Love Lane Brewing

Idea

Introduction

Love Lane Brewery is based in the heart of the Baltic Triangle in Liverpool.

Our business consists of a Bar & Kitchen, a Brewery, and a Gin Distillery. We produce several well known brands, including Love Lane beer, Higsons Beer, and Ginsmiths of Liverpool Gin.

Our home, "Love Lane Brewery", has bars, a kitchen, and houses our distillery. It is also a great events space and offers tours. We see it as a real statement of intent and a significant investment in our future.

Our core beers are Love Lane Pale Ale and Love Lane Lager, but we also love brewing Love Lane Limited Editions and Higsons cask (Liverpool's original from 1780, rooting us in the city).

Our Ginsmiths of Liverpool gins are Merchant Navy, Dry & the award winning Marshmallow gin.

When we opened retail in December 2017 we were known as H1780 Tap & Still, but we have since evolved to be known as Love Lane.

The great reviews for the quality food and drink, our friendly service, and good ambience at events mean we are all very excited by the next stage in the journey. This is the launch of our new brand platform, 'Share the Love' of beer with Love Lane.

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Intended impact

Liverpool is the 7th largest city in the UK and, in our opinion, has not had a serious brewing entity for some time. A population of 2 million people is within our reach, with a growing number of craft-conscious licensed outlets and drinkers evolving nationwide.

We have created a fantastic experiential brewery hub and now intend to expand our core Liverpool customer base by both building on our own direct customers and working with our local and regional distributors, prior to selectively targeting other cities in the UK and abroad as well as off-premise sales.

We believe that Liverpool's reputation and growth as a city strengthen our proposition and that our proximity to the city centre will enable us to build our brewery, gin tour and event sales whilst getting people to experience our slice of Liverpool hospitality in a great converted rubber factory that has been said to be reminiscent of east and west coast USA craft brewery taps.

We aim to be amongst the consolidation of craft by expanding Love Lane beyond Liverpool and creating a local platform for Higsons & Ginsmiths of Liverpool.

Substantial accomplishments to date

The start up business has raised approx £4.4m from private shareholders and has built a large brewery, a small distillery and a substantial retail presence in a converted rubber factory that was uncovered after being bombed in the 2nd World War. Some recent highlights include:

• The creation of a A 50 Hl brewery (equivalent to 30 brewers barrels, 8,640 pints), plus extra fermenting vessels and kegging / cask racking.
• Our potential annual beer brewing capacity is now 18,000 Hl (equivalent to 3 million plus pints).
• Over 60 UK on-trade customers for our Love Lane Pale Ale.
• Over £300k of revenue in 2017.*
• Over £1m of revenue in 2018 so far (to December).*
• Designed a beautiful new livery for the brand.

*Based on unaudited management accounts.

The business has evolved and established a strategy, led by our Love Lane brand, based on the idea of 'Share the Love'. This strategy is intended to allow us to sell into the local, regional, national and international market.

Monetisation strategy

The main sources of income are:

Beer sales (Love Lane kegs, cans, bottles & Higsons Cask bees).
Gin Sales (Sales of our 3 gins plus our planned Experimental Editions & range extensions / Limited Editions).
Retail outlet sales (Food, Beverage, Shop, Tours, Online Shop, Events).

The Sales & Marketing plan is currently focused on sales to the 'On Trade' in the UK through various sales channels. We intend to market direct to consumers once distribution targets are met.

Use of proceeds

We intend to deploy the funds raised in the following way:

1. Brand Investment - 60%
- Digital communications, point of sale / point of purchase items, PR, traditional, experiential / events, customer investment (fonts, badges, consumer / trade incentives).

2. Infrastructure - 20%
- Warehouse fitting out (cold store, fork lift, racking etc), vans, computer system.
- Brewery (hop cannon, lab equipment, auger).

3. Retail enhancement - 20%
- Signage, enhanced sound system, furniture, audio visual, filming for tours, completion of tasting room, lighting, shop fit out, online shop, website enhancements.

NOTICE

Please note that the company has the following loans outstanding:

1) £300,000 directors loan, which has no interest and is only repayable once company is profitable.
2) £200,000 shareholders loan, which has an interest rate equal to the Bank of England base rate +1%, with the interest payable quarterly, in arrears. The principal is repayable once the company is profitable.
3) An asset finance loan for brewery equipment to Close Brothers, which is repaid by monthly repayments of £5,367.60 from existing cash-flows, with 47 payments remaining.
4) Another asset finance loan for brewery equipment to Close Brothers, which is repaid by monthly repayments of £3,874.28 from existing cash-flows, with 51 payments remaining.
5) £28,000 short-term directors loan, to be repaid from existing cash-flows in Q1 2019.
6) £6,751.60 loan from Funding Circle, with a remaining term of 10 months, repaid at a rate of £675.16 per month from existing cash-flows.

Investors funds will not be used to repay any of the above debts.