Breaking Into the Beverage Industry – A Small Business Owners Guide
Breaking Into the Beverage Industry – A Small Business Owners Guide
Starting out on a journey toward introducing your new beverage product idea into a very competitive market is a decision to not take lightly. There is a lot of legwork which needs to be done before you ever fill your first juice bottle. The work you put into the idea beforehand often determines your success so it is important to do your homework and create the strongest product possible. As a small business owner, it is your responsibility to perform the due diligence required to ensure your product will be competitive with the many other brands already on the market. The following guideline will help you start on the process towards being a successful beverage entrepreneur.

Part One – The Legwork

Brainstorming your Ideas

Categorizing Products

You start with your initial product idea but must also consider all the ins and outs of the beverage industry itself. When putting together your product, think about the big picture. Do you plan to only sell one product or multiple kinds? The beverage industry offers many types of drinks including:
  • energy drinks
  • health drinks
  • juices
  • sodas
  • coffees and teas
  • sparkling waters
  • alcoholic beverages
Consider which product category your ideas fit into so you can do the appropriate research and analyze the competition effectively.

Testing Recipes

While you may be famous for one drink in particular you know all of your friends love, it is worthwhile to spend the time perfecting your recipe for your initial product idea and other potential products. Try different variations of recipes. Host tasting parties with your friends and family for feedback. Take your product to the public for more feedback. Ask a local grocery store if they would allow you to hold a Saturday morning taste test with the customers. The more information you can gather on what consumers think of your products, the better product you can develop. Listen. Make notes. Talk to the people in person to gain insight into what your product needs to be successful.

Developing your Product

Go back to the drawing table with the feedback you have collected over several weeks and different tastings. You may find the entire scope of the product changes or you might discover you have a high-quality product idea ready for the market. The more time you spend developing and perfecting your product from the start, the more likely you will ultimately find success.

Spend Time Crafting Your Business Plan

Do not doubt the power of the business plan. This plan will not only help you follow through with marketing and sales after the product has been launched, it may be the key to your discovering the process is not worth your time. While working through the different parts of a business plan, you must be able to answer important business questions and research vital data. Throughout the process, you may find your venture is more expensive than you realized or will require more time than you have to offer. If you are able to see the business plan to fruition, you will already be starting out with a solid plan for success. You will have a visual of your business as a whole. This will allow you to make smarter decisions from the very start and prepare you for expansion as your success grows.

Parts of a Business Plan

Analyzing the Market

One of the most important parts of your research involves the competition. Your research should include all markets – local, regional, national, and international even if you only plan to sell local. If your product is a success locally, its presence in other markets could grow. Know beforehand what else is on the market so you can be ready for that growth.
  • Local/Regional Market – find out what beverages are being produced and sold locally and in your state. Many entrepreneurs will be willing to discuss some aspects of their business with you, unless you plan to be their direct competitor. You might even ask to shadow the person for a day or two. This will help you gain a real understanding of what the business requires.
  • National/International Market – research the histories of other big product companies whose products are known worldwide. There are industry websites and magazines available you should read to better understand the bigger markets, important trends, and other data vital to the beverage industry.

Develop Your Marketing Plan

Your marketing plan must cover a lot of territory. It involves not only the process of getting your product out to consumers, it requires a lot of thought about the big picture. You must identify several key components in your marketing plan including:
  • What/who are your target market/demographic? Consider what demographic you will be marketing to primarily based on the type of beverage you will be producing. Is it a kid-friendly juice? An adults-only alcohol beverage? A health juice for the fitness market? Your marketing efforts will largely be based on who you are targeting so you must be able to identify the right demographic.
  • How is your product different than the competition? If you are producing a new line of apple juice, you must be able to identify how it differs from all of the other apple juices on the market. If you cannot determine the difference between your competitors, how will the consumers tell the difference? Demonstrate why people should buy what you are selling versus the other brands already on the market.
  • How will you enter the market? Part of your marketing plan will require an outline of your initial introduction into the beverage market and a timeline for growth and expansion. Will you start locally, selling your product at local farmer’s markets? Will you start seeking distribution deals on a national level? Will your products only be sold online? Your strategy for getting introduced onto the market is important but a visual timeline of what happens next is also vital. This is a good time to be creative with your ideas for reaching your target market in an effective way.
  • What sales strategies will be used? There are many ways to sell your products but having a plan will help you do it more efficiently. Do you plan to sell your products by yourself? Will you employ sales personnel to cold call potential markets? Based on your marketing plan, it is important you understand your sales strategy from the start and have a plan for increasing sales in a specific period of time. Account for all costs for advertising your product – print ads, online ads, website, and social media pages.
  • Will there be accompanying merchandise to further market products? To generate interest and attract attention, it may be necessary to think outside of the box for good promotional ideas. T-shirts, free giveaways, and other special offers are a good way to get your product to a larger audience. Determine the cost of buying additional merchandise and include it in your startup costs.

PART TWO - Perfecting Your Brand

Your branding concepts can make or break your chance of success. Think about all of the brands on the market you know by heart simply based on a logo or a tagline. You must finalize your brand’s image early on to maintain consistency throughout the life of the product. You can’t develop a logo then change it later. Consumers will get confused and your brand identify will be a failure. Basics included in your brand’s design include:

Creating a Logo

Your logo should represent the spirit and personality of your product. If you are a not a graphic design expert, hire someone who is to design your logo and other graphics to ensure a professional, clean look. You may wish to create one primary company logo along with individual logos for each product. Make the decision early on so you won’t have to make changes once the product is already on the shelves.

