In this episode of Legally Consumed, our CIE Legal co-hosts took a seat at the bar to learn more about Bonehead Brewing, an independent craft brewery in Melbourne that focuses on producing well-balanced and approachable beers. Hosting us at their brewery for a beer and a chat were co-founders and self-nominated boneheads Anthony Dinoto and Travis Nott, two friends who started their co-working journey stacking shelves, and later turned competitive homebrewing into a business.
Our second episode explores everything that goes into producing a perfect pint at Bonehead Brewery, from understanding the consumers’ purchase path to learning how to do more with less.
In this conversation, Anthony and Travis share how to (or not to) announce that you’re starting a business together and highlight the importance of doing a proper IP search before choosing a business name. They also discuss how the government can help encourage the growth of smaller brewers by scaling the amount of excise tax that a brewery would pay depending on the quantity of beer produced.
If you are a beer lover and drinker, or simply interested in the work involved in starting a business, then this podcast is for you.
If you would like to provide feedback on this episode or have any questions for CIE Legal, please reach out to us below:
Raph Goldenberg (00:05): Hello and welcome to Legally Consumed, a Consumer Products podcast by a consumer products law firm in Australia. I’m Raph Goldenberg and I’m joined by co-hosts Kaye Ho and Will McMinn, who are members of the team at CIE Legal.
Kaye Ho (00:13): We chat with executives of consumer products companies, their legal teams, and industry experts who give us a peek into their journeys as people. We explore industry changing ideas and even share tips and tricks on how to navigate the consumer product space.
Will McMinn (00:26): This season, we’ll feature guests from the automotive, retail, advertising and insights, food, beverage, and primary production and franchising sectors.
Raph Goldenberg (00:38): Today, we’ve got two guests on the Legally Consumed Podcast. We are very lucky to be joined by Anthony Dinoto and Travis Nott, co-founders of Bonehead Brewing. We’re even more lucky to be recording this podcast at the brewery and drinking some of the product as we do. So my co-host today is Will McMinn. Welcome Anthony and welcome Travis and welcome Will.
Anthony Dinoto (01:19): Thank you for having us.
Travis Nott (01:20): Yeah, thanks for having us on.
Raph Goldenberg (01:22): It’s a pleasure. This is very exciting. Thank you for joining us. We always like to start the podcast by just hearing about your journeys, how you started off. Anthony, we might start with you. Can you just introduce yourself? Tell us about your first job and kind of how you got to where you are today?
Anthony Dinoto (01:45): Well, firstly, I’d like to say thank you for pronouncing my surname correctly, there’s points for that.
Travis Nott : I’ve been saying Donato our entire life.
Anthony Dinoto : Yeah. We’ve only known each other for 30 years or so.
Travis Nott : My surname’s Nott so it just rolls right off the tongue.
Raph Goldenberg (01:57): <laugh>. It was a lucky guess.
Anthony Dinoto (01:58):Well done. Points for that. So a little bit about myself. I’m a middle-aged father of two children, <laugh>, who happened to have a bit of a career change, approaching 40 years old. Someone would call that a midlife crisis, I suppose. Wouldn’t they <laugh>? Yeah, I wouldn’t. So my first job, I ironically worked with the bloke next to me now stocking shelves. At Big W doing night shifts back in the mid-nineties. Mm-hmm. So Travis and I went to high school for one year together. We did year 12 together. And Travis pretty much got me my first job, I would say. Because you were already working there, weren’t you?
Travis Nott: I did. I was, yeah.
Raph Goldenberg (02:42): And what did you do? How did you end up from Big W to Bonehead Brewing? You must have done something.
Anthony Dinoto(02:47): Little bit of journey, something in between. So, at the end of year 12, I didn’t go to university myself. At the end of year 12, my parents were like, “Okay, you’ve had a week to sit on the couch. Now <laugh> you can come and work at the family business for a little bit until you find your feet and what you want to do but you’re not sitting on the couch for the rest of your life.” And that was a great valuable lesson, by the way. So I really do appreciate that. It’s long term. I did anyway, <laugh>, and 20 years later I was still working in the family business, running it. My parents were long retired.
Anthony Dinoto (03:16): Yeah. So Travis and I, as I said, we went to school together. We started home brewing in pretty much about the same time.
Travis Nott (03:20): Same weekend, I think.
Anthony Dinoto (03:23): I think you got a kit for your 30th birthday. Yeah. <laugh>. Yeah.
Travis Nott (03:25): Um, Mum’s Pilsner. Yes.
Anthony Dinoto (03:26): So we started home brewing, coincidentally about the same time. And over the years we enjoyed it enough that I was the best man’s speech at your wedding, and kind of announced to the world that we’re going to do this as a profession.
Travis Nott (03:43): I hadn’t had that conversation with my fiance, their wife at that time. Ant’s fantastic. I love Anthony to death, but Ant will put his foot in his mouth. There’s a button. There’s a I know <laugh>. Yeah. So, and Jayde, to her credit, was great. She’s been extremely, this is my wife. Extremely supportive.
Anthony Dinoto (04:03): Yeah, and I must say that we couldn’t have done what we’ve done today without our wifes’ support.
Travis Nott (04:04): Absolutely.
Raph Goldenberg (04:05): So Travis, tell us a little bit about you and obviously your mates with Anthony, but I’m sure you had a slightly different journey to get to where you are.
Travis Nott (04:13): Yeah, absolutely. We went to high school together. My first job was actually selling pies at the football. I was a snacks vendor.
Anthony Dinoto (04:19): Hilarious that you hate the sport.
