Why distillers need to consider the importance of employee benefits programs: a Q&A with Robert Reynolds, a financial planner, benefits expert and certified beer judge and the founder of Craft Business Benefits.
Q Why are craft distilleries among the types of small businesses that need to consider benefits for their employees?
A There are only so many qualified employees with the right skills and training to go around. Being able to attract the right employee, and more importantly retain their services, is going to be instrumental in the success of any business, especially in such a competitive growing industry. Benefit plans are a great cost-effective and tax-preferred method of compensating employees outside of pure wages. Plans can offer coverage the employees can't get themselves and ensures that they are in good mental and physical health so that they can work to the best of their ability.
Q Working in a manufacturing or warehouse environment has obvious physical dangers. But in addition to accident insurance, what type of employee benefits and assistance do you offer?
A I provide comprehensive employee benefit plans including the usual Life Insurance, Disability Insurance, Health and Dental Care plus some benefits I find especially valuable in the craft beverage industry. Breweries/Distilleries are dangerous places: think hot steam, boiling wort, caustic chemicals and gasses. I like to add extra Injury and Accident coverage to plans: it is an inexpensive way to make sure employees are compensated if they get hurt on or off the job.
I’m also a big advocate for Employee Assistance Plans. EAPs provide employees with free, confidential and processional counselling and guidance services. Often I hear of employees who struggle with addictions or substance abuse problems that, with an EAP, can get free counselling and support to help them in their recovery. But beyond just counselling, EAPs have become full blown "Lifestyle Concierge" services. Employees and their family members have free access to dieticians, legal advice, work/life balance coaching, financial and budgeting guidance as well as help accessing childcare and elder care services. Business owners and managers also benefit as they get access to a professional HR Department with legal advice when they run into a problem employee or difficult situation.
Q Can you explain how your company Craft Benefits can be an asset to craft distillers securing bank financing for their businesses?
A Distilleries are expensive! All that stainless steel and copper is usually bought on credit, at least at first. Banks are often concerned if an owner dies or gets disabled that the loans will not be paid back. Often you can negotiate better terms for a loan if you have a Life Insurance or Disability Insurance policy that pays the bank. These policies are called Collateral Loan Insurance, and given the right circumstances are a deductible expense to the business.
Q What is Key Person insurance, and why is it important for a small business like a craft distillery?
A Owners, star salespersons, distillers or anyone else that is key to the continued success of a business is a “Key Person.” Could the business survive without them? Life insurance and disability insurance can be arranged so that if a Key Person dies or becomes disabled, the business gets an injection of capital to keep the lights on and the machinery running. The cash can be used to pay bills, hire a replacement or buy back shares from a deceased owner.
Q What can we do for Key Person Retention in a small business like a craft distillery?
A A master distiller or blender can be a keystone to the signature flavours and identity of your company. The loss of such an important employee to a competitor can be very damaging to product consistency, quality and sales. We can offer several so-called Golden Handcuff strategies that reward your employees by staying with you as their employer. Benefit Plans, Retirement Savings Plans, Deferred Profit Sharing Plans and Wellness Spending Accounts can all help build employee loyalty, too.
Q What’s your background, Robert, and why are you particularly well suited to provide insurance solutions to the craft beverage alcohol industry? Where are you based and where are most of your clients?
A I am a Certified Financial Planner, and Certified Group Benefits Advisor. I have been working with business owners providing employee benefit plans and insurance since 2006. While I work with all kinds of businesses, I love working with breweries, distilleries and wineries. I am a Certified Beer Judge (BJCP) and hobbyist homebrewer. Through these connections I've learned about the problems that impact these businesses, and the unique challenges in the craft beverage industry, which led me to find unique solutions. I currently have craft beverage clients across the province of B.C.; however, we are also licensed in Alberta and Ontario, and I would love to expand more into those provinces as their craft beverage industries continue to boom.