Thinking big

“Ballsy! It was a ballsy call,” says SAP reseller Tango’s managing director Philip Bratton of microbrewery Aotearoa Breweries’ decision to opt for SAP’s Business All-in-One software. Although the world’s big company-software providers — SAP, JD Edwards, Oracle and the like — now all target the small (in US terms) to medium-sized market for their software solutions, none really had a business the size of Aotearoa Breweries in mind, he says.

According to the company blurb, SAP Business All-in-One is targeted at companies with revenues from around the $100 million mark up to $1 billion. Or “put it this way”, says Bratton, “the software we put into Aotearoa Breweries is exactly the same software we put into Fonterra”. (Yet Aotearoa’s turnover this financial year is likely to hit just $250,000.)

Why, then, did the microbrewery bother with this sort of system at such an early stage? With just two years of operation behind it, due to break even this year, and with a staff of just six, the Eastern Bay of Plenty-based Aotearoa Breweries is readying itself for growth, says co-founder and director Jaysen Magan.

Magan and his partner, fellow co-founder and chief brewer Tammy Viitakangas, had both used SAP systems in previous jobs before opting to branch out on their own. And given his past IT experience, Magan says he’d seen too many firms put in basic business process systems that couldn’t cope once the company started growing. “They’d go through crazy growth and then they’d have to dump some system that cost them thousands or even millions to put in, or get consultants in to revamp everything and retrain all of their staff, just because they didn’t do it from day one. I just didn’t want to do any of that.”

Working with Tango’s Bratton, Magan selected SAP All-in-One because of its breadth of business processes and best-practice capabilities. For example, says Bratton, a company installing SAP systems used to have to choose between 20 options for a simple process such as ‘procure-to-pay’. But now, while you still have all those options, the software is configured to, say, the two best choices for a manufacturing company, greatly reducing the cost and time of implementation. So instead of a costly seven- to 12-month software setup and training time, it took just three months for Aotearoa Breweries, says Bratton.

“Anyone who’s really confident about their business succeeding and making it big should definitely put something like SAP in,” says Magan. “For us it was like buying that extra tank. We just can’t do without it. And if you don’t do it, you will just end up like every other big business in the world, with a spaghetti of little systems.”

To date, Magan estimates the business has cost him, Viitakangas and their business partners, Viitakangas’ mum and dad, Gloria and Jouni, close to $500,000. The SAP system cost them about the same amount as they paid for all their brewing equipment, bought from a defunct brewery in Wellington for $45,000 from the Trade and Exchange website. But it is money well spent, says Magan, now the brewery is being recognised and sought out for its beer.

After just two years of operation, the company has won silver awards for its Mata Artesian beer and gold for its Mata Manuka beer at the 2007 New Zealand International Beer Awards. More importantly, the beer was trialled at some Auckland Foodstuffs supermarkets and was rewarded with being ‘ranged’ in November last year, allowing all Foodstuffs supermarkets in the North Island to select and stock Mata beers through their normal ordering systems.

When the company was ranged with Foodstuffs, says Magan, it had to change its whole business model. But with SAP, all it took was a call to Tango to say ‘we need to do this and that’ and a couple of days later it was done, he says. “If you had something like MYOB, you just don’t have that sort of flexibility.” The system handles almost all the company’s business processes. “We knew we’d be changing so rapidly that we needed a system that we could just get under the hood and tweak from time to time,” says Magan.

With its Foodstuffs supply deal, its second export order from Japan for 100 cases of beer, and plans for expansion in the South Island and the US, as well as into Finland and India through family connections, Aotearoa Breweries is planning to upscale its facilities to increase batch production from 1,000 litres to 5,000 litres this year. But with all that selling to do the family members running the brewery are going to be on the road a lot. Fortunately that relatively expensive computer system includes comprehensive, secure remote-access capabilities, says Magan. “It’s simply essential for a company with such few staff. Basically it allows us to concentrate on the business. We don’t have to think about the day-to-day tasks so much.”