Travis Nott (04:20): Yeah. Which was actually to my benefit because I was the only one that wouldn’t stop selling and watch, oh, I’ve made my money. I’ll just sit down and watch the game now. I would just keep hustling. So you’d always get, you know, the best seller and then a bonus. And then I found myself, I couldn’t stand retail.
(04:59) So, sort of had another couple of gigs working on the cusp, the automotive and finance and insurance industry as a research analyst for a publication. Always wanted to work for myself, but had no idea how to do that or what to do that in. I got into sales and marketing and kind of never looked back. I worked for all manner of FMCG, always nicely, I suppose if looking at the resume, always pretty much the leaders in what they did, which was good.
Will McMinn (06:08): Can you name a couple of them?
Raph Goldenberg: (06:09): Yeah. Cause we are a consumer products podcast, so we are keen to hear about that.
Travis Nott (06:13): Yeah, no problems. I started, I suppose, in that world for Foster’s Brewing International. So it was a duty free sort of role. So I managed those accounts just as a key account manager, and that was brilliant. Sort of got me exposure to beer. This was back when they were sponsoring the Association of Surfing Professionals and Formula One. So it sort of was, at that time, they were the two things that I was really passionate about. Yeah. And then beer, which I was passionate about as well, so definitely…
Anthony Dinoto (06:38): Definitely passionate about drinking it.
Travis Nott (06:39): Oh, yeah. And I suppose back then there was no real craft beer in the country. So the craft beer for us was the Belgian beer cafe at the Bluestone building.
Anthony Dinoto (06:57): And trying to offload cases of Pure Blonde off to your mates. Yeah. And he wasn’t buying it.
Travis Nott (06:59): Ant was a stellar drinker in those days, and there was stellar oi not Australia. Um, and we would have, basically working at Forster, would get given two cases of beer. Mum. So you’d always get the beer you wanted to drink, and then I think at the time they were trying to get rid of Pure Blonde when it first came out, <laugh>. So you can have two cases of whatever you want, or you can have four cases of Pure Blonde and I would always have people say, oh, have you got beer? Have you got beer? So it would always take one case for me in two cases of whatever I had to get rid of for family and friends.
(07:38): I’m sure it’s like drinking a battery. I think that’s where low cal[ories] beer. Yeah, low taste beer too. <laugh>. So I worked with those guys for a little bit and then, jumped out, worked for 20th Century Fox Home Entertainment, doing DVDs for a long time.
Anthony Dinoto: He also palmed on DVDs to me that I wanted to watch.
Travis Nott: And then, what else? So then from there, I worked for the guys that founded or started bringing in Rekorderlig cider in the country. So Red Island Imports, that went on to become Quiet Deeds and now Deeds brewing. So I worked for those guys back when it was literally just Pat Dave and myself sitting around a table like this. And then jumped out and worked at Pacific Brands and I was a national sales manager at Tontine for about eight years before we started this. So, yeah. Very different paths, you know, really different paths.
Anthony Dinoto: You’ve done a lot, haven’t you?
Travis Nott: I have! Very hard to hold down a job when you’re a drunk. Um, <laugh> No, for anyone listening, I didn’t do that. Um, excellent. Yeah. So yeah, so it’s kind of a crash course in sales and marketing, I guess.
Will McMinn (08:48): Great. Thanks guys. Can you tell us a bit about the history of Bonehead Brewing as an organisation?
Travis Nott (08:56): Yeah, so I mean, as Ant touched on, we started brewing pretty much on the exact same weekend. And we saw this, I always had a desire, I always had a want to do something like this. And I knew that if we were going, if I was going to do it, it was more likely going to be with Anthony. I mean, we were in competition more so than collaboration with each other for a lot of that 10 year period, fair to say. You know, two mates always trying to out brew each other and make a better beer than one another. <laugh> I started very slowly and improved.
Anthony Dinoto: (09:29): Yeah, yeah. It went past him.
Travis Nott: (09:31): I wouldn’t say that, but others may. So we took very different paths, right? So, to be fair, I came out, I wanted to, at some point I wanted to have a brewery. So I literally developed five or six beers that were the types of beers that I wanted to make. And I spent a long period of time trying to perfect those beers. And some of those beers are still on today! So Mum’s Pilsner. We sell, which was the first beer I ever made. Mum gave me the barrels, the Home Brew kit for my birthday. So Mum’s Pilsner was the first beer ever penned, and to this date, it’s still pretty similar.
Raph Goldenberg: (10:08): So how long ago was that?
Travis Nott: (10:10): Oh, that was 15 years ago. Yeah, 45. That was at 30. So, whereas Ant took to it as he just wanted to try his hand at anything and everything that he could possibly make. And I think that’s the business model today, I think. And it is, you know, and you found, you kind of found IPAs and then really, uh, really started focusing on those. I, to this date, have never made an IPA. They just weren’t what I wanted to focus on. So we took to it in a very different light. And then circa, oh God, we were at it for, as I said, maybe nine years, eight, nine years before we decided, okay, we’ve either, we’re either gonna die wondering, um, or we’re going to do it. Yeah. And it was,
Anthony Dinoto (10:55): It was about early 2016. We started really seriously considering it.
Travis Nott (10:57): Yeah. We called ourselves Scoundrel Brewing because, and you know, this is, I’m sure, for the little bit of money that we made, a little bit of beer that we made and sold, no one’s really gonna, you know, dig too deep into it. So we called ourselves Scoundrel Brewing because it was just all brewed in the backyard and it was all sold to weddings, parties, and anything. Right. So we had a mate that had a wedding. We would, for a hundred bucks, a keg of 20 litre corny kegs, we would rock up and pour beer.
