Unexpected challenges in Killer Sprocket's 'normal'
Delivery and supply has been an issue during the Melbourne lockdowns according to the founder of Killer Sprocket, but Sean Ryan is optimistic for the future of the city’s brewing industry.
Seven-year-old Killer Sprocket opened the doors to its production brewery and taproom venue in February 2020, and a month later COVID-19 hit, so lockdown is the brewery’s ‘normal’.
“We’ve been open more during lockdown than normal times,” explained Ryan who co-founded Killer Sprocket with his partner Andrea in 2013.
“We don’t even know what a normal weekend looks like, or turnover or anything like that which has definitely made applying for JobKeeper harder.”
With announcements due this weekend regarding the future for Melbourne and the wider Victoria region, businesses across the metropolitan and regional areas are waiting for news which they will have to again adapt to.
But Ryan isn’t worried for the craft beer industry.
“I’m optimistic for craft beer because we’re an industry based on innovation and flying by the seat of our pants,” he said.
This ethos is one Ryan has brought to Killer Sprocket, facing the day-to-day challenges of being a brewery in lockdown.
Supply and delivery
Some of the biggest issues that have arisen for brewers – apart from venue shutdowns – are the unintended consequences of rules such as the 5 kilometre ‘bubble’ allowed to Melburnians and the overwhelming pressure on the postal service.
“When they did this Stage 4 lockdown, what got weird was all the auxiliary things you don’t even think about,” explained Ryan.
“All our suppliers were able to get things to us, but trying to do the right thing, like with spent grain, is much harder.”
Killer Sprocket gives its grain to a goat farmer hobbyist.
“They’d love that grain but they’re outside that 5km radius and because it’s not an actual business, it’s a hobby, they couldn’t come down to get spent grain. So now there’s an extra step in the process to get the spent grain to them.”
The pressures on the postal service and couriers have also affected the business, including an incident which will resonate with many people; having a delivery driver declare the business was not open and therefore not delivering, despite it being open the whole day.
“This is the hardest I’ve had [to deal with] is trying to get ingredients in.
“On websites for example it would show that [the ingredients were] in stock, I’d put the order through then you get an email saying we’ve got everything but these two bags of speciality malts or whatever that you need for that beer.
“You’d wait a week, it didn’t come through, then a bunch of people are on backorder so that goes out to them first. It doesn’t help that warehouses are running on their lowest amount of staff, they’re not running those things as quickly so that’s been a challenge.
“I’ve got a new pale ale coming out but I got the delivery for that through and it was missing critical bags to make the beers I wanted to.”
But in the spirit of craft beer, Killer Sprocket adapted.
“I went through our recipes and I had the ingredients for what I was going to make later in the year, so that just pushed it forward and I launched it earlier than I probably would have.”
Killer Sprocket, like other brewers including Brewmanity, decided not to invest in their own online sales platform during this lockdown.
“We do direct pickups, takeaway from the brewery so that’s fine, we made that conscious decision to not have an online store, we partnered with Pubble and Craft Republic who send all around Australia.
The lockdown has provided more practical challenges too.
“On packaging day we usually get people in to help but it’s not easy to get people in now, you need work permits to move outside that 5km radius, and only people who have been working for you for a certain time can come in
“So it’s these little things, to get help to make a beer or help package it used to be easy, now it’s all paperwork.”
In terms of sales, Killer Sprocket has, like many breweries, adapted to the new ways consumers are buying beer.
“We’ve been fortunate in that we’ve been in gypsy production for so long that while Melbourne might be in lockdown, NSW and Queensland aren’t as bad so we’ve had a lot of stock going out to the rest of the country too.
“We launched a stout and that first batch is gone, we’re having to brew another batch quickly, so that’s been really good, it’s really complicated with knowing how the lockdown has impacted us, that’s been one of the biggest issues we’ve had.”
Killer Sprocket were also listed with Dan Murphy’s before the pandemic, which Ryan said worked in their favour in a number of ways, not just providing easy access to a new audience who may have not come across Killer Sprocket before, but also relying on a big name brand which has clout with courier businesses.
“If there were issues with Dan Murphy’s deliveries, so if something went wrong like a package wasn’t scanned, they will chase it up and get a result faster than what a smaller company would if they had to deal with it,” Ryan explained.
Bottle shop chains from the mainstream to the independent have seen a surge in people buying ‘local’, although Ryan says he believes that many are existing local brewery supporters. Amongst this, a new trend has popped up in Melbourne.
“Where there’s been new customers who’ve found out they can buy Corny kegs and set themselves up with a keg fridge and they have their own knock off drinks, that’s a new market that hasn’t been tapped before.
“These people are excited, and we’ve had a few people come in, they’ve never homebrewed or been into it before but they see that as a way to have kegs in their house.”
Killer Sprocket as well as Hard Road and Project are amongst the brewers who can fill kegs, showing new ways in which Melbourne’s brewers are adapting to their changed circumstances.
Strength of Melbourne brewers
Ryan explained that craft and small independent brewers were in fact in a useful position compared to the big brewers when facing the challenges of the pandemic.
“This wouldn’t be factored into someone like Asahi’s plans, and we even saw that CUB couldn’t get their kegs out, they were just so slow to move,” he said.
“They couldn’t get it done, but for us we were and will be able to pivot.”
Ryan said what would be most interesting is to see what comes out of COVID-19 and how it affects the industry as a whole.
“It’s tough now but I think we’ll come round. Melbourne has been fortunate in that we were ahead of the curve on craft, so there’s a lot of businesses like us that have those that are sending their beer around Australia, and they’ve been able to keep up with sales in other states, which has been good.
“I don’t know if it would be the same elsewhere. In other states you’ve got little brewpubs growing up, growing their local area first and then demand pushing them into other areas.
“But it’s not not the way the industry grew in Melbourne. A lot of craft beer when we were starting out, they were going out into bars and then as soon as they could, went interstate – in the other states it’s been the other way round.”
Ryan said that the lockdown had raised wider issues about availability and logistics.
“I read an interesting article about one of the biggest issues at the moment is the just-in-time model [a ‘lean’ model which works by increasing efficiency but decreasing on-hand supplies and products] not just with brewers but lots of industries, and with the pandemic it’s hit harder than ever before.”
However it’s not going to be catastrophic for the industry, said Ryan.
“We’re in an industry that’s very supportive, it’s great. And it’s just fascinating to watch things on the news, like we’ve hit this recession, the biggest since the Great Depression.
“But one of the things that never fails in a recession is alcohol.
“We’re in this age of everything being on demand and immediate, like with Pubble and Uber Eats, and that opens up that market where people can still drink at home, so I’m still optimistic.”
Find out more about Killer Sprocket and Sean and Andrea Ryan’s journey on the Beer is a Conversation Podcast.