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is a brewery welcome?

 
sabine
(@sabine)
Active Member

we are hoping to open a small brewery on the islands in a few years. looking for information about the local culture and laws. i understand its a small community and some might say theirs not enough room for more businesses. but i'm hoping to chat with people and get a feel for the community. 

our family is looking to find a new home where we can grow and be part of an amazing community of people. a place to raise kids near nature and live simple lives. 

thanks

also if your feeling negative and just want to put this down. please just scroll by. i think with the current lock down were all a bit worn out. 

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Topic starter Posted : September 9, 2020 12:31 pm
rewired
(@rewired)
Advanced Member

Welcome to the forum, @sabine !

Are you thinking of a brew pub or commercial sized brewery? Do you have experience in the brewing industry?

On STX, there is one brew pub (BrewSTX) and one commercial brewery (Leatherback Brewing). There are also three commercial distilleries (Cruzan, Captain Morgan's and Sion Farm). There is also a fourth distillery working towards opening.

I'm not familiar with how many are on STT.

Others may correct me, but all of them seem to be doing pretty well.

I'm not familiar with the tax laws and incentives for commercial distilleries, but they seem to get favorable tax treatment, in part because sales of rum from the VI in the US result in a return of the federal alcohol taxes to the local government ( https://viconsortium.com/vi-business/virgin-islands-u-s-treasury-remits-273-million-to-usvi-in-rum-cover-over-payments). I don't know if the taxes on other alcohol imported from the VI contribute to this.

If you haven't done a Pre-Move Visit (PMV), you need to come down and talk to people familiar with the process of opening the type of business you are considering. You should also plan on looking at the business environment (and checking out the competition) while you're here.

If I remember correctly, there are significant tax breaks if you employ at least 10 people who have lived in the VI for at least a year. Check out the web site of the Economic Development Authority's web site for more info ( https://www.usvieda.org/ ).

Individual health insurance isn't a thing here - you can't buy from the individual market. Insurance has to be provided by your company or employer.

Do your due diligence and have as much of your funding/backing lined up as you can if you do decide to move forward with opening a business. Also note that insurance is dramatically higher here than in the states due to hurricanes.

Best of luck in your decision!

 

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Posted : September 10, 2020 11:45 pm
vicanuck
(@vicanuck)
Expert

It would be great to have another business on island. It just comes down to the economics. You've got a market of maybe 50,000 beer drinkers in the entire territory. Most are local blue collar types with low or no income beyond public assistance. With relentless marketing, you might get 1% market share after a few years if you're lucky. Keep in mind that your production costs and overhead will be extremely high.

When Leatherback started out they were all the rage with the continentals for a while due to their great marketing and constant presence at and sponsorship of local events. But, from what I've seen at stores and among friends, their market share has diminished considerably. It is, after all, just another beer.

As you're likely already aware, beer is a very competitive commodity. Will you be able to compete with bottles of Heineken at $1.75 or Bud at $1.50? Is there shelf space for another "local" brand with line extensions and can you afford to buy shelf space away from established national brands? Popular bargain brands like Steel and Old Milwaukee sell for $1 a can.

Even restopub BrewSTX can't sell enough beer to keep brewing even half the year and they're the most popular restaurant on the boardwalk with the youngsters. A friend had a craft beer distributorship on STX but had to close it because bars and restaurants didn't want to bother trying to sell $5 craft beer when they can sell Bud for two bucks.

You'd be wise to do a lot of financial analysis before committing and have very deep pockets!

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Posted : September 11, 2020 9:10 am
daveb722
(@daveb722)
Trusted Member

@vicanuck while agree with some of this, i also disagree.  but that's how I roll.. LOL

I think Leatherback is still doing well, they have expanded to STT, their 12 packs are $18.00 (if I remember correctly) at cost u less, and any mini mart is selling bud for about 15-16 dollars a 12 pack.  Maybe I'm biased as I have a kegerator and always have their brew on tap.  It works out to about 1.60 a beer on that, a bit more expensive then the states of course.  But a nice cold draft a few feet away is always a blessing. Yes you can get the 2 dollar beer anywhere, but I rather have a leatherback brew if possible.  I think covid has hurt them short term but tourists rather have something different and that's where they will excel.  But yes cheaper beer is going to outsell them by a large margin and another brewery probably won't do well due to the size of the population.  In regards to Brew, i'm not a big fan of their draft beer, there are a few I like but some just aren't for me.  I've always wanted to open a gastro pub like back home with over a 100 beers, but really don't see that as a viable option on any of the islands as vicanuck said it's more for the younger generation and you don't have the same demographics here. 

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Posted : September 11, 2020 10:48 am
vicanuck
(@vicanuck)
Expert

@daveb722 you have a kegorator??? That's one of goals in life!

But, yes, this is an extremely small, isolated and fickle market.

Personally, I dislike most Leatherback beer but any cold lager on a hot day is appreciated.

A brewery is a big investment and I just can't see the economy here supporting another one. 

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Posted : September 11, 2020 11:24 am
NugBlazer liked
jaldeborgh
(@jaldeborgh)
Advanced Member

As someone who has a good deal of experience in both starting businesses and raising venture capital, no one starts a new business based on the facts, they do it because they believe in themselves (or their team) and their differentiated business plan.  Starting a business of both emotionally taxing as well as emotionally rewarding and it can swing from one extreme to the other depending on the circumstances of any given day, it's hard.  I'd welcome a new business on STX as well as having another entrepreneurial spirited member of the Community.

