How Karl Strauss Pairs Handcrafted Beer with AP Automation

In the mid-1980s, the modern American brewing scene was in its infancy. Decades of homogenization in the U.S. beer market was slowly giving birth to an underground movement of homebrewers and microbreweries — the big bang of what we know today as the world of “craft beer.” And when it opened on February 2, 1989 in San Diego, the Karl Strauss Brewing Company found itself at the forefront of this movement. 

The company was the brain-child of college friends Chris Cramer and Matt Rattner, who were inspired by the brewpubs they visited during a backpacking trip through Australia. When they returned to the States, Chris and Matt decided to bring the vision of local, handcrafted beers to life in San Diego, a place that hadn’t seen a new brewery open since Prohibition, and give the city a beer culture all its own.

To get the project started, Chris enlisted the help of his cousin, a recently retired master brewer named Karl Strauss. Karl was a German émigré whose family had brewed beer in an old-world style for generations, and for twenty-five years, Karl had mastered modern industrial methods as Vice President of Production for the Pabst Brewing Company.

When Chris reached out, Karl decided to come out of retirement to help the young entrepreneurs. He quickly got to work, helping design the brewery, create recipes, and build the ultimate capstone to a life of craftsmanship.

Over the next three decades, the Karl Strauss Brewing Company and San Diego’s craft beer industry grew together. Today, the Karl Strauss Brewing Company is the elder statesman of the city’s world-class beer scene, and honors the legacy of its namesake by sponsoring growth and collaboration among brewers in the city now known as “The Craft Beer Capital of America.”

A Handcrafted Invoice Process

Over the years, Karl Strauss has grown into a large operation. In addition to its bustling manufacturing and distribution business, the company operates its primary brewpub alongside seven microbreweries, each of which includes a restaurant.

But while a commitment to slow, manual processes might set its beer apart, it was drowning its accounts payable team in paper.

Karli-Mae Ochoa, the company’s Senior Accountant and primary AP master, recalls that, for a long time, the company received, approved, and paid over a thousand invoices a month entirely on paper.

“We were getting along with a team of people just hand-keying all of these daily invoices into our Great Plains software.”

But the manual AP system had its flaws. For example, the people coding invoices were mostly employees whose time was better spent focusing on guests and their experiences.  

“The GM or the head chef were really the only people who coded things,” says Karli-Mae. “Those invoices needed to be hand-coded or written out between what accounts it needed to hit. They used to have to hand-key all of those separately and do all of those manual calculations, write it on the invoice and then sign it.”

Doing calculations on paper invoices didn’t make the task any easier.

“Judging by the scribbles and the checkmarks and the math written out on the invoices, I think it took them a while to do. Frequently you would get errors — things that didn’t add up. There was a lot of back and forth with the brewpubs to try and get things coded correctly.”

Transferring paper invoices from the restaurants to the central office presented another obstacle. 

“Our drivers made twice-a-week deliveries of our beer to the brewpubs, and when they did that, they would drop off the keg and pick up a packet of invoices. The restaurants were supposed to have a packet ready for every delivery with their invoices. We had a couple of situations where the driver lost the packet. So that would be 50 to 100 invoices that were just gone.”

Of the invoices that did make it to the main office, many were difficult to read. 

“Sometimes the invoices would come in looking like they had dumped it in whatever they had laying on the counters in the kitchen,” says Karli-Mae. “Especially with the carbon copy invoices, those were easily destroyed. A lot of times, we had to go straight to the vendor to ask for readable copies of invoices.”

These challenges only affected processing invoices — approving and paying them was its own struggle. The CFO couldn’t quickly get approvals from the managers she wanted, and getting sign-off for payment was a daunting task.

“We would drop a pile of about 100 checks on our CFO’s desk every week,” recalls Karli-Mae. “If she was too busy to sign, the pile would go off to the side and she’d get to it a few days later. It was a challenge to get her the time to sign the check.”

On a normal invoice, it probably took two weeks to get a check cut. To get it signed could easily be another two. We paid a lot of invoices right on time — if not a little late.

