How hard is it to open a brewery in Georgia?
When breweries could sell only through their distributor, brewers had to sell a lot of beer, because their margins were thin. Plus, the upfront investment costs were huge—$1.5 to $2 million. But with last year’s law change, known as SB85, brewers can sell up to 3,000 barrels a year directly from their facility.
Before SB85, “if you opened a brewery in North Carolina that had taproom sales, you’d have to get to 1,500 barrels before you were in the black. But in Georgia, you had to get to 5,000 barrels because you had to rely on distribution,” says Taylor Harper, an Atlanta attorney who helps breweries navigate the byzantine route from “I want to open a brewery” to “Our grand opening is next Friday.”
On-premise sales means upstart brewers can open with smaller set-ups—such as a three-barrel system—and smaller start-up costs. “I’m seeing budgets of $300,000 to $400,000,” Harper says.
But there’s a lot more to consider:
Some Georgia cities—Harper mentions Toccoa, Powder Springs, and Smyrna—are recruiting breweries as they see the effect on foot traffic. Harper cautions against signing any leases, since zoning ordinances may not permit a brewing business.
If a brewery wants to sell its beers off-premise, the owner needs to find a wholesaler. So much depends on making the right choice, since getting out of that relationship is onerous and expensive—and not guaranteed. With the new law, Harper will sometimes advise upstarts to sell only directly from their taproom for the first year, so they build up goodwill and buzz, which will make their negotiations with a wholesaler that much easier.
Licensing from local, state, and federal authorities is necessary before you can brew your first batch. Even trademarking can be a hassle. “There are 6,000-plus breweries nationwide, and they’re often trademarking not only the brewery name but the beer name. I’ve seen folks get very tied to a particular name and they find out they can’t use it.”