top of page
SaB_900x140_PlaceHolder_35%.jpg
Distribution Truck Icon

DISTRIBUTION

Distribution can be essential for breweries at many different stages of growth. In some states a distribution contract/partner is required simply to sell your own beer to your tap room to serve it. For others, Distribution can be put off until way into the future….perhaps not in the business plan at all. Breweries growing one step at a time may plan to handle limited self-distribution (in states that allow it) to get their feet wet or just to support their neighbors, with the intent to grow into formal distribution someday.

 

Regardless, it is important to understand the benefits and costs of distribution so that any plan can properly account for the time and cost of each step to prepare properly. Therefore, feel free to explore informational articles that may be organized in Open or Grow even when you’re in the Plan stage. It’s never too early to learn.

 

Distribution is necessarily connected at the hip with Accounting, Branding/Marketing, Business Plan, Human Resources, Legal, and Sales. All of these elements are essential to executing a distribution plan well. And quality execution, including utilizing the requisite time and resources, is necessary to ensure maximum success with your distribution partner.

The Brand Owner's Dilemma:
The Care and Feeding of Distributors, Part I

The explosion of new craft breweries, distilleries and wineries over the past several decades has been a benefit to local economies, curious consumers, and to the craft entrepreneurs themselves. However, for every craft brand that “makes it big” (insert your meaning of “big” here), there are many other, equally hard-working craft brand owners who struggle to scale, and still, many more that simply fail. While we cannot address every solution for a craft brand’s business woes, we do want to take time in this article to focus on a few, simple rules and suggestions for working with your distributor partners.


First, for many craft beverage brands, the journey to growth begins with self-distribution. A few cases in the trunk of the car, and off you go to sell your first run/vintage/barrel of your hard-spent time and resources. This process works for a time, but soon your trunk grows too small, your responsibilities grow too numerous, and your customers and consumers are demanding larger quantities. Kudos, you have begun to scale your brand.


It is usually at this point that the idea of having a distributor begins to appear; and usually, if you have been successful growing your brand locally, distributors have noticed you and have offered their services. While we will discuss the specific strategies around distributor selection in a future article, let us assume that you have picked your distributor, you are shipping to his warehouse, and you will probably be thinking that your distribution worries have been resolved. Not so fast.


Instead of it being just you who is working with local retail and on-premise accounts, you now have numerous representatives of your brand dealing with those same accounts and selling them many other brands at the same time. Do you think those representatives, while being fine people, will have the same focus and passion for your brand as you have? Your responsibility for growing your brand does not end at your distributor’s warehouse door; actually, your responsibility for brand growth has become more complicated.


For your brand to grow and prosper, it must become a priority within your distributor’s portfolio. For that to happen, you must be clear and consistent in communicating your brand priorities to the distributor. In short, you need to provide clear, direct, and consistent focus for the distributor. It is your responsibility to tell the distributor where you want your brand placed, the types of consumers who will purchase your brand, and where you would like to see your brand shelved (said another way, who is your competition?). Left on their own, with too many priorities, the distributor sales force will take the path of least resistance with your brand. It is you, the brand owner, that must communicate the priorities and you who must measure the results of their performance on a regular basis. In his classic business book, In Search of Excellence, Tom Peters summed up this responsibility perfectly: “Inspect what you expect”. And let us just add that this inspection should be early and often. Focused, specific and consistent distributor communication and management is critical for scaling your brand beyond local distribution.


In our next article, we will lay out some specific ideas on how to be a good, and profitable, partner with distributors. In this way, you will ensure your brand’s success, even when you cannot be there personally to manage every aspect of your brand’s business.

Not Your Hobby Marketing Solutions, Strategic Business Consulting Services for Small to Medium-Sized Craft Beverage Companies
SaB_200x520_PlaceHolder_35%.jpg
CONTRIBUTORS-Skyscraper-AnimGif.gif
EventHub-Skyscraper-AnimGif.gif
AndyMansinne_Cropped.png

Contributing Author

Andy Mansinne                                                          President, Brand Elixir Partnerships

 

Andy is the Founder and President of Brand Elixir Partnership. His business leadership experiences, strategic acumen and coaching skills impact results for his broad client base. From start-up beverage businesses to international wine conglomerates, Andy’s approach to ensuring his clients’ success starts with his understanding of strategy, rigorous process development and team-oriented execution.

Open---Distribution---Building-Effective-Distributor-Strategies-for-Your-Brand-1.jpg

Building Effective Distributor Strategies

Andy Mansinne - Joe Karcz

Establishing an effective distributor strategy is a combination of your growth strategies and the opportunities that new markets may provide your brand. It is safe to assume that in today’s competitive and crowded craft beverage sector, market expansion is vital to sustaining young brands’ growth; appointing distributors in new markets is a critical component of a growth strategy; and being able to effectively determine why and where to scale your brand will greatly impact your long-term success, in terms of both volume and value.

Truck Self-distributing goods

Self-Distribution:

Marvelous or Onerous?

Laura Lodge

Is self-distribution legal in your state? As of November of 2020, self-distribution was not legal in AL, GA, DE, FL, KS, KY, LA, MO, MS, NE, NV, RI, SC, & VT according to the Brewers Association. Always double-check the regulations in your state to confirm and find out details that could be critical to your business planning.
There are a number of pros and cons to consider when thinking through self-distribution. Some of the 

 

Contract & Pen

Distribution Contracts:

Content, Strategy, and Negotiation

Laura Lodge & Candace L Moon

Distribution Contracts require both an eye to strategy and legal structure/protections. This presentation is intended to showcase the importance of both while emphasizing the diversity in the industry; no one size fits all solutions exist. Please note that this is not to be construed as legal advice.
Fundamental differences between Traditional Distributors, MegaDistributors, and Brand Collectors include their intent to actively sell your products and grow your brand in coordination with you. Read 

Beer Pallets on Forklift

Fantastic Importers and Distributors

and Where to Find Them

Scott Rosenbaum

Whether you’re a potential employee or supplier, here are the qualities you should look for.


No one wants to end up with a dud. No one wants to settle for less than they believe they’re worth. This is true in business as in love. Sadly, too many employees and suppliers settle for what suffices rather than what satisfies when it comes to business relationships. The issue doesn’t stem from the lack of 

PLAN

  • Research Your State Distribution Requirements

  • Review State Franchise Laws

  • Understand Requisite Quality & Consistency

  • Consider Self-Distribution 

Distribution Truck Icon

oPEN

  • Establish Self-Distribution Limits

  • Plan Distribution Essentials

    • Product Storage​

    • Keg Rental/Purchase

    • Delivery Vehicle

    • Support Equipment

  • Establish Brewery Distribution Team

    • Accounting​

    • Delivery

    • Sales

    • Warehouse

  • Explore Expansion Needs/ Cost

Grow Graph

GrOW

  • Select New Territory

  • Review New Territory Franchise Laws

  • Create Point of Sale Items

  • Additional Brewery Sales Team

  • Explore Distribution Options

  • Select a Distributor

  • Negotiate Distribution Contracts

  • Train Distribution Sales Team

  • Manage Distribution Partnership

bottom of page