Q: Can you offer any insight on how a small business can survive during the current recession? Has your business been effected?
A: Contrary to the rumors, the alcoholic beverage business has been affected and we felt this also. I suppose this is somewhat of a function that we make specialty products so there is some consumer "trading up" in that. I think that it is important in any business cycle to stay focused on what you are trying to do and go forward with that objective in mind. You have to be careful and watch your cash.

Q: Good Morning! How do you conduct market research? Do you use your brewery tours and tasting to test new products?
A: We do a variety of things to conduct market research. First and foremost, a company our size tries to stay close to consumers. Our people are out in the field. Fred Matt (VP of Sales & Marketing) is out in the field. I am in the field. Our product is easy to research and people will tell you what they think it. We also do focus groups and product testing. Lastly, we use the tour when we introduce a new product. We always make sure we have it in the tour center and get comments because those people are interested in our brewery and are interested in giving comments. Email has also given us a base for comments. We get hundreds each week and they tell us about our products and what they like about them.

Q: What are some ways your company uses to find and retain qualified employees? Thanks!
A: Our company does not have a great deal of turnover. I would say we have very low turnover. Probably the highest is the sales area and that is where we have younger people and there is more burnout. There is no organizational ladder to climb in that area. However, in our plant, our production area and the offices it is unusual to have one or two people leave per year. We just don't have a lot of turnover. We recently hired a couple of people and are very pleased with the quality of all of our people. I am especially delighted with our new hires. In terms of how we find people, we use www.CentralNewYorkHelpWanted.com, we advertise in the paper and we post openings through "working solutions" (the jobs of the Workforce Investment Board). We also use temporary agencies to help us find people. Retaining people is about making the working environment a good one. And, of course, paying people appropriately and providing good benefits. Letting people know that they are making a contribution. And it also helps that we're making a product people can associate with. They can take it home and tell their friends about it.

Q: I am interested in finding out more information about the branding of products. What corporate decisions were involved with moving away from the branding of the Matt's product to Saranac? I would guess that the decision was made to target a more upscale market, but why?
A: That is a good question. In the late 80's, Utica Club and Matt's were the primary brands of this brewery. They were declining in sales and were having difficulty competing because their pricing was lower - which didn't allow us to advertise. And they weren't well differentiated versus the national brands. On one end, we were competing with higher pricing and major advertising budgets. On the other end, we were competing with very low prices. The Saranac brand gave us an opportunity to enter the specialty beer field. The importance of that was that it allowed us to make a product that was differentiated from those of the major breweries. We could also charge a higher price for it - and still be very competitive versus other products like it. The Saranac brand really allowed us to compete again in the brewing industry. Its important for a company our size to make a product that consumers can differentiate versus the market leaders and a product that they perceive to be different, better and more preferable.

Q: There seems to be a lot of fed/state/county/city economic development programs and groups. People are saying small business is the future. But how can we get help (and dollars) flowing their way through the previously mentioned groups?
A: I am President of the EDGE Organization, the local economic development group that tries to coordinate the efforts of federal, state and economic development. EDGE's overall mission (and local economic development regardless of where it is coming from) is designed to increase jobs in this area. By definition, these organizations tend to focus on larger opportunities just because they present a greater impact. But any business has the opportunity to talk to the staff of EDGE and to see if there are opportunities for them to get economic development aid. And there certainly are a number of programs aimed at smaller businesses. If you would like to send in your name, we will certainly have someone from EDGE follow up because there may be program you qualify for.

Q: How many employees do you have and are they all in your Utica location?
A: We have approximately 150 employees. And except for sales, they are all in the Utica location. Our sales group consists of about 20 people, with 5 in Utica and 15 outside the area. So there are 135 here in Utica.

Q: How did Matt acquire the Saranac Brand?
A: The Saranac Brand was a new product that we introduced in 1985. At that time, the idea was to make a beer which was well differentiated from the national brands and had more character. The idea actually came from my brother, FX. While travelling through Germany, he was impressed with the quality and balance of the beers he was drinking there. When he came back to America, we developed the Saranac formula, which today is the original Saranac Adirondack Amber. We introduced that in 1985 and have expanded the line to include a number of products.

