Should I Invest in A Mobile Canning Solution?


Should your small business invest in its own canning line or a mobile solution? Get advice courtesy of The Equipped Brewer magazine.


By Kinnek Community  |  October 16, 2015

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Canning Craft Beer and Hard Cider

 

The debate over using a mobile canning vendor or buying your own canning equipment will always be lively.

 

To research this article, I spoke with both mobile canning vendors and the equipment manufacturers themselves. These individuals include Mike Horn, owner of Old Dominion Mobile Canning LLC; Pete Rickert, Jr., head six packer of We Can Mobile Canning; Lindsey Herrema of The Can Van; Peter Love, founder of Cask Brewing Systems; and Michelle Dyon, marketing for Wild Goose Canning.

When to Invest in a Mobile Canning Vendor?

It’s a tough decision to make because costs associated with mobile canning aren’t always transparent, which makes it difficult to understand profit. Then, of course, you have to weigh the pros and cons of the cost of ownership, labor to run the machine as well as potential finance costs — not to mention all of the supplies you need to actually get your liquid into the can and produce a final product.

Here’s a guide for both mobile and purchased equipment.

Two Questions to Ask Yourself About Canning  

Image of a man figurine carrying a metal can on its back. Images courtesy of The Equipped BrewerIt’s not smart to just jump in and try to figure things out. The first two questions I’d recommend asking yourself are:

- Do you have the cash flow to purchase a canning line?

- Do you have the experience needed to operate a canning line?

Let’s talk about cash flow first. There’s no doubt canning will be an expense but it's an expense that brings in additional cash. The equipment is one expense but what about cash outlay for supplies, parts, storage, and training?

Ah, training. Yes, you can’t just turn on a machine and expect it to magically do the canning for you. It will take the help of several people to get your liquid into the finished package. Consider what time and travel costs will be required to learn how to use and maintain the machine.

What Our Mobile Canning Pros Had to Say About Cash Outlay and Experience

“Breweries are able to get their beer in cans when they need to, without sitting on idle equipment when they don't need it. Packaging equipment is expensive, so for small and medium breweries who don't need to can every day, purchasing their own equipment is wasted money when they aren't running it," said Lindsey Herrema of The Can Van.

“Buying the canning line is only part of the battle. Now you need cans, lids, cardboard carriers etc. You'll also need somewhere to store all that stuff! With our service we bring everything needed and take back unused materials. At the end of the day, you have beer in a pallet ready to be sold,” said Pete Rickert of We Can Mobile Canning.

And as it relates to that training and experience challenge, “Within our Mobile Canning Systems network we have the collective experience of over 30 million cans filled across the United States and Canada,” said Mike Horn of Old Dominion Mobile Canning

The Costs of Mobile Canning

Okay, so you’re curious about mobile canning but it’s hard to understand associated costs. Every single vendor I’ve spoken with has a different pricing model. It’s not easy to compare one mobile canning vendor to another [unless you use a solution like Kinnek].

Most mobile canning vendors only ask you to pay for the cost of filling cans. “All materials can be purchased by the brewery separately or from the mobile canner. Usually as a brewery’s canning volume increases, they start to buy more of the materials themselves,” Horn said.

Here’s the rundown:

  • Cost of filling cans — machine and labor
  • Cost of cans
  • Cost of printing or shrink sleeves (plate development costs and proofs cost $3,000<)  
  • Lids
  • Enviromentally friendly snap-on covers, or traditional 6/4-pack rings
  • Pack-out Materials — case tray or corregated containers
  • Freshness date stamping. “Almost all mobile canners charge extra to print a freshness date or other message on the bottom of the can," Horn said. Some mobile canning vendors also have different fees for the size of the can.

What's the Bottom-Line on Mobile Canning Pricing?

Here's pricing from The Mobile Can Man in New York using a 40 barrel batch, 12 oz. cans, and PakTech 6-pack handles to determine costs. This estimate also assumes you buy supplies from this vendor and there being leftover supplies after the mobile canning vendor leaves.

Pre-Printed Cans: $15,249.76

  • Filling fees: Expect $4.56 / case yielding 560 cases = $2,553.60
  • Pre-printed cans: 79,356 minimum can order @ $.11 / can = $8,729.16 + $3500 plate fee = $12,229.16
  • PakTech 6-pack handle: @ $.70/case = $392
  • Travel fees: $75 for travel <50 miles to $75 / additional 50 miles — one way. This example is based on 50 miles of travel.
  • End result? You’ll have about 72,612 printed cans left over for future canning.

Sleeved Cans and Shrink Sleeves: $6,329.40

  • Filling fees: You could expect a cost of about $4.56 / case yielding 560 cases = $2,553.60
  • Sleeved cans: $.165 each = $1,108.80
  • Shrink sleeves for cans: $.12 for 15,000 minimum order = $1,800 + $400 proof = $2,200
  • PakTech 6-pack handle: @ $.70/case = $392
  • Travel fees: $75 for travel <50 miles to $75 / additional 50 miles — one way. This example is based on 50 miles of travel.
  • End result? 8,280 shrink sleeves left over to use on another batch but no cans left over in this scenario.

