Category: Cider

Trends Shaking Up the Beverage Market  

Cyndi
2 men and 2 women at a table in front of a laptop computer and smiling

By: Hanifa Sekandi

Trend fatigue is a real thing. Every year, it is something new. When you think your brand has captured the market with savvy marketing strategies, there is another plot twist. Everyone loves a plot twist in a movie, but not when it comes to modern marketing. It truly is a game of chess. There are many wins and many losses. Marketing teams need to have tough skin and a positive mindset. The long game in beverage marketing requires resilience. Also, a loss does not mean that your brand is failing. It means you must focus on marketing strategies that truly resonate with your audience. Every marketing campaign should include previous successful strategies that, time after time, have proven to be fruitful for your brand.

  As the CEO of a beverage brand, you need to ask your marketing team why they are not developing unique trends. Marketing campaigns that set in motion viral moments lead to other brands following suit and borrowing elements from your brand. Aside from being touted as the beverage of choice, being an industry gatekeeper elevates you to an elite league. And positions you with not just beverage brands but also other consumer goods brands. It also leads to opportunities for collaboration.

  When looking to jump on a trend, gravitate towards timeless ones if your budget is small. Hopping onto a viral trend works if your budget allows room for play, A.K.A. trial and error, rolling the dice. Some brands do not desire to be all things for everyone. Some brands are happy with their audience and consistent revenue. Many beverage brands in this category avoid trends and do not look for viral moments. For new brands, the pressure to surf the trend wave is overwhelming. Do you have a choice? Can you build your audience organically? If so, how? There are a few cost-effective methods to elevate your brand presence.

Here are two timeless trends:

Brand Collaborations

  Does your beverage remind you of extreme sport or a NASCAR race? If your beverage were a clothing brand, who would it be? Imagine your consumer. Where do they shop? What kind of activities do they find enjoyable? Is it fishing? Or golfing? Like beverage brands, consumer goods brands seek ways to reach their audience. An example of a unique brand collaboration was between Fender and Bixton clothing apparel. Fender needed to reach their audience through clothing buying preferences, and Brixton desired to be an apparel brand that musicians gravitate toward.  

  The Croc and Pop-Tarts collaboration is a fitting example of how to market two brands together. Both brands can reach their audience and attract new consumers from brand collaborations. This was a limited edition launch during the summer. When people purchased a pair of Crocs Classic Clogs, they would receive a box of Pop-Tarts and edible crocodile-shaped Jibbitz candies. This promotion ran for only three days, and a limited amount was available for purchase. Those who wanted to purchase this limited edition had to sign up at a microsite designed exclusively for this collaboration. Overall, this was a great marketing strategy to improve brand awareness. Having a sign-up form also allowed both brands to gain new subscribers to their newsletters. 

  Heineken, in 2017, partnered with BAPE clothing. For this collaboration, sweatshirts, backpacks, accessories, jackets and T-shirts were designed to combine BAPE and Heineken branding. These custom-designed items were only available at BAPE stores. The subliminal marketing in this effortless campaign strategy is notable. This is an out-of-home marketing strategy that illuminates the influence that clothing has on consumer choices and the beverages they purchase. Heineken as a beverage of choice when ordering a beer at the local bar after a visit to a BAPE store is a likely occurrence. Everywhere people go, they are influenced by the advertisements they see. Did you want pizza because you truly desired it, or is it National Pizza Day, and you keep seeing social media posts of the best pizza places?

  So how do you get started? How can you dream up a savvy brand collaboration? Research. Spend time understanding the behavior of your desired audience. Look at the brands they lean towards. Find out if the brands you have in mind have done brand collaborations before. Do not approach the marketing director of the brand you have in mind without a plan. You need to pitch ideas and why both brands would benefit from this collaboration. Set the stage for brainstorming ideas and opening the conversation. If you are lucky, they may see this as the perfect pairing. In some cases, you may need to present a marketing plan that allows them to visualize what this collaboration would look like. In addition, highlight the benefits for both brands if this collaboration occurs. 

  Should you only approach big, popular brands? No. Both BAPE and Brixton are niche brands. They target a specific consumer base. The sky is the limit with brand collaborations. Crocs also collaborated with KFC. With brand collaborations, you can do several in a year. Supreme clothing and Oreo collaboration is another notable think-outside-the-box marketing strategy. The food your consumer loves in the color of the clothing brand they cannot get enough of. Is your top-shelf tequila or ale the next limited-edition ice cream flavor? 

A Little Bit of Everything  

  Who doesn’t love a good Caesar salad? When the craving hits, you want to make your own. But you do not want to purchase every ingredient individually. Reaching for the pre-made salad mix is ideal. Consumers like it when brands offer them what they need without the hassle. Take the guesswork out of the process. If you sell cases of your beverage, consider including mixers or other drinks that pair well with your beverage. Multi-packs are quite popular, but consider making yours functional. Moreover, each beverage pairs well together.

  Consider something that has not been done yet, but maybe you will be the first. If your brand offers non-alcoholic beverages, split the pack in half to contain an alcoholic and a non-alcoholic option. Conscious beverage consumption is on the rise. This gives the buyer the option to have one or both. But for those who choose to drink less or attend a gathering with friends and do not drink, this takes the guesswork out for them. It is also very convenient.

  A little bit of everything also includes a signature fizzy flavored water that combines clean ingredients. This should be sold along with your beverage. Ensure that all the items are packaged or placed together in-store. Create promotional material that can displayed in-store that highlights your unique offerings. These campaigns can run along with recipes that a master mixologist has crafted for your brand. It also allows you to do a call-to-action where people can show you how they created cocktails from the limited edition offering. Take all the guesswork out for this limited-run campaign.

  An end cap is quite effective for this strategy. It saves the store trouble and gives you control over how you display this promotion. The beauty of this strategy is that you will introduce your existing consumers to a beverage from your product line that they have never tried. 

Two Trends for Success

  Each year, pick two timeless trends to implement. If previous trends are still serving you well, continue to utilize them, but be sure to add unique nuances so that they are familiar but different. Both brand collaborations and showcasing several products together are timeless trends that can be used all year. A little bit of everything works well in the summer and during the holiday season. Brand collaborations can occur every few months. Throw your net out wide to see how far you can go with each brand collaboration. Consumer brands are collaborating with famous bakeries. For example, Lakes Brew Co. collaborated with Ginger Bakers to make a Chocolate & Stout Loaf Cake with Lake Brew Co. Breaking Origin Imperial Stout. 

  Collaborations are not just limited to brands. Influencer and celebrity collaborations with limited-edition products perform quite well. This approach requires due diligence. Remember your brand ethos, what your brand represents and the desired goal. Partnering with a popular chef from a popular show could be fruitful. If you try this form of collaboration, do not assume you must collaborate with a popular influencer or celebrity. Your goal is to target your audience. Niche influencers and celebrities are also a smart choice. It also helps you narrow down your audience. Brand collaborations can have many angles. If you are bold, you can combine both trends: a little bit of everything and a brand collaboration. Both trends give you room to devise a marketing campaign that can help you become a noteworthy beverage brand. 

Become Aware and Prepare for National Preparedness Month in September

Cyndi
flooding waters surrounding businesses in a city

By: Raj Tulshan, founder of Loanmantra.com

June kicked off the official start of hurricane season with the National Oceanic and Atmospheric Administration (NOAA) announcing that the Atlantic region will have an above-normal amount of hurricane activity1. Whether or not your business is in a coastal area, natural disaster can and does, strike anywhere. In recognition of National Preparedness Month in September, we’ll discuss how businesses can become more aware and prepare for natural disasters.

  Natural disasters such as hurricanes, wildfires, floods, earthquakes and tornadoes can have devastating effects on beverage businesses from damaged infrastructure, facilities and inventory to supply chain disruptions, shuttered operations and financial loss. A small business credit survey2 finds that more than 1 in 10 small businesses suffer losses from a natural disaster each year. And for those small businesses that do endure disaster, almost half (43%) never reopen and an additional 29% percent go out of business within 2 years of the disaster3. At the same time, less than half of businesses plan for such events.

  That’s why planning for natural disasters is crucial for businesses to minimize costly disruptions and stay in business. A disaster preparedness plan facilitates and organizes employer and worker actions to prepare for emergencies while a business continuity plan determines how the business and its employees will continue operations during a time of disaster.

