The Mandate
A brewmaster transitioning from contract production to owned facility engaged Feasibility Study Consultant to prepare a third-party feasibility study supporting a SBA 7(a) financing request for a project located in Chittenden County, Vermont. Total project capitalization fell within the $3M-$5M band. The capital provider, a community bank originator with SBA 7(a) guarantee, required documentation consistent with current program review standards. The analytical question put to the team: Did Burlington-area craft-beer demand and self-distribution capacity support 4,200 barrels annual production.
Engagement Scope
- Primary market area defined as a 30-mile drive-time
- Comparable supply set of 13 properties
- Demand model framework: barrel-production self-distribution and taproom-revenue dual model
- Financial projection horizon: 7 years
- Site inspection completed; operator interviews where applicable
- Primary data collection through field reconnaissance and third-party market data
Methodology Applied
Primary Market Area
The PMA was defined as a 30-mile drive-time from the subject site, calibrated to the demand catchment behavior typical of brewery assets in Vermont. The boundary captured the population, employment, and competitive supply base relevant to the subject's operating thesis.
Supply and Demand Reconciliation
The comparable supply set comprised 13 properties operating within the PMA or in directly substitutable submarkets. Demand was modeled using a barrel-production self-distribution and taproom-revenue dual model approach over a 7 years horizon. The reconciliation tested whether incremental supply, including the subject, could be absorbed within the projection window without compromising stabilized occupancy assumptions.
Capture Rate Calibration
The subject's capture rate was calibrated against the absorption capacity of the PMA. The analysis concluded that PMA absorption capacity exceeded subject build-out by a factor of 1.7 across the projection window, with a stabilized capture rate of 2.8%.
Exhibit 1: Comparable Supply Set, Vermont PMA
[Table or chart rendered in delivered report.]
Exhibit 2: Demand Projection Summary, 7 years Horizon
[Table or chart rendered in delivered report.]
Exhibit 3: Subject Capture Rate vs. PMA Absorption Capacity
[Table or chart rendered in delivered report.]
Analytical Conclusions
- Vermont craft-beer per-capita consumption ranked among the highest nationally at 22.1 gallons annually.
- Comparable production microbreweries cleared 3,800 to 5,200 annual barrels in years three to five.
- Taproom revenue projected at 28% of gross supported the dual-revenue financial model.
- Year-three DSCR of 1.34x cleared the SBA 7(a) review threshold.
Deliverable
The delivered report ran 122 pages with 28 exhibits distributed across nine analytical sections, plus appendices documenting comparable supply data, demographic inputs, and financial projection assumptions. The document was prepared to the documentation standards of the community bank originator with SBA 7(a) guarantee. The corresponding SBA 7(a) review framework guided exhibit selection and supporting documentation.