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Customer Story: Valley Petroleum

04.02.21
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While today Bremer provides Valley Petroleum with a full range of banking services, serendipity may be the best way to describe the start of this relationship, which began not long after Trevor Longtine (president), Mike Bakken (vice president) and Kathy Reiser (CFO) purchased Valley Petroleum.

In March 2018, Brett Pauly, new to Fargo and his role as Bremer relationship banker, was prospecting for business when he noticed the Valley Petroleum sign and decided to stop in and say hello. Coincidentally, Longtine and Bakken had just concluded a meeting in which they were grappling with ways to improve their working capital and manage their cash flow so they could continue to grow their revenues.

“One of our luckier moments, early in our ownership of Valley Petroleum, was when Brett and Bremer showed up that day,” said Longtine. “I really appreciated Brett’s style and approach. And the other people we have met at Bremer are also very easy to talk to. They look at opportunities from all angles and come back to us with good ideas.”

One of Bremer’s first recommendations was to consolidate Valley Petroleum’s debt into a 10-year fully amortized SBA loan. “Bremer spent a lot of time learning about Valley Petroleum and explaining the near- and long-term financial impact of a new debt structure,” said Pauly. “We showed them how this would give them the ability to revolve their credit line and chase profitable new business opportunities.”

In 2019, Valley Petroleum had the occasion to do just that – and to fully understand the benefits of having a banking partner who’s in their corner. The company had an opportunity to be part of a large, 90-day project for the University of North Dakota. They would be able to leverage their 30 years of relevant experience but needed additional working capital to fund the job. “I called Brett right away and explained the project and how profitable it would be,” Longtine said. “Bremer was able to provide a sizable short-term loan that enabled us to complete the work, build our reputation with a new contractor and deliver increased profit to our bottom line.”

Valley Petroleum realized the value of Bremer’s partnership again in early 2020 when COVID-19 took hold. Despite the seasonal nature of Valley Petroleum’s business, demand for their products and services – including petroleum handling and lubrication equipment, fuel storage tanks and dispensers, and automotive lifts – was strong when the year began. But due to the pandemic, one of Valley Petroleum’s biggest customers abruptly cancelled an order worth hundreds of thousands of dollars. Longtine again credits Bremer with providing critical support. “Bremer quickly helped us apply for federal funding through the Paycheck Protection Program and gain temporary forgiveness of our SBA loan payments,” he said. “It was a really smooth process that I doubt we would have had if we had been banking elsewhere. It allowed us to avoid layoffs and weather the pandemic impact.” In fact, despite the pandemic, Valley Petroleum’s 2020 revenues have increased by double digits and they have hired three new employees, growing their team to 19 people.

Pauly points to Valley Petroleum’s leadership trio – each with their own expertise and complementary talents – and the company’s employee-centric culture as foundational to their success. He believes their long employee tenure provides a meaningful competitive advantage. “Many of their employees have worked for Valley Petroleum for 15 years or more, and they all take pride in the work they do,” he noted. “Plus, the three leaders work really hard; they have a sense of urgency, and they’re fully transparent. They are honest to the point you don’t see very often, which has earned them considerable trust from customers and loyalty from their employees.”

Trust is at the heart of Valley Petroleum and Bremer’s relationship as well. “It’s important to look for a banking partner who is focused on creating a win/win relationship,” said Longtine. “They all sound nice when you first talk to them, but it’s what they do to support your business that truly matters.”