Here are Some Key Steps to Take for Preparedness

Assess the Risks: Conduct a thorough risk assessment to identify potential natural disasters based on the geographic location(s) of workplaces, offices, business sites, retail/restaurant/bars, headquarters, distribution, manufacturing plants and even hops fields. The risk assessment will form the basis of a disaster preparedness plan. This plan includes procedures for evacuation, sheltering, communication and recovery steps. Once this step is taken, it is a good idea to review current insurance policies to ensure they include relevant natural disasters and their potential outcomes. Consider additional coverage, if necessary, to protect against specific risks facing the business. Also look at the financial risks including current credit rating and access to loans, capital and financing available today. These financial resources may be needed in the case of business disruption, damages or significant business losses.

Business Continuity Plan (BCP): Create a business continuity plan that outlines how your business will continue to operate during and after a disaster. This includes identifying critical functions, establishing backup systems for data and recovery, alternative power sources (during outages) and ensuring employees know their roles. Ready.gov4 contains comprehensive planning and disaster recovery materials including situation manuals, test exercises, video training, emergency response plans, toolkits and more. Another resource for business continuity planning is a  toolkit5 for each type of natural disaster, from the Insurance Institute for Business & Home Safety (IBHS).

Choose Teams: Designate the company stakeholders who should serve as emergency response team leaders and will be responsible for implementing the plan. Team leaders could be based on specific functions, areas of expertise or critical assets. For instance, a team leader could be chosen from job category like executive leadership, operations, production, safety/quality, IT, sales, marketing, distribution, finance and administration. Make sure that leaders are willing and able to serve in these roles. Next decide the critical hierarchy of functions and where each team leader fits.

  Meet with stakeholders to discuss the responsibilities of each role in the recovery process and gain buy-in. Detail specific tasks required to restore business operations in each area. Discuss among group members to decide what each team requires to meet expectations. Identify staff members who will be part of each response team. Go with individuals who have necessary skills, knowledge, and authority to coordinate the staff during a disaster. Remember to assign backup team members to address any absences or overlapping duties. Provide resources and training to team leaders and members to familiarize them with roles, recovery procedures and tools.

Communication is Key: It is important to keep an updated directory list of company and supplier contacts with name and address location information, cellphone numbers, email addresses, home address and alternative contacts. Store the contact database securely and ensure its easily accessible to authorized personnel. Determine ways for employees to report their status and location in case of emergency.

  Establish communication protocols for employees, customers, suppliers and stakeholders before, during and after a disaster. Determine which communication channels will be used during a crisis. For instance: text, phone calls, SMS, e-mail, company-wide platforms, social media platforms and emergency notification systems.

  Create communication trees outlining the communication order and assigned leaders for each response team. That way a clear and efficient flow of info during a crisis. Using multiple communication channels helps team reach each other during a crisis. Develop incident-specific protocols that outline how teams share information during a disruption for guidelines on the frequency of updates, the level of reported detail, and the escalation process for urgent matters.

Check Facilities: Ensure your physical facilities are structurally sound and prepared for disasters. This may involve retrofitting buildings, securing equipment, and implementing safety measures. Conduct an audit of any back up energy sources and satellite communications in case of power and phone outages. Also communicate and distribute important safety information ahead of disasters like evacuation routes, fire escapes, location of important equipment controls, the water main valve shut off and the location of energy and gas lines. Conduct regular training sessions and drills so employees know how to respond to emergencies.

  Ensure important data is backed up and stored offsite that is needed for operations like transactions, formulations, customer data, transactions, assets, company and employee files, operating systems, applications and software that power business capabilities. If digital systems malfunction, data or information is compromised systems may break down and the ability to conduct business may be lost.

  Evaluate the vulnerability of your supply chain and identify workarounds if key vendors are unable to meet commitments during this time. Develop contingency plans with alternative suppliers and logistics solutions to minimize disruption and channel resources accordingly.

Financial Preparedness: Maintain enough financial reserves to cover immediate expenses after a disaster, such as repairs, employee salaries and operational costs during downtime. If this is not possible, assess your access to available credit and capital by talking with a financial professional. Make sure important documents are secure and available. For instance, at Loan Mantra business owners can set up a free account6 and keep copies of financial records in a safe, secure and encrypted environment. The IRS suggests that every plan should include copies of vital business records and financial documents: Bank statements, tax returns and insurance policies. They also suggest documentation of valuables through photos or videos that are stored in a safe location. Information on disaster assistance and emergency relief for individuals and businesses is available at IRS.gov7.

Community for Continuity: Businesses that respond to employee and community needs with expediency can profit during times of disaster and have a greater chance of staying and remaining in business. Harvard Business School Professor, Hirotaka Takeuchi, and 300 of his students spent 9 years studying why Japanese businesses not only survived disasters but thrived versus U.S. companies. As a country, Japan stands out for corporate longevity; 40 percent of companies that have remained in existence more than 300 years are in Japan despite devastating disasters8. These companies consistently focus on serving the common good versus pursuing layoffs and other cost-cutting measures in the face of a crippled economy.

Review and Renew: Natural disaster risks and business operations may change over time. Regularly review and update your preparedness measures accordingly. Using a disaster recovery plan checklist9 can help outline the essential aspects of a disaster plan for testing, training, planning and the recovery process. Once an emergency plan has been prepared, it should be reviewed and updated yearly.

  By taking steps to create a disaster preparedness plan to assess risks, plan for business continuity, choose the right team members, establish communication protocols, check and harden facilities, build up financial resources and remember to focus on community, businesses can enhance their resilience to natural disasters and mitigate potential impacts on operations, employees and customers.

  Raj Tulshan is the founder and managing member of Loan Mantra, a one-stop fintech and loan advisory platform that democratizes the loan process by providing corporate sized services and access to entrepreneurs, small and medium sized businesses. Connect with Raj and Team Loan Mantra at 1.855. 700.BLUE (2583) or info@loanmantra.com

1.“NOAA Predicts Above-Normal 2024 Atlantic Hurricane Season.” National Oceanic and Atmospheric Administration U.S. Department of Commerce, 23 May 2024, https://www.noaa.gov/news-release/noaa-predicts-above-normal-2024-atlantic-hurricane-season.

2. https://www.fedsmallbusiness.org/topics/natural-disasters. Accessed 7 Feb. 2024.

3 https://emilms.fema.gov/is_0111a/groups/23.html. Accessed 7 Feb. 2024.

4. “Business Continuity Planning.” Ready Logo, 21 Dec. 2023, https://www.ready.gov/business/emergency-plans/continuity-planning.

5. “Business Disaster Recovery Plan.” Insurance Institute for Business & Home Safety, https://ibhs.org/businessdisasterrecovery/. Accessed 7 Feb. 2024.

6. Loan Mantra. https://users.loanmantra.com/Home/Register. Accessed 7 Feb. 2024.

7. “Disaster Assistance and Emergency Relief for Individuals and Businesses | Internal Revenue Service.” Home, https://www.irs.gov/businesses/small-businesses-self-employed/disaster-assistance-and-emergency-relief-for-individuals-and-businesses. Accessed 7 Feb. 2024.

8. “Why Japanese Businesses Are So Good at Surviving Crises.” HBS Working Knowledge, 26 June 2020, http://hbswk.hbs.edu/item/why-japan-s-businesses-are-so-good-at-surviving-crises.

9 Velimirovic, Andreja. “Disaster Recovery Plan Checklist – 13 Critical Points.” PhoenixNAP Blog, 29 June 2023, https://phoenixnap.com/blog/disaster-recovery-plan-checklist.

Insights and Ideas for Bottling & Canning Your Craft Beverages

Cyndi
lady holding beer bottle

By: Alyssa L. Ochs

Bottling and canning are critical steps in the brewing and distilling processes, yet new ideas and industry trends are now influencing how beverage producers approach their packaging. Bottling still has its place in the craft beverage world for certain products and to adhere to consumer preferences. Yet more producers are turning to canning due to the reduced environmental impact, lower production costs and process efficiency.

  Breweries and distilleries benefit from choosing packaging systems that allow quick adaptation and flexibility if their needs or customer demands change. That’s one reason manufacturers have created machines that can handle both canning and bottling processes with minimal changeover downtime.

  Here’s a look at current bottling and canning opportunities and best practices to consider for modern breweries and distilleries.

