a meal in a glass. (Winter)
Brown Ale: Malty, slightly sweet, and medium-dark. (Autumn)
Lambic: A Belgian-style beer that gets its unique character from fruit added during the fermentation process.
The brewerys lambic will be made with locally grown fruits to celebrate fresh seasonal produce. (Summer)
American Pale Ale: Floral hop character, medium body, and crisp bitterness. (Spring)
These are initial ideas, but they have been chosen because they blend familiar standby recipes with unusual
and innovative brews. Customers can expect some degree of familiarity when they visit Good Work for the
first time, but this familiarity is a vehicle for introducing them to just how comforting and pleasurable a
positive-emissions company can be. Eliminating waste doesnt have to be strange and unfamiliar to
customers; done right, it takes place with no negative impact on the final product.
Competitive Advantages/Disadvantages
Factors that give the brewery competitive advantages include:

All-local and sustainable ingredients- stand out from other small breweries

Zero-waste, positive emissions structure- unlike any other Minnesota brewery

Close to market- building community relationships and customer loyalty in Longfellow

Building and supporting community initiatives- helps support Longfellow community beyond
customer base

Goal to hire all-local employees- support community and build positive relationships with locals

Location in South Minneapolis- near some other bars and taprooms but away from the nucleus of
Northeast taprooms

No need to distribute- growler and tap sales only

Competitive disadvantages:

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Many microbreweries in Minneapolis-St. Paul area- will require concerted focus on local/sustainable
ingredients to differentiate

Pricing Structures
The pricing structure of the brewery will be $4-6 per pint of beer, with smaller 10 oz snifter pours available
for $3-5. The price will depend on the density of ingredients used in each beer; heavier beers with
significantly more malt or hops by volume will be priced higher than less ingredient-intensive beers. The
upper limit also takes into account potentially higher prices of the locally grown ingredients. Good Work will
also sell 64 oz glass growlers of beer to be filled only at the taproom. 64 ounce growlers will be priced at $1517 and $10-12 for refills. The initial growler price includes a $3-5 deposit for the glass bottle.

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V.

Marketing Plan

Industry Facts
The craft beer industry produced 13.7 million bbl/year of beer in 2012. Good Work Brewing will not have more
than a very small share of the craft market, as its scope and reach are narrow and focused more on building
deep relationships within a core customer group than on reaching out to a broad audience.
A number of recent developments have come to characterize the craft beer industry. The recent increase in
numbers of microbreweries, taprooms, and craft beer-focused restaurants gives craft beer lovers a sociable
way to connect with each other over new and favorite beers. This change has prompted beer lovers to share
what theyre drinking and learn about new craft breweries they might not have heard of otherwise.
Technologically, the brewing industry has changed for producers as well as consumers. At Red Hook Brewing in
New York, a new computerized brewing process allows recipes and brewing processes to be digitally
programmed. Brewers can now have real-time monitoring of each step of the process, leading to greater
ingredient efficiency and faster production time. 7 Smartphone apps, like UnTappd, and social media sites
allow people to rate beers, bars, and breweries and spread information by word of mouth.
Politically, changing state laws have resulted in greater freedom for breweries and taprooms. In Minnesota,
the 2011 passage of a bill known popularly as the Surly bill allowed breweries to operate taprooms and sell
growlers to be filled on the premises. North Carolina passed a similar law in 2013, and many other states have
similar laws.8
Since the craft beer renaissance in the 1980s, homebrewers and extremist breweries like Rogue, Dogfish Head,
and Deschutes have led the industry in ingredient and technique innovation.9 Current trends within the industry
include beers with a strong hop presence, ranging from the classic India Pale Ale to the more aggressively
hopped American Pale Ale. Some brewers have subscribed to the philosophy colorfully described as the
hops arms race, in which as much as100 pounds of hops are added to the beer during boiling and

Technology a Game Changer for American Craft Beer Brewers. American Craft Beer. 16 Apr 2012.
http://americancraftbeer.com/item/technology-a-game-changer-for-american-craft-beer-brewers.html
7

Gleason, Patrick. Politicians Foster A Craft Beer Renaissance By Not Acting Like Politicians. Forbes. 26 Jun 2013.
http://www.forbes.com/sites/realspin/2013/06/26/politicians-foster-a-craft-beer-renaissance-by-not-acting-likepoliticians/
8

State of the Craft Beer Industry: 2013. Demeter Group Investment Bank.

Page 12 of 34

fermentation. Further trends include the exploration and development of heritage and unusual recipes
ranging from sour beers to beers fermented with fruits and spices. Finally, brewers are also experimenting
with alcohol content, producing beers as high as 20% alcohol by volume (%ABV), also known as
barleywines, along with 3-5%ABV session beers.
The craft beer industry demonstrated growth by 15% in dollar value and 13% in volume in the first months
of 2013.10
More locally, breweries and taprooms in the Twin Cities, such as Surly Brewing, Indeed Brewing, Fulton Brewing,
and Dangerous Man Brewing have all been expanding dramatically in recent years. Surly is currently building its
$20M Destination Brewery in southeast Minneapolis.11 Indeed is expanding its operations into growler sales
after a recent bill passage raising the production cap on breweries allowed to sell growers,12 and Dangerous Man
is barely keeping up with demand for pints and growlers.13
Barriers to Market Entry
Barriers to entering the craft beer market include high capital costs; equipment for starting up a brewery is
expensive, and this can be remedied by purchasing used equipment from other breweries.
Rent for commercial, brewery-ready space is also costly, and can be managed by searching diligently for an
affordable and ideal location. Further, owners can offset the rent price with USDA grants or other credits for
adopting sustainable energy generation or resource use practices.
Shipping costs are also high, taking into account both fuel use and the risk of transporting heavy liquid in
sometimes fragile containers. Good Works solution to the distribution issue is to sell its beer at one source
only, the taproom, and to avoid distribution entirely.