Q: Based on your expertise, at what point does a product or service officially become a brand? How do you take advantage of branding? Do you have any other brands, aside from Saranac? Thanks in advance for your help.
A: When we introduce a product to the market, we have to have a brand on it. Saranac beer is our primary business. We do have Saranac soft drinks as well, and Jed's - a hard lemonade. We license Two Dogs (lemon brew) which is a similar product to Jed's that is marketed mostly in the Midwest. And of course we still market Utica Club and Matt's because there are a fair number of people who still enjoy those products. As a principal, you have to decide what your brand stands for, what is the idea for this brand? On Saranac, the principal we try to live by is really excellent products that are better than our competition - and very fairly priced. As you look across that line, the beers and soft drinks fit that mold. The soft drinks are better, richer, more full-flavored than the major soft drink brands. We won't make a product that is just like Coke or Pepsi.

Q: Does Matt Brewery brew beer for other beer companies? If so, or if not, why would an established brewery explore this option?
A: We do brew beer for other people, and it is a key part of our business. About 30 percent of our business is brewing for other people. We currently make Brooklyn Beer and Brooklyn Lager. We also make Tremont Ale that comes from Boston. We make the Dock Street and Red Bell Products from Philly. And we make the Foggy Bottom products from Washington. We also make a product called DNA, which is a flavored malt beverage. And we make Malta, which is a non-alcoholic Hispanic drink that is sold in New York City. We call this "contract brewing" and it is a way to increase our capacity utilization.

Q: With some of your employees in different locations, how do you communicate with your outside employees for HR issues?
A: We have an inner company mailing. We also have a voice mail box on our telephone system. Whether in our office or not, everybody has email. Depending exactly what the subject is, we would communicate in the appropriate manner. In addition, people who are out of our office also come to the office for meetings roughly 4 times per year. If there is any major topic we need to cover, we could cover it that way.

Q: I'm am putting together a board of advisors for my 5-person company. What advice would you suggest for approaching area-business leaders as I request them to join the board? I know people are busy…and there maybe other issues, right?
A: We operate with a relatively small board that is composed of family members. So I am not necessarily an expert on this subject from this company's point of view. You want to be sure the people you get on the board can make a contribution to your business. If they can, and if they see that they can, I think you would find a surprising willingness for people to participate in this activity.

Q: Hello, would you explain what information your company uses to decide where/when to expand your product into new marketplaces? For example, several years ago, it seemed that Saranac was only available locally (it was a nice gift for our out-of-state friends). Now you can find it in many other states.
A: Well, I am sorry that it is not as good a gift for the out-of-towners!! We, like all companies, are trying to grow our business and we do that in 2 ways. One is by expanding the geography of the brands we sell - and Saranac is an example of that. We now sell Saranac in most places on the East Coast, and 10 years ago it was only available in CNY. The other way we try to grow our business is through new products. Over the years we have had some success and some things that weren't successful. Saranac soft drinks have been successful. Mountain Blush, a wine-like product introduced a couple of years ago, was not successful. Our effort to grow our business is really behind the effort to expand the geography and introduce new products.

Q: I enjoyed looking at your web site especially learning about the history of your company. Also, the home brewer section is terrific providing customizable templates for labels. But how much of a component is your web site in Matt's overall marketing strategy?
A: We feel it is very important for a company our size to interact with consumers on a very personal level. And our web site is one of the ways we can do that. We get a great number of emails from the site and we answer all of those personally. I think that this personal touch is extremely important.

Q: Talking about the web, do you advertise your product on other web sites? Something like an affiliate program with links back to your site? I read that these programs offer businesses potential increased site traffic and hopefully orders!
A: We are not doing that right now, but have plans to in the future. We just recently updated our web site and we want to be more proactive with it than in the past. So we have been investigating those types of programs.

This wraps up our Executive Chat session for today. BizBOOM.com and National Grid, would like to thank Mr. Matt for his time today in providing expert advice to the upstate NY small business community.

This Executive Chat with Nicholas Matt is brought to you by BizBOOM.com and National Grid.