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Why is there not more micro breweries in Ireland?

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  • #62
    BeerNut
    Moderators, Recreation & Hobbies Moderators Posts: 11,891 Mod ✭✭✭✭BeerNut


    the long finger wrote: »
    Can micro breweries sell their produce directly to the public from the brewery or do they need a pub licience?
    They can sell direct, as long as the quantities are greater than 4.5 gallons per transaction.
    the long finger wrote: »
    Is their much in the way of legislation involved in setting up even on a small scale
    Yes. The excise requirement for a bond is maybe the biggest.
    the long finger wrote: »
    Are home breweries a posibility
    Revenue insists that you have a secure premises, and you'll also be subject to planning/zoning laws, so brewing commercially at home isn't really an option, usually.
    the long finger wrote: »
    are there to many obstacles to setting up a small operation?
    The biggest obstacles are financial. If you have an understanding bank manager, anything's possible, but they're a bit thin on the ground these days.

    My beer blog | The Twitter | My other beer blog



  • #63
    the long finger
    Closed Accounts Posts: 5 ✭the long finger


    Aaaaaaaaaahhhhhh I see sure no wonder there are few. The one thing that really puts people off ventures like that is legislation that makes you commit on anything but a medium size scale without allowing you to dip your toe in first..

    Whats the duty bond and how does it work.? for that matter whats the rate of duty on beer and cider.

    I assume your 4.5 gallons aren't allowed to be consumed on the premises? And giving it away.... say samples and promotions. Would they have to be 4.5 gals and do you have to cover duty if there is no transaction??? I'm not nit picking just trying to see how anal the system is...


  • #64
    BeerNut
    Moderators, Recreation & Hobbies Moderators Posts: 11,891 Mod ✭✭✭✭BeerNut


    the long finger wrote: »
    Whats the duty bond and how does it work.?
    I think the theory is that all the tax theoretically owing on your first year's brewing is placed as a bond by your bank with Revenue. The actual sum varies quite a bit, depending on your local Revenue officer and the side his toast landed the morning he reads your application.
    the long finger wrote: »
    for that matter whats the rate of duty on beer and cider.
    For the microproducers it's €7.86 per % ABV per hectolitre.
    the long finger wrote: »
    I assume your 4.5 gallons aren't allowed to be consumed on the premises?
    Not sure about that. But who's going to buy 40 pints at once to drink on-site?
    the long finger wrote: »
    And giving it away.... say samples and promotions. Would they have to be 4.5 gals and do you have to cover duty if there is no transaction?
    No duty, no limits. If it's free, you can give away as much as you want. And before you ask, you can't take the money for something else and provide the beer for free with it. At least not for very long, in all likelihood.

    My beer blog | The Twitter | My other beer blog



  • #65
    noby
    Registered Users, Registered Users 2 Posts: 2,114 ✭✭✭noby


    BeerNut wrote: »

    No duty, no limits.


    TBN is pretty spot on with most of his reply, except for this bit. If you produce beer, you pay duty on it, whether you give it away or charge for it.


  • #66
    BeerNut
    Moderators, Recreation & Hobbies Moderators Posts: 11,891 Mod ✭✭✭✭BeerNut


    noby wrote: »
    TBN is pretty spot on with most of his reply, except for this bit. If you produce beer, you pay duty on it, whether you give it away or charge for it.
    Sorry, yes, of course. It's only beer produced domestically for domestic use that is duty free.

    My beer blog | The Twitter | My other beer blog



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  • #67
    the long finger
    Closed Accounts Posts: 5 ✭the long finger


    Some other questions so...

    Is there any lobbying going on to have the regs changed to make it more managable as a craft industry e.g. direct small scale sales to the public from the brewery or even from craft fairs (god forbid....).

    Where does cider and wine sit in the micro brew world or are they all treated the same??

    Apart from the outlay/RandD how much does beer cost to make from scratch, say 1000L and how long does it take to get to market??

    I'm no brewer, if thats not evident already, nor am i interested in being one(although i do have a bucket of home brew on the go in the front room, my first) but I have been around the craft industry most of my life and have never looked at home brew or micro breweries as "Craft" producers. They obviously are and it would be great to see them trade alongside other food crafts such as cheese etc... I'm just interested to see what the obsticales are to setting up on small producer scale..


  • #68
    the long finger
    Closed Accounts Posts: 5 ✭the long finger


    noby wrote: »
    TBN is pretty spot on with most of his reply, except for this bit. If you produce beer, you pay duty on it, whether you give it away or charge for it.


    So does that mean the duty bond is based on your first years expected produce rather than sales?

    How do returns, dated stock or anything else thats not consumed, sold /given away...what goes down the drain... get factored into duty?