10

Is the craft movement set to benefit from some empowering legislation? Euromonitor. 25 Nov 2013.

Moore, Janet. Surly breaks ground on $20M destination brewery in Minneapolis. Star Tribune. 29 Oct 2013.
http://www.startribune.com/entertainment/dining/229733621.html
11

Growlers are now available at Indeed! Indeed Brewing. 11 Sept 2013. http://www.indeedbrewing.com/growlersare-now-available-at-indeed/
12

13

Interview with Maggie Pearson, assistant taproom manager, Dangerous Man Brewing. 11 Mar 2014.

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Changes in government regulations pertaining to taprooms could have an effect on Good Works operations; a
restriction in taproom laws is not likely, but an expansion of them may result in more Twin Cities taprooms
that would compete with Good Work for customers, which can motivate innovation. A change in the economy
could also have an effect, but despite the economic recession beginning in 2008, the craft beer industry has
continued to grow year by year. Craft beer seems to experience relatively inelastic demand in this regard. And
finally, a change in the beer industry could affect Good Work; a new shift of focus away from small craft
brewers could occur, which would threaten the brewerys business, but given crafts steady upward climb, this
is unlikely.
Product Features and Benefits
From a customers perspective, Good Work will provide locally sourced and produced beer from sustainably
grown ingredients. Customers are likely to perceive it as great-tasting, average-priced beer that supports local
farmers and community membersin short, a want that serves a greater need. The lineup of beers ranging
from basic staples (American Pale Ale, Stout) to more unusual styles (Lambic, Klsch) allows customers to
compare common styles to other breweries as well as try unfamiliar beers. In addition to the pride of
supporting local business, customers will experience the benefit of inclusion in a vibrant community.
Service Features and Benefits
Good Work will provide a variety of seating options, from bar stools to small modular tables to outdoor patio
seating. The taproom area provides customers with a place to gather and socialize with other members of the
community, and since taprooms are not permitted to sell food in Minnesota, customers can carry in food
from other eateries (such as Gandhi Mahal, Midoris Floating World Caf, the Anchor Bar, etc.) or bring food
from home to complement their drinking experience.
Beyond the consumption experience, Good Work will support Longfellow community initiatives such as
community gardens, skill-sharing events, and communal resources such as tool sheds. Good Work will survey
employees and customers in order to find what sorts of initiatives are already happening and which ones
community members would like to start..

Customers
The Microbrew Target Market

Page 14 of 34

According to the 2006 edition of Best Customers, key customer groups for purchasing beer at bars and
restaurants (referred to as on-sale) include householders under 35 and households in the Midwest.14 Further,
single customers comparatively spend the most on on-sale beer, followed closely by married couples without
children. By education, the top customers for on-sale beer are those who have completed a bachelors degree.
And finally, unsurprisingly, the amount of money spent on on-sale beer increases as annual salary increases.15
In general, 46% of new craft beer drinkers are Millennials (coming of age after 2000).16 84% of craft beer
drinkers change what beer they drink depending on the season.17
From these data, it can be determined that the target market for Good Work is 21-35 years of age, single or
unmarried without children, college-educated, and middle to upper-middle class. Finally, it will be important
for Good Work to provide a seasonally rotating lineup of beers to satisfy customers desires for variety and
connection to place through seasonality.

The Longfellow Neighborhood

The ZIP code 55406, which encompasses the Longfellow neighborhood as well as surrounding
neighborhoods, has a population of 32,896. The median age is 39 years, and median income is $49,100. The
area is populated by the following PRIZM groups:
American Dreams
Younger than 55 and in the upper-middle class with a median household income of $56,067, this group is
mostly urban, has higher than average income-producing assets, and is predominantly composed of
homeowners (some of whom have children). This group is generally college-educated and professionally
employed, and is comprised of white, black, Asian, Hispanic, and mixed races (with non-white races making
up just under half of the group).

14

Beer and Ale at Restaurants and Bars. Best Customers. 2006.

15

Ibid.

Clarke, Jim. Who is The New Beer Consumer? Beverage Media Group. 1 May 2012.
http://www.beveragemedia.com/index.php/2012/05/who-is-the-new-beer-consumer-brewers-ready-to-say-ihola-andmore-to-expand-reach/
16

Crowell, Chris. Craft beer consumer stats: how will they affect your business plan? Craft Brewing Business. 20 May
2013. https://www.craftbrewingbusiness.com/business-marketing/craft-beer-consumer-stats-how-will-affect-yourbusiness-plan/
17

