Mixed reactions have followed New Zealand brewery Garage Project’s announcement of its own Australian retail website.
Wellington-based Garage Project announced on Sunday that it had launched its e-commerce platform to serve the market across the ditch.
The brewery will offer flat rate shipping on all orders. It is charging $10 for deliveries in the Melbourne area, $15 for the rest of Victoria, New South Wales, Queensland and ACT, with plans to deliver to the remaining states in the coming months.
Garage Project this year took four spots in the top 10 of the GABS Hottest 100 Kiwi Craft Beers, and its brews are in demand across Australia.
The move has met with mixed reactions from bottle shops and retailers, but consumers on the whole seem to be excited about the move.
It also highlights the balancing act that retailers and suppliers have to face whether it’s opening a venue or expanding their reach online.
Garage Project’s retailers
Tony Harper of Brisbane’s Craft bottleshop said that he could understand the move but said things like this had to be done carefully.
“There’s two sides to it. For the end user I think it is kind of good, if they bring the full range over, warehouse it and send it direct.
“Their beers are fantastic and their push is to make their limited release stuff, which isn’t available here in Australia, available.
“From a retailer’s perspective it’s like cutting someone else’s grass.”
A number of Garage Project stockists were not alerted to the move prior to the launch and found out about it through social media.
However Harper said that while at first glance it might be a difficult one when it came to Garage Project’s relationship with stockists, it could be a chance for bottleshops too, to tap into better availability of Garage Project’s beers in Australia.
“What I’ll be doing is nudging them – you’ve got limited releases and I want to get some.
“If they’re going to start shipping across the ditch then make it available to us.
“Garage Project is here to sell beer, so if they’re selling it through the website or through us they’re still selling, they might make a bit more profit on the website, but they’re still turning over stock here.”
Harper said that the great equaliser with any brewery moving online was shipping costs.
“One thing that pisses me off is that if we’re stocking someones wines or beers and they have an online store and they undercut us,” he said.
“But 15 bucks for shipping, that’s kind of the leveller. When you do get a bunch of people together and buy a heap of stuff and get the beers we can’t source, and for people in Toowoomba or Warwick or out west that can’t get to our shop and don’t have a good craft beer retailer then terrific, it’s kind of alright. They’re parity priced on the beers we have in common.”
Last year Bucket Boy’s Johnathan Hepner spoke with the Beer is a Conversation podcast about consumers ordering directly from overseas.
Johnathan Hepner of Bucket Boys, which has an online store as well as three retail outlets and one on the way, agreed, saying it was a question of cost.
“I don’t know the inner workings of Garage Project, I can only comment broadly. But if you want to retain your wholesale customers, I reckon the way to do it is to make sure whatever you are offering is at least the same price or more, to what you’re offering at wholesale.
“They’ve cut out the independent bottle shops, especially in the case of Garage Project.
“For years we were the ones that helped spread their beer all over. You can only do this when you have enough clientele, enough fans of your beer to sell online.
“From the customer’s perspective there’s this idea that if you go direct to the supplier it’s cheaper because there’s no middle person.
“What I’m concerned about is not what they’re doing, if I were a brewery and wanted to maximise my revenues I’d be doing it too. But because it’s becoming so competitive, basically everyone is forgetting about the long term health of the industry.”
Affecting the industry
Bucket Boys’ Hepner said that ecommerce platforms for breweries were also affecting the health of other retailers and venues.
“We lose more money every week due to people buying direct from the breweries,” he said.
“If that’s the way the market goes it’s fine for the consumer, but places like ours aren’t going to be around.”
He said that a healthy industry also encompasses a healthy retail environment.
“It’s not great from the industry as a whole, it doesn’t encourage diversity. It’s not just about having breweries it’s about having venues and retailers too.
“They are the places where most people discover their love of beer, finding out things, and experience new beers they would never have done on their own.”
Hepner said the more that brewers, particularly those whose beers are imported, invest in an Australian presence, the less diverse the retail market will be.
Craft’s Harper said that breweries moving online will inevitably chip away at retailers’ business, but there would always be a place for them.
“Garage Project’s beers are so good, we get them and range them and this is going to eat away at that, but not necessarily in a big way.
“[It’s important to consider] what an online shop doesn’t do. People like to come and browse – it’s why bookshops haven’t gone under, people like to go in and look at covers, titles, buy books and not just from the comfort of their own home.
“There’s something nice about something you can hold in your hand. Beer and wine people like to go into a shop and look at the cans, it’s not doomsday that they’re doing it, it’s probably on their behalf a little bit clever.”
He said with the amount of beer in the market bottleshops always had the option of moving on and stocking something else.
“They’re not the first people to do things like this. It happens to like our business model here at Craft. We find wineries that are small enough that they don’t have distributors in Queensland, and might invest two years in building the brand, and then they get a distributor pick them up and that can be frustrating, but that’s the business.”
Garage Project were contacted for comment but did not respond to questions.