  • #69
    BeerNut
    Moderators, Recreation & Hobbies Moderators Posts: 11,891 Mod ✭✭✭✭BeerNut


    I'll probably get contradicted again by noby and his unnecessarily correct answers but...
    the long finger wrote: »
    Is there any lobbying going on to have the regs changed to make it more managable as a craft industry e.g. direct small scale sales to the public from the brewery or even from craft fairs (god forbid....).
    There's certainly a group whose job that is (though it won't officially exist until this coming Thursday). Precisely how it's going to go about this remains to be seen. The exclusivity of pub licences is very closely guarded by people well-connected to the decision-makers in this country.
    the long finger wrote: »
    Where does cider and wine sit in the micro brew world or are they all treated the same?
    From what I can see, they don't enjoy the 50% duty cut that beer has. Cider carries a flat rate of €65.86 per hectolitre up to 6% ABV; wine €262.24 up to 15% ABV.
    the long finger wrote: »
    Apart from the outlay/RandD how much does beer cost to make from scratch, say 1000L and how long does it take to get to market?
    I'll leave that one to noby :), but I'd say costs vary wildly, depending on how you make it, how big your kit is, your dispense method, etc.
    the long finger wrote: »
    it would be great to see them trade alongside other food crafts such as cheese etc...
    It really would be. But licensing strictures, and the dominance of the big brands makes it very difficult indeed. Imagine trying to be a craft cheesemaker when 80% of the market is divided exclusively between Philadelphia and Kimeaden, and you can only sell via a supermarket. You'd want to be really into your cheese.
    the long finger wrote: »
    So does that mean the duty bond is based on your first years expected produce rather than sales?
    Yep. You might get off lightly with a few grand; you might get told to provide a bond which it would take you five years to owe the tax on. I've heard of both happening.

    My beer blog | The Twitter | My other beer blog



  • #70
    the long finger
    Closed Accounts Posts: 5 ✭the long finger


    the odds really are stacked against the little guy...
    Checked out that link thanks.
    I might get involved in that it looks like it could be interesting. The regs seem to me to be the primary obsticle as they stifle enterprise and competition. Dublin and Ireland as a whole should in theory be logical places for micro breweries due to that "drink culture" thing we seem to be known for but..........

    Is there any sniff of political will to change things... I'm sure it would be a popular choice amung the electorate if it was given the profile.... Its up the greens street.


  • #71
    BeerNut
    Moderators, Recreation & Hobbies Moderators Posts: 11,891 Mod ✭✭✭✭BeerNut


    the long finger wrote: »
    The regs seem to me to be the primary obsticle as they stifle enterprise and competition.
    I think the brand loyalty of customers (and retailers) to heavily promoted macro products is possibly greater, but the two are related.
    the long finger wrote: »
    Dublin and Ireland as a whole should in theory be logical places for micro breweries due to that "drink culture" thing we seem to be known for
    Counter-intuitively I don't thik that's the case. The three biggest per-capita beer consuming countries are Germany, Ireland and the Czech Republic. All of them have very conservative markets and an ill-deserved reputation for good beer.
    the long finger wrote: »
    Is there any sniff of political will to change things
    Not really, at least not in Ireland. I've heard vaguely positive rumblings from the European Parliament, but I can't see that being enough.
    the long finger wrote: »
    Its up the greens street.
    Really? It shouldn't be. Factory-made beer is much more eco-friendly than microbrewed.

    My beer blog | The Twitter | My other beer blog



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  • #72
    enda1
    Registered Users, Registered Users 2 Posts: 5,166 ✭✭✭enda1


    Interesting reading this about the difficulties of entering the market.
    Perhaps it is deserving of another thread, but what do people think really needs to be pushed for by the craft brewers in Ireland in respect to legal/fiscal changes to be made to encourage more competition and start-up producers?

    The duty bond as mentioned already for me is a non-runner. Is it not really just similar to a VAT bond anyway? It seems to be a necessary evil to stop micro-breweries springing up and selling beer really cheap, liquidating their business and declaring bankruptcy. Kinda smart by the tax-man.

    Perhaps the focus should be more in the direction of Enterprise Ireland to get them to set up a fund for breweries. You guys in IrishCraftBrewers could also help in the sense of compiling supplier information, guidelines on the Health & Safety side, costing etc. simple economic stuff that the "entrepreneur" often sidelines...

    Also FÁS could be targeted to get some courses in the pipeline, never mind some more prestigious places like DIT's excellent culinary school which could offer a diploma course or something in Brewing and Brewery Economics.


