Friday, 18 March 2016

The realities of scaling up...

Scaling up a brewery - actually any business - is not a linear affair. To make ten times more beer may take just about the same time on brewing day, but apart from that everything else shifts a couple of orders of magnitude or more...

Something as simple as quickly popping into the homebrew shop to buy a couple of kilograms of malt you forgot about ordering simply isn't an option anymore. You need bags full of malt for this one day only, plus you need a good flow of ingredients for upcoming brew days. The same applies to yeast, hops, bottles, labels, etc. Getting everything to the brewery on time requires coordination, planning and sometimes even a bit of luck.

The brewing part is easy. Brewing on a bigger system quickly becomes the norm. It is different, but you quickly find a new rhythm. Mashing still takes about an hour; transfers & sparging can take a little longer; boiling is the same; cooling takes a little longer... Different, but not too different or unfamiliar. Once the cooled, hopped wort is in the fermenters and happy yeast is turning the sugary liquid into beer the real "fun" starts...

Packaging, conditioning, storage, distribution, sales, accounts receivable; ordering more ingredients & materials for upcoming batches...

What used to be a couple of hours to get beer into bottles becomes a rather well planned, full day of hard manual labor filling bottles; capping them; tagging / labelling; glueing & packing cases; and finally stacking packed cases.

It is on these days that you somewhat envy the big boys with shiny, advanced, automatic fillers & cappers... But at the end of the day the sense of achievement and satisfaction is much better the hard way. It feels good to have created something. Something that you and others can enjoy. A simple concoction of water, barley, hops and yeast... This simple product which is an essential part of the civilized world we know... Just imagine this world without beer !!

With the beer going to market and sales picking up the "real fun" is set to start...

Let's assume the beer is well received and there are no major problems. Gradually sales will pick up and then (hopefully) the whole setup is bound to gain momentum. At that point I predict (and hope) the following situation will unfold... as described by Tony Magee from Lagunitas... Running the brewery will become like being chased down the road by a pack of rabid dogs. In addition to being chased like this, managing cash flow in the business will be like falling down a seriously long flight of stairs while blindfolded. On top of that we will have to add managing people... And we all know managing people is similar to herding cats!

I am pretty sure we are in for an interesting, entertaining, fun and informative ride with our little brewing adventure...

Bring it on !!

Tuesday, 15 March 2016

Expansion - Gallows Hill Brewing Co

Expanding a bootstrapped sideline business is a tricky and challenging affair. Despite the challenges it is actually a rewarding and fun experience.
On top of that it is also a serious learning process. Learning involves a little bit of everything… From plumbing and electrics all the way through to financing and taxes.
Since we have been building Gallows Hill Brewing Co at our own pace (we intend to stick to this going forward) and not always with the same exuberant fervor as others, I have decided to put in more effort to document and share our journey. Pretty sure there will not necessarily be weekly or more frequent updates, but there will definitely be more effort being put into documenting our expansion and progress with the brewery.

You may be wondering where we are heading with the brewery… As a start, let’s clarify what is important to us:
The brewery is a serious business, but it is by no means a “get rich quick” scheme. (Anyone getting into the beer business with that in mind should seriously reconsider their position.)
We aim to build the business in a manageable way into a sustainable small endeavour that suit our lives. Those lives involve young families and serious day jobs. Juggling all the responsibilities will be no easy task. We have to accept that this juggling may result in things at the brewery not always going as planned or at the pace originally intended.
We are local. Our operation is based in a gritty part of town undergoing a slow revival. Despite the issues of crime in our area we intend to stick it out and be part of building up our bit of the city. Breweries all over the world are contributing to uplifting rundown neighborhoods and derelict industrial areas.
In South Africa alcohol producers are too easily painted with a tar brush and depicted as the source of evil in our society. We accept that the country does have an alcohol abuse problem, but the mass consumption market is not really the market we are aiming for. Breweries, bakeries, butchers, green grocers, etc. are essential components of a properly functioning society. In our opinion a world without good quality beer is not worth living in.

