Congrats, you've been handed the best job in the world–the CFO of a brewery! Now how can you be successful in craft brewing? I’ve often told people that my job was the intersection of power, emotion and money. Since I wish that someone had sat me down and explained this industry and how it works, I'm sharing my experience in a regional craft brewery in ten distinct words of wisdom.
1. You Are a Stranger in a Strange Land
Throw out the accounting, business and MBA guides. Not all of the rules apply here. Brewers haven’t taken the classes and don’t drink the Kool-Aid, yet the bankers and auditors know the rules and expect the brewery to follow them. You have to find creative ways to reach the brewers and create change.
2. Your Job is Much Greater Than Accounting and Finance
Although those responsibilities could take up all of your time, you will need to understand all of the other areas of administration. There is a very great chance that you are the only person wearing all of the administration hats. Become an HR and IT expert (maybe even help develop the safety committee). Understand that as the company grows, so does the need for administration.
3. Administration Grows With the Company
Most people entering the industry will come from larger companies. It is important not to implement administrative change just to match their past experience. “Don’t be the solution looking for a problem”. Implement change when it is truly needed. Think about the journey from simple financial statements to full blown audits. What do you need to understand and do before the auditor arrives?
4. Our Job is to be Different
We represent authority either in terms of governmental authority or bankers. Finance people have some of the most interesting nicknames. I used to tell my master brewer that "without beer there is no money and without money there is no beer". We have to work together. Yet if you aren’t friends with everyone, no one will listen to you.
5. You Are the Catalyst for Change
Change is never easy. Especially when people don’t have the background to understand why the change is necessary. It takes a magician to morph yourself into all the people that you need to be.
6. The Physical World Must Match the Virtual World
You can’t manage what you can’t measure. Therefore it is important to create a sound accounting system. If the two worlds are in sync, then you can easily understand what is happening AND you can gauge the effectiveness of your forecasts. Keeping inventory in balance is a constant struggle. However, it is well worth it. If the brewery doesn’t understand their inventory, they do not understand the company.
7. Process Matters
Yes, craft brewing is a creative endeavor, yet there is room for process and procedure. All ERP systems are based upon standardized procedure. The sooner that everyone plays by the same rule book, the smoother the growth transition will be.
8. Variance Matters
The whole point of a computer system is to tell you when something unexpected happens. That can only happen if you can measure what should happen against what did happen. That allows everyone to see where the company can make improvements.
9. Banks Are Your Friends and Your Worst Enemy
It is actually true. Banks will lend you money when you don’t need it. Your relationship with your bank is one of the biggest, most important relationships in the company. They need to believe in you and your story, but you will need to honest with them. Bad news before it happens is WAY better than after the fact. That super nice guy that you have been drinking with for two years, can suddenly turn into your worst task master. Never let your guard down.
10. The Industry is Changing Before Our Eyes
The growth of our industry has been staggering. For a while there, it seemed as if every day, there was another brewery opening up in your area. The business model that founded your company will need to evolve as the industry matures.