What's next for Epic?
Mount Brewing's dream debut in Malthouse IPA Challenge. Colab's genius label idea. Lessons we can learn from Australia. Matching beer with chocolate. Our amazing sense of smell.
Happy International Beer Day friends,
As this email lands with you there’s every chance a deal is being done for the sale of Epic, which went into liquidation last week.
The liquidators set a deadline of 4pm today for the sale of the brand and its assets. But I’ve heard a whisper that the deadline has been extended until next Wednesday. Sources tell me there is “huge” interest in the brand.
While we await the announcement of that, there was also the news that Deep Creek were encouraging fans of the brand to get together to buy Epic and that they would have the space to brew the beer under licence as they have the capacity at their Silverdale production site.
Someone will buy Epic and make it work again, especially as the numbers I’ve seen indicate there could be considerable savings made on the operational side of the business.
The brand was trucking along pretty well before Covid and making some money, though not a lot. Like many, they did well in the first year of Covid, 2020.
Their taproom which opened in 2021 came with associated costs, including staffing but was largely paying its way.
Where things appear to have gone awry is that costs crept up, not by much, and revenue went down, not by much, but in both cases it was enough for a brand operating on a very narrow margin to fall into losses over the past three financial years, according to data from the insolvency firm handling the liquidation.
As reported last week, the “golden goose” in the form of their own brewery and new taproom could have saved them, but the reality is they were being propped up by an investor who got cold feet as the clock ran down. And the propping up hid the under-performance.
There’s been plenty of commentary on the root causes of the failure, including this insightful yet divisive piece from Phil Cook which has sparked a fair bit of debate on social platforms.
I find it hard to argue with Phil’s excellent points about the brand being a little tired or stuck in the past. He also dwells on owner Luke Nicholas’ personality as a factor in the brand’s demise, but there are plenty who will argue that Epic without Luke wouldn’t have the same value for would-be owners.
The one thing I would have considered more closely in last week’s story, given the power of hindsight, is the assertion from Luke that the contract brewing model had “failed”.
As one correspondent rightly pointed out, Bach Brewing operate on a similar model, also out of Steam Brewing — so share similar underlying cost structures in terms of production, freight, storage etc. But yet Bach continues to do well.
What Bach have done that might be different is lots of innovation in the new product space, notably their All Day non-alcoholic range. Plus they’ve given their brand regular updates and energy. What you see now with Bach is a far cry from 10 years ago.
Just look at Supajuice from three years ago versus Juice Axe from this year.
For those who like an in-depth look at numbers, the NZ Herald’s business whizz Anne Gibson did this story.
Mount Brewing’s dream debut
Last Friday night, the annual Malthouse West Coast IPA Challenge went to Mount Brewing with their Point Break IPA.
On the back of Eddyline’s win last year, the result confirms the massive regional strength in New Zealand brewing right now, highlighted further with Brave Brewing from Hawke’s Bay in second place.
Mount Brewing director Briar Meikle told me that just getting into the event was one of their goals for the year. Entry is by invitation and Mount Brewing were making their first appearance — some debut!
“We sat together as a team at the start of the year and discussed all our goals and a big one for us was to be at the challenges such as Smith’s and Malthouse,” Briar said, “so for us just to be there with all the top breweries was a massive accomplishment, and then to win it was honestly crazy! We could not believe it! The brewer behind the beer is our newest team member Trevor, and this beer was his first-ever seasonal so a massive win for him!”
Meikle and her partner Niall Harley have only just recently taken over the running of the brewery from Briar’s parents Glenn and Virginia, making it a rare second-generation New Zealand brewery.
Harrington’s, before it was sold to Lion, was a second-generation outfit, and you could argue that Stoke is a second-generation version of Mac’s, while Black Sands is in a transition from father Ian Hebblethwaite to son Craig… but by and large, what’s happened at Mount Brewing is rare in NZ.
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