Beer Wholesalers Conference Report
I’ve long been fascinated by the middle tier of distribution: the laws that surround the post-Prohibition three tier (producer/brewer >distributor >retailer) system of alcohol distribution have been criticized loudly by consumers and behind closed doors by brewers. Some brewers’ business models align better with the three tier system than others. I know a lot of local distributor craft beer sales reps who are passionate about bringing more breweries to the New Orleans market, and are proud to consider themselves an integral part of the region’s craft beer growth over the past few years.
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National Beer Wholesalers Association
The NBWA, and its annual conference, first got on my radar in 2013 at the Beer Bloggers Conference in Boston.
While there, I enjoyed several conversations with Kathleen Joyce, NBWA’s communication director. The NBWA subsequently sponsored a writing competition through the Beer Blogger’s Conference’s website with the theme of “America’s Beer Renaissance: Consumer Choice and Variety in the U.S. Beer Market.”
The grand prize winner got a trip to New Orleans to attend the conference, and 25 runners up got free admission to the San Diego Beer Bloggers Conference. (I didn’t enter, but I met the guy who did! Dave from Ann Arbor, creator of All the Brews Fit To Pint, with this entry.) Since I live in New Orleans, I thought this would be a great opportunity to go and see what the NBWA is all about.
Wholesale Beer Kegs
Photo by Flickr user Steve McClanahan
Small seminars at the conference ran the gamut – more than retail and consumer issues, business strategy, employee management, travel and shipping logistics, negotiating deals and contracts, and investment strategies were all covered.
The first one I went to was “Developing a Social Media Plan,” presented by the Beer Industry Electronic Commerce Coalition (BIECC.) One of the most interesting things I noticed in the session was that when the speaker asked who in the room worked for companies that had a dedicated social media professional in their organization, very few hands went up. I think there’s a huge potential for creating market share growth if distributors had a plan to work with their breweries to engage online through social media platforms. In the ever-increasing and competitive marketplace of craft beer, this kind of interaction is key to spread the word and build customer loyalty.
The next day, I went to “Draught Line Quality: History, Economics, and Best Practices for the Best Quality.”
The panelists were Rob Gerrity from Sierra Nevada, Matt Meadows from New Belgium, and Bart Watson, the staff economist and data wrangler at the Brewers Association. I learned that there’s some misunderstanding on the cost-value equation on the part of some retailers that need to be overcome with education.
When cleaning the lines frequently, bar owners see beer that they could have sold literally go down the drain, which can be difficult to reconcile to their ideas of how to run a profitable business. However, investing in frequently cleaned lines is how repeat business is won, as well as gaining a reputation for quality. Several distributor reps attending the session shared their frustration with certain accounts not getting the importance of tap and line maintenance.
Beer Goggles & Beer Offerings
My last seminar, held on the third day of the conference, was Ray Daniels, of Cicerone.org discussing “Beer Goggles & Beer Offerings: Helping On-Premise Accounts Do More With Less.”
This was a class that I wish all distributor sales reps would take – it drives me insane when I go to a bar that has 5 different American wheat beers, 4 different ciders, lots of lagers, and maybe one or two actually interesting offerings. Daniels did a good job of breaking down different types of clientele and how to have a little something for each of them. Variety is the name of the game, as well as paying attention to upcoming trends and styles.
Ray Daniels of Cicerone.org
Photo by Nora McGunnigle.
Knowledge is Power
He also addressed my personal pet peeve of beer bars – just because you have a lot of taps doesn’t make you a beer bar.
It’s the education of the staff, the quality of the experience (appropriate glassware, no frozen glasses), and what’s on the taps that matters. Quality, not quantity. If you have more taps than you’re able to move in a reasonable amount of time, then what you have is stale beer in questionable lines. His rule of thumb is “don’t have more taps than you have customers on an average Tuesday night.”
Small Breweries are Expanding
So, my seminars were very closely aligned with my personal interests in the craft beer universe. The general sessions, on the other hand, were very distributor-focused.
The one I went to on Monday began with the outgoing NBWA chair Greg LaMantia talking about how the three tier system works well, and pointed to the expanding craft beer market as evidence of that, saying that “small brewers are expanding because of the system we have in place here in the U.S.”
Craft Beer Culture
Afterward, a bunch of brewers held forth on a panel John Bryant, co-founder of No-Li Brewhouse; Steven Crandall, founder of Devils Backbone Brewing Company; Tom Long, CEO of MillerCoors LLC; Tony Magee, founder of Lagunitas Brewing Company.
The most memorable part of that panel for me was that Magee said he would love to get Adolphus Busch high (while taking his stash out of his pocket.) The other general session, on Tuesday, began with the new chair of the NBWA, Eric Best, taking up similar themes as his predecessor the previous day. “Opportunity abounds in our industry, but despite the mutual success of all the tiers, the system is under siege,” Best said. Very much a “not broke, don’t fix” message.
Photo by Nora McGunnigle.
Afterward, the president of G&M Distributors, Inc. Adam Vitale moderated a panel of beer industry experts:
Mike Mazzoni, senior partner of Seema International Ltd.; Benj Steinman, president of Beer Marketer’s Insights; Trevor Stirling, European beverages analyst for Sanford C. Bernstein Limited; and John Williams, executive director of the Beer Industry League of Louisiana. It was interesting to me to hear from Williams, who was extremely conservative in his views about the growth of craft beer culture, a viewpoint which I think is reflected in the slow rate of growth in Louisiana and frustrations that breweries have in opening here.
Quality vs. Quantity
Photo by Flickr user Bruno Girin.
Product Demonstration Showcase
Another important aspect of the conference was the Product Demonstration Showcase – basically an expo for all things relating to beer distributors.
There were breweries there, but also inventory control system suppliers, forklift manufacturers, warehousing technology, financial services software, promotional products, and all sorts of other businesses that support the country’s beer distributors in ways I’d never even conceived of. There’s so much that goes into the business of beer – what I write about barely scratches the surface.
Early to Rise
Being around distributors for three days was a very different culture than hanging out with brewers or writers.
Their morning sessions started at 7am, for crying out loud! These guys were up and raring to go at the break of dawn, hungry to learn and then go out and get ‘em. I met people from really large distributors as well as small – it was really great to meet Kurt Strickmaker, president of Bounty Bev, a “Better Beer Brigade,” and craft-only distributor out of Nashville. I was also impressed that the NBWA showcased the work he’s doing in the craft beer market there, honoring him by making a video and showing it in Tuesday’s general session.
Article courtesy of AlcoholProfessor.com.