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Qualities that make this group a desirable market include a young median age, upper-middle class income,
and college education.
Close-in Couples
Older than 55 and owning homes in urban neighborhoods, Close-in Couples are in the lower middle class
with a median income of $41,435 and above average income-producing assets. This group is ethnically diverse
and populated by white, black, Asian, Hispanic, and mixed races. Most Close-in Couples are retired emptynesters with high school educations.
This group is less likely to seek out craft beer and taprooms due to their age cohort, lower median income,
lower education levels, and home-based hobbies.
Money & Brains
Members of this urban group are wealthy, with a median income of $87,139, elite income-producing assets,
and advanced degrees. Mostly in the age range of 45-64, some members of the group have children at home,
generally own homes, work in management positions, and belong to racial categories of white, black, Asian,
Hispanic, and mixed.
Qualities that make this group a desirable target market include high income and high levels of education.
Children at home and higher average median age make it slightly less likely that members of this group will
patronize Good Work, but they are still a worthwhile market.
Multi-Culti Mosaic
Members of this urban group are in the lower middle class with a median income of $35,770 and moderate
income-producing assets. Ranging in age from 35-54, some members of this group have children at home,
and most are homeowners. Most members work in service industries and have some college education.
Members fall into the racial categories of white, black, Asian, Hispanic, and mixed.
A quality that makes this group a desirable target market is their relatively high levels of education; however,
with a relatively low income, childcare concerns, and slightly higher age cohort, it is unlikely that members of
this group will patronize Good Work.
The Cosmopolitans
Upper-middle class with a median income of $56,913, members of this urban group have above-average
income-producing assets and are generally homeowners. Cosmopolitans are mostly 55+ empty-nesters with
college degrees and white-collar jobs, and are members of white, black, mixed, and Asian racial groups.

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Members of this group enjoy going out to socialize on a regular basis and include ample time for leisure in
their lives. 18
Qualities that make this group a desirable target market include higher median income combined with higherthan-average leisure time and the desire to spend it out at restaurants and bars.
Major Competitors
Fair State Brewing Cooperative (taproom, co-op, locally made)
2506 Central Ave NE
Minneapolis, MN 55418
Dangerous Man Brewing (taproom, growlers, locally made)
1300 2nd St NE
Minneapolis, MN 55413
Harriet Brewing (location, taproom, growlers, locally made)
3036 Minnehaha Ave
Minneapolis, MN 55406
Fulton Brewing (taproom, locally made)
414 6th Ave N
Minneapolis, MN 55401
Indeed Brewing (taproom, growlers, locally made)
711 15th Ave NE
Minneapolis, MN 55413

Table 1: Competitive Analysis

FACTOR

Good Work
Brewing

Strength

Products

Local,
sustainable

Weakness

Fair State
Brewing
Cooperative

Dangerous
Man
Brewing

Importance
to
Customer

Locally
produced

Locally
produced

Zip Code Look-up, 55406. My Best Segments. The Nielsen Company.

http://www.claritas.com/MyBestSegments/Default.jsp?ID=20
18

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Fair State
Brewing
Cooperative

Dangerous
Man
Brewing

Importance
to
Customer

x (conveys
high quality)

Average

Average

High

Equal to
competitors

High

High

Selection

Small

x (easy to
change
lineup)

Small

Large

Stability

Goal of
long-term
community
integration

Community
owned,
therefore
more stable

Integrated
into
community

High,
positive

High, preopening buzz

High,
positive

Location

Ideal (south)

Northeast

Northeast

Appearance

Inviting,
comfortable

Unknown

Comfortable,
sociable

Advertising

Logo
stickers,
print and
online
media, The
Growler,
website/blog

Website/blog,
logo apparel,
The Growler

Logo
apparel,
growler
customers,
The Growler

Image

Responsible,
fun

FACTOR

Price
Quality

Company
Reputation

Good Work
Brewing

Strength

Average to
slightly
higher

Weakness

x (fewer
beers to try)

I envision small, taproom-focused breweries like Dangerous Man and Fair State Brewing to be Good
Works major competitors. The two will have a competitive advantage due to their earlier entrance into the
market (Dangerous Man began in 2012, and Fair State is scheduled to open in June 2014), although my brewery
focuses on local and sustainable ingredients to a degree that the other two do not. This will be advantageous
to Good Work. Both of these competitors are located in Northeast Minneapolis, somewhat removed from
Good Works location in the Longfellow area of Southeast Minneapolis. However, Harriet Brewing, a
nanobrewery, is located in northern Longfellow and will prompt customer exchange and product innovation
between the two taprooms.

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Niche

Good Work Brewings niche is providing a small, rotating lineup of high-quality beer made from local and
sustainably produced ingredients. It will market its products to customers who value building community and
supporting local and cradle-to-cradle farming and malting. Its cooperative structure will attract customers
who are passionate about brewing and want to have a greater stake in the business by becoming memberowners.
Strategy
Growth Plan
In order to build a business with a solid base of quality beer recipes, community support, and financial
feasibility, Good Work will begin as a home-operated, community-owned brewing operation. Interested
community members will divide the cost of producing a 5-10 gallon batch of beer, experimenting with recipes
and production methods in a small-scale, low-risk fashion.
Of all beer brewing methods, all-grain brewing offers the greatest degree of control over the finished product,
and starting a brewing cooperative will require the purchase of an all-grain system. Such a system would
include the following:

All-grain brewing tanks (hot liquor and mash) with insulation and false bottom- $219.99 at Northern
Brewer homebrew supply

Stainless steel boil kettle and propane burner- $114.99 at Northern Brewer (20 lb propane tanks
available for $29.99 at Lowes and can supply BTUs for 3-5 brew days)

Wort chiller- $59.99 at Northern Brewer

Fermenting bucket- $16.99 at Northern Brewer

Wide-mouth glass carboy- $43.99 at Northern Brewer

For starting on a small scale, 7.5 gallon batches are a reasonable size and would produce approximately 63 12ounce bottles of beer. Therefore, the containers listed above are 7.5 gallons in capacity. All of these startup
materials would cost $485.94, and would be split evenly among community shareholders. If just 20
community members purchased a share in the neighborhood brewery, start-up equipment would cost only
$24.30 per person. The ingredients for a 7.5 gallon all-grain batch of beer range from $50-70 in price. By
going in together to purchase shares of a batch of beer, community members can purchase high-quality beer
for a low price and support the brewing innovation in their neighborhood. If the aforementioned 20
members shared the cost of one batch, it would cost each of them only $2.50 to receive an average of 3
bottles of beer. Fewer members would mean a slightly higher price for slightly more beer per person.

