Beer Overview
Beer is a low alcohol content beverage produced by fermenting sugars extracted from various types of cereals. A large number of different beer types exist that vary in the use of raw material, and the strength, taste profile, and packing of the final product. Each brewery generally has its own specific product and container mix.
Production methods differ by brewery, as well as according to beer types, equipment, and national legislation. Historically beer was produced from malted barley. However, there is a trend toward a more diverse group of cereals, with modern large breweries increasingly using maize and rice. The sugar is extracted from the cereal into the water, hops are added, and the mixture boiled. After cooling, the mix is fermented with yeast to produce alcohol. This raw beer is then matured and packed. Some beers are filtered and pasteurized.
Brewing is the process of production of malt beverages. Beers, ale and lagers are the main malt beverages produced by a method called brewing. Brewing is a complex fermentation process. It differs from other industrial fermentation because flavor, aroma, clarity, color, foam production, foam stability and percentage of alcohol are the factors associated with finished product.
Beer is a fermented aqueous drink that is made from four main ingredients: water, hop, yeast and barley malt. Barley malt is sometimes partly made from rice, corn or wheat, all of which are very starch-rich. Each of the four components is added at different times during the beer making process.
We begin the beer making process with the mash, which is the name of the slurry formed from mixing barley malt and water. Barley malt makes up the body of the beer, and typically 200 g of barley malt is needed to make a litre of beer. The amount of barley malt added to the water determines the strength of the resultant beer, and the type of malt (rice, corn or wheat) used controls the colour of the final product.
The mash is then heated to around 60 °C. At this temperature, the enzymes in the malt – called amylase and protease – are able to catalyse the breakdown of starch and proteins in the mash. This produces a mixture of sugars and peptides. To ensure that the amylase and protease enzymes are present in mash, harvested barley has to go through a process called germination to turn it into the barley malt that is used in the mash.
To start germination, barley is left to soak up water in steeping tanks for a few days. The soaked barley is then aerated at around 15 °C in a large room, where it is constantly turned to promote sprouting. The aeration takes around five days and the resultant barley is called the green malt. The green malt is then dried at temperatures over 48 °C, which stops sprout growth. Changing the drying temperature will change the type of malt produced. This dried barley is the barley malt that goes into the mash; it is full of sugars, starch and the enzymes that are needed in the mash to catalyse the protein and starch degradation.
After the enzymes have catalysed the starch and protein degradation, the mash is filtered. What remains is a sugar solution that is called the ‘wort’.
The wort is put into a brewing kettle, then boiled, and hops are added, for at least an hour. Only a few grams of hops are needed per litre of beer (much less than the barley malt), but it is a very important ingredient in the beer making process. When the hops are added, they form insoluble complexes by bonding with polypeptides and proteins, which is important in stabilising the beer foam and it acts as a sterilizer.
When the wort has been cooled to room temperature, and the used hops are removed by filtration, the resulting solution is called ‘hopped wort’. This solution is then moved into a fermentation vessel and the yeast is added. The yeast cells in the hopped wort convert sugars into ethanol and carbon dioxide; this process is called anaerobic (without oxygen or air) fermentation.
What are Micro-Breweries?
A microbrewery or craft brewery is a brewery that produces a small amount of beer. Exact definitions vary, but the terms are typically applied to breweries that are much smaller than large-scale corporate breweries and are independently owned. Such breweries are generally characterized by their emphasis on quality, flavor and brewing technique.
The market for microbreweries is still developing. These microbreweries produce between 5,000 and 50,000 litres of beer, a day. It takes about seven hours to brew each variety of beer using imported ingredients.
Generally, a microbrewery is considered to be a brewery that produces between 1000 to 15000 barrels of beer annually.
According to industry estimates, the market for such finely crafted beers currently ranges between Rs. 75 crore to Rs. 125 crore microbeweries and it takes about Rs. 6 crore on an average to set up a microbrewery.
What is Benefit of starting a Beer Processing Plant?
a) High public demand
– Breweries and liquor pubs are a place for people to relax and de-stress. Hence, there is a huge demand for high-quality breweries with great ambience.
b) A revenue making venture for the government
– Both central and state governments levy hefty taxes on breweries. Hence, they encourage the operation of breweries round the year.
c) Huge profit margins for business owners
– This is a huge win for entrepreneurs planning to begin a brewery. Breweries have high profit margins making them a profitable venture.
d) Recession proof business
– Breweries are among the handful of businesses that are profitable at all times.
e) Year-around demand
– This is another plus of brewery business. There is a year-around demand. While some months like Ramzan, Navaratri see reduced demand there is a consistent demand all through the year.
Steps to Follow to Start a Beer (Microbrewery) Business
1. Understand the Market
Before initiating the microbrewery business do some research about it. Study the market and about your would-be competitor. Study about the culture of taking beer of the people where you want to establish the business. These all will help you to craft a business feasibility report.
Before starting any business, it is advised to collect as much information as possible regarding the market volume and local buying behavior. It holds true for the brewery business too.
Conduct detailed market research and find out the existing pricing structure of local competitors, the type of beers that are most popular, and the prospective customer base. This information will help you explore the gaps that exist and plan accordingly.
2. Select the Type of Beer to be Produced
It is extremely important to select the type of beers you are going to serve to the customers. It is essential to talk to local customers and collect information about what kind of beers are trending from nearby local competitors.
Some of the beers that are popular in India are India Pale Ale, Porter, Wheat, Stout, German Lager, and so on.
3. Create a Business Plan
Create a detailed microbrewery business project plan report. Determine your business objective and mission statement. Calculate set up cost with equipment and human resources needed.
