A 135-year-old pub has closed its doors after struggling with rising costs, with its owner claiming he would have had to charge $20 a beer to survive.
The Carringbush Hotel, located in the north-west Melbourne suburb of Abbotsford, permanently closed its doors at 10pm on Sunday.
The iconic Langridge Street pub made the shock announcement on its Facebook page on May 27, despite five and a half “incredible years” after its 2019 renovation.
“Like most, we are feeling the current financial crisis and instead of running the gauntlet we have decided to move forward,” the post said.
‘We have the best group of staff, locals and regulars, and to all of you, thank you for everything. We’d love to see as many of you as possible this week for a big party, and then again on Sunday for a few Bloody Marys for our final day of sharing.
‘From today we will not accept any more reservations. Walk-ins only. Our menu is slowly running out and the taps are running dry.’
Iconic Melbourne pub The Carringbush Hotel, located on Langridge Street in Abbotsford, has closed its doors.
The pub announced it was closing on its Facebook page, with trading officially ending at 10pm on Sunday.
Carringbush hotel co-owner Liam Matthews said the pub closed due to the “horrible” cost of “everything” in the hospitality industry.
“We’re putting more in the box than ever before, but what’s left over is less than ever,” Mr. Matthews told the Australian financial review.
For the pub to survive, the 47-year-old estimated he would have had to increase the pub’s most popular beer, Mountain Goat Lager, from $15 a pint to $20.
And that was something Mr. Matthews was not willing to do.
‘The client is not prepared for that, so we take the hit. Brewers and distributors face similar pressures and pass the costs on to us, but we are the end of the line,” said Mr Matthews.
Matthews explained that the salaries of the pub’s 20 employees had increased by 8 per cent from 2022.
Staff salaries accounted for 55 per cent of the pub’s total turnover, which is 15 per cent more than is considered sustainable.
The pub saw energy bills rise from $1,500 in 2020 to about $2,000 a month and also noticed an increase in its insurance costs.
Matthews added that the pub was also charged a beer delivery fee of $10 per keg, a cost that did not exist before the pandemic.
The desperate owner even attempted to sell the pub’s beer lines in a bid to raise money, but found no takers even though the $10,000 asking price was a fifth of what he believed the system was worth.
Matthews, who also runs the Old Bar in Fitzroy, believes a quarter of Melbourne’s hospitality venues could close next year due to rising costs.
Co-owner Liam Matthews said the pub closed due to the “horrible” cost of “everything” in the hospitality industry.
It comes as a number of independent breweries across the country have gone into administration in the last 12 months.
Closures included Melbourne’s Deeds Brewery and Hawkers Brewery, Sydney’s Wayward brand and Akasha Brewery, Brisbane-based Ballistic Beer Company and Adelaide’s Big Shed Brewing.
Financial services and software company CreditorWatch predicted in a report released May 21 that one in 13 hotel businesses would fail in the next 12 months.
The report claimed that businesses were left at the discretion of their spending customers, a demographic that had “depleted as cost-of-living pressures increased”.
He described that the food and beverage industry ranked first in debts to external administrations and tax offices of more than $100,000, and also ranked third in invoice payments more than 60 days late.
In the past three months, several prominent venues in Melbourne and Sydney have collapsed after succumbing to the cost crisis facing the industry.
In May, all seven companies of the BCN Events Group hotel group, including its cooking school Lumiere Culinary Studio, went bankrupt, ceasing business immediately and affecting its 90 employees.
The Botswana Butchery chain went into liquidation and had a debt of more than $23 million.
The chain, which had high-end steakhouses in three cities, also laid off its 200 employees.
Other notable store closures in Sydney include Raja, Izakaya Tempura Kuon, Tetsuya’s, Tequila Daisy, Redbird Chinese, Khanaa, Cornersmith, Sushi Bay, Elements Bar and Grill and three Bondi Pizza franchise stores.
In Melbourne, venue closures include Rosetta, La Luna, Gingerboy and Izakaya Den, Gauge Bistro, Que Club and Italian restaurant The Olive Jar, which closed after 40 years in business.