Amarillo Craft Brewing Company

1. Amarillo Craft Beer
Company
Business Plan

2. Mission Statement
• Amarillo Craft Beer Company’s (ACBC) mission is to be
the leader in sales of craft beer in the state of Texas.
• ACBC intends to attract first-time craft beer consumers,
experienced craft beer consumers, as well as the most
discerning connoisseurs by producing four different
styles of high-quality beer.
• ACBC intends to dominate the local market by
developing strong customer loyalty amongst locals and
by becoming a part of Texas culture that locals and
tourists alike seek to experience.

3. Brewmaster/President
• Our President and Brewmaster, Matt Helm, will make
every batch by hand and will play an integral role in all
aspects of the business.
– B.S. in Business Administration & Economics
– M.S. in Finance & Economics
– Six years of brewing experience
– Six years of entrepreneurial experience
– Over four years of experience with the IRS and
Department of Labor

4. Market Summary
• Our target market is comprised of the 25 major
metropolitan areas (MMA’s) in the state of Texas:

5. Texas Is The Perfect Market
• Texas ranked 44th out of the 50 states in terms of
breweries per capita. This indicates that Texas is under
serviced in terms of craft breweries and makes it a great
market to do business in.
• The census estimates that Texas will have the fourth
fastest population growth rate in the United States
through 2030 and, by that year, will have more than 33
million inhabitants.
• The Beer Institute (BI) estimated that 2012 beer
consumption in Texas was 34.4 gallons per person (21+
years old), or 9th overall in the U.S. Based on these
figures.

6. Business Strategy
• Our strategy is to brew quality beer, focus on the Texas
market building brand loyalty, and to dedicate as much
of our budget as possible to marketing. ACBC wants to
sell itself as the only microbrewery in the Texas
Panhandle thereby encouraging residents to buy local
and we also want to become part of the Texan identity.
We want Texans and visitors alike to know that we are
the only microbrewery in the panhandle and encourage
them to drink local beer while they are in the state. We
also want to provide guided tours of the brewery.
• We will work closely with our distributors to ensure that
their sales teams are properly selling our product and we
will also work with tourism agencies to set up tours of
the brewery. We will have a presence at as many local
events as possible to project an image of being part of
the community and develop brand awareness.

7. Competition
• There are a large number of firms and the largest firms
distribute their product nationally thereby competing
with local microbreweries and brewpubs. Spoetzl
Brewing Company is the major indigenous competitor in
the Texas market and Real Ale Brewing Co, Rahr & Sons
and Circle Brewing Co. are minor competitors. Our main
competition will come from the five largest craft
breweries who distribute nation-wide as well as non-
craft breweries and imitation craft breweries.
• The industry is growing at an attractive rate, meaning
that competition for market share is only moderate. The
largest firms are likely to compete for higher market
share while the large number of smaller firms are likely
able to improve profitability just by keeping up with the
industry growth rate.

8. Goals and Objectives
• Our five-year goal is simply to obtain contracts to sell
our entire yearly production which will gradually increase
from year to year:
– Year 1 – 4,500 barrels
– Year 2 – 6,000 barrels
– Year 3 – 7,500 barrels
– Year 4 – 9,000 barrels
– Year 5 – 10,500 barrels

9. Product Pricing
• We expect to sell bottles at a price of $326.57 per barrel
– This translates to a price of $5.92 per 6-pack
– Distributors will typically mark up the product by
30% when selling to retailers
– Retailers will typically mark up the product by
approximately 25% for a final shelf price of $9.62
per six pack
• We expect to sell kegs at a price of $375 per barrel
– This translates to a price per beer of $1.85 at the
retail level

10. Finances
• We need $1,320,200 to start a profitable microbrewery.
• We expect to generate sales of at least $1,430,783.71 in
the very first year, increasing to $3,338,495.32 by year
five.
• We expect to be able to repay an investor as follows:
– Year 1 - $175,000
– Year 2 - $225,000
– Year 3 - $250,000
– Year 4 - $375,000
– Year 5 - $400,000

11. Risks and Rewards
• Given the industry growth rate, we view the risks as
minor and we are confident that the figures presented
are very conservative estimates.
• Using the initial five payments to an investor and the
present value of a perpetual dividend of $150,000 yields
a rate of return of 19.4%.
• The profitability index for the project is 1.43.
• The net present value for the project is $563,879.50
• All of these figures are computed using a discount rate
of 10%, which is the approximate average annual return
on the S & P 500

12. Summary
• The Texas market is ripe for entry by a new
microbrewery.
• The craft beer industry is booming and this business
plan represents a once-in-a-lifetime opportunity for an
investor to own their very own American microbrewery.
ACBC will thrive in this thriving industry and we will be
the leaders in craft beer production in the region.
• Not only does this business plan represent the
opportunity to be involved in one of the most exciting
industries in the country, it represents an opportunity to
earn an extremely attractive return on the initial
investment.
• Investing in ACBC is truly a “no-brainer.” If interested,
please contact Matt today and let’s make this dream a
reality.