Harpoon Brewery streamlines its buying
The recipes for Harpoon Brewery's dozen different beers are complex enough. Fortunately, the buying process doesn't have to be.
By Tom Stundza -- Purchasing, 7/13/2006 2:00:00 AM
A copper-colored brew in the English style of pale ales has become the best-selling beer for the tenth-largest craft (or specialty) brewery in the nation, which is based in Boston. What's purchased to make Harpoon Brewery's India Pale Ale is deceptively simple—malted barley and hops, which are added to water and yeast for fermentation into the alcoholic malt beverage. Except, each of the dozen beers and ales produced at Harpoon Brewery require different ingredients—and they all have to be packaged for sale.
So, Sean Cornelius, the assistant vice president of brewing operations for Mass Bay Brewing Co., this year is buying enough raw materials, bottles, carriers, cases and kegs to get almost 3.1 million gallons of these alcoholic beverages into a 23-state market area east of the Mississippi River. He also buys the ingredients and packaging for a new product line of soft drinks in three flavors—root beer, cream soda, and orange and cream.
Matching the apparent simplicity of the buy is the actual simplicity of the buying process. 'Although we do open up RFQs (request for quotes) annually, we've used the same suppliers for some time,' says Cornelius. 'We don't go just on price; we also go on quality. We have to keep the quality of the malts and hops high to maintain quality of the beers.' That's because beer is described by industry insiders as a fragile liquid, so the use of the choicest raw materials and careful brewing performance is required to produce a quality end product that meets the 'standards for beer' revised and published in 2005 by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), a law enforcement organization within the U.S. Department of Treasury.
The main brew house and bottling complex of Harpoon Brewery (www.bostonbrewery.com) is located inside a former ship construction facility on Boston Harbor in the mostly seafood-oriented industrial waterfront of South Boston. Inside this building, the 20-year-old company brews five year-round and four seasonal beers and ales. These beers also are made at the former Catamount Brewing plant in Vermont, where the company also brews 100-Barrel Series of specialty beers. The Boston brew house plans to pour 65,000 barrels (at 31-gallons each) this year while the Vermont facility will make 35,000 barrels. Next year, the Vermont brewery will make close to 45,000 barrels because of new equipment recently purchased by Alan Marzi, the vice president of brewing operations.
The company will brew 100,000 barrels this year. To meet this year's goals, Cornelius will purchase 5.5 million lbs of 10 different kinds of malts, 65,000 lbs of six types of hops and various fruit flavorings and spices.
Barley malt is to beer as grapes are to wine. That's because beer brewing requires fresh malted barley that is mashed; the starch is converted to fermentable sugar during the brewing process. Cornelius has an annual contract with an Upper Midwest supplier for the grains, which are shipped either in 50-lb bags or loose for storage in stainless steel silos at the plant. Hops contribute bitterness, flavors and aromas to the beer. Hops actually are a hardy perennial plant with high levels of alpha and beta acids required in brewing beers. Cornelius sources Nugget and Cascade varieties through a Pacific Northwest supplier. The firm delivers boxes of hops in pellet form twice a year.
The brewers yeast used for Harpoon beers to convert fermentable sugars into alcohol and other byproducts is a proprietary product. 'Our yeast is cultivated here in the brewery and is unique to Harpoon,' says Cornelius. The final key ingredient comes from freshwater reservoirs in Massachusetts and Vermont, although the water is filtered twice at the breweries to remove any impurities and to ensure it has the correct content of inorganic salts required for brewing.
Harpoon Brewery was founded on the Boston waterfront in 1986 by three classmates at Harvard University in Cambridge, Mass. Richard Doyle, Daniel Kenary and George Ligetti hired one employee, Russ Heisner, a recent graduate of the University of California's graduate brewing program. Today, there are 90 employees at the two locations. In 1987, it's first commercial year, the company made 1,319 barrels of beer. Sales last year were 93,000 barrels, a 14% increase over 2004. The goal for this year is 100,000 barrels.
The Harpoon brewery plant in Vermont is described as an ashes-to-glory drama. Catamount Brewing was the Green Mountain State's first microbrewery but an unsuccessful attempt to expand put the firm into bankruptcy and eventually Harpoon bought its assets. The site and its modern bottling operation now makes all Harpoon brands.
As the company's expansion continues, so do Cornelius' purchasing duties—and the Excel spreadsheets where he tracks purchases and suppliers' performance. 'Recently, I took over the entire packaging buy'—bottles, paperboard carriers, labels and crowns (bottle tops)—'and am learning a whole new area of potential problems,' he says. That's because he must coordinate the delivery of up to five truckloads weekly of 2,800 cases of bottles.
Beer is a foodstuff. As with most foodstuffs, beer is perishable; that is, it deteriorates as a result of the action of bacteria, light and air. The brown-colored glass bottles keep out the full spectrum of daylight, which can have undesirable effects on a beer over a period of time. It is in these glass bottles that Cornelius' business day can become 'very interesting.'
Paperboard six-pack carriers made in Connecticut and 12-pack carriers and loose-fill cartons made in New Jersey are shipped to the upstate New York factory of the beer bottle manufacturer, which provides all these goods to the automated bottling units at the two breweries. The two state-of-the-art bottling lines can fill 250 bottles per minute and up to 3,200 cases daily. The racker (keg-filling machine) fills a 13.2-gallon keg every 60 seconds. Harpoon Brewery usually fills 270 kegs daily.
The bottle buy is a single-source annual contract, Cornelius explains, mostly because there are so few beer bottle manufacturing plants available to supply craft breweries in New England. It is in delivery that risks exist, he says.
'We've learned over time that glassware scan be a supply problem if there's a snafu with production on either end,' he says. Since beer making is a batch production process and bottling usually can be scheduled in advance, glass bottle delivery bookings can be prearranged. 'Except, we try to have deliveries made two days before we need the bottles, just in case there's a problem with bottle making or there are truck breakdowns,' he says. 'And that's not to indict the supplier because our bottle maker bends over backward to meet agreed-upon delivery dates.'
Modern beer kegs can have a service life of 30-40 years even though they take a beating in service because they are made from tough stainless steel alloys S30400 and S30403. When replacements are needed, Marzi, the head of brewing operations, usually negotiates with the producers.
Related links:
More on craft beers at http://www.beertown.org/education/craft_defined.html
History of Harpoon
http://www.purchasing.com/contents/images/Harpoon_history.doc
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