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In this environment, Good Work can build customer demand, a database of favorite recipes, and capital for a
larger, 10 bbl brewing facility and taproom. Failures at this scale are inevitable, but they will be far easier to
remedy than failures at the 10 bbl scale, and the stakes are much lower. After 2-3 years of experimentation at
the 7.5 gallon scale, brewers can begin to share beer with potential investors to encourage them to offer
capital for the larger facility.
Growth Timeline
Year 1: Assemble homebrewers and interested community members to purchase start-up equipment. Share
cost of each batch of beer and take turns finding, brewing, and bottling recipes. Drink together and find out
what recipes resonate with community tastes.
Years 2-3: Develop list of favorite recipes. Host potlucks and other gatherings where the beer is served to
gauge what the broader community thinks, and learn what others want to try. Reach out to potential
investors, displaying the potential for a successful brewery given proven demand and reliable recipes.
Assemble capital for full-scale brewery and taproom in Longfellow.
Years 4-5: Seek out ideal space in Longfellow. Continue assembling capital and begin recruiting cooperative
members. Select who in initial group wishes to hold positions within the brewery. Begin to search for more
employees through farmers markets, street fairs, homebrew supply shops, and co-op groceries.
Years 5-6: Construct full-scale facility and begin operations as a brewery/taproom.
Five Years Out: Full-Scale Facility
Fig. 1. American Brewers Guild Site Assessment Survey.

Page 20 of 34

Promotion
Good Work will advertise through The Growler, a free quarterly about the Minnesota brewing industry; through
sponsorship of the public radio station 89.3 The Current, a press release in the Minneapolis Star-Tribune, an
active website and blog, and sponsorship of farmers markets and summer concerts. These channels will
enable Good Work to reach customers who are enthusiastic about high-quality beer, local and sustainable
growing, and community activities. Additionally, low-cost methods of promotion include encouraging
customers and employees to tell friends and neighbors about the brewery, as well as having special drink
discounts for first-time patrons. Good Works image will be one of warmth, hospitality, stability, and

Page 21 of 34

responsible resource use. It should call to mind the heritage of the brewing and labor traditions and appeal to
a wide array of ages, cultures, genders, and abilities.
Good Work will establish a customer loyalty program (with promotional rewards such as stickers, free growler
deposits, free beer, hats, and shirts) for members and repeat customers.
Promotional Budget
Good Work will spend 7-8% of its annual revenue on promotional tools, as suggested by the Small Business
Administration.19
Pricing
Good Works prices for pints ($4-6), snifters ($3-5), and growlers ($12-15 new, $10-12 refill) will be on par with
other taprooms in order to match the price that most customers feel comfortable paying. Rather than
competing on basis of price, Good Work will compete by brewing with the freshest local ingredients and by
connecting itself to the life of the community.
Proposed Location
Location is important to Good Works customers and employees, because it is in keeping with the brewerys
mission to hire local employees and be located near where customers live, work, and play; in this case, this
will be the Longfellow neighborhood of Minneapolis. The brewery will have a small parking lot if possible,
and at the very least, on-street parking. Bicycle parking will be plentiful, thus encouraging cyclists to patronize
the brewery and accommodating more people with fewer expenditures for parking space. The location will be
consistent with Good Works image as a locally driven, cradle-to-cradle brewery through its use of repurposed
and upcycled building materials, warm and inviting interior space, and convivial patio area. Customers who
want to bond over the beer theyve purchased at the taproom will find a pleasant environment to do so,
whether they spend the time inside or outside. Main competitors, namely Fair State Brewing Cooperative and
Dangerous Man Brewing, are located across the river in Northeast Minneapolis, and it is ideal for Good Work to
be located in Longfellow because South Minneapolis currently has fewer microbreweries and taprooms than
the fairly saturated Northeast market. Customers who want to patronize a local taproom can do so without
traveling to Northeast.

Beesley, Caron. How to Set a Marketing Budget that Fits Your Business Goals and Provides a High Return on
Investment. SBA.gov. 4 Jun 2012. http://www.sba.gov/community/blogs/how-set-marketing-budget-fits-yourbusiness-goals-and-provides-high-return-investmen
19

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Distribution Channels
Good Work will only sell its beer on tap at its brewery and taproom. Customers can purchase 64 oz growlers
of beer for off-site consumption during taproom hours.
Sales Forecast
At the peak of Good Works operationsthat is, once the brewery has established itself in its full-scale
facilitythe taproom is projected to be selling:
25-30 growlers/day, 15 customers/hour, 1.5 pints/customer = 1952 oz/day = 15.25 gal/day
15.25 gal/day x 5 days/wk = 76.25 gal/wk = 5 half-barrel kegs/wk = 2.5 bbl/wk, 130 bbl/year
These levels of growler sales and beer consumption are based on data from Dangerous Man and Indeed Brewings
current sales levels, which are at a level that Good Work aspires toward.
Indeed Brewing, another Minneapolis taproom, has revenue estimated at $110,000/year. The taproom is open 3
days a week, and therefore 157 days/year. That means revenue of $700/day; figuring on an average purchase
of 1.5 beers per customer, and assuming a rotation of 15 customers per hour, $8 x 15 x 8 = $960 per day.
Good Work will be open 4 days a week, and therefore 209 days/yr. At similar revenue levels of $960 per day x
209 days = $200,640 per year.
At projected sales levels of 20 growlers/day, 75% of them new, and 25% of them refills, 15 (13.5) + 5 (11) =
202 + 55 = $257 from growlers. Annually, Good Work can estimate 257(209) = $53,713 from growler sales.
Total Projected Revenue = $254,353 per year.