Getting Started with Canning

  Craft beverage producers typically get into canning to sell more products because it’s convenient and profitable to sell canned beverages to-go behind the taproom bar. Oktober Design, a Grand Rapids, Michigan-based can seamer company, told Beverage Master Magazine that a single-head canner offers a low barrier to entry into production canning. Oktober began online sales in 2016 and has a location in Sparks/Reno, Nevada to serve West Coast customers in addition to its vibrant West Michigan shop.

  “Even a manually loaded seamer can seal over nine cans per minute, making it quick and easy to offer cans in display coolers, local markets and convenience stores,” said Dennis Grumm, Oktober CEO and engineer. “This lets you test how your products perform in new venues, offer distribution samples and try out different can sizes. It’s a tool you’ll wonder how you lived without.”

  Grumm said that getting started in canning is surprisingly straightforward and that the most challenging decision is often choosing your initial can size. But if you decide to switch sizes later on, it’s easy to swap out the necessary parts to accommodate different cans.

  “Ordering a can seaming machine and cans from our website is as simple as click and buy,” said Grumm. “We’ve also curated a wealth of how-to videos that cover everything you need to know. And if you have any other questions, we’re always just an email or phone call away.”

Examples of Canning Systems

  Brewers and distillers have numerous options when choosing a new canning system. A good canning system will preserve the taste and quality of your products while extending their shelf life and boosting your brand reputation. With an effective canning system, you can customize your production, ensure proper hygiene, achieve consistent fill volumes, maintain consistent carbonation and continually deliver fresh products to your customers.

  Pneumatic Scale Angelus, offers open-air CB50F and CB100F systems with magnetic flowmeter technology to fill up to 100 cans per minute. The company’s CB50C design utilizes counter-pressure filling technology perfect for ready-to-drink cocktails, hard seltzers and sparkling wines. Pneumatic Scale Angelus also offers a full rotary design with a compact footprint to fill up to 150 cans per minute in a smooth, continuous motion.

  Regardless of your chosen company, there are two main types of canning systems: single-head canning machines and full canning lines. Single-head canning machines are great for smaller breweries because they are affordable and easy to use. While full canning lines are considerably more expensive, they take care of the entire process, from purging to filling and canning.

  With an increasing number of beverage companies now canning more than just beer, it’s important to consider systems that can accommodate canned cocktails, hard seltzers, kombucha and cold-brew coffee. Look for canning systems that let you package various beverage types and fit into your space. Some canning systems support higher carbonation volumes than others, so assess the filling technology, tubing and flow control dials of the machines you are comparing.

Choosing a Can Seamer

 A can seamer is a valuable piece of equipment in the craft beverage industry and might be the key to boosting your to-go sales without breaking your budget.

  “Our most popular product across both breweries and distilleries is the Model 8 Automatic Can Seamer,” said Grumm from Oktober. “What varies is typically the can size chosen for different types of beverages. Craft breweries often opt for 16 oz. or the large 32 oz. cans, while premium beverages are often offered in 8 oz. or 12 oz, ‘sleek’ cans. The versatility of the Model 8, which can seal any can size, makes it the favorite in many craft beverage categories.”

  Grumm said that many of Oktober’s machines have sealed hundreds of thousands of cans with minimal maintenance.

  “A simple wipe-down every day and a dab of grease in a couple of spots periodically is all it takes to keep your seamer running smoothly,” said Grumm. “If anything does go wrong, it’s usually a quick adjustment or a small, inexpensive replacement part that we can guide you through replacing with common hand tools. After nearly nine years in the business, we still don’t need a dedicated service team, and we plan to keep it that way.”

Sustainable Bottling Ideas

  One reason why breweries and distilleries are switching to cans is for sustainability. However, modern technology is paving the way for sustainable bottling systems that give beverage producers more choices without compromising their values.

Innovative companies are experimenting with alcohol bottles made from recycled PET, which are far lighter than glass and BPA-free. The British packaging company Garcon Wines makes these bottles flat so they fit nicely into cartons without extra packaging and in larger quantities on shipping pallets. PET bottles can often be refilled multiple times and recycled, offering shatterproof properties and lighter weight.

  Graham Packaging sells recyclable PET cans and bottles for beer, wine and spirits. Its products have a proprietary barrier technology that provides excellent oxygen, carbon dioxide and light protection. Meanwhile, the sustainable bottles are easily accessible with recloseable screw caps and are easy to transport, lightweight, recyclable and shatterproof.

  Another company, Frugalpac, makes bottles with 77 percent less plastic than a standard plastic bottle and that is resistant to humidity, spills, premature spoiling and breakage. The Carlsberg Group created a “green fiber bottle” made from paper, and other beverage organizations have been working toward creating totally organic paper bottles. Meanwhile, some craft beverage makers participate in BottleDrop Refillable programs to pursue sustainability goals while controlling supply needs and overcoming potential shortages.

Consider Contract Canning and Bottling

  Many breweries and distilleries contract out their canning and bottling to an outside company. These companies often handle the entire packaging process for you and can provide advice about the best bottles and cans for your products.

  Outsourcing this work can be beneficial because canning and bottling equipment can be prohibitively expensive and challenging to set up and maintain. Staff members must also be adequately trained to operate it safely and effectively.

To choose a contract canner or bottler, determine your budget and assess the menu of various companies’ services. If you don’t have the time, space or money to control your own packaging process, a contract arrangement may provide new avenues for experimentation and expansion as your business grows.

How to Boost Your To-Go Sales

  To-go sales can dramatically improve a business and turn on-site consumers into brand advocates outside the tasting room. To-go purchases are investments in your brand, an opportunity for greater public exposure and ensure a higher likelihood of customer return. 

  Grumm from Oktober advises producers to use clear, engaging signage to inform customers about their to-go options and prices.

  “This simple step can prompt impulse purchases and drive last-minute sales,” he said. “Train your staff to mention to-go options, especially when customers show interest in specific products. Highlighting that they can enjoy their favorite items at home can encourage additional purchases.”

  Whether you choose cans, bottles or a combination of the two, it’s essential to research and understand what options are available and how they could affect your bottom line. As Grumm mentioned, simply having your staff members ask customers if they want to make a to-go purchase can create a huge jump in sales, thereby justifying a new canning or bottling investment in the long run. Research shows that customers who make to-go purchases are also more likely to return to your business, which is a great way to expand brand awareness and help it succeed. You can go one step further with this effort by creating attractive, eye-catching displays for your to-go products near the exit and offering discounts on seasonal products or rewarding loyal customers with special to-go deals. 

Elevating Beverage Distribution

Cyndi

The Case for AI-Driven Systems Over Legacy Platforms

android robot standing behind a bar serving a glass of alcoholic beverage

By: Ian Padrick – Co-founder and CEO of Ohanafy

The beverage industry in 2024 is characterized by rapid evolution, driven by shifting consumer preferences, technological advancements, and new market dynamics. As consumers increasingly demand healthier and more customized beverage options, the industry is witnessing significant changes in product offerings and business operations. This landscape presents unique challenges and opportunities for beverage distributors, particularly those operating on outdated legacy systems.

  Legacy systems, which have been the backbone of distribution operations for many years, are increasingly becoming a liability. These systems are often inflexible, unable to scale with business growth, and lack the advanced analytics capabilities required to respond effectively to fast-changing market conditions. They struggle with integrating new data streams and automating processes, leading to inefficiencies in inventory management, customer relationship management, and overall supply chain operations.

  A recent study by Aberdeen highlights a stark reality: businesses that spend 12% of employee time searching for data can incur up to $1.2 million in unnecessary costs annually for a company with 200 employees. This underscores the critical need for systems that enhance efficiency and profitability by reducing wasted time and resources on inefficient data management.

  In contrast, AI-driven systems offer robust solutions by harnessing the power of data analytics and machine learning. These modern platforms can integrate diverse data sources, providing a holistic view of business operations and consumer trends. This integration enables more informed decision-making and faster response times. Therefore, transitioning to AI-driven systems is not just about keeping pace with technological trends but fundamentally enhancing beverage distributors’ strategic capabilities.

The Risks of Legacy Systems

  One of the primary risks associated with legacy systems is their inherent lack of integration capabilities. These systems often operate in isolation, meaning that data silos are typical. When information cannot flow seamlessly between sales, inventory management, and customer relations, inefficiencies abound. This can include delayed order processing, inventory discrepancies, and a poor customer service experience, which can erode trust and reduce client retention.