Anthony Dinoto (11:23): Or if a cricket club needed some beer.
Travis Nott (11:24): Cricketer Club needed some, all that type of stuff. Right. So we weren’t selling it commercially, we were doing it under the radar. And it was quite scoundrel.
Will McMinn (11:36): Yeah. And presumably Pirate Life was taken at that time.
Travis Nott (11:39): Exactly. Yeah. You’re exactly right. Yeah. And as it turns out, so was skeletal. Um, so, right. Ok. So after, yeah.
Raph Goldenberg (11:46): So this is where the legal comes into the podcast.
Travis Nott: Absolutely.
Anthony Dinoto (11:49): Yeah. Probably leads into the next question, I suppose, isn’t it?
Travis Nott (11:51): Oh, is that why we’re called Skeletal?
Anthony Dinoto: (11:53): No, why we’re called Bonehead.
Travis Nott (11:54): So why we’re not Scoundrel. So basically, when we decided to do Bonehead Brewing, we decided to divide and conquer. I still had my day job. And Ant was finishing up what he did to start working at Bonehead. So it made sense. Anthony had to then become the brewer and from the background, I’ll take care of sales and marketing. So that was kind of what I’d always done. Ant was, you know, at that point, I had gone off and done other hobbies. Anthony continued brewing. He had gone off and done some extra study for brewing. So that just made perfect sense. I then did the IP search for Scoundrel Brewing. Um, not realising that if I didn’t…
Anthony Dinoto (12:35): We had legal advice, didn’t we?
Travis Nott (12:36): Well, no, at that point we didn’t. I just went and did it and thought, right, it’s available. Let’s, call ourselves Scoundrel Brewing. Which is, I’m sure if I had done an IP search for fish and chips, I probably would’ve tried to register fish and chips. Right. Like I, yeah. So lesson learned. A bit of a bonehead move. And then for a little while, I, for a long time later, I then tried to sell Anthony on the name Bonehead because it was, it was very much what we were about.
Will McMinn (13:07): <laugh>. So, and you prevailed.
Travis Nott (13:08): And we prevailed. Yeah.
Will McMinn (13:10): You prevailed. Yeah. What was the turning factor, Ant?
Anthony Dinoto (13:15): Turning factor? You may as well. You may as well. Turning factor, the turning factor was, so my mother’s got severe dementia these days, and one of her last lucid conversations with me was, do you trust Travis? I’m like, yeah. So then do you trust that he’s going to make the right decision? I’m like, yeah, of course I do. So just go with it. Because I was resisting the name.
Travis Nott (13:34): I’ve never actually said this, but are you sure that that was her, your last lucid conversation? Or was she, was she wrong? Like <laugh>?
Anthony Dinoto (13:45): She was wrong. She still had her wits about her at that stage. And then, yeah. Didn’t for much longer after that.
Raph Goldenberg (13:55): So, how did you get out of the Scoundrel situation? Or did you prefer to talk about that?
Anthony Dinoto (13:59): Well, it wasn’t much of a situation to do really. We asked, so long story short, there’s a winery in South Australia who we won’t mention, but they have trademarked the name Scoundrel for one of their wines. And we asked if we could co-exist. Yep. And over the phone, it was like, yep, I’m sure we can come to some agreement. And then a few days later, got a cease and desist. Mm-hmm.
Travis Nott (14:19): And then we picked up the phone again. And so I could have sworn I was talking to you about this. Yeah. Where were we having conversation <laugh> to which it was replied, that’s a lawyer, and why will we let go of it? So we say, okay. No, that makes perfect sense.
Will McMinn (14:35): Ticking all of the boxes in Raph’s head for IP and trademarks.
Raph Goldenberg: Yeah!
Travis Nott (14:44): <laugh>. Yeah. Look, I mean, it is what it is. And when we were first starting out, there was no way that we were going to try and fight anything. You know, as you know, when you’re starting a business, you put all your money into the business and try to get as much stainless as you can to make as much liquid as you can. Not hire people to fight things that are probably a losing battle.
Raph Goldenberg (15:02): So, and in a way, lucky, I guess, that you found out at that stage before, it was before you’re too far along and you could actually rebrand and absolutely do something different.
Travis Nott (15:10): And we can bounce off it, you know? Yeah, absolutely. You know, by calling the business Bonehead Brewing, which this probably does lead into the next conversation by calling a business Bonehead Brewing, it did one of a few things. It allowed us to continue that narrative and that story, therefore, why you no longer called Scoundrel. So the 15 people that knew who we were kind of got some continuity to it, <laugh>.
Will McMinn (15:32): For sure. So you were saying before, you know, nobody starts a business to pay lawyers. You start the business so that you can buy as much stainless steel as you can. But Anthony, why don’t you tell us a little bit about the process of making a brew. How hard is it to run a commercial brewery in Melbourne?
Anthony Dinoto (15:45): A little bit harder than I first envisioned. <laugh>. Um, so…
Travis Nott (15:50): Do something else. If you’re listening at home.
Anthony Dinoto (15:52): <laugh>. Yeah. Unless you got loads of money.
Will McMinn (15:55): These guys, they don’t want the competition.
Anthony Dinoto(15:57): No, no. It’s got nothing to do with that.
Travis Nott (15:58): Please. That is also true.
Anthony Dinoto (15:59): I do, I believe a rising tide lifts all vessels. So, yeah. A little bit harder than I first thought. So we had some serious low budget original plans that we were gonna do, even starting off in my backyard with a small, small 300 litre brew house. And then it got scaled up and I did some research. And the more I read up, I’m like, no, we’ll be broken the first five months if we do it this way, we’ve gotta go large or go home. And when I say go large, we’re still tiny compared to most, but it’s as large as we could afford. I’d had no personal experience in a commercial brewery before, short of being in a few, but never really worked in one or knew the goings on of one. I started to meet a few people in the industry and obviously got a bit of advice.