You'll need to add the cost of boxes for both scenarios to house the 6 packs but you'd incur this cost with bottling as well.

How does this pricing compare to that offered by the vendors I spoke with?

“Using our service will range from 15 cents to 68 cents per can. The variation in price is so vast because the brewery can choose how much of the materials they want to supply. The 15 cents would cover just our machine and labor and the brewery would supply the cans, ends, etc. The 68 cents would be for us to provide everything. We tailor our service to fit each brewery's needs,” says We Can Mobile Canning.

Printed Cans? Shrinked Sleeves Cans? How Many of Each?

As you can see above, filling costs are just part of the costs associated with canning. Here are some tips from vendors about how to purchase your supplies.

Questions from The Equipped Brewer:

Q: How many cans should you buy?

“I’ve seen small 7 bbl breweries buy a quarter million cans because they have the storage space and cash. One the opposite side I’ve seen very large breweries buy just enough cans for a one day run of seasonal beer. In general, you should strongly consider buying printed cans from Ball, Crown, or Rexam if you are going to can regularly and in sufficient volume. The can manufacturers require anywhere from a minimum order of 70,000 cans up to 150,000 cans of a single style. For example, 45 barrels two or more times per month of a single style. If you are canning less, then your mobile canner has shrink sleeved cans available for order quantities as low as 3,000 cans.” Old Dominion Mobile Canning LLC 

“Start small and build. You don't want to sit on a large inventory of cans.” We Can Mobile Canning

Q: Are printed or shrink sleeves the way to go?

“While shrink sleeves are more expensive on an individual basis, the reduction in cash flow is significant. A minimum order of sleeved cans could cost less than $1,200 delivered, while your first order of a truckload of printed cans from a can manufacturer will cost over $20,000, not including graphics charges. There are two other benefits too. No. 1: high definition graphics and colors available on shrink sleeves make for the most eye-popping cans on the market. No. 2: you can get your initial shrink sleeve cans in as little as 4–5 weeks as compared to the 8–12 week lead time for printed cans.” Old Dominion Mobile Canning LLC

“Printed! If you can afford the minimum order of printed cans, then that's the best way to go. With a printed can you eliminate the cost of the label all together.” We Can Mobile Canning 

“Printed cans are definitely more cost effective for the customer, but labels are a good option for smaller breweries or those looking to split a canning run between multiple styles.” The Can Van

Regardless of the amount of supplies you keep in stock, “At some point the cost of mobile canning will exceed the cost of doing it in-house; that line is somewhere around [filling] 60,000 to 100,000 cans per month, depending upon the brewery and how they measure costs.”Old Dominion Mobile Canning

What Does it Cost to Buy a Canning Line?

Let’s look at what it takes to invest in a canning line.

Cask Brewing Systems and Wild Goose Canning, for example, both offer smaller breweries the option to get into canning at an affordable price. I learned their customers are typically breweries and cideries that already have experience with mobile canning.

“Usually when we get calls from a brewery, it’s not to weigh their options on mobile canning versus purchasing. It’s to get pricing either for budgetary planning purposes or they are ready to purchase. If they’ve been working with a mobile canner, they are more familiar with the canning packaging process and are usually ready to move forward with a Wild Goose system purchase,” said Michelle Dyson.

Wild Goose's entry level unit is the WGC 50, a manual dual-head filler, starts at $30,000. Their WGC 250, a semi-automated 4-head filler, cans 40 cans per minute. That starts at $85,000. Their top-of-the-line WGC 600 is an 8-head filler that cans 95 cans per minute and starts at $165,000. Cask’s SAMS semi-automatic machine costs $50,000.

So a brewer can get into cans with a machine that has great features like fast speeds and extremely low levels of dissolved oxygen at a reasonable price. “That’s a small upfront cost. If you spread the cost of our machines out over a year or two, our machines are especially affordable,” said Peter Love, founder of Cask.

Boiling It All Down

The biggest difference between mobile canning and owning your own canning line really boils down to labor and cost of owning the machine. The supplies are the supplies, and supply costs don’t vary much from vendor to vendor.

So if you take the $2,553.60 filling fee that I used in the example above and multiply that by the amount of times you think you’ll fill in a given year, does it makes sense to invest that money into your own machine and labor or does it make sense to outsource to a mobile canning vendor?

Some breweries and cideries will want to test out mobile canning first and see how cans perform for them. Cans are a growing format in the craft industry but 6-pack bottles continue to remain the format consumers pull out of coolers most often. Others who don't want to invest in bottles will dive right in and buy their own canning systems. Making an informed decision that makes financial sense for your business is always the best idea.

by Melanie Collins, Publisher of The Equipped Brewer & Owner of Cider Creek Hard Cider

If you liked reading this article, you may also like: Select the Right Automated Bottling Equipment



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The Equipped Brewer is an online publication dedicated to the success of young craft beverage companies, including breweries, cideries, distilleries and wineries. It shares insights, advice and strategies that give you the edge in a competitive market. Whether you're an owner, head brewer, production manager or operations manager, The Equipped Brewer will help you make smart decisions and build a thriving business.

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