  Moreover, legacy systems typically lack scalability. As businesses grow and market demands shift, these systems struggle to adapt. This inflexibility can stifle innovation, as adding new features or expanding into new markets might require extensive manual intervention or even complete system overhauls, which are costly and time-consuming.

  Another significant risk is the absence of robust analytics. Legacy systems do not utilize the power of modern data analytics, which is crucial for making informed decisions. Without these insights, companies may make choices based on outdated or incomplete data, potentially leading to a general lack of strategic decisions.

The AI-Driven Solution

  Transitioning to AI-driven systems can effectively address these risks. AI-enabled platforms offer integrated tooling where data from various departments is consolidated, providing a unified view of the business. This integration enables more streamlined operations, from inventory management to customer relationship management, ensuring that all parts of the business are aligned and efficient.

  AI-driven systems are inherently scalable. They are designed to grow with the business, easily accommodating new functionalities or market expansions without the need for disruptive overhauls. This flexibility ensures that beverage distributors can respond quickly to market changes, a crucial capability in an industry as dynamic as beverage distribution.

  Perhaps most importantly, AI-enabled solutions have advanced analytics and machine learning capabilities. These tools can analyze large datasets to uncover trends and patterns that might not be visible otherwise. For instance, predictive analytics can forecast demand more accurately, enabling better inventory control and reducing overstock and stockouts. Similarly, machine learning algorithms can enhance customer segmentation and personalize marketing efforts, increasing sales and customer loyalty.

Applications of AI in Beverage Distribution

  The transition to AI-driven systems in the beverage distribution industry represents a significant leap forward in operational efficiency and market responsiveness. Here are several systems that stand to benefit from leveraging artificial intelligence to enhance various aspects of the distribution process.

Inventory Management: AI significantly improves inventory accuracy and efficiency. By analyzing patterns in sales data, AI can predict future demand more accurately, enabling distributors to optimize their stock levels. This reduces the risk of overstock, which unnecessarily ties up capital, and understock, which can lead to missed sales opportunities. For example, AI systems can integrate historical sales data with seasonal trends and promotional schedules to adjust inventory levels in real-time.

Route Optimization: AI-driven logistics applications can dramatically improve delivery efficiency by optimizing delivery routes and schedules. These systems analyze traffic data, weather conditions, and delivery windows to suggest the most efficient routes, reducing fuel consumption and delivery times. This cuts costs and enhances customer satisfaction through faster, more reliable service.

Customer Relationship Management (CRM): AI enhances CRM systems by providing deeper insights into customer behaviors and preferences. This enables personalized marketing strategies, such as targeted promotions and product recommendations based on data-driven insights. For instance, an AI-enhanced CRM system can identify purchasing patterns and predict when customers might be ready to reorder or suggest new products they are likely interested in, thereby increasing the potential for upselling and cross-selling.

Sales Forecasting: AI algorithms excel at processing large datasets to identify trends that would be difficult for humans to spot. In beverage distribution, AI can analyze data across multiple channels to forecast sales with a high degree of accuracy. This allows distributors to better align their schedules and marketing strategies with anticipated market demand, reducing the risk of surplus and shortages.

Operational Efficiency: Beyond these specific applications, AI drives overall operational efficiency by automating routine tasks, such as order processing and payment transactions. Automation reduces the likelihood of human error and frees staff to focus on more strategic tasks requiring human oversight, such as customer service and business development.

Security and Compliance: With increasing data breaches and stringent data protection regulations, AI systems can also provide advanced security measures to protect sensitive information. Moreover, AI can help ensure compliance with industry regulations by monitoring and reporting deviations in real-time, thus avoiding potential legal and financial penalties.

Embracing the Transition to AI-Driven Distribution

Distributors that have switched to AI-driven systems often report substantial improvements in operational efficiency and customer satisfaction. However, transitioning to a new system is not without challenges. It requires careful planning and a clear understanding of business needs. The key to a successful transition lies in choosing a platform that is not only powerful but also aligned with the business’s specific needs and goals.

  While legacy systems have served the beverage distribution industry well for many years, the rapid pace of technological advancement and changing market dynamics make it clear that the future belongs to AI-driven solutions. By embracing these modern systems, distributors can remain competitive in an increasingly complex and fast-moving marketplace.

About the Author

  Ian Padrick is co-founder and CEO of Ohanafy, the leading distribution management platform built on Salesforce. Before Ohanafy, Padrick has served in strategic roles at Salesforce, Veeva, nCino, Accenture, and Capgemini. He is highly regarded for his strategic vision and leadership within the Salesforce community and for continually advocating for the integration of AI-enabled technologies to enhance business operations and customer engagement. To get in touch, visit ohanafy.com/contact.

Ten Ways to Keep Profits on Tap

Cyndi
piggy bank sitting on short stacks of money

By: Raj Tulshan – Founder & Managing Member of Loan Mantra

Over the past two years the cost to run a business has risen sharply with inflation surging to over 13%. This squeeze leaves many business owners trying to operate more efficiently and find ways to do more with less — making every dollar count. A recent survey by Vistage reports that two-thirds of small business owners have either cut costs or plan to reduce spending in the near future. The majority, 67%, also plan to seek business funding over the next 12 months.

  Finding and evaluating the best financing options can be confusing for business owners that are already short on time and money. Using a one-stop loan application portal to find the best suited options like the one at Loan Mantra is a way to access multiple commercial loan options in one place and avoid high-interest debt. In addition, here are some tips to keep profits on tap.

Monitor Cash Flow Closely: Cash or flow management is critical for beverage businesses, as even minor fluctuations can have a significant impact on financial stability. Keep a close eye on your cash flow by monitoring incoming and outgoing payments regularly. Implement invoicing strategies to encourage prompt payment from customers and consider offering discounts for early payment to improve cash flow. By staying proactive and vigilant, cash flow crunches can be avoided to maintain a healthier financial position in the long run.

Reduce Overhead Expenses: Examine overhead expenses carefully and look for opportunities to reduce costs wherever possible. This may involve renegotiating lease agreements, downsizing commercial space, installing lighting timers or switching utilities and service providers to save on electric bills, phone service and Wi-Fi. Encourage employees to adopt energy-saving practices, such as turning off lights and equipment when not in use to save money on lower utility bills. Have major systems inspected for water leaks and waste. Saving dollars on overhead expenses is one of the best ways to contribute to your bottom line.

Negotiate with Suppliers: Building strong relationships with your suppliers can pay large dividends when it comes to saving money. Don’t hesitate to negotiate for better prices or discounts, especially if you’ve been a loyal customer. Explore different vendors and compare prices to ensure you’re getting the best possible deal on supplies and materials. Additionally, consider joining co-ops or buying groups with other businesses to increase purchasing power and negotiate bulk discounts.

Invest in Human Capital: Thirty three percent of U.S. companies expect employee turnover to increase this year according to a recent poll, costing an average of $36,295 per employee. While it may seem counterintuitive to spend money on training, investing in your employees can yield significant long-term savings. Research from LinkedIn found that 94 percent of employees say they would stay at a company longer if it invested in helping them learn. Well-trained employees are more efficient and productive, leading to lower turnover rates and reduced recruitment costs. Provide ongoing training and professional development opportunities to help employees stay current with industry trends and best practices. By investing in your team, you can build a skilled workforce that drives business growth and profitability.

Get the “Lifetime” worth out of Equipment: I was talking to a friend about their recent doctor’s office visit. During the visit, my friend noticed that as the medical tech entered the room, they dragged a large unit behind them bumping into both doorposts and finally hitting a back wall. They noticed how this tech roughly handled expensive medical equipment. This illustrates an important point. If a company purchases equipment designed to last 10 years but it only lasts 5, it will need to be replaced before its “lifetime worth,” or it will need replacement 5 years earlier than expected. This can add up to thousands if not millions of dollars in unintended expenses.

Train to Remain: Make sure that employees are properly trained to use equipment safely to minimizes workplace hazards to avoid unfortunate events that could result in heavy losses. It is a good idea to periodically check on employees to see how costly business equipment is being used and reward or remediate actions if needed. And don’t forget machines need regular scheduled maintenance for cleaning and repairs. Getting a lifetime worth out of equipment contributes to automatic savings and impacts profit.