Anthony Dinoto (16:48): And luckily my neighbour, by coincidence, was opening up a brewery at the exact same time in Argentina. He was moving, so he was from Argentina. He was moving back to Argentina to open up a brewery pretty much the same size and getting equipment, ironically, from the same place we were looking at and everything like that. So, long story short, he was an engineer and had a larger background on how to actually assemble the stuff and know what the right course was. So, I bounced off him quite a bit. We ended up buying the equipment together. Well, not two for one, but it’s…yeah. We packaged our purchases together and we actually went to China together to go inspect it and make sure everything was to our specifications. And when we got it back here, we assembled a fair bit of it ourselves, and they brought a technician over from their factory to help us assemble it all up. And, yeah. I mean there were a few learning curves there. Like we had no idea how a steam boiler actually functioned. We just thought you would buy a boiler and plug it all in. It’s a lot more complicated and expensive than that.
Raph Goldenberg (17:54): Because we just took a look before we started recording downstairs at all the big equipment there. It has to be expensive, doesn’t it?
Anthony Dinoto (18:06): It is, it is. I mean, there’s a lot of big investments. It is on our scale. It definitely is. I mean we’ve got complete skin in this game. Our mortgages are basically paying for everything you see next door. Yeah. Well the initial startup anyway on that. So we did everything we could within our budget and I mean, there’s other breweries that are a lot more flash and have a lot better equipment than us. But
Travis Nott (18:28): Yeah, to jump in there really quickly. I think as a business and as a team, we kind of pride ourselves on punching above our weight, if that makes any sense. Right. So, for a long time we were running around saying, well, we were telling everyone, they’ll come in, basically ‘we are Melbourne’s cheapest built brewery’, right. <laugh> in terms of how we’ve put it together.
Will McMinn (18:46): Well. It was a very impressive set of vats over on the other side. Can you guys tell us a little bit more about what goes into the vats and the range that you guys make?
Travis Nott (18:58): Yeah. Do you want me to tackle this?
Anthony Dinoto (18:59): Go for it.
Travis Nott (19:00): So I think, for us, we’ve really looked at, I suppose diversifying our portfolio or getting a range hierarchy I think is important. And from my time in sales and marketing, I think that it’s important that people understand a brand. You’ve kind of got to be comfortable with what they’re putting out. So we do a lot of different tiers, and we’ve got that hierarchy, it’s got some entry level sort of stuff that we do as white paper around the world. So you might go into a pub and see such and such pale, well, it’s just Bonehead pale or such and such Mexican Cerveza and it’s our Cerveza. Um, we’ve kind of got two or three of those lines. And then we’ve got a whole bunch of classic boneheads which are beers that are a little bit less mainstream than you’ll think nowadays.
Travis Nott (19:44): So we don’t have a standard IPA in that range. We don’t really have a standard pale ale in that range. They’re the dark lagers that we do. So ‘Sweet Pea’ is a dark lager. ‘Phaze Out’ is our New England IPAs, probably the most mainstream that we do nowadays. We’ve got a beautiful American red ale, we’ve got a Czech style pilsner, and these are the beers we launched the brewery with. And we have people coming in going,“you’ve not got an IPA, you’ve not got a pale ale. What are you doing?”. There’s plenty of good IPAs and pale ales out there, go and drink those. Right. We are doing stuff that’s a little bit different here. Not anymore drink outs. Yeah.
Raph Goldenberg (20:17): I was actually struck by the range. It’s quite like when we went to the bar there, there’s quite a few there. So, that must make it more complicated.
Travis Nott (20:27): Makes my job tricky. It does. Yeah. I mean, and not as hard now as it was when we first started. When we first started we only had four little 10 hec tanks. Um, so 10 hec fermented, so a thousand litres a piece. And we had no canning line. So we had a contract counter. We had a guy that would turn up in a van (and this is something you can still get done), unpack all these canning equipment and then set up downstairs in the bar and pack and the economy of scale says you need to pack all four tanks at once to make it worthwhile. So we had to line up, or Anthony had to line up the production schedule from the end. So what date is everything going to be finished? Let’s work back from there. That’s when the can’s coming in and we’ve got a brooker’s beer.
Travis Nott (21:08): This beer doesn’t all take the same amount of time to ferment or to get ready. So we had to kind of line it all up from the back. It was a nightmare. Nowadays we’ve got a lot more space and a lot more tanks. But we have these classic boneheads, which are our core range. And then we are putting out a new beer or a limited release beer once every two weeks. So the market at the moment, and the market for the last few years has definitely been one of, sometimes it’s, I’ll only drink a beer once. So you get people, it’s kinda like Pokemon or Gran Tourismo if you’re into that type of thing, where you’ve gotta collect everything, you know? Um, so you get people walking into a bottle shop. You gotta collect all the cars in Gran Tourismo. So it’s like you gotta walk in and you walk into a bottle shop and you might, you buy a mix six pack.
Raph Goldenberg (21:58): Yeah. So you’re talking about the canned beers, canned only for a couple of weeks.
Travis Nott (22:01): Yeah, absolutely. Yeah.
Raph Goldenberg (22:03): We’ll, I guess you’ve got the flexibility, don’t you, to do that.
Travis Nott (22:07): And that’s the idea. We’ve got so many tanks in there now that we can just have new beers on.
