Cost Control (like Beer) is Not Just for Breakfast Anymore!

As noted in the section on Increasing Sales, there is more than one way to achieve your goals for your brewery. One of the most important is cost control.

The craft brewing industry is as notable for thin margins as for the passion of the owners, brewers and consumers. And as in any business with tight margins, small gains can have a big impact on the bottom line.

Brewery Costs are NOT Unique to Your Brewery

Although there is great diversity and fragmentation in the industry, craft breweries share many important similarities in operation and management. As a result, Beer Czar Consulting can help you benchmark how you are doing relative to similar craft breweries in such areas as packaging efficiency, productivity per hour of labor, efficiency of marketing efforts vs. sales revenues, and so on.

Brewery Costs ARE Unique to Your Brewery (Doublespeak?)

BUT ... all breweries are not alike. Each has its own special circumstances. For example, the impact of rent per sq. ft. on pricing will be quite different for a brewery located in an urban downtown environment compared with one found in a warehouse district. Similarly, marketing expenses for a brewpub will differ from that for a contract brewer. Identifying and optimizing the critical aspects of YOUR brewing business is the key to establishing a sustainable cost advantage.

The Smart Way to Think About Costs

Like most things in life, costs are what you make of them. In all industries, successful businesses look for ways to turn costs into advantages. They key here is either to minimize costs (e.g. become the low-cost producer) or to derive some kind of marketplace advantage from higher costs.

A good example of this in the beer industry are the higher costs associated with selling product in an enameled bottle vs. a plain bottle with a paper label. A cost cutter would always go with the paper label, while a marketer might find ways to turn the more expensive packaging into an advantage.

Typical Cost Problems for Microbrewers

One of the biggest problems for brewers is the lack of time. Most brewery owners are too busy executing day-to-day activities to perform the important analysis and planning required to turn a good and reasonably profitable brewery into a great and highly profitable one.

In terms of cost, this usually means there are real cost savings waiting to be discovered. And these cost savings can be found all over the operation. Raw materials, labor, packaging, capital, printing, advertising, utilities, CO2, marketing and many more costs all might be hiding potential cost savings.

Another big problem for most owners and managers of craft breweries is that they see cost as a negative. Many of the most successful companies in the world, however, view cost as an opportunity to create real advantages in the marketplace.

How Beer Czar Consulting Can Help You

Beer Czar Consulting specializes in helping brewers analyze costs (e.g. analysis) and identifying ways to create cost advantages.

Click here to learn more about how Beer Czar Consulting can help you discover what cost savings - and cost advantages - are waiting to be realized in your brewery.