Moderate prices: The public has hit a tipping point where high prices are driving consumers away from fast and quick-serve restaurants to eat at home. Prices at quick serve establishments rose 5% in March over the same month in 2023 while grocery prices have increased more slowly, according to the Bureau of Labor Statistics. The take-away? If price increases are needed, avoid this kind of consumer sticker shock by moderately raising prices slowly over time.

Drink in new distribution sources: Beverages now influence where consumers are choosing to eat. The National Restaurant Association’s 2024 State of the Restaurant Industry report, says that alcoholic beverages no longer take a back seat as just a “compliment” to dinner but can influence consumer’s choice of one restaurant over another acting as a key driver to the establishment. Seven out of 10 consumers who drink beer, wine, or cocktails claim the availability of alcohol beverages would make them more likely to choose one restaurant over another. Alcohol brands can approach eateries, local restaurants or franchise chains to form partnerships to push sales.

Get ready to go: Half of full-service restaurants deliver alcoholic drinks with food orders and 96% say they’ll continue to if permitted to do so in their area. 93% restaurants also offer alcoholic drinks with pick-up orders, according to the same NRA report. For operators who serve alcohol, beer is the most common alcoholic beverage served with takeout or delivery orders, with 83% of restaurants offering it. Wine by the bottle is available at 65% of full-service restaurants that sell alcohol with takeout or delivery, and cocktails are at about 6 in 10 full-service restaurants selling alcohol to-go. Locally sourced beverages, such as craft beers, are also popular among Gen Zs and millennials, as are alcohol-to-go selections.

Fake it until you make it: The mocktails are coming! The popularity of no and low-alcoholic beverages are anticipated to grow to 4% share of the alcohol market by 2027. Non-alcoholic beverage sales increased by 32% as compared to the year before while total alcoholic beverage sales for the same period only increased by 1%. Non-alcoholic beer “dominates” the no-alcohol category over wine and spirits while non-alcoholic craft beer claims over a quarter (28%) of the non-alcoholic beer available. The demand is partly fueled by more health-conscious, younger consumers who are concerned about personal wellness, low carb/calorie offerings and choosing brands that are sustainable and environmentally friendly.

  Saving money is a crucial aspect of managing business and implementing the right strategies can make all the difference. By investing in human capital, getting a lifetime worth in equipment, negotiating with suppliers, monitoring cash flow, reducing overhead expenses and expanding distribution channels, business owners can achieve greater financial stability and long-term success. With careful planning, smart decision-making and by making every dollar work harder, beverage businesses can thrive in today’s tough market and keep more profits on tap.

  Raj Tulshan is the founder and managing member of Loan Mantra, a one-stop FinTech business portal that democratizes the loan process by providing corporate sized services and access to entrepreneurs, small and medium sized businesses. Connect with Raj and Team Loan Mantra at 1.855. 700.BLUE (2583) or info@loanmantra.com.

Event-Season Tips for Restaurateurs & Vendors

Cyndi
man and women with beer glasses sitting outside with other people

By: David DeLorenzo

Summertime often equates to weddings, events, festivals, outdoor concerts and more where a variety of vendors converge to serve food, drinks and more. Establishments and vendors have a unique opportunity through these events to promote their businesses to a whole new demographic. However, these types of events come with their own set of specific circumstances in which restaurants and vendors need to be prepared for — and that they need to protect themselves from.

  First off, the more you know about the situation you’re going into or the event you’re scheduled to participate in, the better. This is key because your extended coverage for these events will depend on exactly what is going on during the event. You’ll want to make sure that you have your own insurance and understand exactly what that insurance will cover and what it won’t for any off-premises event.

  This will depend on not only your carrier but also on whether your current coverage will extend to the event. The extension of the premise may not. Some carriers have a designated premise of the endorsement, which will not allow their policy to cover the business at an event.

  It also depends on the role your business is playing at the event. For example, if you are a vendor of the event and not the host, the coverage requirements needed will be up to the host of that specific event and the city in which the event is being held, if it is held on city property.

  If the host has insurance for their event, it doesn’t necessarily mean that if a vendor shows up there they would have coverage if they were pulled into a lawsuit. So before committing to an event, check with your broker or insurance company to see if that coverage extends.

  Additional event coverage may require an added fee and your carrier will probably want to know the exposure basis of the event. This can include the size of the event and how many people are expected. This includes not only the total attendance count but also what percentage of those ticket sales include alcohol sales.

  The carrier will likely specifically want to know the event’s estimated attendance count of people consuming liquor. That number will be taken into account differently than the total attendance count.

  The carrier will also want to know what exactly is taking place at the event because anything from bouncy houses to ax throwing can become liabilities. It’s important to note that 99% of the time, these types of things are automatically excluded from a policy anyway.

  For example, consider if you’re a vendor participating in an event and you have your own insurance coverage that protects you from liquor liability for serving people at the event. If there happened to be an accident due to ax throwing and they were to get sued based on the ax injury because of alcohol, there would be an exclusion altogether.

  It is highly unlikely that a carrier will cover a vendor for those instances. That’s why it’s essential to recognize that in many cases, events with dangerous activities should be approached with a “buyer beware” attitude. You need to be cognizant that at these types of events, your company could be pulled into a claim or lawsuit that you may not have coverage for.

  Major events and festivals are often seen as opportunities to make more money, get additional exposure and get your name out there. However, if you aren’t fully aware of all the details of the event and all the things happening during it, you could be putting yourself at risk.

  It’s also important to recognize that with proper coverage, your carrier should cover your business for the normal instances of serving alcohol at the event. But with exclusions for things like the examples of a bouncy house or ax throwing, you would not be covered. If there was a claim due to an accident that was excluded on the premises policy, then anyone and everyone participating in the event would be on their own to defend themselves in the case of a lawsuit.

  However, if a person who consumed too much alcohol then decided to get into the bouncy house and broke both their legs may try to go after the vendors that served alcohol at the event, that would likely come out of their pocket, as an insurance would likely automatically decline it. On the other hand, if a patron drinks too much at the event and gets into a car accident, the vendor’s liquor liability coverage would likely protect them in that instance.

  It’s also wise to look for assault and battery exclusions on event coverage policies. Many of these events have assault and battery exclusions, meaning that if someone gets beat up at the event and wants to sue the host or a vendor, they will not have coverage for that.

  While event season is heating up, we’ve continued to see pretty steady and fair market premiums for event and off-premises coverage. This is highly situational and also depends greatly on what the host city or venue requires in terms of coverage.

  In many instances, two different coverages may be required — one from the city and one from the venue. Some cities may require coverages that are through the roof while others may only require a minimum limit. It is vital to understand what the municipality where the event is taking place is asking for in terms of limits on insurance.

  For example, they may ask for $1 million or they may ask for $5 million. However, if they ask for the latter, this can be discouraging for vendors to participate. At that point, it becomes very difficult for a company to see the value in signing a piece of paper for $1,500 for one day of $5M worth of coverage. It’s overkill, quite honestly because you already have all these participants carrying their own insurance, plus the venue, the event promoter and the city, which all have their own insurance as well.

  To foster and encourage a sense of community through local festivals and events, the municipalities really have to keep it reasonable. On the flip side, the insured parties have to understand exactly what it is they are being insured for — and even more importantly, what they are not insured for. That will be determined on a situation-by-situation basis by the carrier.

  Weddings can also create unique circumstances in terms of coverage. What falls on the venue and what falls on the vendor may depend on the venue and the situation as well. In many cases, we recommend that the client gets coverage for general liability and liquor liability. However, liability will likely fall on the venue itself if they are the ones serving alcohol.

  It all comes down to making sure that whoever is serving the alcohol, whether the venue or the vendor, is well-trained and certified in liquor training. This is a key way to protect your business while also keeping staff and patrons safe throughout event season.

  Out of his passion for serving the restaurant and hospitality industry, David DeLorenzo created the Bar and Restaurant Insurance niche division of his father’s company The Ambassador Group, which he purchased in 2009. For more than 20 years, he has been dedicated to helping protect and connect the hospitality industry in Arizona. For more information visit barandrestaurantinsurance.com.

Boost Summer Marketing Strategies

Cyndi
two cocktail glasses sitting in water

By: Hanifa Sekandi

It is summertime. It is a pivotal time for all beverage brands. It is an opportunity to capture a new consumer base and keep existing consumers loyal. It is also the best time to go rogue and experiment. Test your brand’s marketing limits.