  • #73
    BeerNut
    Moderators, Recreation & Hobbies Moderators Posts: 11,891 Mod ✭✭✭✭BeerNut


    enda1 wrote: »
    what do people think really needs to be pushed for by the craft brewers in Ireland in respect to legal/fiscal changes to be made to encourage more competition and start-up producers?
    The duty cut was lobbied for by the brewers as an organisation ("The Irish Craft Brewers Network"). When it succeeded it was followed up with a short-lived campaign whose details I've forgotten -- it may have been to exempt breweries from needing a pub licence to serve samples. Anyway, the organisation fell apart not long after. It would be great if it re-assembled, but that's someone else's business, not mine.
    enda1 wrote: »
    Perhaps the focus should be more in the direction of Enterprise Ireland to get them to set up a fund for breweries.
    Why would they do that?
    enda1 wrote: »
    You guys in IrishCraftBrewers could also help in the sense of compiling supplier information, guidelines on the Health & Safety side, costing etc. simple economic stuff that the "entrepreneur" often sidelines...
    We're not business consultants and it would be wrong to try and encourage people to enter the market if they haven't already done their homework and designed their business model themselves. We will happily support anyone who has taken the plunge or who comes to us for help, but we're not going to tout for people to get started if they don't already intend to.

    And compiling amateur health and safety literature for an industry that uses corrosive chemicals, boiling liquids and electricity? Can you imagine the legal implications of handing that sort of thing out?
    enda1 wrote: »
    Also FÁS could be targeted to get some courses in the pipeline, never mind some more prestigious places like DIT's excellent culinary school which could offer a diploma course or something in Brewing and Brewery Economics.
    Given the employment prospects, that would be a tough one to justify.

    My beer blog | The Twitter | My other beer blog



  • #74
    enda1
    Registered Users, Registered Users 2 Posts: 5,166 ✭✭✭enda1


    BeerNut wrote: »
    Why would they do that?

    The thinking is that there could build specialised knowledge in the industry and be able judge prospects side-by-side rather than random submissions by punters falling on deaf ears. If examples can be shown (Carlow, Porterhouse etc.) or success, there's always possibility for more.
    BeerNut wrote: »
    We're not business consultants and it would be wrong to try and encourage people to enter the market if they haven't already done their homework and designed their business model themselves. We will happily support anyone who has taken the plunge or who comes to us for help, but we're not going to tout for people to get started if they don't already intend to.

    Well that's what I mean. If/When you get more established, this support could make all the difference, hell you may even turn into business consultants, or spring that arm if the time comes.
    BeerNut wrote: »
    And compiling amateur health and safety literature for an industry that uses corrosive chemicals, boiling liquids and electricity? Can you imagine the legal implications of handing that sort of thing out?

    Perhaps you're right there! Though some hints in the right direction wouldn't go amiss. Some directions to the literature and a few qualified H&S auditors wouldn't go amiss.
    BeerNut wrote: »
    Given the employment prospects, that would be a tough one to justify.

    Its a bit chicken and the egg really. Someone needs to take the plunge, but if its possible to get a small course going in DIT, like they do for breads and pastries for example, it could show to EI that there is a growing "talent" and prospect for a viable home-grown industry...


    I'm just brainstorming really, so don't take any of this as advice on what you should do, more like ideas.


  • #75
    BeerNut
    Moderators, Recreation & Hobbies Moderators Posts: 11,891 Mod ✭✭✭✭BeerNut


    enda1 wrote: »
    The thinking is that there could build specialised knowledge in the industry and be able judge prospects side-by-side rather than random submissions by punters falling on deaf ears. If examples can be shown (Carlow, Porterhouse etc.) or success, there's always possibility for more.
    Thing is, the same can be said for lots of industries -- ones that have a better chance of success than brewing. Looking at EI's definition of what constitutes a High Potential Start-Up, they say "Likely to realise annual sales of €1m and employ 10 or more within three years of start-up". AFAIK, not even Carlow employs ten people.
    enda1 wrote: »
    Well that's what I mean. If/When you get more established, this support could make all the difference
    Sure, my point is there's a massive difference between helping someone's business along and (what I think you were suggesting) encouraging someone to start a business. On the former I think it's much much more important to try and generate customers for the business, rather than interfere with its internal workings.

    enda1 wrote: »
    I'm just brainstorming really, so don't take any of this as advice on what you should do, more like ideas.
    Oh sure, and likewise don't think that I'm just taking potshots for the sake of being contrary :)

    The bottom line, as I see it, is that the movement has to start with the drinkers and the beer money in their wallets. Through legal reform and state funding you can encourage the start of as many businesses as you like, but unless they have customers they will fail regardless of what supports they have. There are already organisations which help entrepreneurs start and run breweries -- anyone serious about business will find them. However there is no other organisation to help brewers find customers, and that's what I want to concentrate on.

    My beer blog | The Twitter | My other beer blog



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