When it comes to expanding a business, most of what the public sees is the physical expansion itself – a new building, an added story to existing infrastructure, or even just more equipment visible through the windows.
But internally, certain expansions are more complicated. And at the Great Northern Brewing Company in Whitefish, a host of machinations are now in place to increase beer production with the goal of statewide expansion.
“We just opened up (distribution in) Billings last week,” Marcus Duffey, Great Northern co-owner and general manager, said. “We’re now officially statewide, and that allows us a lot of different things.”
Great Northern Brewing recently received the financing it needed to increase production levels by thousands of barrels of beer. Such a jump in production is necessary to meet the demands of the new market Great Northern has secured.
Just last week, Duffey traveled the state to give presentations to distributors on the brewery’s plans for 2014. These distributors now include businesses east of the divide, which is a new step for the brewery.
Now that Great Northern has statewide reach, more windows of opportunity to work with other businesses are opening, Duffey said. For example, in order for a company like Town Pump to carry Great Northern Brewing’s beer in it 98 locations around the state, the brewery would first have to join the distribution market across Montana, he said.
The same is true for Safeway grocery stores. Great Northern is now in talks with both Town Pump and Safeway for future distribution, Duffey said, which could start as early as January.
“It’s pretty exciting,” Duffey said. “Now the biggest thing is operationally getting these things into effect.”
This is the part of expansion that becomes a bit of a balancing act, because getting the distribution agreements from statewide companies is one aspect, and increasing production is another.
In order for Great Northern to meet their new distribution demands, the company needs to add more equipment, and needed a loan in a hurry to do so. That’s where Montana West Economic Development came in; the brewery requested funds from MWED’s revolving loan program in mid-September, and the loan review committee met and approved the loan just two-and-a-half weeks ago.
Duffey said that money has already been put into play and new equipment was ordered in the first week in November, which puts the brewery on a timeline to install and start using new equipment by April.
The expansion itself is a fermentation capacity expansion, with two new 100-barrel fermenters and a 100-barrel brite tank.
“Essentially this means we can make more beer,” Duffey said.
The brewery produced 2,400 barrels of beer in 2012, and is expecting to end 2013 with 4,500 barrels. Next year, production is expected to increase to over 6,000 barrels, Duffey said.
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McQuary sanitizes a fermentation tank. The brewery is preparing to expand its distribution. – Greg Lindstrom | Flathead Beacon |
Along with adding new equipment, Great Northern will also need more staff to facilitate its expansion, and Duffey hopes to hire a third full-time brewer and another full-time employee, which would bring the brewery’s full-time employee count to 10.
The brewery also hopes to receive a grant from the state Department of Agriculture to help finance the building of a malt silo at the brewery, which would then allow the company to participate with local agriculture projects, such as the hops farm outside of Kalispell. Duffey said the brewery should know about the grant by Dec. 1.
“It’s exciting,” Duffey said. “It’s come a long way.”
Tina Oliphant, MWED’s vice president of finance, said the brewery’s expansion would not have moved forward were it not for MWED’s revolving loan program. The speed at which the brewery needed the funds in order to buy the tanks and set the expansion in motion was challenging, but entirely doable.
“Everyone has to be nimble,” Oliphant said.
But such timing is familiar for the loan review committee, which consists of 12 business, service and private sector leaders from the community. And when Great Northern pays back the loan, it will be recycled through and used for another business, she said.
Helping Great Northern Brewing on its journey to dominate the state market will also help the company if it decides to pursue out-of-state markets as well, Oliphant said, which, in turn, sends a positive message about the business climate in Northwest Montana.
“It is a way to put the Flathead on the map,” Oliphant said.
For more information about Great Northern Brewing Company, visit www.greatnorthernbrewing.com. For more information on Montana West Economic Development, visit www.dobusinessinmontana.com.