Raph Goldenberg (22:12): But do you have to make a new label for each one?
Travis Nott: Yeah, unfortunately, yes.
Raph Goldenberg: Wow.
Travis Nott (22:43): Yeah, so a new label, new tap decal. We try to do a lot more in kegs than we do in cans. But yeah, essentially we’ve got a new beer every two weeks, mainly under either the ‘Bonafide’ series, which is just our series release, funny enough. Or we do another release called ‘Smells like Pop Culture’. And the dry hopper that you’ve got there is part of that. It’s actually a dry hopper Die Hard reference. It’s our Christmas beer <laugh>.
Will McMinn. : That’s great
Raph Goldenberg (22:48): Where, where can you buy them? So where can you find them? Around town?
Travis Nott (22:53): Where’re in most craft beer outlets. So small local bottle stores, independent local bottle stores. We’re in a couple of Vintage Sellers, First Choice Liquors and Liquorlands. And we are, before Christmas, we should be in about four or five Dan Murphy’s in Melbourne. But we are available nationally. So we’ve got distributors taking care of the other states. We just focus on direct sales here in Melbourne. We’ve got a website, boneheadbrewing.com au. So we’ve got an online store there. And we’ve got the tap room here at 86 Parson Street in Kensington. But yeah, get into if you’re listening at home, get into your local bottle and ask them for Bonehead Brewing!
Will McMinn (23:32): <laugh>. We’re gonna wrap up this sort of section of the podcast with, we can’t escape COVID. During those dark days, our Premier told us not to get on the beers during lockdowns, but everyone did, obviously. How did COVID affect your business? Did it grow? I know there was growth in the consumption of it. <laugh>. Did you guys sell more beer over COVID?
Anthony Dinoto (23:56): It completely changed the way we did things. I mean, pre-COVID, wholesale sales were a very small portion of this business. We relied a lot on the bar and people coming in over the weekend and drinking at the bar. And I think I would say maybe 20% of it was wholesale, 25% was wholesale. Mm-hmm. <affirmative>. And that completely flipped on its head. Like I worked at the very last shift as the Premier was announcing everything shutting down tomorrow. And from there we’re like, okay, luckily we had just purchased that canning machine about a month or two earlier mm-hmm. And we’re able to say, ‘okay, everything that’s about to go in kegs, change course, we’re going to put it all in cans’. And we were able to, at first, set up a really quick website, which still serves us well today. Sold a fair portion of beer online because there were a lot of people that just still wanted to support us, which was great. And then eventually Travis and the sales guys really pushed hard on the wholesale and it changed our business significantly, I would say now to 20% of the bar. And the rest is wholesale. Yeah.
Travis Nott (25:00): Thereabouts. So it’s flipped on its head, it’s flipped on its head. We were able to keep operating during that time.
Travis Nott (25:07): It was difficult. It was difficult and I mean, I don’t wanna get too far into it. Yeah. But the whole job of keeping things going. Yeah. The way that it was structured didn’t really favour us. We had just purchased a couple of extra tanks and a canning line, which means we were actually producing a whole lot more liquid than we were the previous year. And they only took one metric into account, how much you’re actually physically selling or how much you’re actually spending. And we only qualified for the first three months of Job Keeper I think it was. And then after that we were cut a drift and, it made things pretty tough. But we kept full staff on through COVID, to our own detriment probably. And we sacrificed quite a bit, both of us personally, to make sure everyone still had a job. Yeah. And we could still function as a business mm-hmm.
Anthony Dinoto (25:55): <affirmative>. Mm-hmm. I mean, as a business. Look there were some really good things and we’ll talk about those in a moment, but to get it out of the way. Yeah. It nearly took us to the wall a couple of times. And we’re still recovering from that hangover. We’ve got it from that. We’ve got a big COVID hangover. You know, the market really is something that’s just come back to where it was pre-COVID. And you know, honestly I’m rolling into New Year’s. Last New Year’s, basically everybody went to a super spreader event. We all got Covid. And then whilst it wasn’t a lockdown, everyone,
Travis Nott (26:24): Um, it might as well have been. It may as well have been.
Anthony Dinoto (26:27): Yeah. Everyone just went home. So the first six months of this year was the hardest retail landscape I’ve ever seen. That was quite difficult during it. Loo, for rightly managed or not. If it wasn’t for Job Keepers, we wouldn’t be here. If it wasn’t for our own, you know, coffers be that mortgage or whatever it might have been, we wouldn’t be here. But we just, we made a decision as Ant said to keep everybody employed and we did everything we could to make sure that happened. From a brand perspective. So there’s all the negatives and the hardships. From a positive perspective. You know, everyone said that beer consumption did this. That was great. And that was, you know, if you think about the people that report, the companies that report on those metrics, they’re not your local craft bottle shops.
Anthony Dinoto (27:20): Right? They’re your Coles and your Woolworths. They’re the guys that have the JFK data. They’re the guys that have the point of sale systems that record and report on that. And that’s not our end of town when it comes to beer.But what it did well for us was, we were a new business. And if you think about the path of purchase to buying something, and I said a moment ago, a lot of people don’t drink the same beer twice. Right. Some, not all. Some.So what was happening is we had people going into craft bottle shops and they’re making that decision whilst they’re making their six packs of beer in the fridge. “Okay, I’m going to have an ipa. Okay, I’m going to have a pale ale. All right, I’m going to have a Bonehead.”
