With the start of summer, people are flocking to stores to buy their favorite craft beverages. Warm weather and socializing mean the craft beverage industry is in full swing, locating ingredients, distilling, bottling, and shipping alcoholic beverages around North America. Consumers with an insatiable thirst expect that when they visit a store, they’ll find a plentiful stock of adult beverages from which to choose. Shipping managers are responsible for fulfilling consumer demand for craft beverages.
The logistics behind sourcing ingredients, cans and bottles, packaging, labels, trucks, and equipment can be a time-consuming and challenging process that requires carefully assessing inventory levels and forecasting customer demand. This article looks at some ways that third-party logistics providers are helping craft beverage shippers overcome some of the daily challenges they experience within their supply chain.
The craft beverage industry encompasses a range of craft beers, artisanal spirits, boutique wines, waters and seltzers, functional beverages, hard kombucha, and other beverages. The largest vertical within this particular niche is arguably the craft beer industry. Beer enthusiasts know that they are living in the golden age of beer brewing. A plethora of new styles and tastes, such as sours and IPAs, are released to the public seemingly every week. In addition, seasonal releases aim to accompany events such as summer barbeques or Thanksgiving dinners; regional variations incorporate local ingredients, styles, and flavors, and local artists showcase their designs on the cans and bottles. Craft beer has proliferated across North America, with thousands of local breweries commercially producing their distinct tastes and conceptions of beer and sharing it in a global market.
But regardless of your beverage of preference, craft beverage logistics requires rational planning, up-to-the-minute communication with carrier partners, steady capacity, and supply chain optimization to ensure that customer orders are fulfilled on time and in full.
From beers and wines to spirits and waters, elaborating craft beverages requires sourcing key ingredients. Hops, barley, water, grapes, sugars, syrups, flavoring, as well as the bottles, cans, cardboard, labels, and other packaging materials needed to manufacture and get the product ready for distribution.
Since the COVID-19 pandemic, the craft beverage industry has witnessed a dramatic transformation in consumer shopping habits, with e-commerce and direct-to-consumer (DTC) sales becoming the preferred method for consumers to get their favorite beverages. Traditionally, shipping managers only had to cover the logistics of getting their beers into the hands of wholesalers, distributors, supermarkets, venues, and bars. The vast majority of craft beverage companies only have the time, energy, and transportation service possible to market and distribute their products to these third-party entities. But with the rise of DTC across the industry, food and beverage companies are now contending with this growing marketplace for smaller, individual orders that don’t require a 53-foot dry van or reefer. This is one of the emerging trends in the beverage warehousing and logistics sphere and something that shippers should consider when choosing a transportation provider that can offer a variety of services and emphasizes final mile delivery.
Just having an end customer is not the only consideration when shipping craft beverages around the country. Having sufficient warehouse space is crucial, especially for breweries with heavy volumes, but also ensuring that supply chains are streamlined and optimized for top performance. Cold chains must be managed to ensure the highest safety standard for consumers and avoid spoilage, product rejection, and expensive insurance claims. In the craft beverage vertical, transportation costs are one of the most costly expenditures shippers incur. When truck fill rates are low, and when KPIs for on-time deliveries are less than perfect, shippers spend more, whether it’s on more truck orders or spending time to repair damaged relationships. But by partnering with a logistics provider specializing in data-driven managed transportation, craft breweries can get total control over their supply chain, and in some cases, save hundreds of thousands of dollars on their annual transportation budgets.
There are many third-party logistics providers out there, and shipping managers are well aware of their existence from the abundance of phone calls and emails they receive from brokers soliciting their services. There are many fine transportation providers out there, and craft beverage companies should know that some of them actually specialize in working within the craft beer logistics market. Companies like Zengistics understand the unique operational requirements necessary to protect the integrity of craft beer cold chains, offer a network of carefully vetted carriers with experience shipping alcoholic beverages, and by offering value-added services to ensure customer fulfillment is a top priority. On top of that, Zengistics offers a uniquely proactive approach to working with craft beverage companies by combining logistics experience and technology to offer practical solutions to help optimize supply chains for peak performance.
The results speak for themselves. Craft beverage companies know that by partnering with Zengistics, they obtain a service provider that knows the ins and outs of the niche marketplace, understanding the seasonal volatility, unique operational requirements, and the necessity for real-time shipment visibility. One of the most critical roles that 3PLs are providing the craft beverage industry is with data-driven performance. Technology is helping companies identify key areas within their supply chain to streamline, for example, in improving their route optimization and consolidation of shipments. This ultimately reduces travel times, fuel costs, and greenhouse gas emissions, and improves on-time deliveries of products. All of this is designed to help breweries maximize profits and improve their customer satisfaction.
As the consumer landscape evolves, so too does the logistics industry, and that’s why it’s crucial that shipping managers partner with transportation providers that offer calculable, customizable solutions built around your company’s unique operational requirements. What does that mean, specifically? Glad you asked. Basically, it involves the following facets:
Craft beverages are now a globalized commodity, especially within the North American trade zone. Aside from the thousands of craft breweries that exist in the United States, craft beverages have proliferated. Craft beer is thriving in Mexico and filling shelves across Canada too. Craft beverages are also exported globally and shippers need transportation providers that offer a variety of services to accommodate their brand’s shifting market presence. Shippers look for a provider that offers a collaborative approach to managing supply chains.
The logistics industry has come a long way from just finding a rate and a truck. Shippers are looking for a provider who can analyze their shipping data, create customizable reports that are tailored to maximizing their efficiencies on their shipping lanes, finding key areas that reduce transportation costs, eliminate time-consuming tasks like manual check-calls and load notifications, and create cost-effective solutions that are driven specifically to help optimize the supply chain of craft brewers. For example, technology is helping craft beverage companies predict market trends, reduce waste, lower operational costs, and design scalable growth mutually beneficial for both shippers and providers.
Craft beverages are just as important as crafting a quality transportation network to fulfill customer orders, and that’s why Zengistics exists. Zengistics partners with hundreds of craft beverage companies across the United States, helping companies fulfill customer orders, expand their market reach, facilitate scalable growth, reduce their environmental footprint, and optimize their shipping lanes to peak performance. Zengistics does this with its veteran team of logistics experts and proprietary technology that allows shippers to implement strategies to gain total transparency on their supply chain and make informed decisions on how to operate their business in ways that save costs and improve KPIs. Zengistics offers customers a means to step back and analyze their trade network, looking for ways to streamline operations and find areas to cut costs that can save customers a substantial amount on their annual budgets. Many fine transportation providers are out there, but few specialize in the craft beverage industry. Contact a craft beverage expert at Zengistics today!
Operating on the world’s first collaborative logistics platform, Zengistics is a technology company that executes freight.