  Before you dive into the deep end, test shallow waters first. See how your audience responds to slight changes – changes that stand out but maintain brand familiarity. People should still know how to identify your brand. So, keep key markers in place. For example, there is a better time to change or make adjustments to your brand logo. This should occur at the top of the year when most brands experience a dip in sales due to consumer behavioral changes. Dry January is a great time to revamp your brand. The summertime is when you push your brand to the forefront in a fun and colorful way.

  There are many ways to boost your summer marketing strategies. Many brands experience notoriety during the summer. An outsider can become a star brand overnight. Consumers are more open to new beverage brands during this time. Also, gatherings such as BBQs and festivals open the doors to beverage exploration. Take advantage of old-school marketing approaches, such as giving out mini samples of your beverage at events. This approach has proven to be successful for many beverage brands. As you begin to think of ways to benefit from this season, consider a summer label. 

  A short-order run of new labels is cost-effective. You can also repurpose these labels next time if you see a boost in sales and brand popularity due to an exclusive summer label. It also allows you to re-introduce your brand without developing a new product line exclusively for the summer. A fitting example of this is Busch Beer’s beer cans and packaging adorned with an image of corn. A label that their audience loves, and they repurpose it as a limited edition. The Bass Can limited edition run of their beverage is also notable. 

Seasonal Beverage Labels & Packaging

  Sometimes, products need a boost to be noticed. There are a lot of great beverages on the market that go unnoticed simply because of poor labeling and packaging choices. Also, even if they are aesthetically unappealing, popular beverages take centerstage. It is hard to cut through the beverage market noise. But it is certainly possible. Keep in mind that your beverage must meet consumer standards. There have been brands that have lost popularity due to poor beverage quality. Good ingredients paired with a palatable beverage are imperative. Brands can fix poor label decisions, but they cannot fix a poorly crafted beverage. Most brands do not aspire to go viral being known as the worst tasting beverage. Nor do they aim to be a one-hit beverage wonder. 

  You might assume that it may be too late to jump in on the summer beverage surge by developing limited-edition seasonal beverage packaging. It is never too late. Remember, this is a short run and a terrific way to grow your consumer base. Also, you can sell this limited edition until the beginning of fall. Market segmentation will also help you push higher quantities of this limited run to regions that maintain warmer temperatures throughout the year to help manage supply overages that may occur. Research your demographic thoroughly. Therefore, you will know how to best allocate your beverage to retailers. 

  When designing your new beverage labels and packages, spend time researching colors and imagery that are symbolic of summer. For example, teal, white, yellow, orange and pastels captivate the senses. Coconuts, palm trees, water, sand, boats and ice cream complement summer imagery. Use subliminal marketing cues to draw people towards your beverage. Some full-bodied beers taste like milkshakes. The thickness and riches of the beverage give a desert-like experience. Is your beer the root beer float of ales? Play off flavor profiles to highlight your beverage. 

  Here is an opportunity to showcase the time and effort poured into the cultivation process. What is the star ingredient? What sunny destination does this beverage remind you of when you take the first sip? Is it capri or the cottage on a sweltering day surrounded by trees while sitting on a boat at the lake with friends listening to music? You are the designer of your brand’s culture. Convince people to join in on the movement. 

Get Bold with Cocktail Recipes

  Everyone thinks they are America’s next best bartender once the party gets going. Developing new recipes to diversify a beverage experience is another way to boost marketing strategies. New recipes can be featured on blog posts and social media. Hire a master mixologist to craft summer cocktails using your beverage. Create further engagement with a call to action by asking consumers to display their at-home bartending skills by making a cocktail with your beverage. 

  Reimagine your beverage. Take the ordinary and transform it into something extraordinary. This is a wonderful way to test market new beverage variations. Recipes that perform well can lead to a limited-edition product line that is only available in the summer. So, what is in a great recipe? Since it is summer, lean towards ingredients that pay homage to warmer weather or destinations. Also, incorporate fruits or vegetables that are in season. They are readily available for your consumer. It demonstrates that you understand true recipe development. Restaurants often rework their menus to ensure they use ingredients during peak seasons. Summer fresh labels and packaging go hand in hand with expertly crafted cocktails that combine ingredients that favor warmer months. 

  Avoid complicated recipes; this is not a magic show. Also, it should be cost-effective so your consumer can invest more in your beverage than shopping for ingredients. Turn well-known beverages like slushies, milkshakes, sweet tea or lattes into a cocktail. A familiar beverage with a little kick is always favorable. For those who prefer to sip their beverage or prefer just one, this will go over well. A quality cocktail that is familiar, fun and tastes great will get your audience engaged and excited to give your recipe a try. Remember that summer when the frosé was trending? Any brand could make a variation of this refreshing icy beverage. Cocktail recipes are not just reserved for spirits, liquor and wine; beer can also be used to join the party. Beer and espresso pair quietly nicely. This cocktail might beat out an espresso martini. Feeling extra bold? Add some vanilla ice cream. 

High-End Merchandise

  Subliminal marketing has many angles. The use of repetitive imagery via commercials and print ads is one route. Another route is high-end merchandise. Yes, the cool kids rummage through vintage clothing stores, looking for apparel from iconic beverage brands. It is not because they seek to make a fashion statement.

  Moreover, brands of yesteryear did a great job with product development. They designed a cap that was both functional and well-designed. They used quality fabrics and designs that people felt proud to wear. There was an understanding that people wear things they like. Also, cheesy merch would be thrown at the back of a closet. A patchwork denim jacket featuring your brand is a great collector’s item. When getting designs printed on t-shirts, opt for direct-to-fabric printing; it wears well over time. Also, select high-quality fabric. Whether you are giving merchandise away or making it available for purchase, people love wearing merchandise by their favorite beverage brand if it leans towards something you would find from a fashion brand. 

  Many generic clothing brands adorn their clothing with their logo. Walking into a bar and seeing a patron wearing a vintage Coors light t-shirt or baseball cap may entice patrons to order this and another brand’s beverage offering wearable merchandise. So, as you brainstorm ideas to boost your summer marketing strategies, consider a limited-edition merchandise collection. Research old and new popular merchandise from your competitors. What brands do you commonly see people wear while out? Are distressed t-shirts in, or are truck driver-style hats popular? Do not just paste your logo on items and think this is enough. Hire a designer who works in apparel and merchandise. Have them dream up a merchandise collection. If you do not think this is a worthwhile endeavor, think again. Fender Guitars did a great capsule collection with Brixton apparel that sold quite well. 

  High-end merchandise is not only coveted but it is also sustainable since it is more likely to be worn and can be resold. Sellers on eBay who source iconic beverage brand merchandise make a lot of money and are always on the lookout for what will be a high-value item once it is discontinued. If you sell out of items, do not produce more. Scarcity and novelty drive demand. Re-introduce these items the following year or as a special holiday season gift people will receive when they purchase your beverage. Your goal is to drive beverage sales. High-end merchandise is a great branding tool to transform your brand’s reputation. 

Sourcing Grains for Craft Distilled Spirits

Cyndi
two men standing at bag with grains in their palm

By: Becky Garrison

According to Michael Swanson, co-founder, farmer and distiller for Far North Spirits (Hallock, Minnesota), craft distillers have an excellent opportunity to highlight the difference between a crop grown for flavor compared to a crop grown solely for yield. This distinction affords them unique opportunities to explore how to source the specific grains that will produce a spirit with a particular desired flavor profile.

  Swanson cites rye as an example, as that’s the primary grain he utilizes in his whiskeys, and he observed how this scenario plays out similarly to many crops. As he observes, historically and across multiple countries, winter rye has been grown and sold as a commodity. There are exceptions to this, particularly in pre-prohibition Pennsylvania, where rye was grown specifically for use by the many distilleries across the state. But for the most part, rye was and still is treated as a commodity. However, when they started growing rye to distill into whiskey, they realized that their particular variety had a distinctive flavor profile.

  So, Swanson and his team conducted a three-year crop research study that was the first of its kind. In this study, they grew 15 different varieties of rye and then milled-mashed-fermented-distilled them individually. From this, they could determine that all other things are equal, the variety of rye alone affects the flavor of the whiskey. Also, after barrel aging the whiskey, they found that the aging process amplified the differences in flavor between the varieties. In particular, the open-pollinated varieties showed a much broader flavor spectrum than the hybrid varieties.

