Succession planning in a family run brewery

The brewery outlives the founder only if someone plans it

In a family-run brewery or brewpub the founder usually holds the whole business together: the recipes, the malt supplier relationship, the excise paperwork, the landlord and the bank. That works while the founder is there. It fails the week they are ill, let alone the year they retire.

Succession is three separate handovers that happen at different speeds. Knowledge (how the beer is made and how the business runs). Management (who makes the daily decisions). Ownership (who holds the shares and the risk). Families often plan the third and forget the first two.

Write down what only the founder knows

Start with a simple audit. For one month, the founder notes every task only they can do. Then turn each into a written record:

• Recipes with full specifications: grist, mash temperatures (for example a rest at 65 to 67 °C), original and final gravity, bitterness in IBU, fermentation temperature and timings.
• Supplier names, contacts, prices and the quirks of each, such as which malt lot gave trouble.
• Licence renewal dates, the documents each renewal needs and the officials involved.
• Bank, landlord and insurance details.
• The cleaning and maintenance routines the founder checks by habit.

This also protects the business against a sudden absence long before any planned handover.

Separate ownership from management

Not every child who inherits shares wants to run a brewery. Not every capable family member is the right manager. Decide the two questions separately. A son or daughter can own a stake and sit on the board while a professional runs the floor. Our guide to bringing in a professional manager covers that route.

Where several family members will own shares, agree early how they will decide things: who has a vote, how profits are shared and how a family member who wants out can sell. A family constitution or a shareholders' agreement, drafted with a lawyer, turns those promises into rules.

Test the successor before the handover

Give it years, not months. A successor should run the business through at least one full financial year, including the summer peak, the monsoon slowdown and the festive rush, with the founder available but not in charge.

Hand over one area at a time. Purchasing first, then the taproom, then the monthly accounts, then brewing decisions. Agree in advance which decisions the founder will no longer overrule. A founder who steps in on the floor every week tells the staff the handover is not real.

Licences, shares and wills

How easily a brewery passes on depends on its legal structure. In a sole proprietorship the business and its licences are tied to one person, which can make transfer slow. In a company or LLP the licence sits with the entity, so shares can change hands while the licence stays, though many states want to be told when directors or owners change. Rules vary by state and change, so check the current position with your licensing consultant.

Every owner should have a will that matches the shareholders' agreement. Keep nominee details up to date on bank accounts and shares. A chartered accountant and a lawyer should look at the tax side of any transfer before it happens, not after.

Plan for the handover nobody chose

Not every succession is planned. Illness or a death can force the question overnight. A family brewery should have an emergency page that answers the first week's questions: who can sign cheques and excise returns, where the licences and lease are kept, which supplier gets paid first and who the head brewer reports to while the family decides.

Check the bank mandate in particular. If only the founder can operate the current account, salaries and duty payments stop the day they cannot. Add a second authorised signatory now with a sensible limit. Review it once a year.

Tanks do not wait for paperwork either. A lager sitting at 0 to 2 °C in conditioning can wait a few days. A fermenter at peak activity needs someone to watch temperature and gravity today. Make sure at least two people can run the brewhouse, the chiller and the daily excise register without the founder.

Keep the people who make the beer

Staff watch succession closely. A head brewer who has worked beside the founder for ten years may wonder whether the next owner will value them. Tell key people what is planned, when and what it means for their role. Consider a retention bonus or a small stake for the one or two people the brewery cannot lose.

Planning the handover is a management skill. So is reading the business through numbers once the founder is no longer on the floor every day. Your first step: spend one afternoon this month writing down every task only you do, then put a name next to each one.

Common questions

When should a family brewery start succession planning?

Years before the founder plans to step back. A successor needs at least one full financial year of running the business with the founder available but not in charge.

Does a brewery licence pass automatically to a family member?

Not necessarily. It depends on the business structure and state rules. Licences held by a company or LLP are usually simpler than those tied to an individual, but check with a licensing consultant.

Should the next generation run the brewery or just own it?

Decide those separately. A family member can own shares and sit on the board while a professional manager runs daily operations.