We’re now 1.2 years old, which is approximately 35 in brewery years. So, hopefully we’ve learned 35 years’ worth of stuff. Here are my big takeaways…
Sacred cows ain’t so sacred (aka Never Say Never)
Going into this venture, we had several principles that we vowed never to compromise. In our holy taproom, we would never have TV’s, those obnoxious flashing matrixes of pixels that divert people’s attention away from bona fide human interaction. Our tap list would fully rotate: No matter how popular a particular beer may be, when that batch is out, it would leave the rotation, if only temporarily, in favor of something else. We won’t have a flagship beer with some catchy name. And speaking of names, we’re going to give our beers simple names (Holler IPA, Holler Hefeweizen, etc.) to let our beers sell on their own merits – No gimmicky names!
Well, fast-forward a year and the field of sacred cows is mostly ground chuck. To a degree, our steadfast conviction gave way to pragmatism. Our tap list is still 80% rotating, but our Holler Dollar Pils Y’all (note the catchy name) and ESB (award-winner) are now permanent fixtures. And as the Astros’ pennant race became increasingly real, how could we not watch it in the tap room? Now, the TV is a retractable screen that is only used for special occasions, but nonetheless, it is always there to condescendingly remind us to Never Say Never.
Making and selling beer for a living is not a non-stop party
“Do what you love and you’ll never work a day in your life,” goes the saying. Not that we ever believed it, but I can say that in this case it is not true. We work hard in this business, and, to be honest, there are days when we would rather be doing something else. It is extremely rewarding, but it is still work.
Earth-shattering Revelation: You can’t please everyone, no matter how hard you try
Our goal was to make a wide variety of fresh, flavorful beer. And if we could do that, everyone would appreciate it and love us for it. Scroll through the online reviews and we would get nothing but praise for our hard work, save for perhaps the occasional thoughtful criticism that would only help us improve.
This fantasy evaporated immediately after we opened. While our product was well-received and we were confident in its quality, it didn’t stop the Haters from making themselves heard. I was shocked to see that, among several positive reviews, we had someone call our beer “undrinkable swill”. How could he think that? I worked hard on that, and, more importantly, I find it objectively delicious! Of course, it wasn’t the last negative review we’ve received, and we’ve learned that Shitty Reviews are a fact of life.
Our skin has thickened considerably since then. But we don’t ignore criticism, as sometimes it can be useful. For any negative review, we read it carefully, consider the context, determine if it has merit, and take action from there. And we never scroll through reviews before going to bed!
Our alcoholic beverage code is really screwed up
We knew the code going into the business, but we didn’t realize how much time we would spend having to explain these rules to understandably bewildered guests and industry counterparts. We have to tell the bar around the corner that, “No, we can’t bring you a keg on Sunday, even though we are allowed to fill the keg and you are allowed to sell it on Sunday.” We have to tell the customer that, “No, we can’t fill your growler because we’re too close to a school (seriously).” We have to explain to people that, “No, the CR-V outside with the TABC sticker on it is not a TABC officer – it is our vehicle that requires its own designation and license to be able to transport beer.”
Many people are actually surprised to find out that Texas, in spite of how proudly supportive of personal liberty it claims to be, has possibly the most over-regulated beer industry in the country.
Parasites abound, and don’t believe anything you read on the internet
We get calls and email solicitations constantly to participate in listicles, festivals, and other promotions taking advantage of unsuspecting consumers. That Top 10 Brunches list that you saw on Twitter is probably sponsored content. The Artisinal Barbecue festival with “hand-selected local craft beers” was selected by the hand of an opportunistic promoter – the highest bidder was probably Budweiser or the Budweiser distributor, and that local craft beer is probably one of its brands that it disguises as such. That highly rated place on Yelp? You get the idea.
Unfortunately, having seen these promotions from our perspective so many times, I’ve become a cynical bastard. Now, when someone tells me how excited they are to pay $100 to go to a Ramen festival, it takes every ounce of energy in me not to go full Debbie Downer on them (and I usually do).
Retail is brutal
Kathryn and I have always (not always, but for a long time) loved the idea of owning a brewery – to have complete control over making a product that we, and others, enjoy. And the tasting room is a key component – it’s a place where we share the product directly with the beer drinkers and get to watch them experience it. Oh the joy of seeing someone enjoy the beer – it really is awesome.
However, having a tap room means we’re partially in the retail business, and the retail business is hard. Making a tasty beer is easier than making people walk through the door. Sometimes business is great, sometimes it’s lousy, and it’s not nearly as predictable, as we’d like it to be, much less something we can easily control. And what about those people that come in? Will they have a good time? Will they have too good of a time?
