Australia’s once-thriving craft beer industry is at serious risk as small brewers are confronted with cost of living pressures and the high levels of government excise tax imposed on the popular beverage.
Co-founder of Sydney’s Philter Brewing, Stef Constantoulas, who distributes throughout Australia stated that the challenges the industry faces are hard to overlook.
“I don’t think there’s any lie that it’s a pretty tough trading environment for independent craft breweries at the moment,” Mr Constantoulas said.
The brewery Co-founder emphasized the increasing difficulty of staying competitive amid government pressures. He highlighted the significant hurdle of excise tax, a major concern shared by the industry, as they contend with rising costs.
The excise tax, set to increase every six months, poses a continuous threat to the industry, prompting criticism for contradicting the Federal Government’s earlier tax relief efforts for small breweries and distillers in the 2021-22 federal budget.
“The number of friends of ours, unfortunately, hitting the administration button or losing their businesses is pretty shocking to see,” Mr Constantoulas said.
Two Japanese companies, Kirin (owner of Lion) and Asahi (owner of Carlton United Breweries, also known as CUB) are actively acquiring independent breweries.
Mr Constantoulas revealed that he has already been approached by huge corporations. In response, Philter Brewing started an equity crowd-funding effort in October 2023, raising more than $2 million from more than 1,200 investors.
“That was a great way for us to give back to the community, to the people who supported us,” Mr Constantoulas explained.
“We could have gone down the roots of a larger corporation – they would have invested in us – but essentially, they’re going to take too much of the business”.
Philter Brewing intends to utilise the funding to expand its brewing capacity to 2.5 million liters in order to remain competitive.
And as genuinely independent Australian craft beer is becoming harder to come by, Mr Constantoulas said anyone looking to buy should research before purchasing or looking for an independent seal.