Being a bootstrapped, small scale & amateur brewing operation (none of us studied fermentation sciences or went to brewing school) we will surely make a number of mistakes along the way, but our eternal strive will be to produce high quality beer our way. We are going to be honest about our products and we take everything about our beer and brewery personal. It is part of us. Due to running our brewery the bootstrapped way, some things we do will be a little unconventional.
The brewery is self-financed! We have no big financial backing or external investors at this point. It is simply a case of investing our own resources and income from our day jobs into the business. We are lucky to be able to do it this way. On the one hand it adds a certain amount of pressure to make it work and forces you to work smart and to make compromises in certain areas. On the other hand it gives us the freedom to do whatever the hell we want to. We do not have a banker or other investors breathing down our necks drooling for payback or returns on the investment.
We have day jobs and young families. On the one side we have two doctors and a little one who is not even six months old. On the other side we have a chef, a structural engineer and a 3 year old toddler. The doctors have crazy & haphazard working hours. My work can be sporadic, often riddled with deadlines, travel, corporate bullshit and having to manage people and projects across the country and around the globe. On many occasions family commitments and work demands forces brewery related tasks and plans to play second fiddle or to take a rain check for a couple of days. Having the brewery is a creative outlet for all of us. It keeps us sane to some extent, I think.
We are still fairly young. Even if we are completely on the wrong path and it does not work out, we will be OK. There is still a lot of life and living left. At least we hope so, right!
Back to where we are heading…
As a start. We are going to make beers that we enjoy drinking. At the moment that is to a large extent Pale Ale, India Pale Ale, Porter, Stout and Barrel Aged Beers.

Variation will probably be the norm. The perfect beer is something we haven’t brewed yet. Maybe we can get there… One day…
We are not in the game of pushing high volume, low flavour beer. We will also not participate in the price war game.
Pay to Play” is unethical and wrong. We will not do it.
Our initial growth will be fairly slow… This is largely due to demands from our day jobs for the next 6 to 8 months, but also because we would prefer to ramp up gradually. There is still a lot of learning and figuring out required.
This is probably a good time for a bit of a recap…
After a burglary mid 2015 - that cost us quite a bit of stainless steel kit - we got to the point of having to decide between plodding along as we were doing at the time, or taking it more seriously and expand the business. After a lot of deliberation, arguments, back-and-forth, etc. we decided on a brewhouse size, selected an equipment supplier and decided on a broad outline of how we planned to run things.

By a stroke of luck I tracked down a guy in our big-ass firm (one of the perks of working for a Fortune 500 multinational) running a small brewery in New Zealand with his best mate. After a couple of emails we learnt a lot from like-minded folks who’ve gone through a similar situation and managed to track down the actual manufacturer of the equipment we were going to buy through a middle-man. With a slight setback in time, scoring about 30% off the equipment cost and getting the opportunity to customize our brewhouse for very little additional cost, we pushed the button on the manufacturing of our new brewery.

Late in 2015 our 3 main brewing vessels arrived. Unpacking was a bitch in the scorching Cape Town summer heat.

Thanks to our bootstrapped approach the expansion is not a case of simply unpacking a couple of containers or crates, and paying a guy to fit the jigsaw together. We had to do it all ourselves. Sourcing all the additional pieces to turn 3 main stainless steel vessels into a functioning brewery is a mission. It is a real bitch when you factor in the generally poor service provided by most South African firms. It takes quite a bit of time to pin down good suppliers with who you can build a relationship and then work together to build a business. (More about that on another day)

Where we stand now there are a couple of small items still missing and a bit of tweaking that needs to be done before we can move into full steam production. At least we managed to run the necessary testing required, proper initial CIP and passivated the tanks.

This was followed by our first big kit brew day. Surprisingly the brew day went pretty smooth. Obviously there were a couple of process related issues. Mostly in terms of timing and a minor boil-over incident… Gladly nothing that cannot be sorted with some better planning.

At least we can confidently say we are now in the home stretch before we start brewing again in earnest.