Regional Manufacturing:Microbrewtech, Oamaru

Simon Ross of Microbrewtech, based in Oamaru, shares with NZ Manufacturer his company’s role in manufacturing beer bottling machines for the craft beer market.

Describe your company’s main areas of activity.
Microbrewtech manufactures beer bottling machines designed specifically for the craft beer market. A significant gap was identified and we developed a machine to fill the gap.

Breweries with capacity up to around 1800 litre batches are considered to be the target market. Microbrewtech has so far only sold into Australia and New Zealand because we are a small company, however there is a large international market and plenty of interest from further afield, even with though our advertising strategy is deliberately being limited trans-tasman.

Microbrewtech has limited heavy manufacturing capability and most of our components etc. are outsourced from New Zealand and as far away as Germany. Final assembly, wiring, programming and testing is performed in house.

What area(s) of the business are currently being developed?
Documentation is constantly improving, as well as programming, streamlining assembly techniques etc. Each time a small issue is encountered an effort is made to improve the design, or process. An Australian dealer has been engaged to allow an increase in manufacturing capacity and sales.

Does the company place much emphasis/outlay on R & D?
Yes. This company is based on R&D, and is now growing manufacturing, distribution and sales roles. R&D outlay is difficult to quantify, as it began far before the company was formed. For example, I left my former job working for a company designing / manufacturing microlight aircraft and worked for 10 months with no income before selling the first unit and forming the company. Prior to that there had been a couple of prototypes as well.

New product development has been put on the back burner at this stage in order to get the company into the black!

Where do you export to and where are future opportunities?
As stated above at this stage only to Australia. I have been in negotiation for a sale into Thailand, because it’s owned by Australians. The step towards having an Australian dealer is the first step toward further international expansion. The UK is the next target market. They have over 400 microbreweries being installed each year.

How do you find current business conditions?
The business is too young to gauge this- I don’t have any yearly trends or overall feel for macro business conditions in general, but there’s a lot of interest in this product, craft beer is growing like crazy at the moment.
It has hit 20% of the market in the USA, in New Zealand and Australia craft beer accounts for only around 4% of the market, Australasian craft beer is said to be around 10 years behind the US, so I believe it’s going to grow a lot. My partner Jess is a brewer, and we thought we had a good handle on Australian craft beer, we can’t believe how many breweries enquire about the machine that I have never heard of!

What assistance would be beneficial to your company’s growth?
As stated, my past career has been mainly in design and development, so the business, sales side of the business is evolving, and could use some input toward growing the business.

Staff. Is it challenging getting the right staff?
Mostly this is a one-man band at the moment, I have had some help assembling, and help from friends and family along the way. Increasing sales and markets would allow some staff to be added to the business, growth is probably the most challenging part of the business.

The future. What is the 5-year plan for the company? Where to from here?
At this stage the plan is to expand into the UK and eventually the States. There’s no way I could produce enough machines to cater for those markets right now, while keeping customer service at a high level. So I guess it’s all business development!

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