Page 23 of 34

VI.

Operational Plan

Production
Good Works beer will all be produced on site in the brewery/taproom. Brewing will occur 1 to 2 times per
week in the 10 bbl system, and the company will make weekly orders of only as much raw material as is
necessary for one to two batches of beer. Prior to brewing, the ingredients will be stored in the taproom
during non-business hours. The brewmaster and assistant brewmaster will test samples of beer at multiple
stages of the brewing process for correct gravity, unwanted flavor compounds, and contamination.
In order to inform future brew days, the brewmaster, assistant brewmaster, and all other Good Work
employees will make a practice of exploring various styles and brewing methods through visiting other
breweries in Minnesota, as well as occasionally across the U.S. and beyond. Good Work will also survey its
customers to learn what styles theyd be interested in trying.
Location & Space

From an operations perspective, Good Works location needs to be close to the highway in order to facilitate
easy delivery of raw ingredients. Easy walk-in and bike-in access for customers and employees is also crucial;
thus the brewery should be located near bike- and pedestrian-friendly paths. The square footage of the space
should range from 550-1200 ft2, with 12-14 ceilings in the brewhouse to accommodate fermenters and 9-10
ceilings in the fermentation and taproom areas. The space needs to be zoned as a taproom with liquor license.
Water supply should be 60 psi @ 25 GPM, with dedicated water flow to the brewing operation. Hot and cold
water will be necessary, especially in the kegging area of the brewery. Drains in the floors of the brewhouse
and walk-in keg cooler will be necessary, and if possible, a sloped floor would help liquid drain. The
floors, walls, and ceilings will be made washable. Exhaust flues will be placed to vent steam and other gases
from boiling and firing the boiler, and air conditioning will circulate fresh air into the brewhouse. 20

Cost

Building Requirements. Specific Mechanical Systems Ltd. http://specificmechanical.com/productsservices/brewery-systems/building-requirements

20

Page 24 of 34

Estimate your occupation expenses, including rent, but also including maintenance, utilities, insurance, and
initial remodeling costs to make the space suit your needs. These numbers will become part of your financial
plan. (down in Startup Expenses)
Business Hours
Good Works taproom will be open to sell beer on tap and by growler from Tuesday through Saturday, 4
PM-12 AM. Brewing will occur twice a week from 5 AM until the active brewing is finished, and brew days
will be set at the discretion of the brewmaster.
Personnel
Good Work plans to eventually hire 12-14 employees, including a brewmaster, assistant brewmaster, marketing
director, social media director, taproom manager, accountant, and 4-6 taproom employees. In order to find
the right employees, directors plan to canvas the Longfellow neighborhood; place informational posters in
co-ops, taprooms, liquor stores, and homebrew stores; and post an opening for job applications on Good
Works website.
Good Work will pay its employees a living wage, with health insurance and retirement plans available for fulltime employees. Loyalty to the brewery will be rewarded with salary increases.
Inventory
Good Work will order only enough supplies to brew 1-2x per week (to keep stock fresh), and will store kegs of
finished beer in order to free up the brewing system for different varieties of beer.
Suppliers
Rahr Malting Co.
Shakopee, MN
Hippity Hops Farm
Forest Lake, MN

Page 25 of 34

VII.

Management and Organization

The manager of day-to-day operations at Good Work will need the following qualities:

clear vision of the companys zero-waste, positive-emissions goals

ability to communicate with brewing, serving, marketing, and accounting staff

ability to break down Good Works overall goals into manageable increments

desire to innovate and lead craft brewing market in Minneapolis-St. Paul area

Further, the entire Good Work team will need to possess:

ability to work constructively in teams

desire to communicate Good Works mission to the Longfellow community general public

passion for environmental, social, and economic sustainability

attitude toward exceptional customer service

ability to form strong bonds of affinity around great beer and resource-minded brewing

Page 26 of 34

VIII. Startup Expenses and Capitalization

According to Sound Brewing Systems, Inc., a brewery generally costs between $125 and $350 per barrel of
annual brewing capacity to build and support. For a 10 bbl system that brews on average 1.5 times per week,
that cost ranges from $97,500 to $273,000.21 Below is a breakdown of the expenses that make up this overall
cost.
Brewing supplies- the price of a new 10 bbl system varies, but a new system from Glacier Tanks, LLC costs
$62,287.05.22 Brewers have shared that used systems are far more affordable and are often sold by breweries
that have outgrown the 10 bbl capacity. After spending time within the brewing industry while outreaching
for capital, the Good Work team should be able to make a connection with another brewery willing to sell its
equipment for a better price than new.
Rent- In Minneapolis, the average for office spaces is $13.42/sq ft/yr.23 That x 1500 is $20,130.
Ingredients

Grain: $0.61/lb, 561 lbs (basic recipe) = $314.76/batch

Hops: $33.47/batch (but need 88 lb contract purchase)

Yeast: $195.00/batch

Mineral Additions (calcium chloride and calcium sulfate): $0.50/batch24

Excise tax = $.15 per gallon, so $47.25 per batch.25

Total cost of 1 batch: $590.98; $59.10/barrel; $1.88/gal; $0.015/oz

Industry Info, Standards, Statistics, and Conversion Factors. Sound Brewing Systems, Inc.
http://www.soundbrew.com/standards.html
21

