The old brewery debate

[JFB]

I watched the brewing a nation on Netflix whilst having a few the other night and if that documentary doesn't make you want to start a micro brewery.... then woke up in the morning and thought I best just crack on with what I know.
But hey since when has safe ever been fun??

 

[Druncan]

Well we are registered and brewing. Sold two kegs through our Licensed Restaurant. Our profit margin makes it worth while:thumb:

It is the only way to sell and make a good profit. We are an sadly Green business and it is working. Happy to share with anyone,,,:grin:

 

[Druncan]

Update from the Inner Hebrides. We were registered 7th June HMRC now on Gyle 16 (23l gyles) We had initial problems with the lack of comms with HMRC. All resolved and now fine. EHO fine if you engage early. All our documented procedures and day brew sheets were forwarded and submitted for approval. Approved and adopted all amendments. It is a viable business extension for any licenced premises. I sell out our beers every gyle. Although I do not think I am brewing the best beer I could,,,,, Still learning, and making mistakes. But loving what we are doing. Bun Dubh Brewery, Tiree.

 

[Ale]

Lots of good advice on here but one thing I dont think has been given adequate attention is your market.

Do you know who you are going to sell to? Are the pubs in your local area tied to breweries or free to buy local brews? How far are you able to travel for deliveries and how many potential customers are there is this area? Who are your competitors and will they respond to your small operation? Are there many beer festivals you could exploit to increase sales? Are there seasonal changes to you market? This one in particular may be an issue. You may be able to cope with demand in winter but if there is a tourist trade pubs may need a more stable supply for than you can produce. Can you bottle and sell that way rather than barrels?

 

[Robin54]

Lots of good advice on here but one thing I dont think has been given adequate attention is your market.

Do you know who you are going to sell to? Are the pubs in your local area tied to breweries or free to buy local brews? How far are you able to travel for deliveries and how many potential customers are there is this area? Who are your competitors and will they respond to your small operation? Are there many beer festivals you could exploit to increase sales? Are there seasonal changes to you market? This one in particular may be an issue. You may be able to cope with demand in winter but if there is a tourist trade pubs may need a more stable supply for than you can produce. Can you bottle and sell that way rather than barrels?

I think the Inner hebrides is pretty small, population wise.:whistle:

 

[Ale]

I think the Inner hebrides is pretty small, population wise.:whistle:

The OP said (and Ive copied) "It's on a farm in brecon". I always thought Brecon was in Wales :whistle:

 

[Druncan]

Hi All, ALE- Sorry yes, we are on the Isle of Tiree in the Inner Hebrides. I butted in on the OP.

Actually, 70m from mainland Scotland. Captive seasonal tourist trade.

Unlike the mainland I am not swimming in a shrinking pond with more and more hungry fish appearing :mrgreen:

I am a partner in a licensed restaurant. Delivery costs are a significant on cost to us. This is the only way we would be competative and give us an edge.

Now got 14 25l Cornies. Working flat out through the winter to build up stock for the season. Still extract brewing but had planning approval from my partner to move to BIAB next as the brewery has been so successful (so far) Thanks to everyone on the forum for the invaluable source of information you have all created. Best wishes for the new year. Druncan, Bun Dubh Brewery.

 

[simon12]

Thanks Simon. Good advice. Did you have to put down a 20k deposit with hmrc?

Just came across this again if your still looking into it, update HMRC decided we did need to put down a large deposit or get a bank to agree to guarantee it or pay all duty as soon as its due (ie as soon as the beer is racked). So we sent them 2 returns in 1 day (we forgot to add a pin to the 1st one) and made 2 payments and they contacted us to say they can't deal with multiple returns a week and to just do it all monthly anyway without any deposit or guarantor.

 

[Jakeyboi]

Just came across this again if your still looking into it, update HMRC decided we did need to put down a large deposit or get a bank to agree to guarantee it or pay all duty as soon as its due (ie as soon as the beer is racked). So we sent them 2 returns in 1 day (we forgot to add a pin to the 1st one) and made 2 payments and they contacted us to say they can't deal with multiple returns a week and to just do it all monthly anyway without any deposit or guarantor.

Typical hmrc haven't a clue what they're doing. Rant over! I was talking to the owner of a micro brewery/pub near me and he said he doesn't pay tax on the beer until it is sold. It might be different as he is selling it in pints to the public.

 

[Druncan]

Typical hmrc haven't a clue what they're doing. Rant over! I was talking to the owner of a micro brewery/pub near me and he said he doesn't pay tax on the beer until it is sold. It might be different as he is selling it in pints to the public.

IMHO, HMRC know exactly what they are doing. The problem is interpreting an archaic system.
Duty is due on our beer (>1.2% ABV) released from duty suspension for sale or personal consumption. Can't even give it away without paying duty! :nono:
Only experimentation and waste/spoilt beer is excluded.

We do a monthly return (EX 46) and HMRC take the duty we declare.
We also keep a beer production account. Beer can be held in duty suspension in our designated storage area or can be constructively released if we need to.
It's not that bad once you get used to it.

 

[BeerCat]

IMHO, HMRC know exactly what they are doing. The problem is interpreting an archaic system.
Duty is due on our beer (>1.2% ABV) released from duty suspension for sale or personal consumption. Can't even give it away without paying duty! :nono:
Only experimentation and waste/spoilt beer is excluded.

We do a monthly return (EX 46) and HMRC take the duty we declare.
We also keep a beer production account. Beer can be held in duty suspension in our designated storage area or can be constructively released if we need to.
It's not that bad once you get used to it.

I know someone just opened a brewery in Leicester. Its called Framework. He said the HMRC paperwork was a headache. Am i right in thinking you have to inform them in advance of what your brewing?

 

[simon12]

I know someone just opened a brewery in Leicester. Its called Framework. He said the HMRC paperwork was a headache. Am i right in thinking you have to inform them in advance of what your brewing?

We never had to inform them in advance except we told them most of our brews would be 1 off and we may not brew consistently. Unlike Druncan we could not hold beer in duty suspension hence it was due when we racked it.

 

[Druncan]

I know someone just opened a brewery in Leicester. Its called Framework. He said the HMRC paperwork was a headache. Am i right in thinking you have to inform them in advance of what your brewing?

Hi m8. We just hold in suspension as Simon says. Dunno why it developed into this system and It was a real struggle at first. HMRC do not really actively help. It's up to you to 'discover' the documentation and controls. The guarantee and warehousing bits were bad until they told us it would not apply. But maybe 'cos we had a PAYE HMRC account and EU HMRC Importers Duty ID for 9 years and were known to them? We also had help from great friends with local breweries thankfully. Now it ticks over nicely. Ciders now under way. Going to try the new HMRC electronic returns system next to speed things up:whistle:

 

[Druncan]

How the beery vision of brewing a small fortune can fall flat | Business | The Guardian


https://www.theguardian.com/busines...f-brewing-a-small-fortune-can-fall-flat#img-1

:-(