“You can change your focus, but make sure you’re actually focused on a plan and not just shooting wide and hoping to hit something.”
As one of the first production breweries to open in Boise, Payette Brewing has brought craft with a local spin to their patrons. Hometown hero and Payette founder Mike Francis opened the brewery in 2010 and has grown the production to 10,000 barrels annually in the eight years since. A former Boeing engineer turned craft brewer, you get the sense Mike brings an engineer’s rigor to everything he does for the brewery. In this interview, Mike shares lessons learned in scaling a new brewery and tips for maintaining your focus early on. From combatting turnover to growing your brand through the taproom, new brewers stand to learn a lot from Payette’s story.
Mike: Sure. I was an engineer at Boeing at the time. I had been there since right out of college. After a few years on the inside, I realized that’s not what I wanted to do with my career. So I went to brewing school at Siebel in Chicago then worked for some time at a brewery. The whole time I was doing that, I knew I wanted to move back to Boise, where I grew up, to start a brewery. At the time there was no production breweries in Boise. There were a few brewpubs and that was it. So after being in Seattle and seeing how breweries like Mac & Jack’s or Georgetown had such success in the market as production breweries, that kind of led me to move home and start Payette Brewing.
So now Payette is producing 10,000 barrels, right?
In the first couple of years, what did your production look like? How many people did you have on staff at first and when did you make your first sales hires?
So when we opened up there was myself and I hired one other guy to do sales and distribution for us. We started self-distributing. We self-distributed draft for about two and a half years. So I had a salesperson right off the bat. I needed someone out there to call on accounts, take orders, and then deliver the beer. So about three or four months in is when we started to add more bodies. Maybe a year or so in we added more sales reps. We started very small and focused on accounts. When we opened we had 15 accounts and that’s all we serviced. And then as we started to figure that out, we added five more, then five more, until we got to the point where we had two or three sales reps and the delivery driver. We kind of got to the point that we either needed to hire more or move to a distributor. So at that time, we decided to go with a distributor so we could stay focused on beer and repping the brand.
So it was first looking at what our skill sets were. We did a good job with self-distributing, but our core competency was making beer. The logistics of a distribution network was not what I founded the business to do. I got in it to make beer. So that was a big reason. And the second was, Boise is not the biggest town. We kind of got to a point where we couldn’t really service any more accounts because they were either too far away or there just wasn’t enough moving. As we expanded our markets, we didn’t want to self-distribute to a town that was an hour and a half away that had a pretty small population.
So distribution just makes sense. I always hear brewers at times complaining about the three-tier system, but it’s a necessary thing and there’s a lot of places we could not physically sell beer if we didn’t have a distributor to do it for us. We’re not going to take a truck and drive 100 miles to drop off two cases of beer. That was a big point. This is what distributors are set up to do, let’s let them do what they’re good at and have us do what we’re good at.
“I always hear brewers at times complaining about the three tier system, but it’s a necessary thing and there’s a lot of places we could not physically sell beer if we didn’t have a distributor.”
It’s an ongoing challenge and it’s almost harder now than it was five years ago. There are more breweries and more people in the market and everyone wants their distributor share of mind. Years ago someone with a bigger brewery told me, “Expect a distributor to take beer and deliver beer. Anything else is gravy.” At first, I was kind of like, “Well, that’s setting your expectations low.” But if you go into it knowing that you got to work and earn your share of mind, then you’re gonna be more successful. You can’t just go and expect the distributor to do it for you because they have 50, 100, who knows how many brands. So a lot of it is going out there, selling beer, and repping yourself with your team. That’ll start to drive some sales and show the distributor reps that you have a product that they can work in a market, and it grows from there.
“If you go into it knowing that you got to work and earn your share of mind, then you’re gonna be more successful.”
What are some of those things that you have learned to make your communication better with your distributor?
Yeah, you know, communication is the big thing. Things like Lilypad really help to streamline that communication. The more information and the timelier you get it to the distributor, the better. In the end, it’s really a lot of relationships, whether that’s with accounts or with distributor reps. Just building that rapport. I think it’s really the most important thing for growing a sales organization.
Learn more about Cross-Tier Communication in Lilypad
Can you tell me a little bit about making your first sales hires?
I’ve had hits and misses throughout the years. A big thing for me is finding someone that has a passion for beer and that wants to be in the industry to sell beer. That’s one thing. But the most important thing is really culture. Finding someone that fits our brand, someone who fits who we are as a company and as a sales organization. There are a lot of things I think you can teach someone from a sales standpoint. You know, there are some inherent skills that people have, but in the end, if you have the right person that can go embody who we are and build relationships, I think that’s the key right there. A lot of other things can be trained.
What have you found to be your most successful strategies when going into accounts? How do they differ between on-premise, off-premise, and chains?
I think the most important thing for me is knowing who the buyer is – buyers for bars and restaurants and stores are all different. Being able to get to know them and understand how they want to be sold. Some people like the relationship and will buy something based on if they know you and like you. Some people really want to try the beer. For some people, the hard sale works great, and on some, the hard sell will immediately turn them off. So there’s never a one size fits all for accounts. I think you really need to have someone that can read the situation and adapt.
“I think you really need to have someone that can read the situation and adapt.”
