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Famous Melbourne Brewery Shuts Its Doors Down
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Quickly increasing expenses coupled with weak customer interest
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FURTHER READING: Customers Outraged Over the Cost of a Pint in Sydney
The high cost of living and rising expenses have led to the closure of a cherished bar and brewery.
The Molly Rose Brewing proprietors revealed earlier this week that the acclaimed establishment in Collingwood suburb within the inner city will be undergoing changes.
Melbourne
has entered liquidation.
Industry supporters anticipate that the struggles will persist, as elevated operational expenses and increasing pricing pressures push out hospitality businesses.
While the liquidator, DBA Reconstruction & Advisory determines how to distribute Molly Rose’s assets among its creditors, the establishment’s doors will stay locked.
“We’ve experienced pressure from rising operational expenses alongside declining revenues,” owner Nic Sandery stated to Daily Mail Australia.
The expenses for insurance, electricity, gas, water, transportation, and brewing ingredients have all risen by over 30 percent, concurrently with this increase, the
cost of living
The crisis has decreased the amount of discretionary money our customers can use for spending.
‘In my home and within my social circle, everyone is venturing out much less frequently and cutting back on expenses simply to make ends meet.’
At Molly Rose, we’ve observed firsthand how these pressures directly correlate with fewer visitors coming into our establishment as well as a decrease in the amount of wholesale beer we supply to other bars, restaurants, and stores.
Regardless of the ambiguity, Mr. Sandery remains optimistic that the Molly Rose brand will ‘continue to exist in some form in the future.’
Molly Rose launched in 2019 and was crowned Australia’s top brewery bar in the previous year’s Australian Bartender Awards.
Encouraged by the success of its distinctive beers, the venue introduced a second indoor bar as well as a beer garden, a lounge area, and a restaurant in 2023.
The owner attributed a 40 percent rise in construction expenses to exacerbating the financial strain on the bar, coupled with ‘soaring’ interest rates.
In his statement, Mr. Sandery noted that attempts to address these issues by cutting expenses related to salaries, manufacturing, and transportation proved inadequate against the backdrop of waning consumer confidence and the persistent cost-of-living crisis.
The most recent regional brewer to close due to financial struggles characterized by the Independent Brewers Association (IBA) as “a myriad of small setbacks” is Molly Rose.
Deeds Brewing, yet another highly praised Victorian-era pub in the locality
shut down in recent weeks alongside Kaiju Beer in February
The onslaught isn’t just
confined to New Jersey.
Last month, one of Brisbane’s longest-standing and prominent brewpubs, Newstead Brewing Co, shut down its location in Milton. Meanwhile, Sydney’s Rocks Brewing Company went into voluntary administration back in October.
Over the two-year period ending in February, the IBA reported that over 47 Australian breweries underwent voluntary administration or liquidation.
A decline in consumer demand due to financial hardships is one of the latest issues, however, proponents argue that the root cause runs much deeper.
The IBA highlighted low competition and alcohol taxes as major hurdles for the sector, according to a report released in February.
Approximately 83 percent of all beer made in Australia is produced by two foreign-owned corporations: Carlton United Breweries, which belongs to Asahi, and Lion.
owned by Kirin
.
Consumer advocacy organizations have urged the ACCC to initiate a supermarket-like investigation into the dominant market position held by these two corporations.
The IBA stated that ‘the absence of competition within the beer industry is detrimental to economic growth.’
‘It is hurting our nations cohort of small independent brewing businesses, stifling entrepreneurship and innovation, creating a roadblock to productivity, and limiting consumer choice.’
In the meantime, the alcohol excise, commonly known as the ‘beer tax,’ has been raised 84 times to keep pace with inflation since its introduction in 1983.
Although Labor has committed to freezing the beer tax for two years should they win the forthcoming federal election, this measure would only decrease the cost of an average mid-strength pint by less than one cent.
The opposition leader, Peter Dutton, subsequently declared that his party would follow suit, honoring a previous commitment made by the coalition’s treasury spokesperson, Angus Taylor.
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