Fix your marketing strategy considering the niche audience you want to reach. A business plan will not only help you to get finance also help you to check whether your business is on the right track or not.
The business plan will show you how profitable your brewery will be. It will also help you to decide if this is a business that you’re willing to work for.
A well-written and thoroughly thought out business plan can help you to succeed in any business.
If you are planning to pitch for funding from investors, the need for this business plan document becomes all the most important. Almost all investors will ask for the business plan to know more about your proposed venture.
Some of the key topics your microbrewery business plan document must address are the following:
a) Executive summary
b) Company details
c) Market Information
d) Operational plan
e) Manpower hiring plan
f) Financials
g) How do you plan to promote your brewery business?
4. Choose a Location for Beer Processing Plant
Choosing the right location is an immensely important factor in the success of the microbrewery business. Every state has laid down different rules and regulations for setting up a brewpub. Generally, a minimum space requirement of approximately 0.1 square meters is required to produce per liter of beer in a microbrewery.
On average, an area around 800-1000 SQ.FT is necessary to start a brewery pub in India. It is advised to find a location close to commercial locations, especially corporate hubs as executives are often the main target customers for crafted beers. Another lucrative location can be beside the highway junctions.
5. Name your Beer Processing Business
Naming plays a major role in pulling a crowd. Remember people will come to your place to have a good time. So, choosing a cool and creative name is really essential. Plus, make sure your name has all the online availability. A hangout place means you will need a massive online presence. Make sure you have your own website, social media handles, and online listings.
The Internet is going to be an important medium to promote your microbrewery and bar business. So, make sure you have the needful while finalizing the name.
6. Legal Formalities for Microbrewery Business
To start the commercial operation of the microbrewery business, you need to obtain a license from the state government excise department. Its terms conditions and fees vary from state to state.
Also, you need to have a trade license, commercial electricity connection, commercial water line, land registration or lease agreement, NOC from the state pollution control board. Along with this you have to register your company firstly.
In addition, you need a water quality testing certificate, and lastly quality control certificate of finished beer from Govt. approved QC labs. It is always advisable to consult with a small business advisor to get the right advice about obtaining these licenses.
Generally, the state excise government issues the microbrewery or brewpub license. It allows the company to start operations in its microbrewery for commercial use. The price for this license in Rupees 25000/- per month. The amount may vary state to state. Additionally, you have to obtain a separate bar license too.
7. Machine & Equipment for Beer Processing
You can initiate a microbrewery business in two ways. First of all, you can start the brewpub with the bar and restaurant setup. However, if you already have a hotel or restaurant, you can add on a microbrewery with the existing infrastructure. In that case, you must have space for it.
List of the most important microbrewery equipment:
a) Mashing Tuns & Kettles
b) Lauter Tuns
c) Fermenters
d) PHEs (Physical Heat Exchangers)
e) Refrigeration machine
f) Boiler
g) Electric Cabinet with all controls
h) PLC touch-type process controller
i) Beer Filters
j) Distribution Tanks
k) Serving System
l) Canning and Bottling Machine
It is important to purchase machinery from reliable suppliers. Ask for customer feedback before placing your final order. Additionally, ask for a detailed equipment list and technical specifications of materials and physical technical specifications. Additionally, if the water supply does not meet standards, you will need to have an RO system.
8. Beer Manufacturing Process
Beer is a mildly alcoholic beverage. You can produce it from Barley malt, hops, yeast, water, and other adjuncts such as maize, rice, sugar, wheat, etc. First of all, weigh the barley malt. Mill it to get a powder form.
Then, mix the malt with other ground ingredients as per the specific recipe. Add the treated water. Then put the whole mixture for Mashing.
During mashing the enzymes of the malt degrade the starch and proteins as per specific demands of the recipe for the style of beer and bring the sugars, amino acids, and minerals into the solution. Here, you will get WORT.
Then separate the WORT from the waste solid matter through a process of filtration called lautering. After Lautering, transfer the “WORT” to the kettle for WORT Boiling. Finally, send the solution to a Whirlpool wherein the WORT is swirled to precipitate the suspended matter and make it clear.
Finally, chill the WORT in a Plate Heat Exchanger from 100 °C to about 10 °C in an hour. Add the yeast into the Fermenters. In the fermenters, the yeast converts the fermentable sugars in the WORT to alcohol and Carbon Dioxide and this takes place for about 5-7 days at about 10 °C.
Soon after the maturation, pass the beer through a Filter. Finally, send the clear beer to the beer tanks. The beer is now ready to be dispensed fresh to the customer.
9. Cost of Starting Beer Processing Plant
The initial investment will largely depend on the size and scale of operation. The major cost will be in buying the brewery equipment. The minimum cost of buying brewing equipment for a small-scale brewery unit will be in the range of $70,000 to $80,000. The other essential investments are rent of the space, salaries of staff. and interior decorating expenses.
On average, to start a mini microbrewery unit one will need a minimum investment of $1,00,000.
10. Promote your Business
You will have to promote your microbrewery to reach out to a broader community. Start promoting on social media and serve your brewed beer as tasters for free initially. Pull in the crowd by promoting your brand. Run special offers and happy hours to attract more customers.
Offer standard quality food and drinks to the customer. It will induce them to share their experience with others. It will also build a strong reputation in your microbrewery business.
Do some outdoor advertising activities. You can also promote your brewpub by direct mailing and some add publishing on the local newspaper.
Create a catch line of your brewpub business. Create an online presence for your microbrewery business. Social media can be an ideal platform to promote your business.
