At the end of 2018, when Jean-Philippe Lalonde drew up the business plan for Brasserie Silo, his hope was that it would become a destination for residents and workers in the Chabanel district. Historically, this area of Ahuntsic has been deserted after working hours, with nowhere to go out or hang out with friends and colleagues at the end of a long day. The opportunity was all the more favourable in light of recent zoning changes allowing for the opening of businesses and restaurants on Louvain St., with a view to revitalizing it and generating economic activity in the area.
Jean-Philippe, who also owns the Birra bar in Little Italy and was a former Brewer and Partner at La Succursale, a craft brewery on Masson, found a home near café Barista, whose owners share his desire to generate traffic along the artery. The entrepreneur selected a vast former t-shirt manufacturing building that included 125 parking spaces and an outdoor terrace, an unheard-of commodity in the neighbourhood. He was also able to install a giant mural to enhance the brasserie experience.
Jean-Philippe Lalonde offers a choice of a dozen different beers, all brewed on-site. Selections include classic German and Czech lagers like Pilsner and Kellebier, along with Birra favourites, such as Irma, Ginette and Francesco.
Ahuntsic residents flocked to Birra, alone or in groups, for an after-work drink or two, and this gave him an idea about the void that was waiting to be filled north of the Metropolitan Autoroute. Silo is located within five minutes of numerous businesses on l’Acadie Boulevard and the Marché Central, which generate a large concentration of potential clients.
A sudden and unexpected course change
In March of 2020, a successful launch appeared to be a harbinger of a very profitable first spring season. Unfortunately, a short three weeks after opening, Silo was forced to adhere to the Public Health directive respecting the mandatory closing of non-essential businesses and stores, and so he closed the bar.
Originally in effect until April 13, the health measure ended up being imposed for more than three months. Not only did this compromise the better part of the peak season for Silo (April to June), but it also forced the Owner-Brewer to demonstrate the resilience and agility of his business, and to adjust his strategy.
As a result, although the distribution of beer in cans had constituted one of four sources of revenue in his initial business plan, it became the activity that would keep the company afloat.
According to Jean-Philippe Lalonde: “At the beginning, our income was expected to come from four sources equally: the sale of draft beers at Silo, sales at Birra, the sale of our draft beers in other bars and the distribution of beer in cans. However, when distribution was the only avenue open to us following the government decrees at the end of the winter, I made the change in that direction in order to ensure the continued existence of the business.”
In the spirit of transparency, Jean-Philippe admits that, all in all, the adaptation was fairly simple, but also taxing in terms of the amount of time that had to be devoted to it.
I had already signed agreements with a number of partners: label designers, suppliers, distributors, etc., so the structure was already in place. The volume of production was really the major challenge.
Nevertheless, it was necessary to squeeze every bit of juice out of this sole source of income, the main reason being that the profit margins for this activity were considerably lower than for the other activities. In addition, the preparation and aging process for a canned beer is longer that for a draft beer. On top of that, the labelling alone ate up half of the production costs.
Rapid implementation of logistics
One of the major logistical challenges that Silo faced was the need to use a mobile canning system, because the company had not planned to install an internal canning system so early in its existence. In order to make the rental costs feasible, it was necessary to undertake the labelling of a least two products each time. In addition, because production volumes were so much higher than what was originally expected, it was necessary to acquire larger tanks, which was a costly purchase for such a young company.
In my initial business plan, those tools were not expected before the third year.
Another step that suddenly became of paramount importance was establishing relationships with a much larger number of specialty retailers. “I didn’t want my beers to just be put on shelves with all the others. I wanted them to be recommended at specialized points of sale. To do that, the staff at each location had to know the history of our beers so that they could talk about them in context and explain to consumers what sets them apart from the others, and so on.”
Looking back, even though the pandemic played havoc with his original game plan, Jean-Philippe Lalonde says that he is satisfied with his first year in business. “I put my 15 years of experience in the brewing industry and my knowledge of the steps of launching a business to good use. What’s more, right from the start, I calculated everything in such a way that Silo would always remain below the risk thresholds. By experience, I know that anything that can go wrong will go wrong. That being said, like the rest of the world, I can’t wait until things return to normal, because that will enable Silo to become a destination in a neighbourhood that desperately needs one.”
How PME MTL has made a difference for Brasserie Silo
“In launching Silo, I relied on PME MTL to help me develop my financing package and facilitate access to resources. Thanks to their advice and their extensive network, PME MTL is able to direct entrepreneurs toward the right resources for their situation, which enables them to make the best decisions. In addition, with their many support programs, PME MTL can help you acquire the tools you need when things don’t go according to plan – like when an unexpected pandemic hits during your first weeks in business.”
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Brasserie Silo is supported by PME MTL Centre-Ouest.