N.W.T.'s only microbrewery out $100K after equipment supplier goes out of business

The owner of the only microbrewery in the Northwest Territories is out more than $100,000 after one of his suppliers went into receivership and shut its doors.

Fletcher Stevens doesn't know if he'll get his hefty deposit back

Fletcher Stevens, the owner of the only craft brewery in the Northwest Territories, is trying to recover more than $100,000 he put down as a deposit to a supplier that has since gone out of business. (Gabriela Panza-Beltrandi/CBC)

Fletcher Stevens woke up Tuesday, checked his phone and found out his brewery in Yellowknife, N.W.T., lost more than $100,000 overnight.  

"I never thought I would wake up in the morning and lose that chunk of money, ever," he said.

A supplier that Stevens and other microbrewers rely on for equipment went into receivership a day earlier.

P.E.I.-based Diversified Metal Engineering (DME) failed to make its payments on more than $18 million the company and its guarantors owed the Royal Bank of Canada. That left Stevens wondering what will happen to his hefty deposit.

The company manufactured equipment for the food and beverage industry, including equipment and components for craft brewing operations across Canada. 

Stevens owns the N.W.T. Brewing Company, the only microbrewery in the Northwest Territories. He says he learned about DME's financial woes through a brewery forum on Reddit.

Despite this setback, Stevens says the Woodyard and the N.W.T. Brewing Co. will continue running as usual. (Gabriela Panza-Beltrandi)

Stevens said he put down a deposit in September of more than $100,000 for equipment for a new brewing facility he planned to open in Yellowknife. He went through DME's sister company Newlands Systems. 

He doesn't know if he'll ever get that money back.

"It's like somebody came in and just stole that money from us," he said. "I don't think we'll ever get it back."

Stevens is now speaking with lawyers about his options. The equipment from DME was expected to arrive in April, but now Stevens doesn't know when it will come in, if at all.

The new brewing facility would have been three times the brewery's current size, but with all this uncertainty, he doesn't know what will happen next.

"It's definitely slowing us back," he said.

"We had a lot of plans for festivals in the summer. We had this goal to be able to make Folk on the Rocks, and that's kind of gone up in smoke because I've got no timeframe now of how long equipment is going to take to get here.

"This [company] crashed and so did everybody's dreams."

Effects ripple across Canada's craft brewers 

Brewers across Canada have been shocked by the recent news, just like Stevens.  

Marko Marjanovic, the owner of Winterlong Brewing Co. in Yukon, narrowly missed being in a similar situation to Stevens — he nearly ordered new tanks from DME last week.

DME, a supplier for the craft brewing industry, has contracts with companies across Canada. Many are feeling the pressure after it went into receivership this week. (Pat Martel/CBC)
 

"We rushed down to the bank and purchased equipment from [another] supplier in Canada, thinking that their workload was just about to increase because of the closure."

In Alberta, the Prairie Brewing Company relied on DME for ongoing customer support after purchasing about $20,000 worth of equipment from DME in 2017. 

Mark Ferguson, the president of Prairie Brewing Company, previously told CBC News he is concerned about what could happen if that equipment he purchased malfunctions. 

The court-ordered receiver of DME says it plans to sell the business as a going concern — meaning the company has the resources needed to continue operating for the time being — with the hope of finding a buyer to reopen the P.E.I. company. 

Meanwhile in Yellowknife, Stevens says despite the setback, the N.W.T. Brewing Co., and his adjoining restaurant The Woodyard, won't be closing. 

"At the end of the day you've just got to always keep positive and know that we are still doing the right thing," he said. "We will move forward and we will do something." 

About the Author

Gabriela Panza-Beltrandi

Gabriela Panza-Beltrandi is a CBC reporter based in Yellowknife. She worked in newsrooms in Toronto, Alberta, Saskatchewan and Yellowknife for two years before joining CBC North in April 2017. Her coverage focuses on Yellowknife city council, and goings-on in the city. You can get in touch with Gabriela at gabriela.panza@cbc.ca or on twitter @GabrielaPanza.