Successfully starting a small business is hard. It’s especially daunting to create a manufacturing enterprise when the initial investment capital requirements for the equipment are so steep.
Rick Goehring and BJ Hunt each had dreams of starting a craft-brewery years before they met. They didn’t know it at the time when they were introduced to each other in 2010 by a mutual friend that they each brought to the table the know-how to turn their dream into a reality.
Rick Goehring started brewing beer in 1994 when his brother gave him a ‘beer-in-a-bag’ brewing kit. He kept refining his brewing techniques, and even spent five months completing the Craft Brewers Apprenticeship Program through the American Brewers Guild in Vermont. Rick also obtained a college education in chemistry, computer engineering and physics. While Rick wanted to make brewing his profession, he knew he needed to partner with someone who had the business background and marketing skills.
BJ Hunt, a former director and president of a family-owned company for many years, was looking for the opportunity to start a craft brewery when he met Rick. BJ had earned an Executive MBA, and had a passion for marketing, fund raising, management, and of course, good beer.
One year later, in 2011, Rick and BJ bought a half-barrel pilot system to sample, share and promote their brewed products in El Dorado and surrounding areas. It didn’t take long for them to know the demand was there to support more production of their award winning beer. After investing significant personal assets, and initial financing through Emprise Bank in El Dorado, Walnut River Brewing Company was sanctioned by the various government agencies to officially start selling beer in July 2013.
Rick and BJ soon reached capacity and realized that in order to grow their business to the next level, they would need more capital.
Travis Rohrberg, an avid home brewer and microbiologist with work experience in ethanol production and pharmaceutical manufacturing, had been excited about the new brewery in El Dorado. Since 2012, Travis had been volunteering his time helping BJ and Rick paint and other tasks to keep the brewery going. Travis had the skills needed to manage yeast and other lab work functions necessary for large production. Travis’ know-how and enthusiasm made him a natural fit to invest in Walnut River Brewing Company as a junior partner.
Currently, the Walnut River Brewing Company is expanding from its 2 barrel (62 gallon) production to a 30 barrel (930 gallon) capacity. As is the case in most manufacturing environments, the large jump in production is necessary to obtain the economies of scale needed for long-term growth. “The cost of a 30 barrel system was not that much more expensive than the 15 barrel equipment we looked at. We opted for the 30 barrel system because it would support 7 to 8 years of growth,” said BJ.
After tapping-out their savings, Rick, BJ and Travis approached their lender, Emprise Bank in El Dorado for financing the construction and new equipment. “We have had a great relationship with Emprise since the beginning,” said BJ. “Their Lending Officers, Ms. Tobey Johnson, and Mr. Glenn Buchholz were instrumental in helping us obtain the SBA 7(a) Loan to finance our expansion,” he continued.
The large 30 barrel fermentation tanks, glycol cooling system, and a 1 million BTU boiler were delivered to Walnut River Brewing Company’s warehouse in July 2015, as electricians and other contractors were preparing the infrastructure for the installation. Everything is coming together for their operation to be up and running in the coming months.
“The support from the City of El Dorado and the community has exceeded expectations. All of us are very grateful for the matching grant funding from the El Dorado Main Street organization that allowed us to fix and paint the front of our building,” said BJ. Both Rick and BJ also give a lot of credit to other craft brewers in the region for helping them plan for growing their business. “It’s amazing how supportive the breweries are to one another,” said BJ. In fact, the Walnut River Brewing Company recently obtained a canner that has the capacity to can a case of beer per minute from the Tallgrass Brewing Company in Manhattan, Kansas.
The Walnut River Brewing Company’s Tap Room restaurant should be up and running by early fall 2015. By then, the brewery will be canning beer for distribution. Once fully operational, their goal is to sell 60% of their beer in cans for the retail market, and the remaining 40% in kegs for restaurants and bars.
When asked what advice he would give to someone thinking of starting up their own business, BJ Hunt said “Take care of your spouse during the whole process. Make sure each of you are on the same page. They may not be involved in the daily details of the business, but having their support to see the whole thing through is critical.”