10 BBL Complete BrewHouse STEAM Tank System. Glacier Tanks, LLC.

http://www.glaciertanks.com/Brew_House-10_BBL_Complete_Brew_House_STEAM.html
22

23

Minneapolis, MN Market Trends. Loopnet. http://www.loopnet.com/Minneapolis_MN_Market-Trends

Mitchem, Michael P. An Ounce of Beer- Ingredients. Brewing in the Woods. 1 Oct 2012.
http://brewinginthewoods.blogspot.com/2012/10/an-ounce-of-beer-ingredients.html
24

Biggerstaff, Andrew, and Joel Michael. Alcoholic Beverage Taxes. House Research: Short Subjects. July 2013.
http://www.house.leg.state.mn.us/hrd/pubs/ss/ssalbvtx.pdf
25

Page 27 of 34

Since this sample recipe is for a cream ale, a per-batch cost of $590-780 will be allowed to account for
heavier (more ingredient=intensive) beers and less readily available ingredients.
Low end cost of brewing/year: $590 x 2 x 52= $61,360
High end: $780 x 2 x 52 = = $81,120
Average: $71,240
Employee salaries- $15/hour for taproom employees (plus tips), will cost $49,920/yr to pay 2 taproom
employees. Ideally, Good Work will employ approximately 8 taproom employees, plus a CEO,
brewmaster/assistant brewmaster, accountant, marketing director, social media director, and taproom
manager. Salaries for all of these employees will be dependent on brewery sales and individual job
responsibilities, and cannot be projected this far in advance.
Marketing- 7-8% of revenue. Projected revenue: $254,353 per year. Marketing budget: $19,076 (7.5% of
revenue)

Page 28 of 34

IX.

Financial Plan

During years 2-5 of Good Works nascence as a small-batch brewing collective, brewers and community
members will seek out potential investors and encourage them to support the brewery becoming a reality.
Some of this start-up capital will ideally be in the form of donations and grants and will not need to be repaid,
but some of it will be in the form of small-business loans. In order to raise capital, Good Work representatives
will hold tastings at farmers markets, give public presentations about the brewerys community and
environmental goals, and solicit the attention of angel investors. One of these is Dr. Stephen Naylor of the
Mayo Clinic, who has expressed interest in Good Works mission.
12-Month Profit and Loss Projection

Costs
$71,240 (beer) + $19,076 (marketing) + $20,130 (rent) + $49,920 (taproom employees) + unknown (other
salaries) + unknown (brewing equipment) = $160,366, not counting salaried employees and brewing
equipment, both of which will become more clear as the full-scale brewery becomes a reality.
Revenue
$254,353 per year (see Sales Forecast).
First year profits: $93,987, not counting salaried employees and brewing equipment. Due to the expense of
employee salaries and equipment, these profits will be much smaller.
Break-Even Analysis
In order to break even so that Good Work is operating at profit rather than loss, the brewery will need to sell a
bare minimum of an estimated 15.25 gallons of beer per week, or 130 bbl per year. This would supply a
revenue of $254,353 per year, which has been selected as an intermediary point at which it is likely the
brewery will be able to pay for the costs of space, ingredients, salaries, and marketing. Its production capacity,
set at 780 bbl per year, is considerably higher than this bare minimum, which is good news. Good Work will
likely not sell at its full capacity, as it will be prudent to store some beer to age and have enough supply to
withstand temporary brewing problems. However, it will aim to ultimately produce at a higher level than 130
bbl per year.

Page 29 of 34

X.

Appendices

Disambiguation of Terms
Craft brewing: As defined by the Brewers Association, a craft brewery is small (less than 6 million bbl of
beer per year), independent (less than 25% of business controlled by entity that is not a craft brewer), and
traditional (loosely defined as relying on inventive or heritage recipes for beers, as well as not producing a
significant quantity of non-beer beverages). http://www.brewersassociation.org/pages/business-tools/craftbrewing-statistics/craft-brewer-defined
Microbrewery: A brewery that produces an annual output of 15,000 barrels (bbl) of beer per year, with 75%
or more of it sold off-site. http://www.brewersassociation.org/pages/business-tools/craft-brewingstatistics/market-segments Microbreweries fall within the craft brewing umbrella, but not all craft breweries
are considered microbreweries. Samuel Adams, for example, is technically classified as a craft brewery, and
the well-established company produces thousands of barrels of beer per year.
Cradle to Cradle philosophy: As defined by Michael Braungart and William McDonough in Cradle to Cradle:
Remaking the Way We Make Things and The Upcycle: Beyond SustainabilityDesigning for Abundance, Cradle to
Cradle thinking aims to improve the quality of products so that they:

Have an improved consumer quality for the user

Pose no health risk for anyone who comes into contact with them

Are of both economic and ecological benefit.26

Keeping it Local- Investigations into Local Craft Brewing

Interview, Maggie Pearson, assistant taproom manager, Dangerous Man Brewing, Minneapolis, MN
3/11/14

26

Cradle to Cradle. EPEA-Hamburg.org. http://epea-hamburg.org/en/content/cradle-cradle%C2%AE