At the beginning, we obsessed over every day’s sales, trying to decipher patterns that would tell us the fate of our brewery. Our traffic is up – Do we need to brew more beer? Hire more staff? Our traffic is down – Is this because of the weather? Does nobody like our beer? Now, we look at it on a longer-term basis. How was this month compared to the same month last year? Are we appropriately staffed on Wednesdays? How can we make sure we’re prepared for each day to be 50% higher and 50% lower than expected?
In terms of the service, we’re lucky to have an excellent tap room manager and staff that are tuned in to customers’ emotions and behavior. We also close early (10 PM on weekdays, 9 PM on Saturdays, 7 PM on Sundays), so customers getting intoxicated at our place is not as likely as it is at an actual bar.
I could go on and on here, but the bottom line is that the retail business is hard, and we are still learning how best to manage it.
The business plan: The planning is important, but the plan is useless
My background is in business planning, so we did not skimp on the planning. We must have spent over 500 hours working on our business plan. Research into the market, comparable markets, competitors, equipment options and costs, financing models, locations and lease rates. We had a SWOT analysis, a 5-forces analysis, a cash-flow model loaded with scenarios and investment options and tornado diagrams showing our ranges of uncertainty (as though we could appropriately confine our uncertainty). When we sought investment from friends and family, one of the potential investors shared our deck with his investment advisor, who said it looked more polished and detailed than what he routinely sees from companies seeking investments on the order of $50M (our ask was more modest than this by a couple orders of magnitude).
We started executing this plan, and by the time we were open, almost every assumption we had was wrong, sometimes even outside the range of uncertainty (how could that be!). For example, we assumed that Kathryn and I could do the production, deliveries, and tap room management without any additional help (not even tap room employees!) for the entire first year of operation. This was true only for the first week of operation, and that was only because we had our friends helping us in the tap room for that week.
It wasn’t all bad, though. We had a number of assumptions that turned out to be wrong in our favor, so that the net result was more of a wash. We also built in sufficient cash cushion to absorb the impact of unforeseen blows. And, we are still following the overall strategy set forth in the plan, which has held up to the current business environment (more on this later, maybe).
The planning was a very useful exercise. It helped us think through many problems we would face, helped us generate novel ideas, and it helped us present a credible case for investment to ourselves and our partners. And we still do a formal annual plan, and consider the process very important and therapeutic.
Social media is life
Of the 6,000+ breweries out there, I’m open to the possibility that there’s an uber-hipster brewery that runs without any social media, but, c’mon, we know they’re just doing that to be ironic.
As much as I’d love to believe our beer could sell on its own merits and word-of-mouth, I don’t think half of our beer drinkers would know who we are if it weren’t for social media. It is an incredibly powerful way to communicate directly with people about new beer releases, new places carrying our beer, upcoming events, or whatever goofy stuff we have going on in the back of the brewery.
Kathryn spends a lot of time on it, and luckily she enjoys it and is good at it. There are a lot of consultants and promotion companies that have approached us to manage our pages for us (perhaps they don’t think we’re as good at it as we think), but we like the authenticity of our social media voice, and we’re cheap.
Beer really is a friendly and super-awesome industry
From the outside looking in, I was always skeptical when I heard the feel-good stories from breweries about how collaborative and friendly the industry is. But we’ve been shown 100 times over how that truly is the case. From the early stages of planning, we reached out to other Texas brewers, most of whom we had never met, for advice. Without fail, every inquiry we made was met with genuine generosity. We got in-depth tours and conversations, specifications on equipment, and I even got the opportunity to intern for a couple weeks at a brewery that had nothing to gain by tolerating my ignorance and uselessness.
Now that we’re up and running, we can still count on others for help. When we’ve been short on a particular supply, nearby brewers have bailed us out. Our keg washer broke down and we hauled our kegs to a brewery down the street to wash them. In any other industry, I think, such calls for help, especially given the inconvenience imposed on the other party, would be met with polite refusal or maybe a reluctant agreement to help in a limited capacity, or with quid pro quo. But in this industry, generosity is the norm, almost regardless of the consequences. Helping our fellow brewers is akin to a religious obligation, and we also do our best to step up when we can.
And it’s not just breweries. When we opened in November of last year, we were inundated with support not only from other breweries, but also from bars, restaurants, and even distributors that welcomed us to the industry and many of whom have become true friends.
Overall, it’s been a freaking thrill, with no shortage of “character developing” experiences along the way. Here’s to another 1.2 years!