Liquor Logistics: Keeping the Supply Chain Moving
Liquor Logistics: Keeping the Supply Chain Moving
An interesting article written by Karen M. Kroll, found in Inbound Logistics, really struck my attention as many liquor, wine and beer consumers out there, don’t realize the logistical challenges it takes to move what they love so much through the complete supply chain. Scarbrough is very aware of the challenges manufacturers, distributors, wholesalers, and breweries of these fine commodities must go through.
In fact, our very first customer 32 years ago was McCormick Distilling Company, a distillery based in Weston, Missouri. The company remains our customer to this day and now ships its products to 78 countries around the world and to all 50 states.
We partner with an array of liquor, wine and beer distributors and have even imported large machinery to help with start-up breweries and existing breweries in the United States. Check out the pictures! We are known for our large equipment and special project moves. We partner with Alfons Koester of Germany on a lot of these projects and love to see the outcome… and taste what’s created too! For instance in this scenario, we work with the U.S. buyer as Alfons Koester works with the German supplier from purchase order, pick up at origin, transportation across the Atlantic, U.S. Customs clearance, and final delivery.
Check out the article below by Karen M. Kroll to learn more about what is involved with these fine commodities.
If you are interested in learning more about how Scarbrough provides solutions to your supply chain, please don’t hesitate to contact me directly at ktaylor@scarbrough-intl.com.
To keep customers in good spirits, beverage companies need their liquor to move quicker. Here’s how they keep the drinks flowing.
“Although wine, beer, and spirits often signal fun and festivities, achieving success in the U.S. liquor market is a serious challenge. The number of products continues to proliferate. Suppliers, distributors, and retailers must comply with myriad regulations, many of which vary by state. One key: a supply chain that offers visibility, facilitates collaboration, leverages technology, and allows sophisticated data analysis. A daunting order, but some companies are bellying up to the bar.
That’s critical, given the exponentially increasing number of stock-keeping units, or SKUs, one result of the booming number of breweries, distilleries, and wineries. Over the past decade, the number of craft distilleries jumped from about 80 to 800, reports the American Craft Spirits Association.
The number of breweries hit 3,464 in 2014, according to the Brewers Association, and each offers its own products. In the late 1990s, in contrast, most warehouses stocked about 150 unique products. “It used to be ‘stack ’em high and let ’em fly,'” says David Christman, senior director for state and industry affairs, the National Beer Wholesalers Association. This is no longer the case.
The wine industry has enjoyed similar growth. More than 10,000 wineries and wine warehouses now dot the United States, up from about 2,900 in 2000, according to the Wine Institute.
These changes add several levels of supply chain complexity. New SKUs lack sales history, which limits the ability to forecast demand, says John Spain, executive vice president and senior partner with Tompkins International, a supply chain consulting and implementation firm. In addition, the volume of SKUs means customers have more choices, and some choose less popular items. That has led to more bottle, rather than case, picking. While it’s hard to quantify the increase, Spain notes some distribution centers now pick more bottles than cases.
In contrast to the explosion in the number of products, the industry has seen consolidation among many wholesalers and distributors. “Thirty years ago, there were a lot of wholesalers,” says Paul Laman, vice president of W&H Systems Inc., a materials handling systems integrator. “Today, the top 10 wholesalers conduct 80 to 90 percent of the business. They may have 10 to 12 states each. That reflects a massive change in distribution.”
For instance, Glazer’s Inc., a wine, spirits, and malt beverage distributor, currently operates in 15 states, up from four in the mid-1990s, says Dave Christensen, the company’s vice president of supply chain. The growth has come both organically and through acquisition, he adds.” – Karen M. Kroll, Inbound Logistics
