Just a few decades ago, Daniel Thwaites merely traded in its

They do not really need to bother giving visitors maps or directions to find Daniel Thwaites. Approach Blackburn from any direction and the Star Brewery looms up like a monument, dominating the skyline and leaving people in little doubt that here is a town where beer is big business. Thwaites, which brewed its first ales back in 1807, lays claim to be Britain's seventh biggest beer producer. But its other activities, which include 450 tied pubs, extensive canning and bottling production and a growing estate of four-star luxury hotels, mean the company is now on the brink of "super regional" status. It remains a family-run company, with chairman Ann Yerburgh and her husband, John, the president and a direct descendant of founder Daniel Thwaites, controlling shareholders. Thwaites is a £130m a year turnover company and is expanding at a steady rate of knots. Last year, it acquired extra pubs and forged brewing and supply deals that saw new ales and lager brands enter its portfolio. Just a few weeks ago, it bought a bottling line from the doomed Brakspear brewery at Henley-upon-Thames to add another strategic string to its bow. "We are a table with four legs," explains managing director, Paul Baker. "We spread our risk over the four different parts of our business so we can never be caught with all our eggs in one basket." If brewing and pub retailing remain its two core activities, it is the way these two sectors have diversified over the past five to 10 years that has been one of the keys to the company's success. Strong beer and lager brands have helped secure quality, free-trade business, while a mixed pub estate comprising community locals, food-led destination houses and town centre bars provides a balanced retail pub portfolio. While Thwaites might be best known for its beers and its pubs, its canning and bottling operations and the hotel business are growing in stature. The Star Brewery boasts one of the most advanced canning lines in Europe, which allows it to package its own brands and also secure an increasing number of contract canning deals for other brewers. The recent purchase of the Brakspear Brewery bottling line is expected to see business in this field expand in the future. The lesser-known strand of Thwaites' business is its Shire Hotels division. This has grown into a nine-strong estate of premier four-star hotels operating not only in the company's northern heartland but now across the Midlands and the south. Latest opening, the £18m Thorpe Park Hotel in Leeds, demonstrates Thwaites' commitment to capital investment in this part of its business. Baker says: "Over-all, we have reached a position today where we have four extremely strong trading divisions that have been allowed to prosper thanks to the foresight of previous management, which has not been afraid to invest. "There has been major capital spending, particularly on brewery plant, and in brand development, which has made Thwaites one of the strongest names in regional brewing. "Our beers are being sold farther afield than ever before and our pub estate in branching out into new trading areas such as the Midlands and Yorkshire. Tied estategrowing Thwaites' tied pub estate is one of the company's core businesses and key strengths. Its pubs have been traditionally located in its north west heartland, but over the past 10 years significant expansion has seen a geographical switch, eastwards towards Yorkshire and south into the Midlands. Historically, the retail focus has been firmly on the community and suburban local, which could always rely on a regular clientele housed in the surrounding industrial chimney-pot towns. But now its pubs also comprise food-led destination houses and smart young persons' venues, which make up a substantial percentage of the company's 70-strong Thwaites Inns managed house division. Retail director, Paul Howarth, says food has been a major element of Thwaites Inns' growth. "Last year, we sold 750,000 meals in our managed pubs and since 1998 we have seen a fivefold growth in food income," he says. "We like to think our food offering is more than run-of-the-mill corporate menu stuff. "The food offering is developed pub by pub and, within certain parameters, our managers and chefs are encouraged to do their own thing. We certainly do not go down the branded road, because we are convinced individuality is the way forward and what customers look for these days. We have some fabulous food pubs while some of our young persons' venues are really top of the tree. "Our award-winning NTK in Blackpool is a case in point. It has no shortage of competition, but consistently produces the goods with turnover well past £1m." The bulk of the tied estate is made up of 350 tenanted pubs that are currently enjoying good trading as the "local" enjoys a return to popularity across the UK. Howarth says: "This is a very strong sector at the moment and our tenancies are currently showing good returns. "We like to think we support our licensees in practical ways and a major attraction for them is our three-year standard tenancy deal . "It gives them more peace of mind to know they are trading on a simple agreement with no hidden dangers." Thwaites is expanding in both its managed and tenanted estates, although piecemeal acquisitions tend to be its preferred route. However, 18 months ago, it purchased 10 managed pubs from Six Continents in the Midlands and, at the end of last year, it purchased the 28-strong Nice Pub Company estate from Tom Cobleigh in south Yorkshire. "These were areas where we were keen to get a foothold and we are delighted at the response from both licensees and customers." New horizons Excise officer Daniel Thwaites produced his first pint of Thwaites back in 1807, and since that day, the beers have been synonymous with the town of Blackburn. Close on 200 years later, the famous Thwaites shire horses are still a familiar sight in the town. Yet this traditional image belies the massive strides that Thwaites has made in recent years. Its traditional mild and bitter still form a key part of the beer portfolio, but the brewer is moving with the times. Seven years ago, it bowed to popular demand and launched a nitrokeg beer brand, Thwaites Smooth. An enterprising marketing and advertising campaign saw Smooth sales race way ahead of target and win a host of new free-trade accounts. In the last few years, two new German lagers joined the portfolio when Thwaites took on sole UK distribution rights for Warsteiner, and followed this up last autumn with a licensing deal to produce Kaltenberg Royal Lager Beer. "These last two deals have enabled Thwaites to achieve its aim of either brewing or controlling a brand in every sector of the ale and lager market," explains sales director, Brian Jenkins. "We feel we've a portfolio that can compete with many brewers and knock spots off most." But Jenkins stresses that these new brands won't threaten production of cask ales. "We are passionate about cask ale and are offering customers more brand choice than ever before." Daniel Thwaites factfile Address: The Star Brewery, Blackburn, Lancashire BB1 5BU Founded: 1807 Turnover: £130m Pre-tax profits: £11.91m Pubs: 420 (350 tenanted; 70 managed) Employees: brewery 400; managed pubs 1,000 Brands: Thwaites Bitter, Thwaites Mild, Thoroughbred, Lancaster Bomber, Thwaites Smooth, Warsteiner, Kaltenberg.