(28:00) So you’ve got one part, one marketing connection point there deciding to buy Bonehead. They’re making their six pack, they’re taking it home, they’re putting it in their fridge, and then they’re doing the exact same thing again. “Okay, what am I gonna drink today? Oh, today I’m gonna have a Bonehead.” So it was almost like, for every one interaction we were having that double up, if that makes any sense. So our brand awareness went through the roof, which was fantastic. And I think if it wasn’t for COVID, we wouldn’t have seen such a sharp rise in brand awareness, which was good. At the same time, we did get a canning line and we did get a lot more tanks. So not only, yeah, okay. We had to pay for those, but it meant that we could diversify what we’re doing a lot more. And that’s where this new beer, we’ve scaled back to a new beer every two weeks.
Anthony Dinoto (28:45): We put out 46 beers, 46 new limited release beers.
Raph Goldenberg: Wow.
Anthony Dinoto (28:49): In 2020. 52 weeks of the year. 46 beers. So just because the only way you could do it was to keep fresh. And for us it worked really well because it meant that people wanted to go back to the local bottle shop. There was so much newness, so much innovation coming into the market that for the people that were only drinking beer once, they could go in there every week and find a new Bonehead product. Yeah. And I guess, and that worked for us.
Raph Goldenberg (29:12): I guess people who’d familiar with the brand as well, were kind of like, ‘okay, what’s next? What’s coming next week?’ Yeah. Yeah. I’m gonna try that one.
Anthony Dinoto (29:28): And the landscape’s slowly changing back to a bit of a normality on that. Our core range in this current unit in 2022 has actually really thrived. Cause people have gone back to drinking at the pub and just drinking a core range beer.
Travis Nott: Absolutely.
Anthony Dinoto (29:30): So, which takes a little bit of pressure off us as far as needing to reinvent the wheel every week, especially me.
Travis Nott (29:36): And we do things quite planned. So this is the lovely balance, I guess, of both of our worlds. Ant, at an operational level, on the ground keeping, what’s going on today. I’m trying to think about what we’re doing next. So, we sit down once every six months and plan out what we’re doing for six months. So all our limited releases, we know what we’re doing now in July. Because we have sat there and planned those out. We know what all the releases are, we couldn’t do that. If we were doing one a week, we would, it’d be, well we would have to do it more, but you just couldn’t do it. It’d be mental!
Anthony Dinoto (30:09): Kind of like throwing spaghetti up against the wall.
Travis Nott (30:11): <laugh>. Yeah! And it’s good. I mean, we build our range to kind of say, you know, there’s a lot of people that don’t just drink one beer once <laugh>, so they want to keep coming back to Mum’s or Phaze or Junior’s or Sweet Pea or Revered or whatever the core range is. Whereas, there’s a lot of people that, yeah. Just shopping, newness and innovation as it is in any consumer. Yeah. You’ve got to have a balance of both.
Raph Goldenberg (30:33): For sure. So now that you’ve sort of gone through that, I think that sort of that setup/establishment phase, and you’ve got some brand awareness. It seems like when you go into a craft bottle shop, there’s just a million different beers, you know, and a million different beers from Melbourne. So how do you kind of stand out? How do you compete or, what’s the special thing that you do?
Travis Nott (31:01): I think a lot of it, I mean, I know myself when I go into a craft bottle shop, I shop visually first. If there’s really cool artwork on there, it’s gonna attract me to it. Then I’ll look at the style of beer that it is, then I’ll probably look at the brewery.
Will McMinn (31:17): Totally. I’m gonna jump in there. I’m a sucker for a good label. Yeah, I totally agree. I shop exactly the same way. Yeah.
Travis Nott (31:24): And it’s unfortunate in some circumstances, because you could make an amazing beer, but have a really crappy label and you might not try it. Yeah. But we have seen, and I’m not gonna name names, but there are beers out there with amazing labels. The liquid inside really doesn’t hold up. Mm-hmm.
Anthony Dinoto (31:43) (important for understanding your consumer): Yeah. It’s a balance, I think. So that’s part of it, but it’s that whole path to purchase, you know. So I think when people think about how they’re shopping, and if you’re talking about consumer goods, a lot of the marketing’s gotta come down to what that path to purchase is. So, I mean, a guy wakes, a person wakes up and they’re like, ‘oh, I’m gonna buy a beer’. They know where they’re shopping. So getting them to the store is not the problem. It’s, you’re right. Once you’re in store, what are we picking up? Yeah. And I think it’s gotta come down to, for us, there’s nothing going into the store. They’re not taking a catalogue into their local bottle shop going on buying on specials. So they’re not buying on price point. They’re buying on, okay, brand loyalty. Have I had enough of this brand to trust what I’m buying and therefore can I try something different and feel like it’s okay?
Anthony Dinoto (32:17): Right. Yeah. So for us, liquid is number one. All right. So the quality that we put into it is number one. And we always strive to make sure that our beers are three things. And they sound a little bit silly if you’re not into beer or beverages, but, balanced. So that’s not one dimensional. You can’t just be very happy without having a bit of sweetness to cover that. It’ll be very bitter without having a sweetness just to cover that off. Yeah. Two is approachable. So you’ve gotta make sure that, t’s not, you’re like, o’h my God, I’m chewing through this’. I don’t need a, not, you know, just those, those kind of comments. We need to steer away from those. And then, third is sessionable. And I don’t mean light in ABV, I mean moreish, you know, like, ‘oh, can I have this?’ And if we focus on making sure, we were pretty staunch on this early on.
Travis Nott (32:58): I think we were judging by the look around the table here. All the glasses seem pretty empty.
