Brewery qualifies for little help, but looks forward to reopening

Tumut River Brewing Co. is still experimenting with table layout to facilitate social distancing.

A $10,000 NSW Government grant for supporting small businesses has been expanded to include wineries, cellar doors, spirit distilleries and microbreweries, but Tim Martin at the Tumut River Brewing Co. said that since he’s been able to keep his doors open during Covid-19, it won’t benefit him. 

“If you’re in business, if you have any kind of success, you’re excluded,” he said, when he learned that businesses had to have seen a 75% drop in turnover (compared to the same period last year) to qualify.

“It almost encourages you not to do anything.”

Mr Martin has been disappointed that he hasn’t been able to qualify for much government assistance through Covid-19, but still ultimately grateful that he has been able to continue operating and keeping his staff employed. 

“Everybody’s been able to pay their rent,” he said. “Because we did pivot (by switching to takeaway food), we’re pretty lucky. We’ve had great support from the community.

“It’s not ideal, but we’re bleeding slower than other businesses.”

Mr Martin said he’s looking at the positives through Covid-19, which has provided a new set of challenges and opportunities.

The expanded grant from Business NSW was announced this week, as the Government said a survey at the end of April revealed that many independent brewers were “facing permanent closure and massive job losses as a result of venues, retailers and non-essential services being forced to close their doors.”

The survey took in 650 breweries and was put out by the Independent Brewers Association. 93% of respondents said they were “operating at a loss and struggling to survive.”

Mr Martin has seen a 27% drop in turnover, just shy of the 30% needed to qualify for Job Keeper support. He says if he’d been “slower to react” or let turnover drop a little further, or just closed his doors, he would have been better positioned for financial help.

“It is frustrating to always be a few percentage points out of the criteria, but it’s not in your nature to sit back and let bad things happen.

“Some people won’t have a choice, they’ll have to close,” he acknowledged. “But most of us have some option, and we’re told, ‘Well done, you’re still losing money, still going out of business, but well done.’”

The drop in turnover also doesn’t tell the whole story, according to Mr Martin, who said his expenses are up and his profit is down, because he’s had to change the way he does business and is spending more than usual in adapting to Covid-19, but bringing in less. 

“It’s a big issue [for me] that they’re measuring turnover, not profit, but the Government has to have some kind of metric to measure businesses by. 

“We have nowhere near the same profit as we used to.”

TRBC is doing about 70% of its normal trade, which is well above the 75% drop required under the grants. 

“It’s a disappointing structure,” said Mr Martin, “but I don’t have a better solution.”

In the meantime, he said the brewery is accruing more and more debt, but he keeps telling himself “it’ll be fine, it’ll be over soon.”

One bright spot on the near-horizon includes the reopening of cafes and restaurants, and pubs and clubs, this weekend. 

“We’ll definitely be reopening,” said Mr Martin. 

To comply with the government’s limit of 10 people in a restaurant at a time, Mr Martin said they’ll have to get creative with table positioning and online bookings. 

The reopening brings its own unique challenges, with the potential for it being a financial step backwards if one large group comes in and stays for several hours. The brewery will have to hire staff to take care of the inside dining, but if customers are spending a lot of time with their meals, it makes it difficult to justify the staffing and kitchen outlays.

“We want customers in here,” said Mr Martin. “We don’t want to rush them, but we can only have 10 people in here at a time. 

“How do you do that?”

He said they’ll likely allow inside dining by bookings only and be forced to put some kind of time limit on each group.

“We can’t afford to have them in here for three hours, not eating and not drinking when we could be serving other patrons, but how do you manage that without a detriment to the customer experience or our bottom line?”

Regardless of how the bookings are eventually structured, Mr Martin said the brewery has “every intention” of being open Friday through Sunday for breakfast, lunch and dinner, adding additional days as the system works itself out and the government loosens further restrictions.

“For us, it’s the slow burn of all our payments and bills when we don’t have the turnover, but we’ll ride this out,” said Mr Martin. 

The full criteria for the Business NSW grants include: a reduction in turnover of 75 percent compared against the same period of last year, having between one and 19 employees and being beneath the payroll tax threshold of $900,000.

“The funds can also be used for paying utilities, salaries, rent and marketing activities to help the business through these challenging times,” said Business NSW Regional Manager Andrew Cottrill, adding that the government has already approved 20,000 applications out of 29,000 received. 

Grant applications are being taken until June 1, 2020.