Helena micro beers seek sales growth in very different ways

The two local craft brewers that bookend downtown Helena are pursuing different paths to success in the specialty beer market.

By JOHN HARRINGTON, IR Business Editor

At Sleeping Giant Brewing Company on Getchell Street, the owners are swinging for the fences, hoping that bringing in a bottling machine to package their new Lewis & Clark Lager for retail sale will ratchet up sales and help the business grow.

Meanwhile, at Blackfoot River Brewing Company on Park Avenue at the south end of downtown, the big news is the recent certification of the brewery as an organic processor, allowing the company to once again label as organic two of its signature beers.

There’s no bottling on the horizon at Blackfoot, where the owners are content to sell their kegs and growlers to a loyal band of beer aficionados across the state.

The addition of a small bottling line at Sleeping Giant represents a shift in the market the local company is seeking to serve. Whereas draught beer in kegs is available primarily at taverns and restaurants, bottled beer can be bought at retail outlets, exposing the brew to many more potential customers.

The bottler was bought used from a brewery in Arizona, while the labeling machine came from Colorado. At a little more than a case a minute, the line can fill around 1,500 12-ounce bottles in an hour.

The economics of bottling are different, too. The margins tend to be smaller, meaning volume is the best way to make a go of it. The Sleeping Giant folks are convinced that with the L&C lager, they’ve got a product with the cachet to sell very well over the next couple of years of Lewis and Clark hype throughout the state.

"The two things it gives us are variety and stability," co-owner Max Pigman said. "There’s so much draught out there, and it’s difficult to ship kegs. With the bottles, even if we only sell one six-pack at a time in a convenience store, there are hundreds of convenience stores in Montana. It adds up."

Under its previous ownership, Sleeping Giant beer was brewed in Helena, then shipped to Missoula for bottling at the Bayern Brewing Company. Now the beer can be bottled at the source and dished out to a distributor inside of 24 hours. Pigman believes keeping it local will help the quality of the product.

Because Lewis and Clark lager takes 30 days to ferment – twice the time of other beers – the brewery recently added a pair of fermentation tanks to increase capacity. Pigman estimates around 70 percent of his capacity is dedicated to the new brew.

Pigman says potential retailers for the beer are wowed by the slick label, which features the two musket-bearing explorers beneath the Sleeping Giant at the north end of the Helena Valley. But he knows there’s got to be more to the product than packaging.

"It’s getting sold on the artwork, but we knew it couldn’t be a bad beer because people wouldn’t buy that second one," he said.

At Blackfoot River, co-owner Brian Smith said the brewery had to stop labeling as organic its North Fork Porter and pale ale when new federal regulations governing organic labeling took effect last October. Although the beers have always been made with organic ingredients, the brewers found their operation had to be certified as an organic processor.

"We had to go through a period of time where we did not label the beers or advertise them as organic until we got our organic certification," he said. "We didn’t quite understand the law when it came out. We were still using the same organic barley and organic hops."

The certification process took several months and included filling out a lengthy application and a day-long visit from an agriculture department inspector.

"It was a long procedure," Smith said. "We had to describe our entire food handling procedure, and to make sure all the safeguards are in place to keep the organic and non-organic products from co-mingling."

In addition to detailing the cleaning and sanitizing procedures, the brewers had to show they could document the source of all the ingredients that go into the organic beers.

"They want to be able to take any product sold as organic and be able to go back and know which field it came from, which batch, which harvest," Smith said.

The producers of the barley and hops Blackfoot uses had to be certified as well.

"Probably the most challenging thing for us is finding the certified organic ingredients to make the styles of beer we want," Smith said.

Finally, in mid-May, the word came that Blackfoot’s porter and pale ale could once again be labeled organic.

Smith said the decision to pursue organic certification was based partly on marketing, but was more a matter of supporting good land-use practices.

"We think organic farming is a much more sustainable form of agriculture and sustainable use of the land. We look at it as more of a land-use and environmental issue," he said. "There’s some marketing benefit to it, but it’s not huge. It’s more of a good community citizen issue for us."

When it comes to bottling, Smith said that’s an idea that will likely stay on the back burner. For one thing, the brewery would have to move somewhere with a little more room to operate.

"We’ve pretty much maxed out the facility, added space and remodeled space," he said. "It’s been a lot of hard work to get this far, and the thought of picking up and starting over… I don’t know."

John Harrington can be reached at 447-4080 or [email protected].

http://www.helenair.com/articles/2003/07/25/business/e01072003_01.txt