In this week’s SME Focus we hear from two entrepreneurs who have carved out a niche in the expanding craft brewing industry after changing careers.

Name:

Matt Johnson, co-founding director (the other founding director is Patrick Jones).

Age:

37.

What is your business called?

Pilot Beer Ltd.

Where is it based?

Leith in Edinburgh.

What does it produce?

Natural unfined, unfiltered and unpasteurised beer.

To whom does it sell?

Mostly to local pubs and bars but we also do a small amount of wholesale trade.

What is its turnover?

Approximately £150,000.

How many employees?

Three - including the two founding directors. We’ve just employed our first member of staff, Jordan. He’s our Business Development Manager and will be helping us grow the brand while managing customer relations.

When was it formed?

Our first brew was produced in November 2013. We purchased the brewery equipment six months prior to that and spent those months setting up and preparing the unit in Leith.

Why did you take the plunge?

Patrick and I met while studying the Brewing & Distilling MSc at Heriot-Watt university in 2011. Both of us were seeking a change of direction and a new challenge away from our previous careers. Being of a similar age and stage in life, and both settled in Edinburgh, we had a shared vision of what a brewery should be and so we worked on various projects together throughout the course. When we graduated, the next logical step was to look at possibilities of setting up a brewery together, and we were really lucky to come across a second-hand one that was available locally. By April 2012 we were the proud owners of a shiny new(ish) brew kit and all we had to do was work out how to take it apart, move it and rebuild it.

What were you doing before you took the plunge?

I was a freelance graphic designer and Patrick worked in finance. Both our previous careers play a big part in our business, and together with our brewing knowledge we have a useful skill set for operating a small business.

How did you raise the start-up funding?

A mixture of savings and family loans, which allowed us to be completely independent and free to do our own thing.

What was your biggest break?

Landing our first permanent keg line at Akva – a café/bar in Edinburgh’s Tollcross area. Prior to that we were tussling over rotational beer lines and had no guarantee of our beer being available in any bar at any one time. The line at Akva really helped us to get the ball rolling and get our beers out there, and after that we were offered three lines in the Devil’s Advocate just off the Royal Mile, as well as permanent lines in all of Fuller Thomson’s group of bars.

What was your worst moment?

There was a point during our six-month set-up period where we were lying face-down, digging out a one metre deep drainage channel by hand with trowels because it was too narrow to fit spades into. It was pretty miserable, but three years down the line we are proud to have an established brewery, with quality in-floor drainage – it was all worth it in the end.

What do you most enjoy about running the business?

No two days are the same. There are always interesting challenges and it’s great to see the business growing and developing. Basically, we get to make the types of beer we enjoy drinking without anyone telling us what to do (other than the bank, our customers and our partners, of course).

What do you least enjoy?

Some days it can feel like the world is against us. Different pieces of equipment break down and it’s always at the worst possible time. We are far better at coping with it now, though - it’s funny to think how much we used to panic when certain situations arose, whereas now we just talk things through rationally and figure out the best way to solve the problem.

What are your ambitions for the firm?

We currently produce around 900 litres of finished product per brew, which sounds like a lot but is tiny by industry standards. We want to grow our business to a size where we’re capable of making enough beer to employ a team of staff who love their jobs, and with them, continue to create beers that excite and challenge the expectations of our consumers while maintaining balance and drinkability at the heart of everything we do.

What are your top priorities?

Increase production capacity.

Start producing bottles and cans (we’re currently selling everything we can make in keg and cask).

Employ a team of like-minded staff who can help us build upon what we’ve started.

Broaden our sales reach from local to national and even international.

Have professionally installed in-floor drainage that Pat and I haven’t dug out ourselves.

What single thing would most help?

An unlimited budget. Or at least more money than we currently have, but that’s always going to be the case.

What could the Westminster and/or Scottish governments do that would help?

For a start there could be rates relief for new businesses and for when established businesses move to a new, larger site. A year of rates relief would really help growing businesses to get some money coming in before being stung by bills. There are already some really helpful schemes out there offered through Scottish Enterprise (we’ve found their assistance and advice to be incredibly useful) but I understand that a lot of their initiatives are currently EU-funded so the future is currently uncertain.

Our accountants, French Duncan, have been helping us to be more creative and efficient with our budgeting. They have also been working with us on both forecasting and fundraising. This has been incredibly valuable in helping us get a stronger understanding of where we need to be heading in terms of both growth and expansion over the next five years and we’re now finalising exciting plans around how we’re going to get there.

What was the most valuable lesson that you learned?

Sort out your intellectual property as early as possible and preferably prior to starting to trade. It’s a tough one, though, as when you first set up it is difficult to find the budget for trademarks which can cost hundreds or even thousands of pounds. However, if you’re already established as a business and then have your trademark applications contested, it can be seriously costly or even result in you having to change your trading name.

How do you relax?

Pat and I both have young families so the short answer is, we don’t. But we both love spending time with our kids - family time is obviously of the utmost important to us. Having a bit more time to spend doing ‘market research’ in pubs and bars would be nice though.