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Roman
10-20-2014, 05:32 AM
Hi, I need the information what the production cost of mead is in case of a big company such as Spółdzielnia Pszczelarska Apis (Poland) which produces more than 800 liters of mead yearly.

What could be a production costs of a 0.5L bottle of mead?

Any estimations and suggestions will be appreciated.

[unfortunately the company refused to share any information with me]

kuri
10-20-2014, 07:39 AM
It's going to be hard to know since there are all sorts of variables. First is cost of the honey. Depending on where they source their honey, that could vary by up to a factor of 10. Next is rent, which could vary by even more than that depending on country, city, and specific location therein. 800 liters will require somewhere in the ballpark of 250-300 kg of honey. At $8/kg that comes to $2,000 - $2,400. Add in $300-$800/month rent (more likely $2,000/month if you're in Tokyo) and you're up to $5,600 - $12,000. If this is a 1-person business and they're trying to make a living out of it, then you need to add in the salary of that one person. I have no idea what average salaries are in Poland, but let's say $30,000/year. More likely this is something that is done as a side job. Then there's the startup costs in equipment that are typically spread out over many years, and I have even less of an idea what those costs are going to be in Poland. In general, however, they are higher than you would think. The very least they could get away with is having 1 1000 liter fermentor that doubles as a settling tank, probably temperature controlled, hooked to a hand-run bottling machine. They could then make one batch of mead a year. However, they could just as well have 1 100 liter fermentor with 10 settling tanks, all hooked up to an automatic bottling line, and make mead more like once a month. Let's put those costs at $10,000 a year. Then there's bottles, corks and labels, which all together will probably come to between 50 cents and $1 per bottle. You could get much better costs on a much larger scale, but 1,100 bottles a year isn't very serious bulk.

So, you have something like $52,000 per year you have to recover from 1,100 or so bottles, which means having to sell your mead for close to $50 a bottle. Obviously, if you aren't aiming at making a living from this you don't need a $30,000 salary. Also, the honey costs could easily be cut to a fraction of the cost listed, and it's possible to use much cheaper equipment and make mead more often. If you're happy making $1,000 for yourself brewing out of your basement, then the total costs you need to recover plummet to probably $5,000, in which case you can get away with selling your mead for closer to $5 a bottle.

As these estimates show, it's really impossible to give you the answer you want without having a much better idea of what the setup is at the company.

antonioh
10-21-2014, 01:01 PM
And taxes Kuri, don´t forget taxes !

In EU alcohol has high taxes .

Bob1016
10-25-2014, 10:08 AM
In Florida, including taxes and tax breaks, only considering non capital costs (no fermenters, equipment, etc.), rent, utilities, and ingredients all included with licensing, if you make more than 99 cases per year (891L, in 75cL bottles), the price is less than $5/bottle.
That's my math based on all operating costs plus 10%, for florida laws and my access to ingredients.

It can actually be a profitable business if you provide a high quality product that people are willing to pay $30-$80/bottle for. The big problem is the investment time, just sitting on the mead waiting for it to mature (same as the wine industry), and no matter how drinkable it is, all meads are really better after the first year; there are some clever ways around this problem though.


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