Executive SummaryThe craft beer craze is sweeping through Michigan making it the 4th largest in the nation in the number of breweries, microbreweries and brew pubs. We are looking to put Reed City on the Craft Beer Map with Red Tail Brewing Company. Reed City is at the crossroads of the US-131 and US-10 interchange; which is the in between spot for Grand Rapids and Traverse City. Besides the Metro Detroit area, Grand Rapids and Traverse City have the most breweries on the map. Company DescriptionRed Tail Brewing Company will stay a local, family owned business for a couple years with hopes of expanding to more locations to serve more areas of Michigan. The Brewmaster, Kevin Murphy, has been homebrewing since 2006.
He has won several awards for his Beer and Meads in different contests around the state of Michigan. Seeing others enjoy something he brewed brought a sense of pride and he wants to expand that to a larger level. Kevin’s present job takes him around the country and he has been able to visit microbreweries all throughout the U.
S. and talk to many of the Owners/Brewmaster’s and find out what works and what doesn’t. Deanna Murphy will be heading up the marketing and business management portion of the business. Deanna’s background has been working in the material management/purchasing and planning for automotive suppliers; worked for a bar and grill and has studied business management at Schoolcraft College.
Market Analysis:Our closest craft beer competitors are in Big Rapids and Cadillac, but in all actuality we are not competitors, but we are working together and feeding off of each other – it is just breweries rallying trying to get more people involved in the movement! Just like in Grand Rapids, Detroit or Traverse City – the more the merrier! While we have local competition with the local bars down the street, the people in and around the Reed City Area are looking for an alternative to the local bars, that serve the commercialized beer and wines, along with the typical burger and deep fried foods. Beer drinkers are changing their tastes to a more robust style. They want to have more of a selection, they are longing for a better beer. Beer that is created and produced in smaller batches so the quality and process is more controlled. Red Tail Brewing Company will be serving Craft Beer, Wines, and Sodas, which will all be produced in house.
We will also be providing a menu with lighter options; sandwiches, soups, salads, appetizers and a special each day. Marketing/Sales:Our Marketing Strategy will be simple. Build it, they will come! Make good beer, they will return! We have a website designed, just waiting to launch. We have had our Facebook page started since we purchased the building back in 2013; we are also in the Michigan Beer Guide as a brewery in the works – it has been an excellent way to get people on the Red Tail Brewing trail; people are liking, asking when we will be open and selling beer. “We are close”, we tell them.
We will be open soon. We have received at least 1 call per week asking if we are open yet, or where exactly we are located because they are coming through the area and want to stop in. We need to get open!!Organization/ Management:Marketing/ Business Management – Deanna MurphyBrewmaster – Kevin MurphyAssistant Brewer – Full time (To be filled). We plan to post this vacancy on our Facebook page as well as reviewing the homebrew site for possible candidates.Taproom Associates – 2 full time & 3-part time (To be filled). We plan to post this vacancy on our Facebook page as well as the job portal at Michigan Works!Kitchen – 2 full time & 2 part time (To be filled). We plan to post this vacancy on our Facebook page as well as the job portal at Michigan Works!Salesperson – Full time (To be filled). This position will not be filled immediately but is in the planning as sales increase, to support this position.
We plan to post this vacancy on our Facebook page as well as the job portal at Michigan Works!Financial:Red Tail Brewing Company is seeking financing for our business, we are looking to refinance our present mortgage ($70,000), Loan with City of Reed City ($10,000) and $30,000 for additional renovations as a commercial mortgage. The projected terms of this loan are 7.5% for 30 years, using an SBA guaranteed loan. We are also looking for a Commercial loan in the amount of $75,100 to cover the additional equipment ($37,500) and operating capital ($37,600). The projected terms for this loan are 7.5% at 7 years. We want to successfully launch Osceola County’s first Microbrewery.
As you can see we have personally invested $60,000 into the building, renovations, equipment and furniture and fixtures. The building after the renovations and other fixed assets, will be sufficient collateral for financing the business.At the present, we have a building that is renovated at about 90% complete. We have been able to do the majority of the work ourselves, investing our own equity, and devoting weekends and vacation weeks towards this project.Use of Funds for Commercial Mortgage: Additional Ductwork for the Heating and CoolingKitchen FlooringWalk in CoolerBarBuilding Permits Use of Funds for Commercial Loan: KitchenLighting in TaproomFurniture (Tables & Chairs)Fermentation VesselsStart-up CapitalSnapshot of the Financial Projections for Red Tail Brewing Company: We have projected a 10% growth each year. After researching other like microbreweries we believe this is at a conservative rate, as we know they have had about a 20-25% growth in the first couple of years. This has determined their needs to increase their brewing systems as well.
We are researching and planning for the additional equipment and the current location will allow for this next level of growth.Total Revenue Net Income2016 – $598,478 $80,9172017 – $658,326 $110,3122018 – $724,158 $142,352