Anthony Dinoto (33:12): <laugh>. Yeah. Yeah. So they’re definitely sessionable. Right? <laugh>. Um, so we, you know, early on we started focusing on this and we were very, very strict and fierce on this.You put on a suit from a certain tailor that fits in a certain way. Right? Yep. That’s how it should be. So we try to build on trust in that brand awareness. And then packaging is what helps it come off the shelf. It’s what draws the eye. Yeah.
Raph Goldenberg (33:37): Sort of turning direction a little bit into the legal space and the regulatory space. Obviously the sale and the advertising of alcohol is highly regulated. How have you managed your way through that? I mean, I know Travis, you talked about how you worked at Foster’s before. You got some familiarity with it, but just seems like there’s so many, every state and territory’s got their own liquor licensing regime. There’s a million different requirements. How do you keep up with it and how do you manage it?
Anthony Dinoto (34:12): Yeah, the local authorities here, there, VCGR or whatever they’re called now, VCC I think they’re now. They were quite good to deal with, to be quite honest. Out of all the bodies we had to deal with over setting up this brewery. They were actually really good there. I think they’re, because they’re only a small team out in Richmond, I think everybody has each other’s back and knows what everyone’s role is. So you’re not picking up the phone and like, nah, that’s not my job. You gotta call back in. Everyone knows what they’re doing and they were extremely helpful with information and really helped us through the process.
Travis Nott (34:43): Absolutely agree with that. Yeah. And there’s not a million changes in the five years we’ve been open that’s really affect us because we’ve got a producer’s licence, which means we’re pro we can produce and we can sell wholesale, but we can also sell retail on our own premise and all alcohol. So, you know, we can sell a bottle of gin. Not takeaway but as long as it’s produced here
Travis Nott (35:13): We can over the bar. Yeah. We can sell it. Yeah. Someone wants a mixed drink, definitely. But we can’t sell a take away bottle that isn’t made on this premise.
Anthony Dinoto (35:20): Well the, I think the only exception of that was the gin that we made. Yeah,
Travis Nott (35:22): Exactly. Because it was made here.
Anthonty Dinoto (35:27): I’ll probably say the same thing about the ATO, to be really honest. I think they’re, you know, from an excise point of view, I think they’ve been quite good as well. I mean, you set up, you don’t know the ins and outs of everything and there’s no government department that will be like, ‘oh, you know, here’s the plan on what you do if you wanna open a brewery’. So just asking the question has been really good. Not often have we been met with ‘What do you mean you don’t know?’. You know, which has been really, really good.
Travis Nott (35:51): The only thing I’ll say on that is on a federal level, the government departments all think you run like CUB Yes. <laugh>. They don’t have an idea that we’re a tiny little one factory brewery where, you know, everybody’s a massive multinational corporation, and we’re all treated as such.
Anthony Dinoto (36:08): In terms of legalities, packaging requirements and what you need on tins and cans, the Independent Bureau Association has been a really good resource for that. They keep us abreast of any changes. They want to make sure that everyone’s doing the right thing. Mm-hmm. <affirmative> It falls back on, on their members. So they’ve been a great help. And in terms of, okay, so flying too close to the sun Yeah. In certain things, like the beer you’re drinking at the moment is obviously, well, it’s obvious to me, a Die Hard 2 reference. Right. We’ve got a caricature of Bruce Willis exploding out of an aeroplane. We try not to fly too close to the sun. You know, we haven’t called it Bruce Willis’s IPA. Right.
Will McMinn (36:50): You gotta be the next Kanye’s burger’s.
Anthony Dinoto (36:52): Yeah, yeah, exactly. Yeah. Although we did, as soon as I read that, my initial reaction was let’s do a collaboration with these guys.
Travis Nott (37:00): <laugh>, I think we steer clear of Kanye for the minute.
Anthony Dinoto (37:02): <laugh> <laugh>. But yeah, we’ve done a few where we have come very, very close. I think flying too close to the sun. And you know, we’re an independent craft liquor store. No one from Marvel Entertainment is going to see that can of Hulk Smash.
Raph Goldenberg (37:20): So they could be a little bit more licensed just to, to be a little bit, yeah.
Travis Nott (37:21): And also they’re here today, gone tomorrow with these beers, we make one batch at a very small quantity.
Anthony Dinoto (37:33): Mm-hmm. <affirmative>. The other thing is, you know, if it doesn’t smell right, then you don’t do it. Really. We’ve had a look at our ‘Smells Like Pop Culture’ release, what type of things should we do? What could we do? Let’s do a Teenage Ninja Turtle beer. Well, okay. If we’re gonna do that, it’s really got to be focused on how our consumer, an adult, remembers Teenage Mutant Ninja Turtle. It can’t be Michael Bay. It’s gotta be a cartoon from the nineties. You know? Oh, we want to do a, I don’t know, a whatever beer. Well, does that play a little bit too young? You can’t go anywhere near that.
Travis Nott (38:13): That’s the biggest problem in packaging, especially in the beer industry. You can’t be seen to play into a young audience. No. There were a couple of brewers that got tripped up on that because they had, whether it be Star Wars references mm-hmm. <affirmative> or something that looked similar to SpongeBob Squarepants or something like that. And they seemed to be playing to a children’s market and they were made to change their packaging.
Anthony Dinoto (38:30): And I feel for that, especially the Star Wars reference, like the beer, we don’t need to name names. It’s widely publicised, that beer started as a limited release beer. We could quite easily have fallen into that, into that world had it been here. We would’ve probably made the exact same beer. We just would’ve called it something else immediately. So, you know, we’ve had, ‘Smells Like Pop Culture’ releases that we can’t do again, that have come back as bonafide releases and slightly different. Of course.
