Sold on Retail: Customer-facing brands of Alaska Native corporations

Community Connections

While revenue is always at the forefront of the decision to invest in retail operations, some corporations see their customer-facing brands as opportunities to create deeper ties to their communities and regions.

In October 2019, when BBNC acquired controlling interests in a seafood company and a fishery, then merged them to create Bristol Wave Seafoods, one of the corporation’s goals was to return control and earnings of the Bering Sea freezer longline cod fishery to BBNC shareholders. Today, the seafood company provides high quality, sustainably harvested Alaska seafood to customers, while also reviving BBNC’s connection to the seafood industry, rooting the company more deeply in the culture and landscape of its region.

For BSNC, acquiring Alaska Industrial Hardware has been a way to stay at the forefront of the minds of its customers.

“A physical retail presence boosts brand visibility and community engagement, allowing direct customer connections,” says BSNC President Cindy Massie. “Retail and customer-facing businesses help to remind our customers about BSNC and our mission to provide to our shareholders. We as a corporation do what we can to bring the health and well-being of our people and communities into a bright future.”

Reversing the Revenue Stream

When it was enacted, ANCSA completely transformed the Alaska economy. Prior to the act, the large oil and construction companies operating in Alaska were mostly headquartered out of state; revenue they generated flowed out of Alaska and benefitted economies in the Lower 48.

ANCSA flipped that paradigm. State labor economist Neil Fried called it a “reverse colonial model” in a 2022 Indian Country Today article; ANCSA corporations established many of their subsidiaries in the Lower 48, and profits from those companies funneled back to Alaska. The model established significant revenues for the corporations, which are distributed to its Alaska Native shareholders through dividend payments.

Retail enterprises have the potential to generate flows of revenue back into Alaska too. The most extreme example of this model demonstrated by an ANCSA corporation-owned retailer might be Clear Alaskan Glacial water. Bottled by Alaska Glacier Products in Chugiak, the company is owned by Minto Development Corporation (a subsidiary of the Interior village’s Seth De Ya Ah Corporation) in addition to several other Native corporation investors. Clear Alaskan Glacial entered a partnership in 2013 with CHIC of Shanghai to sell its products throughout China. This development built on Clear Alaskan Glacial’s existing strong sales in Japan, South Korea, and Taiwan. Alaskans visiting the Far East might be surprised to see thirsty locals quaffing bottles bearing the label of their home state, thanks to Minto’s marketing hustle.

BBNC, meanwhile, delivers fish sustainably harvested from the Bering Sea to customers throughout the world. Fish are processed and flash frozen at sea, ensuring a high-quality product; the revenues from sales of the product are distributed to employees through “crew shares,” portions of the total profit decided upon by each vessel’s captain.

Additional Advantages

Dividends aren’t the only perk that shareholders enjoy through regional and village corporations. The missions of each ANCSA corporation include directives to improve the quality of life of shareholders through economic development. This is done in part through providing employment opportunities, as well as relieving economic hardship, especially for shareholders who live in rural communities.

“In addition to shareholder employment opportunities and returns to help grow shareholder dividends, each of [our] three retail businesses provide exceptional discounts to BSNC shareholders,” Grayson says. “In Nome, the Aurora Inn offers a shareholder discount above and beyond any other discount provided by other hotels. These discounts can really make a difference, especially for people coming from the surrounding communities in the Bering Strait region, where oftentimes travel is significantly higher in cost.”

Meanwhile, BSNC shareholders also enjoy lower prices at BSNC car rental; however, shareholder discounts at AIH vary by item.

BSNC’s companies also create jobs. The corporation’s shareholders and their descendants currently make up 12 percent of AIH’s 200 Alaskan employees, “reflecting our commitment to creating employment opportunities for our community,” says Grayson.

With twenty-four stores throughout Alaska, Afognak-owned Brown Jug employs more than 200 Alaskans; like many retailers owned by ANCSA corporations, Brown Jug emphasizes shareholder hire on its career opportunities website, encourages Afognak shareholders to apply, and links them to career development resources at their corporation. Other ANCSA corporations highlight a preference for shareholder hire at their subsidiaries, including their retailers.

Though retail operations create exciting new possibilities for ANCSA corporations, operating retailers is not without its challenges, says AIH President and CEO Terry Shurtleff. But every challenge, he emphasizes, can be viewed as a possibility, too.

Staffing, supply chain issues, and competition pressures, Shurtleff says, “are also the same challenges our competitors have. We reframe our challenges as opportunities to distinguish ourselves from our competitors and provide the superior customer experience Alaskans expect.”