  Despite the increase in flavor in the open-pollinated varieties, the hybrid varieties have been quickly gaining acreage across the U.S., Canada and Europe because of their much higher yields. These high yields enable farmers to increase their gross revenue to the point that growing hybrid rye can be almost as profitable as a corn/soybean rotation, with much lower input costs. But growing the majority of open-pollinated varieties at this price point isn’t profitable. Hence, mass producers of whiskey aren’t willing to pay more for open-pollinated rye due to the massive number of bushels that they consume in a year.

Talking About Terroir

  Swanson has observed that craft producers who focus on producing products based on flavor rather than yield are willing to pay more for grains with a broader spectrum of flavor. To this end, craft distillers have started conversations about terroir that are very similar to defining a wine by taking into account factors such as the vineyard where the grapes came from and the AVA where this vineyard is located. Simply put, place matters, with regional differences emerging among whiskeys produced by craft distillers based on where the grains are grown.

  Miles Munroe, master blender for the Portland, Oregon-based Westward Whiskey, views barley similar to how a winemaker considers different wine styles, the different grape varietals and the various climates in which they’re grown.

  “We know that barley types, soil, and climate bring diversity and complex flavors to whiskey. The shape of our custom pot stills and the way we approach distillation allows for the most amount of grain character to come through, so we’re focused on high-quality barley that has a sense of place,” he reflects.

  In recent years, the Skagit Valley in Western Washington State, situated along the same latitude as the Scottish Highlands, has emerged as a major agricultural hub. This distinction led to Copperworks Distilling Company (Seattle, Washington), Westland Distillery (Seattle, Washington) and Westward Whiskey emerging as leading players in the evolution of the creation of American Single Malt as a new spirits category.

Sourcing from Malthouses or Direct to Farmers

  Except for a select number of distilleries that malt their grains in-house, distillers work with a malt house to source and then malt the grains according to the distiller’s particular specifications for a given spirit. These malt houses can ensure that the grain meets minimum specifications so that it can be malted.

  Some craft distillers follow the model of distilleries like Westward Whiskey, where they work with malt houses that source local barley, which gives their spirits a sense of where the grain is from. Miles Munroe, master blender for Westward, chooses two-row barley because it meets the standards of what craft brewers also expect. So, they select their malt houses with these criteria in mind.

  Others, like Tyler Pederson, master distiller at Westland Distilling, work with a network of local malt houses and brokers to source their malted barley. These partners work with regional farmers to select and procure the raw barley they malt to their specifications. Pederson describes this process, “It’s a very involved effort, and we collaborate with everyone throughout our supply chain, even going so far as funding a barley breeding program to develop new varieties for the whiskey industry.”

  Westland’s Colere editions were created specifically to reflect how different varieties of barley offer different flavors. To date, they’ve released three expressions: Colere #1, made with Alba, #2, made with Talisman and their current expression and #3, made with Pilot. How Westland sources its grains was one contributing factor to its achieving B-Corp Certification in 2024.

  A small but growing number of distillers like Far North Spirits purchase their grains directly from the farmer. According to Jason Parker, co-founder of Copperworks Distilling Company, “This represents a new way of doing business where a customer is getting better flavor, sometimes at the expense of a good yield.” He cites his experience sourcing a barley variety named Alba as an example. After they created a delicious whiskey using Alba, they found their local malt house had encouraged their supplying farmers to quit growing it because they found another barley that was easier to malt and produced a higher yield. But it didn’t taste like Alba, and now the flavor it produced is no longer possible to produce.

  To convince farmers to grow specialty grains like Alba that may yield fewer bushels per acre or perform less efficiently in the malthouse, they put the word out to farmers that they were willing to pay the farmers per acre instead of per bushel. Once they contract with farmers to bill by the user rather than the bushel, thereby sharing the risk with the distillery of planting grains for flavor rather than yield, they will contract with a local malt house, such as Link Foods, to malt the barley.

  Before contacting farmers, Swanson recommends doing research into the specific varieties of grains that grow best in one’s particular area. This knowledge will help ensure that the farmer can grow this particular grain variety in a large enough quantity without sacrificing quality such that the farmer can make a profit and the distiller can produce a quality spirit.

  Gabe Toth, lead distiller for The Family Jones (Loveland, Colorado), describes how working with Olander Farms/Root Shoot Malting, which is less than five miles from their production distillery, affords them multiple opportunities. “We can develop local, unique flavor, keep our dollars local and support local businesses. We can also reduce our supply chain footprint, reducing both our vulnerability to disruption and our carbon usage via transit and work directly with our farmers to experiment with new grain varietals. This helps us support on-farm sustainability initiatives or collaborate on other projects that are a result of having direct relationships and even friendships with them.”

Challenges in Sourcing Grain Directly from Farmers

  In Toth’s estimation, price is probably the major factor working against this approach, followed by uniformity. As he reflects, “Commodity agriculture over the last several decades has increasingly squeezed small farmers out of the market, and the relatively small farms we work with don’t have the economies of scale to leverage for competitive pricing. Local grain can also be more prone to variability compared to a large processor that can over-contract and be more selective or blend away variation.”

  However, Parker reminds craft distillers that focus on making value-priced whiskeys, as opposed to flavor-driven whiskeys, that they can’t compete with the big producers on price. Big companies have economies of scale and contracts that are not available to craft distilleries. “So, you might as well chase the one thing you can control, which is good, unique flavor. To do that, you probably don’t want to be putting the cheapest ingredients in but rather use grains and other products that make a real flavor difference.”

Liquor Licensing & Insurance 101

Cyndi

What Establishments Selling Liquor Need to Know

By: David DeLorenzo

When you’re operating an establishment that serves food and alcohol, being properly licensed and insured is crucial to the safety and the success of your business. Even if you’ve been in business for some time, it’s vital to stay abreast of ever-changing laws as they apply to serving liquor, specifically. Read on for some liquor licensing and insurance tips to keep your business running strong, while you protect yourself and your staff.

  First of all, it’s important to consider the type of license that you have and the insurance that will cover it. A lot of people may have a misconception about the type of license they have and the dictation for what type of insurance that is needed. For example, a No. 6 license (subject to Arizona law), which is generally a bar license that is 100 percent liquor that will have some dictation on the type of insurance that you will need. You will have to go to markets that are fully vested in the ability to write 100 percent liquor or 50 percent or more liquor, because of that No. 6 license.

  However, the license itself is not as important as the percentage. It only matters that you have a license when it comes to insurance. For example, consider a No. 12 license, which is a restaurant license that allows you to serve 60 percent of your sales in alcohol and at least 40 percent of your sales in food. The insurance agency will look at that No. 12 license, but what they really want to know is how much you are actually serving in alcohol and how much you are serving in food.

  The reality is that most No. 12 businesses may serve 30 percent alcohol or five percent — a lot less than that 50 percent (which is generally what a No. 12 license allows for). All the insurance company really cares about or looks at is the actual percentage of liquor to food. However, if you served 60 percent alcohol and 40 percent food, the insurance company may still classify you as a bar and you will likely have a higher rate even though you have a restaurant license. It’s the percentage of food to alcohol sales that really matters when it comes to your insurance coverage and rates, not necessarily the license itself.

  In the insurance world, if you serve 30 percent alcohol and 70 percent food, for example, that is generally the threshold and the maximum for you to get the most positive and beneficial insurance rate in Arizona because your liquor is 30 percent or lower. Once you exceed that 30 percent threshold, it puts your business in another category of insurance that basically does not allow you to go to those direct markets for your coverage.

  You will need to go to a secondary market, generally a more expensive market, because your liquor liability is increased when you have more people drinking liquor. You have to be insured differently the more liquor you serve and typically those direct markets don’t want to take on that risk. However, there are other markets for that.

  If at least 30 percent of your sales are attributed to liquor, you should look into an umbrella to go over your primary coverage. This umbrella will give you another layer of protection over what you’ve already purchased in terms of your insurance.

  It’s also important to carefully analyze the amount of entertainment your establishment provides and the hours of operation if you’re getting into heavy liquor service. Those two factors will impact on your rate just as much as serving more alcohol than a standard restaurant would.

  There is nothing wrong with entertainment or later hours, but you do need to understand that those factors put you in a different classification at that point. Based on that you will need to adhere to higher rates. This is because the companies that write these have actuaries that have determined what they need to charge in order to create an actual rate that makes sense for the carrier to write the business.