Page 30 of 34

I spoke with Maggie Pearson, the assistant taproom manager of Dangerous Man Brewings NE Minneapolis
taproom. On a Tuesday afternoon, as other employees prepared the taproom for another busy afternoon and
evening of serving patrons, we chatted over a glass of Klsch.
The first thing Maggie called my attention to was the pallet of grain that sat in the corner of the taproom.
Dangerous Man receives a similar shipment, enough for one brewing day, one to two times per week. They
order through Brewers Supply Group, a large ingredient wholesaler. Some grain is malted locally by Rahr
Malting in Shakopee, the largest malt house in the U.S. Some of Rahrs malt is locally sourced, says Maggie,
but most is not. The brewery works within the parameters of a 10-barrel brewing system, all housed behind
the taproom bar. The beer is served directly out of the brewing systems brite tankthe leaders have plans to
keg and store finished beer to increase the brewerys serving capacity.
Community connections
Dangerous Man, situated in the unique neighborhood of Northeast Minneapolis, has strived since its
beginnings to become a part of its community. 80 to 90 percent of Dangerous Mans small employee base live
within two miles of the brewery. Speaking of the taprooms social environment, Maggie says, This is our
place. Taproom employees know the names of their regular patrons who come to Dangerous Man
frequently to socialize with each other. Northeast Minneapolis is very tight-knit, and Maggie claims that some
of this can be credited to zoning that allows small neighborhood bars to coexist with residential blocks. As a
result, she says, people go out a lot and regularly patronize their neighborhood bars. Dangerous Man
supports patrons social rituals by providing a variety of board games to accompany their beers; unlike most
restaurants, Maggie explains, the taproom is not trying to rotate customers through quickly.
The brewery has made the most of its close connection with locals, forming a volunteer crew of
approximately 200 members in the fall of 2013. The crew works mostly on Northeast-centered projects.
About 80 people regularly attend volunteer events ranging from packing lunches for low-income local
schoolchildren, bike cleaning and building days at Free Bikes for Kids, and the Canadian-Pacific Christmas
Train for disadvantaged children. The volunteer events, Maggie says, are staff-intensive, but despite the large
amount of work involved, Dangerous Man staff wants to organize more of them. She says they have helped
the staff and patrons get to know each other better and helped the popular brewery harness the people power
at its fingertips.
Beyond its internal social environment and volunteer activity, Dangerous Man has built connections to its
suppliers and independent organizations by giving spent grains to composting organizations in the Twin
Cities, such as the Womens Environmental Institute. Since the taproom, by Minnesota law, is only allowed to
serve the beer it produces and not food, Dangerous Man encourages customers to order food from
neighboring restaurants and carry it in. A nearby pizza restaurant only delivers to Dangerous Man, and like
other local businesses, it appreciates that the taproom directs customers to purchase from surrounding

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restaurants. Were not taking business away from anyone, says Maggie. Dangerous Mans T-shirts,
emblazoned with the taprooms logo of a silhouetted bearded man, are printed by a local Northeast screenprinter, and the marketing staff of the brewery encourage patron involvement in the many local arts festivals
in Northeast. All the art that adorns the taprooms walls was made by local artists, and the tables were made
by friends of Rob Miller, the brewerys owner, from wood salvaged from a demolished warehouse.
Dangerous Man seeks to provide an urban third space for people to gather. According to Maggie, the
brewery tries hard to reflect customers interests. Since the taproom is located in a residential area, Maggie
says she feels good about the fact that many regular customers walk to Dangerous Man. The bicycle traffic is
so heavy in warmer months that management is working with the neighborhood association to reserve a
parallel parking space for on-street bike parking.
Growth
When asked whether Dangerous Man plans on staying the same size or growing, Maggie said that current
plans were to stay in the same space and produce at the same level. The brewerys goal, she says, is to stay a
part of the community, not to move out and distribute. Distribution doesnt seem worth the effort to
management at Dangerous Man, because the brewery is currently still occupied with meeting the high
demand that exists now for pints and growlers. The taproom sells 25-30 growlers per day, enough to be
keeping up with, says Maggie. Eventually, though, plans are to increase the number of growlers sold per day
and the number of different beers on tap. With the planned move to keg storage, the brewery will be able to
keg off the second half of a batch of beer and put a new beer on tap, allowing for more tap and growler sales.
The bars tap system currently has capacity for 15 beers, 2 small-batch sodas, and a water line. Maggie
mentioned the possibility of opening up a space next door to the taproom for beer tasting and growler sales
to streamline the process. Finally, Dangerous Man has chosen not to partner with food trucks at the current
time because there isnt a parking lot near the brewery for the truck to park to sell food. It would be
prohibitively expensive to buy a permit to allow a food truck to park in a street parking space, and while
Maggie says the staff would love to host a rotating lineup of food trucks like other breweries do, they prefer
to keep it simple and support neighboring eateries.
Relationship to other breweries
The beer industry, says Maggie, is still competitive, but to her and the team at Dangerous Man it seems
incredibly collaborative. The brewery is currently borrowing firkins and glassware from Indeed Brewing, and
Fulton Brewing is storing a cooler until Dangerous Man has space to accommodate it. The brewery owes
much of its positive relationship with other breweries to the fact that it doesnt distribute, so they dont need
to compete for tap handles or cooler space. Since Dangerous Mans business model is to stay in one place
and stay the same, Maggie says, everyone can play nice with us.

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Not distributing also means that Dangerous Man staff get to be the ones representing their own beer from
start to finish. That element of control, and the employees close knowledge of the entire brewing process,
means that Dangerous Mans beer is represented accurately to the public. However, Maggie said, being
entirely self-supported can its drawbacks, as Fulton Brewing, another brewery that distributes and sells kegs
to other bars, contract brewed through other breweries before opening their own facility. Since they
partnered with other breweries and gave them partial control of their brewing process, Fulton had brand
recognition before opening their own space.
Sustainability
In terms of water usage, Maggie said that since Dangerous Mans facility is small, it is by definition less
efficient, with a ratio of 10 gallons of water used for every gallon of beer produced. She encouraged me to
investigate Daves Brew Farm, located one hour east of the Twin Cities; it combines a farm with a brewery
with a business model she described as innovative.