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Posted : September 11, 2020 11:25 am
daveb722
(@daveb722)
Trusted Member

@vicanuck yeah bought knowing I was moving down, a cold beer on a hot day is always satisfying 🙂 I like dark beers (stouts and porters) and they do a decent job with those and the wife gets whatever she wants.  But I agree I don't like all their beers.  I just kicked the lager, which I liked from the tap, but not so much in the can.  My only hope is that WAPA doesn't kill it....

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Posted : September 11, 2020 1:24 pm
sabine
(@sabine)
Active Member

thanks everyone for your comments. i will think about it more. we are looking at 3 year to get it sorted. 

yes my husband is experienced in the industry for many years. Not only is he really good at his job but it is his passion. 

take care everyone

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Topic starter Posted : September 30, 2020 10:52 am
NugBlazer
(@NugBlazer)
Advanced Member

I'll be honest:  I don't think starting a brewery is a good idea.  No one really cares about craft beer in the VI.  Coors Light and Heineken are cheap and dominate the market.  Bud, Miller Lite, Carib, Presidente are also very popular.  You'll have a very tough time breaking into the market and competing with those guys.  Price is the thing here, and there's just no way you'll be able to compete pricewise with the big boys.

Even the breweries we do have aren't all that popular.  I can't remember anyone ever going out of their way to get a draft beer at Brew Pub.  When we do go to Brew Pub (now BrewSTX), it certainly ain't for the beer.  And, no one I know cares for Leatherback.  And, I've been around the party scene here for a looooong time.

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Posted : October 4, 2020 2:50 pm
jaldeborgh
(@jaldeborgh)
Advanced Member
Posted by: @NugBlazer

You'll have a very tough time breaking into the market and competing with those guys. 

This is the key point, without a strong pull based on having a better product you are forced to compete on price, as you will have no brand recognition, which as noted isn't easy.  I'm not a beer guy so it's hard for me to judge what makes a better beer.  Wine on the other hand is something where I have a clear sense for what make a great one, purely as a consumer.

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Posted : October 5, 2020 10:21 am
sabine liked
sttanon
(@sttanon)
Advanced Member

The brrewery question also is a matter of which island. Prestorms, when I loved on STT, the craft brew business was doing pretty good. Frenchtown Brewery was doing a awesome job and used to love going to their tastings on Friday Nights. PieHole in Frenchtown as well had a well stocked cellar of craft brews on tap and by the bottle.

As some people have already mentioned pricepoint is going to be a big issue, more so than in the states because of the smaller community. I personally am not a fan of Leatherback, try as I might, and especially not at a pricetag of $12 bucks or so a sixpack. That being said I would gladly spend that much for something from Rogue or Mikkeller in a heartbeat. Dan who owned the Ale House in Gallows Bay, and kinda jumpstarted the availability of good beer in the VI ,  once told me over a beer in the store that just trying to get the beer out there to the public was tough becuase of bars didnt want to spend the extra cost for limited customers that will drink it because of cost.

I think there WAS room for another brewery prestorms and COVID but as much as the storms changed the islands, the islands are going to look way different when things settle down to the new normal post-pandemic so it might be hard to tell what people are going to be into. I will say that one big secret would be to be consistant with product both in quality and availability...

 

 

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Posted : October 7, 2020 7:02 am
vicanuck
(@vicanuck)
Expert
Posted by: @sttanon

Dan who owned the Ale House in Gallows Bay, and kinda jumpstarted the availability of good beer in the VI ,  once told me over a beer in the store that just trying to get the beer out there to the public was tough because of bars didn't want to spend the extra cost for limited customers that will drink it because of cost. 

Dan is a very close, personal friend of mine. Ale House was also a tenant in my building in Gallows Bay. He's currently staying in my guest apartment while he's assisting with my post-Maria renovations. Sadly, he's given up completely on STX and STT is just hanging on by a very thin thread on will cease shortly.

Its been impossible for him to continue because bars just can't see the revenue opportunity and higher profits of good craft beer versus the easy, no brainer sale of cheap, mainstream brands.

Dan is the poster child for why another craft brewery is an insanely risky proposition in a small, isolated market like the VI. 

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Posted : October 7, 2020 9:26 am
sttanon
(@sttanon)
Advanced Member

@vicanuck

 

Sorry to hear it. For us "beer snobs" that is truly sad news 🙁  I miss the selections that he made available and was friends with his STT rep Ryan. Never missed a beer club there when they were doing them........ Well guess it is time to check my equipment out and maybe start brewing again......

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Posted : October 7, 2020 12:32 pm
vicanuck
(@vicanuck)
Expert

@sttanon

Yes...he exposed me to beer that I never would have tried otherwise. Some I hated but others were awesome. He's here at the shop today cleaning out his tools and such as he's heading back to FL tomorrow after setting up the plumbing and electrical for my bathroom reno. I'm sure he'll be back at Xmas though...I'll have kitchen cabinets for him to install!!!

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Posted : October 7, 2020 12:48 pm
speee1dy
(@speee1dy)
Expert

@rewiredis brew pub brewing these days? i thought they had stopped

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Posted : October 7, 2020 3:41 pm
daveb722
(@daveb722)
Trusted Member

@speee1dy Yes they are still brewing their beers on tap.  i'm not a big fan of their beer as I like dark beers and their stout is a bit sweet to me.

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Posted : October 8, 2020 9:09 am
speee1dy liked
speee1dy
(@speee1dy)
Expert

@daveb722thank you

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Posted : October 8, 2020 9:40 am
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