Craft Soda Business Plan: Bottles, Kegs and a Projection

A craft soda business plan sets out the sodas you'll make and who buys them, what each costs, the rules, and the year month by month. Soda is mostly water, sugar and flavor, so the bottle often costs more than what's in it, and kegs to restaurants and bars, where there's no bottle at all, carry the margin. A small soda maker often sells four ways: singles at markets, four-packs to shops, kegs to restaurants, and syrup for people to mix at home. Carbonated beverages are excluded from FDA's acidified foods rule, so the paperwork is a state food processor license and, for most plants that sell beyond their own counter, FDA food facility registration. In the example below, a soda maker in Toledo, Ohio, turns a profit from month 2 and ends the year about $12,900 ahead on $47,200 of sales, after paying $20 an hour for the making. Below is a description example, each part of the plan, the rules, the year, the startup budget, and a free template.

The short version

• Describe the business in a paragraph: the sodas, where you sell, the space, the goals.
• Cost each format: syrup, CO2, bottle and cap, label, time, card fees; the bottle is the big line.
• Kegs to restaurants leave the most per ounce; four-packs to shops bring the volume.
• Carbonated beverages are excluded from FDA's acidified foods rule.
• A state food processor license, and FDA facility registration unless you're a retail food establishment.
• Nutrition Facts on bottles unless a small business exemption applies.
• TaroStack keeps each batch's lot, its syrup and CO2 costs, and where every keg went. More below.

Part 1: the business description

Maumee River Soda Co., a made-up soda maker in Toledo, Ohio, I use in these examples, writes:

Maumee River Soda Co. brews cane sugar sodas, root beer, ginger, cherry and cream, in a licensed production space, sold in bottles at two markets, in four-packs at local shops, in kegs to restaurants and bars, and as syrup. Every bottle and keg carries a batch code.

Part 2: what each format costs

A sixth-barrel keg holds about 55 twelve-ounce servings, with no bottles, caps or labels. How a batch's yield changes its cost is in batch yield formula.

Part 3: customers and prices

Twelve kegs a month leave more than 250 four-packs. Kegs need a deposit, cleaning, and someone to pick up the empties, which is why the plan prices delivery into each one.

Part 4: the rules

FDA's acidified foods rule excludes carbonated beverages (21 CFR 114.3). A soda plant registers with FDA as a food facility unless it's a retail food establishment, one selling more to consumers directly than to everyone else (21 CFR 1.226 and 1.227), and the state licenses and inspects it as a food processor. Bottles carry the food label and Nutrition Facts unless an exemption applies, explained in nutrition label small business exemption. Registration itself is in FDA food facility registration. This is general information, not legal advice.

Part 5: the year, month by month

Fixed costs are $1,205 a month: production space ($700), insurance ($70), the state license and water testing ($40, averaged), market fees ($120), the website ($40), software and card fees ($35), marketing ($100), and delivery ($100). Sales start at 35% of full speed:

The year's sales are $47,170 and the profit $12,858, on top of $20 an hour for the making. Each new restaurant account with a keg a month adds about $79.

Part 6: the startup budget

What a fermented drink plan looks like is in kombucha business plan.

Get the template

Download the craft soda business plan template. Four sheets: products with price, variable cost and units at full speed; the year month by month with a ramp you can change; fixed costs; and the startup budget. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.

Where this stops working

Twelve kegs out at restaurants, a batch code on every bottle, and empties coming back: a notebook loses track of which keg is where and which batch is in it.

How TaroStack does it

TaroStack keeps each batch's lot, its costs, and where every keg went.

Each batch a lot. A batch of root beer gets a lot with its date, and lot labels print for the bottles and kegs.

Syrups as recipes. Each soda is a recipe with its syrup as a sub-recipe, so a batch carries its true cost, sugar, flavor and CO2 included, at what you paid.

Where it went. Each restaurant's order records the lots it got, so one recall report shows every customer a batch reached, and margins show by product and by customer.

Lots, batches, recipes and true cost are on every plan, from $49 a month. 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 craft soda business profitable?

It can be: in the example, $12,858 on $47,170 of sales in the first year, after paying $20 an hour for the making, with kegs to restaurants leaving the most.

Do I need a license to sell homemade soda?

Yes, in most places: a state food processor license and an inspected production space, and FDA facility registration unless you sell mostly to consumers directly.

Is soda an acidified food?

No. FDA's acidified foods rule excludes carbonated beverages.

How much does it cost to start a soda business?

In the example, $10,850, including kegs, carbonation and filling equipment, a kettle, first bottles and labels, licenses and $2,500 of working cash.