The Karl Strauss team wanted to do something about their manual AP process, but they feared a solution would be out of their price range.

Automating a Dream Invoice Workflow

Based on a recommendation from an employee who had previously used it, the Karl Strauss team found Ottimate — and everything in AP changed.

“We did some cost analysis and decided that Ottimate was a more cost effective way to manage our AP,” says Karli-Mae.

The first time she saw Ottimate in action, Karlie-Mae immediately noticed how simple the system was. 

“It just made sense intuitively. I liked that you didn’t really need any instructions. It’s clear: okay, invoices are here, reports are here, statements are here. There’s just not much to think about. It’s easy.”

And with ease of use also came the ability to implement approval policies that were never possible with the paper workflow. Advanced approval rules eliminated a huge headache from the team’s payments workflow, ensuring a smooth and efficient invoice-to-payment process.   

Ottimate gives our VPs and managers the opportunity to review those invoices before they go to the next person. They can look to make sure that the pricing is right, that the credits are there, or whatever it is that they’re looking for. We could never do that before. If our regional brewpub manager is at the home office, he’s not gonna be able to see the paper invoice that the AGM is approving. Now he can get into the workflow and review them before they get paid.

Not only did Ottimate make it easier to approve invoices, but it also gave the CFO a simple sign-off process for sending payments.

“[The CFO] reviews some of the invoices that are up for payment, looks at the approval history, and checks for flags. She can still send copies over to me or my coworker if she has questions, but she can just approve the bills from there and the payments get sent out,” explains Karlie-Mae.

Ottimate Features Putting Efficiency on Tap

Thanks to Ottimate, Karli-Mae and her accounting team were able to move from a paper-based process for receiving, approving, and paying invoices to a sleek, automated system — but their AP evolution didn’t stop there.

Karl Strauss was also able to leverage several other key features they discovered within Ottimate:

Easy Uploads with EDI

One of the most seamless ways to receive invoices from a vendor is through electronic data interchange (EDI), which transfers pure data. When an EDI connection is set up, the vendor’s computer system simply sends data into Ottimate, which formats the data into a file type that you can process as usual.

Karli-Mae learned about Ottimate’s EDI connections early on.

“During the onboarding process, Ottimate supplied me with a list of vendors that already had EDI established with Ottimate. I think all we needed to supply was our vendor name and the account number. The Ottimate team CC’d me on the emails to make sure I was in the loop, but other than that, I didn’t really have to lift a finger.”

The Karl Strauss team decided to prioritize two types of vendors when using EDI: big vendors, like Sysco, who had long, complex invoices; and small vendors who use carbon copy forms for invoices, which can be difficult to read.

“As soon as we started shifting invoices to EDI, I was like, ‘Okay who has the carbon copy invoices?’ Because I can’t read [them] and carbon copies really don’t scan very well. So EDI eliminated that issue.” 

EDI invoices have also been a hit with the individual location managers.

The restaurants love EDI, obviously, because that’s less they have to scan. The data comes in as this invoice template that the Ottimate team created. The items are already mapped and, really, the restaurants just need to take a glance at it before approving it.

Karli-Mae also says EDI has helped the restaurants get vendor credits faster for deliveries that formerly didn’t have invoices at all. This has been especially helpful with drop ships, which are on-demand or on-the-go deliveries that are often ordered when the restaurants are in a pinch.

“In the back office we would see [drop ship invoices] uploaded to the platform we had with Sysco, but the restaurants would never get them. So we’d have to go in and manually catch it and send it to the restaurant. Now, everything’s just uploaded, whether it’s a drop shipper or a normal invoice. So we never have to worry about that.”

Automatic GL Coding

As it digitizes invoices, Ottimate automatically tags each line item with the proper GL code, eliminating the need for hand-entering invoices — making the lives of everyone at Karl Strauss much easier. 

Because everything is mapped in Ottimate, all the items go where they’re supposed to go. I spend 10-15 minutes in the morning going through the invoices that got caught overnight —  mapping new items that the system doesn’t recognize yet, duplicates that the system catches, invoices that people didn’t upload correctly — and clean it up in Ottimate. Then the restaurants basically just review the invoice and approve it. And that’s it. They don’t have to think about the line items.

