Re: I want to start a nano-brewery...
Posted: Mon May 22, 2017 10:18 am
I'll shoot some holes in your plan. However in my heart of hearts I hope that you succeed. I want to note that I studied small business and entrepreneurship in university. I have also started a few little businesses. So I've studied a lot of different theoretical and real businesses so maybe I'll be able to add some value. You have a very good plan, compared to what most people come up with, in that executive summary. I'm assuming you worked out a full business plan that has pro forma financial statements etc.. The business plan is useful for getting financing and for Learning how to think about the business. In most cases things don't go according to plan so be prepared to be very flexible.
You seem to have a viable strategy. I don't know much about the industry but it sounds like your product is differentiated (locally crafted, low gluten, Quality ingredients etc.) and you're focusing on a niche (Young drinking age people, regional, craft beer enthusiasts, and/or those with gluten intolerance). Differentiation and niche combined are usually the best generic strategy for a small business IMHO. Essentially you're positioned so that the big guys won't spend many resources going after your market and you're focused enough that your minimal resources can go very far. So if I were a potential investor I'd be wondering how are you going to get a foothold in this market. What is your entry wedge? You're not franchising and your product isn't new. I mean it isn't new in the sense that you're not the very first person to employ this technology ever, therefore someone could replicate your product from a technological standpoint. You'll be competing in parallel to the other firms in your industry by creating a similar product with some small points of differentiation. That means you have to start thinking more about exactly where the market is vulnerable so that you can wedge in and get a foot hold. It sounds to me like you may have identified the wedge already you're just not aware of how important it might be. You mentioned that a well regarded local brewmaster thought your brew was decent. Often times in these types of businesses the momentum provided by the first customers is the critical thing that launches the business. If I were you I would develop insanely good marketing around that concept. You'll need to isolate who the movers and shakers are in your market segment and figure out ways to get them to market/advertise/recommend your product. If you do that right it's cheap and extremely effective marketing.
You seem to have a viable strategy. I don't know much about the industry but it sounds like your product is differentiated (locally crafted, low gluten, Quality ingredients etc.) and you're focusing on a niche (Young drinking age people, regional, craft beer enthusiasts, and/or those with gluten intolerance). Differentiation and niche combined are usually the best generic strategy for a small business IMHO. Essentially you're positioned so that the big guys won't spend many resources going after your market and you're focused enough that your minimal resources can go very far. So if I were a potential investor I'd be wondering how are you going to get a foothold in this market. What is your entry wedge? You're not franchising and your product isn't new. I mean it isn't new in the sense that you're not the very first person to employ this technology ever, therefore someone could replicate your product from a technological standpoint. You'll be competing in parallel to the other firms in your industry by creating a similar product with some small points of differentiation. That means you have to start thinking more about exactly where the market is vulnerable so that you can wedge in and get a foot hold. It sounds to me like you may have identified the wedge already you're just not aware of how important it might be. You mentioned that a well regarded local brewmaster thought your brew was decent. Often times in these types of businesses the momentum provided by the first customers is the critical thing that launches the business. If I were you I would develop insanely good marketing around that concept. You'll need to isolate who the movers and shakers are in your market segment and figure out ways to get them to market/advertise/recommend your product. If you do that right it's cheap and extremely effective marketing.