Obviously, you guys use Lilypad and you’re still a relatively new brewery. When did you decide it was time to invest in technology for the sales team?
We tried various different things. I was talking with people who I knew that worked for bigger breweries about what they did. I also saw within our own team that everyone had their cell phones and had their own system for taking notes. The biggest trigger to bring on something like Lilypad was actually turnover. We had reps that got new jobs and we realized that all of their information kind of disappeared when they left.
“The biggest trigger to bring on something like Lilypad was actually turnover. We had reps that got new jobs and we realized that all of their information kind of disappeared when they left.”
We didn’t know what had been going on at this account or that account and who the contacts were. It was a lot of work to try to build that back up when we brought someone new in. So that was kind of the first trigger. “Hey, it’d be great to have a central spot for all of this loose contact information.” As we learned about Lilypad and saw all of the other tools as far as building reports and tracking what’s going on, it just made a lot of sense to have everything in one place and have that data at your fingertips wherever you go. Even if you’re walking into an account that’s not normally yours, you can have all that information so you don’t walk in blind and sound like an idiot.
Learn more about Customer Relationships in Lilypad
How many sales reps do you have in total now?
We have four right now.
And how many states do you cover?
Is Boise home base for everyone or do you have entirely remote people?
We have one person that is solely remote.
Have there been any challenges getting that person ramped up, included as part of the culture, and keeping track of what they’re doing?
With this one, no. This guy had been with us in Boise for a few years. We moved him to a different location, so he already had experience and knew who we were. But as we’ve had different out-of-market sales reps in the past, it has always been tricky. It’s not that I wanted to be “big brother” or a micromanager, but at the same time, they are out on their own. You don’t really know what’s going on and trust is earned, not given. Before I was just relying on their reports and what the numbers look like. But with Lilypad you can track it a little more to get a sense of what’s getting done in a day. Then it gets to the point where you don’t really track it as much because you just know that guy is doing his job, but it’s there if we need to look at it.
“It gets to the point where you don’t really track it as much because you just know that guy is doing his job, but it’s there if we need to look at it.”
Do you have any plans to expand distribution in 2019?
We’re looking at different options. Nothing set in stone, but I’m always looking at our territories to make sure we have the right footprint with the right distributors and if we find a good fit we’ll act on it.
Got it. So let’s jump to your taproom and what you’re doing in Boise, specifically. Can you talk to me about the challenges of opening a taproom and how it’s affected the business? Do you think you’ll expand that effort?
Yeah, I mean, the taproom when we opened was a kind of an afterthought. We put one in, but it was never the focus. We started to realize the benefit of it from a revenue and a profitability standpoint but also building a brand and brand loyalty. We learned that it is a very important tool. So that’s something we’ve talked about, but we don’t want to jump too much on opening up satellite taprooms. I know lots of people are doing that. I’m sure we’ll have one at some point in time. That’s just about trying to find the right places and the right markets. Taprooms are a great resource to sell beer over the counter for higher margins and also build your brand. It shows people who you are more than just what’s on the shelf.
“Taprooms are a great resource to sell beer over the counter for higher margins and also build your brand. It shows people who you are more than just what’s on the shelf.”
I was reading that you guys do some charitable giving through the taproom. Can you talk a little bit about when you decided to kick off initiatives like that and some other ways that you use the taproom that has been successful for you? Hopefully, someone reading who is opening their own taproom can walk away with some ideas.
We started our charitable giving stuff a few months into being open. It kind of started with one specific charity in town. We were trying to find ways to raise money for them and then it grew from there into a weekly thing. It’s been a great way to give back to the community. I always say it’s the community that’s supported us and helped us grow, so I think it’s kind of our responsibility to give back to those people that have given their hard-earned dollars to us.
As far as advice for people opening their own places: figure out who you want to be and do that. We’ve done a lot of things that were ideas we got from other brewer’s, I’m not saying don’t look at what other people are doing, but if you try to be everything to everyone, you’re going to miss something. Try to figure out who you are and what you want to be. That’s the right direction. There are so many different taproom models out there and you should just figure out what your focus is in and hone in on that.
“I’m not saying don’t look at what other people are doing, but if you try to be everything to everyone, you’re going to miss something.”
I’ve got one more big question for you. You’ve been a founder of a brewery for eight years now. Do you have one big thing that comes to mind that you learned that you wish you could have told yourself a few years ago? Something that would have made it a lot easier or would have changed the direction of the brewery?
Ha, there’s probably a lot. When I look back in hindsight, there were definitely times when I was just dumb enough not to know what I didn’t know in some ways that are a good thing. Early on it was probably better not knowing any better because I was probably less stressed.
Kind of going on my taproom comment; we hit times when we lost focus on what we were trying to do. We tried to do a lot of different things and go a lot of different directions. In the last few years, we’ve been getting focused, and it has been key for us. Maybe the advice is you can change your focus, but make sure you’re actually focused on a plan and not just shooting wide and hoping to hit something.
Makes sense. Anything you want to tell people who are reading to look out for regarding Payette in the next few months and then going into 2019?
There’s some cool stuff going on but I’m not ready to really talk about it. Haha.
Fair enough! We’ll just have to follow you on social or come by the taproom.
Awesome. People can find us at @payettebrewing
I appreciate your time, man.
No problem, thanks a lot.