The general public in India has a strong admiration for alcoholic beverages. This explains why the consumption of whiskey, vodka, and rum never experiences a decline. Crafted beers, however, have recently gained popularity in the Indian market. Despite its low alcohol concentration, crafted beer is becoming more and more popular, especially among urban customers. Crafted beer is unique and appealing to a broad range of customers because of its calming flavour, great taste, and form-rich appearance.

The state government is being pushed to expand the number of microbreweries by the steadily growing demand for handcrafted beverages. This is where a business opportunity for startups comes into play. This might be the ideal time to enter the microbreweries sector if you're interested in making good money in the alcohol industry. This article highlights key legal requirements for establishing a microbrewery in India.

What is a microbrewery business?
 

A microbrewery, often known as a craft brewery, is a small brewery facility with a lesser volume or production rate than the major distilleries. The terms, which are frequently used to describe independently owned, much smaller breweries than their larger counterparts, have varying definitions. These breweries are distinguished by their focus on flavour, quality, and brewing techniques. The microbrewery's daily output capacity ranges from 5,000 to 50,000 litres. The brewing process for various types of beer using imported materials takes about 7-8 hours. Throughout this process, nothing is bottled or preserved with preservatives. The scope, conditions, and legalities of the microbrewery industry in India will be the main topics of the blog.

Analysing the potential of microbrewery business
 

• The rapid increase in beer consumption across India has significantly boosted the homebrewing scene. The majority of these units received financial support from a variety of sources, including venture investors. Bira91, which holds close to 6% of the market, received $4.3 million from Sixth Sense and approximately $50 million from Sofina in 2018.
   
• The Indian alcohol market currently holds the third-place spot globally and is expanding quickly. According to the most recent data published by Euromonitor, this industry is expected to increase by 25% to $41 billion by 2022.
   
• Wine, beer, and spirits are the three main categories under which the alcohol market has been divided. After whiskey, beer is the alcoholic beverage that Indians consume the most. Back about ten years ago, the Indian craft beer business was striving to establish itself and had only been able to secure 3% of the $7 billion Indian beer market.
   
• According to the All India Brewers Association, sales of these beers will increase by 20% year over year, outpacing the beer market's 7% year-over-year (y-o-y) growth rate.
   
• More than 30% of Indians live in metropolitan areas where pubs, restaurants, and the brand-new establishment known as brewpubs have experienced the fastest growth. The millennial generation, which prefers craft beer to standard lagers because it is more premium and authentic, is what started the trend.
   
• In India, the market for microbreweries is expanding at a steady clip. Although there are currently just five states with microbreweries, there are a few more that are lined up and ready to go when the government gives the go-ahead.
   
• According to current industry estimates, the market for carefully crafted beers is worth between Rs 75 crore and Rs 125 crore, and it costs on average between Rs 8 and 9 crore to start a microbrewery.
   
• The demand for various varieties of beers has significantly increased in the NCR region. The survey states that more than seven lac litres of imported liquor and 15 lakh bottles per month are used in Gautam Budh Nagar.

Things to consider in starting a microbrewery business in India
 

Overall, running a microbrewery is really difficult. The company uses a lot of capital. It is advised against starting a firm on a tight budget. As a result, you must carefully take into account a few crucial factors.

• Analyse the composition, scope, and purchasing power of your target market first.
• Determine the many types of beer that are offered and consumed in your target market.
• What brand of beer does the population in your target location prefer?
• Your target market's price range and income brackets.
• What are the trade limitations, preferences, and distributional practices?
• Regulations, local permits, product approvals, etc.
• Choose the ideal site for your brewery enterprise.
• Select the appropriate business organisation structure. Whether it would be a Pvt Ltd, partnership, LLC, or proprietary corporation.
• A financial plan for a business.
• Decide how you will compete with your possible competitors after identifying them. Just put your marketing strategy on paper.

How much does it cost to start a microbrewery business in India?
 

One of the most crucial parts of this business is financial planning. Rent, licence fees, equipment costs, production costs, and employee costs are a few of the primary expenses. You should also take other expenditures into account, such as power payments, raw material purchases, and advertising charges.

State-to-state differences exist in the licence fee. You must speak with the state's excise agency to be certain. In order to provide your consumers with a comfortable seating arrangement, you must also consider your interior design.

Microbrewery business setup and machinery equipment
 

There are two ways to start a microbrewery business. The bar and restaurant arrangement can be used to launch the brewpub. However, you can expand a microbrewery using the current infrastructure if you already have a hotel or restaurant. If so, you'll need to make room for it.

List of the essential microbrewery supplies:

• Mashing Tuns & Kettles
• Lauter Tuns
• Fermenters
• PHEs (Physical Heat Exchangers)
• Refrigeration machine
• Boiler
• Electric Cabinet with all controls
• PLC touch-type process controller
• Beer Filters
• Distribution Tanks
• Serving System

It's crucial to buy equipment from reputable vendors. Prior to placing your final order, get customer feedback. Additionally, request a comprehensive inventory of the equipment, as well as the physical and material technical requirements. Additionally, you'll require a RO system if the water source does not satisfy the criteria.

Beer Production or Brewing Process
 

Beer has a low alcohol content. Barley malt, hops, yeast, water, and various additives like maize, rice, sugar, wheat, etc. can all be used to make it. Weigh the malted barley first. It should be ground into a powder.

Then combine the malt with other ground components in accordance with the detailed recipe. Include filtered water. The entire mixture is then added for mashing.

The enzymes in the malt break down the starch and proteins during mashing, according to the requirements of the recipe for the type of beer, and add sugars, minerals, and amino acids to the solution. You will receive WORT here.

Then use a filtration procedure known as lautering to separate the WORT from the waste solid material. Transfer the "WORT" to the kettle for WORT Boiling after Lautering. Send the mixture to a whirlpool to precipitate the suspended material and clear it before completing the process.

Last but not least, in an hour, cool the WORT in a Plate Heat Exchanger from 100 °C to roughly 10 °C. Yeast should be added to the fermenters. The yeast in the fermenters turns the WORT's fermentable carbohydrates to alcohol and carbon dioxide over the course of roughly 5-7 days at a temperature of about 10 °C.

After the beer has matured, run it through a filter. Send the beer tanks with the clear beer last. Now that the beer is prepared, the consumer can receive a fresh serving.

Microbrewery business operation
 

A microbrewery requires a significant amount of preparation, effort, and financial investment to launch. Additionally, you must have some expertise in the retail food industry. The human resource component of this firm is also crucial.

For brewing and other customer services, you need to hire people with high levels of expertise. To get things on track and under control, you must also begin the process with the appropriate software.

Finally, you need to have a marketing plan. You must at the very least advertise the brewpub online and offline. However, obtaining total success in the microbrewery business depends on the quality of the beer and excellent customer service.

Conclusion

Due to the increased demand for freshly brewed, handcrafted beer, the microbrewery business in India is rapidly expanding. Although the majority of Indians have a strong appreciation for alcoholic drinks with a high alcohol content like Whisky, Rum, and Vodka, craft beer is progressively growing its market share in the extremely competitive alcohol industry. The state government is being forced by the constantly growing demand for craft beer to open up the microbrewery business to other businesses. If you are thinking about starting a microbrewery business then you can connect with the experts at Online Legal India.