4 Ways Kegs Are Losing You Money

Introduction

Kegs have been the standard for beer storage and serving for a very long time. At first, kegs were more convenient than their previous counterparts, wooden casks. But for the last 50 years, kegs have remained unchanged and might be starting down the road of obsolescence. Here are a few ways kegs could be costing you money:

1. Kegs Require a Lot of Labor

As you probably know, kegs require a lot of man hours. You have to move them, stack them, unstack them, clean them, and fill them. It never stops.

Let's say you spend 15 hours a week cleaning, filling, and handling kegs. That works out to 98 work days a year! That is a significant amount of time. Now imagine gaining back an extra three months a year by serving from something that doesn't require constant moving and cleaning, like a serving beer tank. You could spend those 98 days developing new beer recipes, marketing your brewery, making improvements, and planning your expansion.

2. Kegs Take Up Cold Storage Space

Full kegs need to be stored in a cooler. If you serve even a moderate volume of beer, you will need a large cooler to store your kegs.

Let's say you brew your beer in 16-barrel batches. For every beer you have on tap, you will need enough cold storage for 32 ½ barrel kegs. If you have five beers on tap, then you will have 160 kegs in cold storage. Most breweries store eight kegs per pallet and stack the pallets two high. If you leave enough room to operate a pallet stacker, you must have 180 ft² of cold storage space just for kegs.

You can drastically reduce your cold storage needs and utility costs by serving out of jacketed vessels that do not need to be in cold storage.

3. Kegs Like to Disappear

In 2007, the Beer Institute reported that $50 million worth of kegs go missing each year, which is $58.5 million in today's money.

Ken Grossman, founder of Sierra Nevada Brewing Co., says they expect to lose 3 percent of their kegs yearly. If your brewer has 1,000 kegs in rotation and loses 3 percent of them, that is 30 kegs a year. At $150 a keg, that is $4,500 lost every year!

4. Kegs Lead to Beer Loss

When foam comes out of the tap and is poured down the drain or kegs are swapped out with some beer still in them, you are losing out on sales.

A discussion in the Beer Advocate Forums suggests that you lose anywhere from 5-10 percent of your beer when using kegs. A 7.5 percent loss equals nine pints of beer you could have served to a paying customer. Over a year, losing nine pints per keg, those losses really add up. Serving 25 barrels of beer a week at $4.00 per pint, that is, over $93,000 a year in wasted beer! Download the beer serving cost calculator to get an idea of how much potential sales you are pouring down the drain.