Kombucha Business Plan, With a 12-Month Projection

A kombucha business plan sets out what you'll brew and how you'll sell it, what a bottle, a keg and a refill cost, the alcohol rule that shapes everything, and the first year month by month. Kombucha is cheap to brew: tea, sugar and fruit for a 16-ounce bottle come to under 30 cents. The bottle, cap and label cost three times that, which is why kegs for cafés and growler refills at markets earn far more per gallon than bottles sold to shops. The other thing to plan around is alcohol: kombucha that reaches 0.5% alcohol by volume at any point, even after it leaves you, is an alcohol beverage under federal law. In the example below, a brewer in Portland sells bottles at markets and wholesale, kegs to cafés and growler refills, makes a profit from month 4, and ends the first year about $22,500 ahead on $80,400 of sales, after paying $20 an hour for the work. Below is a description example, each part of the plan, the alcohol rule, the projection, the startup budget, and a free template.

The short version

• Describe the business in a paragraph: what you brew, where you sell, the brewery, the goals.
• Cost each format: the bottle is the expensive part, not the tea.
• Compare formats by what each earns per gallon: kegs and refills beat wholesale bottles.
• Stay under 0.5% alcohol at every point, including in the bottle on a shop shelf; refrigeration alone doesn't count.
• Test every batch and keep the readings.
• Budget for fermenters, a cooler and kegs before the first sale.
• TaroStack keeps every batch with its lot, its readings and every customer who got it. More below.

Part 1: the business description

Brightwater Ferments, a made-up fermented food and drink maker in Portland, Oregon, I use in these examples, writes:

Brightwater Ferments brews kombucha in 50-gallon batches in a small brewery space, flavored with Oregon fruit. We sell bottles at two farmers markets and to natural grocers, kegs to cafés, and growler refills at our market stall. Every batch is tested for alcohol before it leaves. In our first year we plan to brew about 500 gallons a month.

Part 2: what each format costs

The liquid in a 16-ounce bottle costs 28 cents; the glass, cap and label 83. A keg holds the same kombucha as 40 bottles with no glass at all, and a growler refill goes into the customer's own jug. How to put the packaging properly into a cost is in packaging cost per unit.

Part 3: customers, prices and what each earns per gallon

Wholesale bottles are nearly three-quarters of the bottles and earn the least per gallon: $6.08, against $16.16 in a café's keg. They still matter for reaching customers you'd never meet at a market, but a plan that grows by adding cafés grows its profit much faster than one that adds grocers. How a distributor or grocer's margin shapes a wholesale price is in distributor margin.

Part 4: the alcohol rule

Fermentation makes alcohol, and federal law draws the line at 0.5% alcohol by volume. If kombucha reaches 0.5% or more at any time, during production, at bottling, or after bottling, it's an alcohol beverage under the Alcohol and Tobacco Tax and Trade Bureau's rules (TTB); below that, it's a food under the FDA, with state and local rules on top. The "after bottling" part is the one that catches small brewers: live kombucha keeps fermenting. TTB's guidance describes a bottle meant to be kept cold that a retailer left out, where the alcohol rose past 0.5%; the producer is liable for the federal excise tax, and TTB says refrigeration isn't an adequate safeguard on its own, because you can't control what happens to a bottle after it leaves you. It expects a production method that keeps the alcohol from rising after bottling, or a brewer's qualification with TTB (TTB). So the plan budgets for testing every batch, keeping each reading in the batch record, and for a production method that stops fermentation continuing in the bottle, and talks to a process expert before the first sale. What a batch record holds is in what is a batch record. What your state asks of a kombucha brewer is worth checking too. This is general information, not legal advice.

Part 5: the first year, month by month

Fixed costs are $2,000 a month: brewery space ($1,200), utilities and cooler power ($250), insurance ($100), market fees ($200), the vehicle ($150), the website and software ($60), and licenses and test supplies ($40). Sales start at 15% of full speed and reach it by month 11, about 500 gallons a month:

The year's sales are $80,362 and the profit $22,538, on top of $20 an hour for the work. At full speed, the 30 kegs leave $2,424 a month and the 1,600 wholesale bottles $1,216.

Part 6: the startup budget

Get the template

Download the kombucha business plan workbook. Four sheets: your formats with price, variable cost and monthly volume at full speed; the year, month by month, with sales, profit and cash; your fixed costs; and your startup budget with working cash. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.

Where this stops working

Four fermenters at different stages, a dozen flavors, bottles and kegs in the cooler from five batches, and kegs out at cafés: a notebook loses track of which keg is where, which batch's alcohol reading was close to the line, and which grocers got bottles from it if it needs to come back.

How TaroStack does it

TaroStack keeps every batch, its readings and where it went.

Batches with their readings. Each flavor is a recipe of tea, sugar, culture and fruit, with bottles or kegs, and units convert: tea bought by the kilo, used by the gram. Batch record forms carry your own fields with limits, like the alcohol reading at bottling, with sign-off. Recording a batch takes the ingredients and packaging off stock from the lots used, at what you paid.

Lots to customers. Every batch goes into a lot with its date, picking takes the oldest first, and one report walks any lot to every grocer and café who got it, if a batch ever has to come back.

And orders by customer. Café and grocer orders are sales orders that show whether the bottles and kegs to fill them are in the cooler while you're still typing, and margins are reported by product and by customer, so the café kegs and the grocer bottles show what each really earns.

Recipes, batches, lots, batch records, recalls and margins by product and customer are on every plan, from $49 a month; a market stall as its own site, beside the brewery, is on Standard at $99. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.

Questions people also ask

Is a kombucha business profitable?

It can be. In the example, a brewer selling bottles, kegs and growler refills ends the first year about $22,500 ahead on $80,400 of sales, with $20 an hour paid for the work. Kegs and refills earn the most per gallon.

How much should I charge for homemade kombucha?

Cost each format with its packaging and time, then price. In the example, a 16-ounce bottle costing $1.73 sells for $4.50 at a market and $2.50 wholesale; a 5-gallon keg costing $29.20 sells to cafés for $110.

Does kombucha have alcohol?

A little, from fermentation. If it reaches 0.5% alcohol by volume at any time, including after bottling, it's an alcohol beverage under federal TTB rules. TTB says refrigeration alone isn't enough to keep it under; it expects a production method that stops the alcohol rising in the bottle.

How much does it cost to start a kombucha business?

In the example, about $22,000: $17,000 for fermenters, a filler, kegs, a walk-in cooler, a market kegerator, a kettle, labels, a first order of bottles and permits, and $5,000 of working cash.