  When it comes to selling to-go alcohol, it hasn’t really come to full fruition as many thought it would after COVID. There are insurance companies that write liquor stores, convenience stores or even grocery stores, which is basically to-go alcohol. When you look at those types of establishments, to-go alcohol is already being sold. It hasn’t really changed the stance from an insurance perspective when restaurants are selling to-to alcohol. They just look at the total amount of alcohol sales coming out of that establishment. For example, if a restaurant is selling only three percent alcohol and the rest is food, the insurance company won’t really look at whether that three percent is from to-go liquor sales or not.

  Ultimately, it is up to the establishment to perform in the act of not overserving a customer and not serving a customer that is already noticeably intoxicated. That is regardless of whether the alcohol is served at their establishment or purchased to-go. While selling to-go liquor as a restaurant or bar is legal, is it important to be properly licensed for that.

  For any business selling liquor, it is important to review your policies once a year with your insurance agent to ensure there aren’t any changes that would necessitate an adjustment to your coverage. It is also vital to adequately train your staff, particularly in the awareness of not overserving or not serving a customer that appears to be already intoxicated.

  Documentation of this training is also extremely important. Keeping that and all other documentation in a place that is safe and yet accessible can help protect your business if something were to go awry. If you hear of an incident, even if you don’t

know whether that person was at your establishment, collect your camera footage from that evening and save it in the event of a law suit. You may or may not be liable, but it is good to have, particularly if there was a wreck or even a death near your business. It’s a good idea to collect that data just in case. Security cameras with time-stamped data can be a lifesaver to your business and your staff.

  It’s always important to work with an insurance agent that specializes in the bar and restaurant industry. They will have the knowledge to support your needs and also ensure that you have the coverage you need to protect your business, your staff

and your clientele.

  Out of his passion to serve the restaurant and hospitality industry, David DeLorenzo created the Bar and Restaurant Insurance niche division of his father’s company The Ambassador Group, which he purchased in 2009. For more than 20 years, he has been dedicated to helping protect and connect the hospitality industry in Arizona. For more information visit our website: www.barandrestaurantinsurance.com.

Keg Washing: Working Smarter to Conquer an Essential Brewery Task

Cyndi
kegs on conveyor belt going through wash machine

By: Cheryl Gray

Imagine a dried egg inside a frying pan. Then, imagine the bacteria that immediately begins to grow because you’ve left the problem to fester, and, well, you know the rest.

  The same premise holds true when cleaning the kegs for your brewery. If the job is not done properly, breweries are setting themselves up for all kinds of safety and hygiene problems, both inside and outside the keg. Ensuring that beer is safe to consume is not an option. It is a must.

  Beer products are very sensitive to any outside contamination. Even tiny traces of bacteria or other contaminants can ruin an entire batch of beer, costing breweries money in lost time, resources and, of course, product. 

  There are some key differences in cleaning the outside of a keg versus the inside. Cleaning the inside of a keg involves focusing on removing any beer residue, bacteria or contaminants. Success in this area can ensure that the beer dispensed maintains the quality its brewer intended and is safe to drink. A proper external cleaning, of course, guarantees the removal of any contamination or dirt that may be present on the outside surface of the keg.

  While properly cleaning beer kegs is not an impossible task, choosing the wrong cleaning apparatus can be costly on all fronts. If you choose kegs for your beer products, knowing how to protect your customers from contamination is the job of expert companies with solutions that can help. Many breweries are opting for automatic solutions to clean and sanitize their kegs.

  Fillmore Packaging Solutions, headquartered in St. Louis, Missouri, promises affordable solutions for keg washing designed for craft breweries of all sizes. Since owner Tony Saballa founded the company more than twenty years ago, it has focused on perfecting the mechanical side of production. Saballa says his company is all in when it comes to automatic keg washers.

  “We don’t offer manual keg washers since they typically require the same amount of labor and cost to construct as fully automated washers. We also have found that manual washers often have variable outputs with wash quality issues due to operator missteps and errors.

  Our keg washers are built to completely automate the washing process utilizing state-of-the-art UL certified electronics. Automation simplifies the washing process so brewers can apply their attention to other tasks.”

  Saballa adds that Fillmore’s keg washers are UL Certified and constructed to meet the UL508a safety code standards for the United States and Canada. The washers are constructed at the company’s St. Louis manufacturing facility.

  “We aim to deliver American-made automation that functions to the highest standards at a cost that is affordable for both startups and expanding breweries.”

  Saballa points out some major mistakes that brewers make when it comes to keg washing and how Fillmore can steer them in the right direction. One major error, Saballa says, is overdoing the cleaning process. He says that more is not better in the case of keg washing.

  “Here at Fillmore, we often find that brewers tend to over-concentrate their cleaning and sanitizing solutions, sometimes using double and triple the manufacturer recommended usage rates. More is not better. This increases the operational cost, and safety for the operator must also be taken into consideration. Other factors that exist are the accelerated wear on pumps, valves, seals and gaskets, which can lead to down time and costly repairs.”

  Saballa explains how Fillmore’s keg washers are built to operate on a special voltage and designed for different breweries of different sizes. 

  “This is important since most new breweries are not located in industrial zones. Single-phase machinery offers a solution for brewers operating in areas where three-phase power is inaccessible or installation would be cost-prohibitive.”

  Each Fillmore keg washer operates on either 120v or 220v AC and compressed air and is capable of handling advanced pressurized CO2. Equipped with an enhanced design and technologically advanced features, the semi-auto keg washers include a fully programmable interface designed for customized operation, high-capacity cleaning and advanced sanitizing for brewery kegs.

  Another company specializing in keg washers is Craftmaster Stainless, headquartered in Rancho Cordova, California. The company manufactures production equipment for multiple beverage industries, including beer, cider, wine, spirits and coffee. Its clients range from small craft brewers to large global producers. With more than two decades of experience in stainless steel fabrication, the company’s team has the capability to custom-design and build commercial beer brewing equipment.

  When it comes to cleaning kegs, Craftmaster Stainless offers the Keggernaut Semi-Automatic Keg Washer. The product features a Siemens interface that gives breweries full state-of-the-art touch control over temperature settings and wash cycle timing. 

  The Kerrernaut is equipped with dual cleaning stations designed to wash two kegs of any size.    It can clean up to 40 kegs an hour, contingent upon the length of the wash cycle. The user-friendly features allow the kegs to simply be inverted, automatically washed, sanitized and pressurized in minutes. This semi-auto beer keg cleaning equipment allows for a quick and easy option to increase productivity. 

  Craftmaster Stainless offers its customers lifetime support on all commercial brewing equipment. It also provides custom designs for its microbrewery clients. 

  Keg washers are also available from Alpha Brewing Operations. The company, headquartered in Lincoln, Nebraska, provides fully automated options for an entire brewery. Its automation options from breweries range from semi-auto to what the company calls its fully automated package. The works include features such as a large touchscreen interface and connectivity options with mobile devices.

  For keg washing, Alpha Brewing Operations offers a product called the Alpha “Wash Dog Junior.”  It is an affordable, compact, automatic version of the company’s larger and fully automatic counterpart. The “Junior” is still highly automated but requires manual coupling to kegs and comes in a smaller package. This smaller keg washer is designed to fit into the tight budgets and tight spaces of startups and small breweries.

  Keg washers are also available from international manufacturers, such as Comac, which has its headquarters in Italy. Comac has several varieties of external keg washers, capable of washing anywhere from 30 to more than 1,000 kegs per hour. Comac offers customized keg-washing solutions for breweries of all sizes.

  Comac’s most compact keg washer is only about six and a half feet long, including a single section and one track. The company touts it as an ideal option for hot or recycled water washing. There is a larger option that performs multiple tasks for keg washing, such as pre-washing with recycled water, washing with a caustic solution to remove hard-to-clean dirt and a final rinse with clean water.

  For larger production facilities, Comac offers a dual-track keg washer to boost cleaning capacity. Other features include easy and cost-effective maintenance, quick changeover ability and savings in water consumption. Other options available for large production lines include a separate skid for components, such as pumps, valves and heat exchangers to simplify cleaning and maintenance.

  Experts agree that keg washing, inside and out, protects the beer and the consumers who buy it. For breweries large and small, the task is an inevitable necessity made easier by automated machinery designed to make a mundane task easier to manage while increasing safeguards against cross-contamination.