Interview, Mark Fitzgerald, owner, Butcherknife Brewing, Steamboat Springs, CO

3/27/14
I spoke with Mark Fitzgerald, co-owner of Butcherknife Brewing in Steamboat Springs, CO. We sat in the
taproom, scheduled to open in May of 2014, rolling a bourbon barrel on the ground with our feet and talking
over the brewerys hefeweizen.
Sustainability
Mark began the conversation by talking about the brewerys sustainability goals. Butcherknife seeks to take
advantage of Colorados 300+ days of sunshine per year and install solar panels on the brewerys south side
with help from a USDA grant. The panels have the added benefit of reducing solar heat gain on the wall that
holds the cooling system on the other side. For heating brewing water, Mark looked into a wood pellet-fired
boiler, but at the 1.6 million BTU level needed for Butcherknifes 30-barrel brewing system, the brewery
would need a huge silo of pellets in order to have enough fuel on hand. The brewery currently fires its boiler
with natural gas. Butcherknife uses several window air-conditioning units in its cooling room. In this room,
the storage temperature is 38-40 F, slightly warmer than the 34 F at which the brewery packages its beer;
therefore, very little cooling power is needed in the storage room.

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Water usage is a top concern for brewers, and minimizing wastewater is a high priority at Butcherknife. In
order to conserve perfectly usable and clean water, the brewery keeps hot water from its wort chiller and reuses it throughout the brewery. Mark feels lucky that Butcherknife is the first brewery in the U.S. to use water
coming off the Continental Divide. This means the water needs much less filtration to remove unwanted
mineral compounds, and the energy-intensive reverse osmosis purification process is also unnecessary.
Butcherknife has partnered with local ranchers who are eager to use the brewerys spent grains as cattle and
hog feed. Steamboat Springs is located in a fairly agricultural area, and Mark feels fortunate that this is so. It
gives the brewery more opportunities to get locally-grown ingredients; Butcherknife has reached out to local
hop growers on Facebook to obtain hops for its early brewing work, and a farmer in nearby Hayden used to
grow barley for Coors and expressed interest in working with Butcherknife. However, getting local barley is
extremely difficult for a smaller breweryButcherknife would need to commit to 50 acres, ship the grain to
the maltster, ship the malt back to the brewery, and store it until the brew day. Compared to 20 cents per
pound for standard malt, locally-grown malt would cost as much as $1.50 per pound with these
considerations in mind. Mark has observed that a main obstacle to growing local barley is a lack of knowledge
of malting, and he suggests that if more small maltsters got into business, brewers would be able to malt their
locally-grown grain more affordably. Why not do it all here? asks Mark.
Community Connections
Butcherknife has reached out to the Steamboat Springs community by arranging to sell beer at the towns free
summer concert series; donating logo socks, can coolies, and hats as prizes at community fundraisers; and
putting up stickers around town and on ski lifts at the nearby Steamboat resort. There has been considerable
interest in the brewery within the community. People are reserving tap handles for Butcherknife beer at local
bars, says Mark, because theyre local. Steamboat Springs displays a great deal of loyalty to locally-based
enterprises, and Mark is thankful for that. Butcherknifes goals are to hire employees from within the area,
and to work with people who are interested enough to seek out the brewery before product is on the market.
Butcherknife obtained a large portion of its equipment, including a kegerator, freezers, bar tables and stools,
speakers, a stereo, sinks, and butcher blocks used from a defunct Chinese restaurant in town. All of this
equipment cost $1800, which is approximately half of what the brewery would have had to pay for just a new
freezer. Staying on the pulse of what was happening with the local restaurant helped the brewery immensely.
Growth
When I asked Mark if Butcherknife had plans to grow, he said that hed be satisfied, if not happy, if the
business was known as a good local brewery. However, he has plans for Butcherknife to grow beyond that, as
Steamboat Springs has a relatively small population of permanent residents and there are more craft beer
drinkers in greater Colorado. At the end of year three, Mark says his goal is for Butcherknife to be producing

Page 34 of 34

5,000 bbl per year. Butcherknife plans to can its beer for distribution; the advantages, says Mark, are many,
including lighter shipping weight, fresher beer, and a more compact packaging system. A small company in
Colorado operates a mobile canning unit, which allows small breweries to get shelf space at liquor stores
before they purchase their own canning system. The brewery has a strong relationship with a large distributor
outside of Colorado, but Mark says the Yampa Valley, Steamboat Springs geographical region, comes first
and that he doesnt want quality to suffer at the expense of wide distribution.
Mark feels fortunate that he and his business partner were able to finance the entire 30 bbl brewery with their
own money, and that they dont need to churn out beer at an accelerated pace in order to make enough profit
to pay anyone back. Above all, Mark says he and his team are free to brew what they want and to grow
Butcherknife at their own pace.
When asked about his perception of the craft brewing world, Mark says that he has witnessed a great amount
of collaboration within the industry. Everyones very helpful, he says. More craft beer is just a promotion
of the industry as a whole, and small breweries arent trying to step on each others toes. By finding
Butcherknifes niche as a locally-based, high-quality, and sustainable brewery, Mark hopes to make a place in
the industry for himself and his team.