Vendor Statements

In the old workflow, Karli-Mae never had an easy way to get to the bottom of missing invoices. But with Ottimate’s Vendor Statements feature, it’s easy for Karli-Mae and her team to quickly find lost or missing invoices. 

“The statements side of it is great. That was one of the main things that drew me to Ottimate. I thought it was amazing. 

I used to have to take a ruler, go down, hand-key [invoices] in, then highlight the ones that were missing, and then request it from the vendor. Now, all we have to do is push two buttons to get an email sent to our vendor automatically. So that has saved us a ton of time.

Earning Cashback with VendorPay

Initially, Karli-Mae and her team used Ottimate’s VendorPay solution to streamline the check-writing process when paying vendors. Rather than writing, stuffing, and mailing out checks themselves, Ottimate did the work for them — saving them time and supply costs. 

Soon, however, they discovered that Ottimate offers additional payment options: ACH and virtual cards (vCards). Both ACH and vCard payments are faster and more efficient than traditional checks, ensuring vendors are paid on time, every time. With vCard payments, in particular, Karli-Mae and her team also have the opportunity to earn cashback on transactions. 

“People like being paid quickly, obviously. So the ACH was great to start sending to some of our more high-frequency vendors. That way they get paid quicker and we can continue to get our product. With the virtual cards, same thing. It does help that we get that rebate, which is great. That’s a great incentive.”

Food Cost Insights

Ottimate’s Insights feature gives businesses like Karl Strauss a way to see changing item costs in a few simple dashboards. Insights will show if two locations are being charged differently for the same item, or if the cost of a particular item is changing over time — helping restaurants save more effectively manage their budgets. 

At Karl Strauss, Insights has helped restaurant staff understand their costs in a new light.

Our head chef, assistant head chef, and district managers — really all of the higher-up brewpub staff — love that information, [and] absolutely use it. They go in and see the price fluctuations and things like that. They have all of the reporting. I see the emails where our head chef says, ‘Yeah, coffee has risen over the past couple months,’ or talks about the fluctuations in the price of meat and other more expensive items. So I know he’s looking at it, because he can get that data straight from Ottimate.

A New Hit IPA: Invoice Process Automation

Since being rolled out across all Karl Strauss locations, Ottimate has taken the invoice, payments, and reporting workflow from a time-consuming, manual process to an efficient, automated workflow. 

Before Ottiimate, the AP process involved three people, piles of paper invoices, and 30 or more days to complete. Now, one person manages the AP workflow in only 10 minutes per day — all while practically eliminating paper invoices. 

“We still do have some paper at the office. But this year, instead of sending 80-something boxes to storage at the end of the year, we will send maybe five. We are still cutting some manual checks at the home office, but again, nothing like we used to. Everything’s in Ottimate now.”

Ottimate’s also a hit beyond the Karl Strauss accounting team.

I’ve gotten a lot of positive feedback from our chefs. [Ottimate] saves them a ton of time. There’s an app on their phone, they can just go in and approve invoices at home on the couch, when they have down time. They don’t have to take up time at the restaurant. 

“I know the GMs love that they can see everything we do remotely. They know where to see if an invoice has been paid, and even find that check image to send to the vendors. They’re like, ‘This is amazing. This is going to save us so much time.’”

For the Karl Strauss Brewing Company, Ottimate has been instrumental in connecting their locations, managing the business efficiently, and establishing better relationships with their vendors. In a business built at the intersection of old-world patience and modern technology, Ottimate has given them much more control over where they do — and don’t — spend their time.

“Ottimate has been phenomenal,” Karli-Mae says. “It’s saved time for us, not just in accounting, but also at the restaurant level and for the managers as well. No more paper shuffling back and forth, no more packets coming in from the restaurants, and no more coding because everything’s pre-coded. So it saves everybody time. We all love it.”

Ready to reduce paper and spend less time on your restaurant’s AP process? Schedule a demo of Ottimate’s End-to-End AP Automation solution today!