Craft brewer SAMPLE Brew has gone into administration. Insolvency firm Rodgers Reid (RR) is seeking expressions of interest to buy the business.
SAMPLE was launched in 2014 and had four beers in its range: a pale ale; gold ale; lager; and 3/4 IPA.
In late-2017, the business announced plans to become one of the first Australian companies to undertake equity crowdfunding, partnering with Birchal.
Its prospectus on Birchal's site says the business was structured for "fast, accelerated growth through a four-tier strategy of superior production, sales, marketing and brand experience”.
According to Birchal it was available in more than 500 bars, pubs, restaurants and bottle shops, with national distribution channels.
RR says SAMPLE's annual turnover is around $2.6 million.
Independent Brewers Association chair Jamie Cook told Food & Drink Business the industry is growing so you would expect to see “a natural bell curve of business success in the sector now”.
“There’s 600 craft brewers in Australia that account for about six per cent of the entire beer drinking market. But that’s growing 25 per cent year on year,” Cook says.
Changing attitudes are driving that success, he says. “Consumers have a much stronger desire for more personal relationships with brands, greater authenticity in products with a diversity of flavours as well as feeling connected with local brewers.”
Reasons a brewery could fail are many, but some investors see the growth figures and are fooled into thinking they will get a quick return on their investment, Cook says.
Investors should not expect a return for at least five years. “It’s not easy money. When you factor in that sectoral growth rate, if you are going to succeed you need to be growing quickly as well, so that requires more capital and more investment. The return on that takes time.”
FD&B approached a number of SAMPLE directors and non-executive directors but none responded by press time.