Business Toolbox

Co-founder Brad Hill says customers love going to venues where beer is brewed.

“It's the best way to get really fresh beer,” he says.

“You also get the most flavour and a much better experience from the customer point of view.”

Hill says Limestone Coast Brewing’s technology, which “helps hospitality venues become small local craft brewers”, can be transferred easily and cost-effectively.

The idea was brewed decades ago but formally started in 2016 when the team of four passionate engineers and entrepreneurs incorporated Limestone Coast Brewing.

“We took this pilot plant [built in Technical Brewer Geoff Munday’s garage] where we proved the innovative technology then we built our central facility, or hub, in Malaga,” Hill says.

“From here, we actually brew the wort, which is essentially unfermented beer, and then we send that wort and transport that directly into the venues where we finish the brewing process.

“Then it’s served straight from the tanks.

“The result is a world-class system that sits in your venue on a small footprint.”

Innovative technology

Long Neck Brewery on the Swan River

Hill and the Limestone Coast team plans to replicate its Malaga brewing hub over east.

It’s also looking at purchasing more sites for its own standalone breweries. It currently operates Long Neck Brewery in East Perth.

Its “hub-and-spoke" model can service 20 venues from one brewing ‘hub’, each outputting 100,000 litres per annum. Hill says if the business expands into more Australian major cities, it could potentially service 140 venues.

Limestone Coast is currently brewing a broad range of beverages including beer, ciders, ginger beers and seltzers.

“What's really good about that model for us, is that it doesn't have all the logistics: the middlemen, the storage, the double handling, or triple handling,” he says.

“Without all those steps in the middle, it's just us and either the customer or the business that's buying the wort.

“It's a profitable business with good margins, but also then can still deliver a really well-priced quality product to the end consumer.”

The craft beer market

Craft beer is a rapidly expanding segment of the US$623 billion global beer market, growing at a rate of 10% year-on-year.

In Australia, the production of craft beer is evolving into a large and rapidly growing industry with annual sales of more than A$370 million.

“We think we're 10 years behind the US in that sort of growth curve,” Hill says.

“When we install a brewery, either for ourselves or for one of our business-to-business customers, we do it at about a quarter of the capital cost.

“So, our proposition is really attractive.”

Start-up struggles

It hasn’t been all beer and skittles along the start-up journey, Hill laughs.

“From just an idea of great beers in little kegs and fridges, to having the vision of our own venues and serving hundreds of people offering a great experience is a really hard thing to just talk about,” he says.

“But now we're able to show that, it's getting a little bit easier, and the success comes along with that.”

Hill says the business has an ambitious three-year growth plan.

“We are currently looking to raise $10m in a pre-IPO round to expand into Melbourne and Queensland and prove the business model before listing on the ASX in three years,” he says.

One common business battle that’s less of a strain is staff shortages, says Hill.

“We work in a really fun industry,” he says.

“Of all the venues that attract hospitality staff, a brewery sits at the top of the level for fun.

“We just put out an application for an apprentice brewer and had 110 applications.”

New CCIWA Member

As a new CCIWA member, Hill is hoping to take advantage of the networking opportunities, employment relations advice and investment connections.

Having a venue that’s right on the Swan River offers perfect event options too.

“We've got a really cool space [Long Neck Brewery] that feels like you've gone down to Margaret River on the edge of the city, where we can host events from 10 people to 1000 people. And we know that's successful for us; it's good business for us,” he says.

“We're obviously on a capital raising program, so I’m looking forward to seeing what we can do with CCIWA on that side of things too.”

Bright future

It’s hard to make money in the crowded beer space, Hill says, but he believes they have “cracked the code”.

“We started completely as a local, homegrown company,” he says.

“We designed every tank, we wrote every line of code, we built the entire process –- there's a massive amount of innovation. Now for us, it’s a matter of replication.

“We're pretty proud of what we've achieved.”

To be part of WA’s peak business organisation, get in touch via 1300 422 492 or [email protected].