Raph Goldenberg (39:07): And it’s a tough line because everything appeals to kids in some way or another. So that whole, ‘is it targeted to kids versus is it just something that might appeal to kids?’. Yeah. You know, if you could put it, you know, I don’t know anything in there and you might run into an issue because a kid might be interested in it.
Raph Goldenberg (39:37): Well, I think that’s been fascinating. We always like to ask one last question and I might ask you, Anthony. If you were the Prime Minister of Australia or the Premier of Victoria, be closer to home, and you could change one law, what would it be?
Travis Nott (39:45): Would it be the law that gives us a lot of money?
Anthony Dinoto: Lots of money law. Lots of money law. Just to us. Nobody else <laugh>,
Anthony Dinoto: The gimme, gimme law.
Anthony Dinoto (39:43): If on a federal level, going back to probably excise, I would say we should probably look at the American model, which really encourages growth of smaller breweries in America. Every town has their own brewery and people really get behind their local brewery. And I think there’s some states that you can’t export to other states even because you have to keep it local and they’re taxed accordingly. So Budweiser would be at the very high end of the scale of tax. And the local micro brewery or pub, brew pub would be barely paying any tax whatsoever as far as excise tax we’re talking here. Whereas in Australia, we are all the same.
Speaker 5 (40:35): We are all loaded into one little bucket. Mm-hmm. <affirmative> and we’re all on the same level playing field. They have made some changes to it in the last 18 months, which definitely are better, but it certainly doesn’t go where it needs to go.
Anthony Dinoto (40:50): What about you, Travis? I don’t know. The give Bonehead more money tax. I think that’s the one.
Travis Nott (40:56): I don’t know. I think, probably steering away from breweries. There’s lots of rules that I don’t quite understand. I don’t know why I’m doing 80 kilometres an hour on a five lane highway. Um, you know, so I’ll just, I’ll pass
Raph Goldenberg (41:06): <laugh>, where do you start?
Travis Nott (41:07): Yeah. Where do you start?
Anthony Dinoto: Get rid of speed cameras, you say?
Travis Nott (41:10): No, no. Look, I tend to agree. I think, you know, if you look at the model, of WET tax for wine versus excise for alcohol or for beer. It doesn’t make a lot of sense as to why some things are quite right and we are governed based on the wholesale prime producers, are they not?
Raph Goldenberg (41:32): Yeah exactly. So for the uneducated like me on this topic, how’s wine treated differently?
Anthony Dinoto (41:37): So, yeah, sorry to cut off the end of that question, but, WET, wine equalisation tax was introduced as a way to offset the difference between imported product and the national product. Because wineries are seen as primary producers essentially. Right. Whereas we are seen as manufacturers of alcohol. Um, so, you know, that could be… you know, we are seen as manufacturers. Alcohol, it could be high alcohol, RTDs, we’re taxed the same way they are, versus wine, which is 15% liquid in a bottle versus 5% liquid in a can. Don’t really get the difference. The main difference is for us, it’s based on the alcohol content of the vessel that has been sold to the public. Mm-hmm. <affirmative>, therefore kegs are taxed at a different rate to package goods. Yeah. And package goods. So for every time we, every time we sell a case of beers, to put it in perspective. So case of beers, 50 bucks for a $50 wholesale ish on a 16 pack of beer, how much of that goes to the government?
Travis Nott (42:56): 14 bucks. Yeah. About that.
Travis Nott (43:00): Not including gst.
Anthony Dinoto (43:04): Not including gst. So there’s GST on the tax. So tax on the excise, so we’ve got $14 goes there. You’ve then gotta think of that, so it’s only $50 wholesale, you got the can you got making the liquids, you’ve got, et cetera, et cetera. So there’s not a lot of money on that side. Mm-hmm. <affirmative>. So especially over COVID when that was all we could sell, you can kind of then start to imagine why things got a bit tighter for a lot of breweries. Mm-hmm. <affirmative>, you know, their least profitable wine is all they had left. Mm-hmm.
Travis Nott: Yeah.
Anthony Dinoto (43:40): Right. Which kind of goes back to my point, it’s such a confusing system and they’ve tried to simplify it a little bit in the last 18 months, but it’s so confusing. You’ve got different rates for different size packaging, it just makes no sense. Mm-hmm.
Anthony Dinoto (43:50): <affirmative>. Yeah. Yeah. Whereas WET literally is just the percentage of the wholesale product. Yeah. Right. So you can drop your wholesale and pay less tax.
Raph Goldenberg (43:57): Mm-hmm. <affirmative>. Alright. Got it. Well, on that very sobering note, <laugh>, sobering like that, um, thank you very much. That was excellent and thank you for the beer. Thank you for having us. And if people have been listening at home and they wanna find out more about Bonehead, where can they go?
Anthony Dinoto (44:13): So it’s boneheadbrewing.com.au
Travis Nott (44:15): boneheadbrewing.com.au on your social platforms.
Raph Goldenberg (33:20): Excellent. So thanks so much for coming in guys. Thank you. A really good chat. Thank you. It’s awesome. Cheers guys.
Anthony Dinoto (44:26): Yeah, we do a lot of these from a beer world perspective, from a craft beer perspective, and it’s nice to do one that isn’t just focused on mayhem and flavours.
Travis Nott (44:40): It’s good to do one of these sober as well.
Anthony Dinoto: <laugh>. Thank you!
Raph Goldenberg: Thank you for tuning into Legally Consumed, a consumer products podcast by the consumer products law firm. This was presented by Raph Goldenberg, Kaye Ho and Will McMinn from CIE Legal. Our theme song is by our very own CIE Legal House Band, which is comprised of Will McMinn, Andrew Maher and Andrew Thompson.
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