Designing bottles

Some popular beverage products are recognized solely by the design of the bottle used. Don’t neglect the process of choosing the right bottle for your product as it could become part of your signature look. Juice bottles, soda bottles, and water bottles often have a similar style but this may be time to break the mold and choose a unique bottle design to attract more attention for your product. Create a signature look easily recognizable and you’ll make it possible for the look to sell itself.

Website/Social Media

Whether you plan to sell your products online or not, having a presence online is important these days. Make sure the website is professionally designed and easy to navigate. Include your logo, products, company history, and contact information. Do the same for your social media pages and have a strategy in place to ensure these pages get updated frequently and are used for marketing and positive interaction with your target market. People rely on their Google searches when they want immediate information. Without a web presence, consumers may be less apt to trust in your product and brand.

Understanding Your Finances

Finances play a major part in any startup business operation. It is important to understand how much it really takes to get your product developed and on the market. The initial startup costs are usually the deal-breaker for many entrepreneurs. However, if you work through your business plan and fill in all of the blanks, you’ll know exactly what investment needs to be made up front and throughout the process of sales.
  • How much cash do you have to invest? If you plan to bootstrap your own business, determine how much money you have to invest yourself. Be sure to account for your personal expenses especially if you plan to sell your beverage product full time without other sources of income.
  • Will you need investors? If you do not have the means to put up the cash necessary to get started and keep going, you’ll need to investigate your options for investors. You may need to sit down with the bank to discuss getting a business loan. You may need to see the help of professional investors who will expect a return on their investment. You also may want to start out by asking friends and family to be the initial investors in your business. However you choose to obtain your capital, make sure it’s all done on a professional, legal level to avoid problems when your product sales take off. With a completed business plan, you have a better chance of attracting interested parties to invest in your idea and products.


It is advisable to consult with an experienced attorney and accountant while preparing your business plan to make sure your facts and figures are accurate and legal. There are some important legal considerations to make before your product ever sees the market. These factors include:
  • Are you operating on your own? Forming a partnership or corporate structure? If this is solely your business, you can make the decisions on your own. If you are working with one or more people on beverage products and brands, it is important to establish your company correctly from the beginning. A lawyer or account can help you understand your options for setting up your business legally.
  • Legalities of patents and protection. Once you have developed your product, you must research the essentials of patenting and protecting it. This includes not only your drink product but also your tagline, logo, and other marketing designs. Without proper protection, your ideas may be developed by someone else which can jeopardize your business. Learn more about trademarks, copyrights, and the other legalities of the beverage business by consulting with an expert in the industry.
  • Local/national licensing. There are federal and state laws regulating the beverage industry. You must research the laws pertaining to your product to ensure your business has the correct licensing and certifications. Without proper licensing, regulating agencies can shut your business down and you may face heavy fines for regulation violations.
  • Insurance. Consult with a business insurance agent to understand the insurance policy requirements for the beverage industry as well as for the business in general including liability, property protection, and vehicle insurance.


Understand manufacturing needs/outsourcing

Manufacturing your product is hard work. It is important to research the costs and legalities of doing it yourself or outsourcing the work to a certified manufacturing business. Conduct in-person visits with different manufacturers to see which is best for your company and product. Include the cost of production in your business plan so you’ll know exactly what to expect when the time comes to bottle your beverage.

Sourcing/cost of ingredients

For most beverage entrepreneurs it is vital they include the freshest ingredients possible into their product. You must understand the process of sourcing the best ingredients and determine the cost effectiveness of all your options. Will you only use local fruits to produce your fresh juice? How much of the ingredients will you need to produce large batches of your product? What is the cost of local ingredients versus shipping charges for nationally/internationally-sourced products for seasonal items?

Production equipment

If you plan to manufacture your own product, your initial investment will require the purchase or lease of the proper equipment. Investigate opportunities to buy this equipment in new and used condition. Determine where the equipment will be housed during the manufacturing process. Note the cost of buying the equipment and operating yourself versus the cost of outsourcing to a manufacturer.


While you may initially wear many hats as an entrepreneur, you will no doubt need reliable staff to help with sales and manufacturing. Be sure the cost of employees is accounted for in your business plan. Will you hire full or part-time only staff? What is a reasonable rate of pay for staff? How many staff will you need at startup and during the growth process? Consult with a human resource expert to ensure you understand the protocol for hiring and maintaining staff, records, insurance, tax information, and payroll.


Whether you plan to make all deliveries yourself during the startup phase or are seeking larger distribution deals, it is important to consider all of your options and the associated costs. Delivering product on your own may be easier initially but it still costs a lot of money in gas, mileage, vehicle maintenance, staff, and insurance. If you are looking to get your product into wider distribution channels, it may be worthwhile to consult with a broker in that area.

Final Thoughts

The beverage industry is a highly competitive one but with the right product and a solid business strategy, you can conquer it as an entrepreneur. Read the histories of many popular products of today for the inspiration to continue pursuing your dream. With research and hard work, you have many opportunities to turn a good idea into a goldmine.


Posted by Salesforce
on 05/05/2016
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