Category: General

Keys to Creating Effective Incentives for the Craft Beer Distribution Channel

Cyndi

By: By Nichole Gunn, Vice President of Marketing and Creative Services, Incentive Solutions

  When it comes to improving your go-to-market strategy, incentives can be a powerful tool that craft beer producers can use to motivate distributors and wholesalers to sell their product. Incentive programs help craft beer producers build mindshare with distributors and wholesalers, differentiate their product, provide enablement to indirect sales reps and collect important data throughout their channel.

  However, it is important to be mindful of your marketing spend and to focus on designing your program to generate a meaningful ROI. Keep in mind that an incentive program is about more than just rewards. 

Keys to Creating an Effective  Incentive Program

  While the specifics of incentive program design will be as varied and unique as the craft beer producers who use them, below are several overarching principles that can be utilized to create effective incentives for supply chain trading partners:

1.  Choose a specific, measurable goal for your program.

2.  Analyze your audience and your competitive situation.

3.  Offer rewards that are relevant to your target audience.

4.  Structure promotions to target KPIs (key performance indicators) that bring you closer to your goal.

5.  Consistently market your program to stay top of mind of with your indirect sales reps.

6.  Use digital platforms to drive your program and measure results.

  By following these six steps, craft beer producers can establish effective incentive programs that give them a sustainable competitive advantage in their channel and allow them to focus more of their attention on where it belongs – crafting great beer that their customers will love!

Choosing a Specific, Measurable Goal

  In order to achieve a meaningful ROI, it’s important to begin with the end in mind. Why do you want to launch an incentive program? What do you hope this program will accomplish? How will you measure success? The more specific you are when answering these questions, the more informed you will be when making decisions to empower your goals.

  Possible program goals craft beer producers use incentive programs to accomplish include:

•    Generating brand awareness;

•    Increasing sales for a specific product or region;

•    Driving incremental growth among supply chain trading partners;

•    Gathering data to improve partner profiles;

•    Capturing market share and gaining access to new verticals; and

•    Building loyalty with wholesale and distributor sales reps.

  While an effective channel incentive program can accomplish all of these things, it’s best to start small and narrow your focus to just one or two goals. Doing so will help you sell other members of your organization on the idea of launching an incentive program and will allow you to more effectively measure the results. Plus, you can always scale your program to accomplish additional goals once you know it’s working.

Analyzing Your Audience and Your Competitive Situation

  When building an incentive program, you have to put yourself in the shoes of the wholesale and distributor sales reps you’re attempting to motivate. What do you know about their lifestyle? What are the things that excite them? What information can you provide to make selling your products easier for them? The more you understand about your target audience, the better equipped you will be to create incentives that inspire them and align your goals with theirs. 

  In the competitive craft beer channel, each of these reps is responsible for selling multiple products from dozens of brands. The battle for mindshare is fierce. Chances are, some of your competitors are already running an incentive program or using other channel marketing promotions. It’s up to you to take a look at what your competitors are doing and to create an incentive program that is more engaging and compelling than theirs.

Offering Relevant Rewards to Your Target Audience

  According to the COLLOQUY Loyalty Census, the average American household is enrolled in more than 18 loyalty programs. Of those, they actively participate in fewer than half. In order for your incentive program to accomplish its goals, you have to stand out from the competition by offering rewards that enhance your value proposition and feel necessary to your participants.

  The more closely you can match your incentive rewards to the lifestyle and interests of your participants, the more effective your program will be. However, it’s important to choose rewards that align with varying levels of performance, while fitting into your overall budget. Luckily, there are plenty of options!

  For SPIFFs, rebates or programs with a wide range of participants, debit card and gift card rewards provide flexibility, convenience and wide appeal. Online merchandise rewards are more personalized and scalable, ranging from easily-earned “point burner” items like movie tickets for part-time customers, to exclusive, high-end merchandise and custom reward fulfillment for higher-performing supply chain partners. Group incentive travel is memorable and emotionally impactful, perfect for building loyalty with your top wholesale and distributor sales reps. Although incentive travel events are currently on hold for the foreseeable future, demand for travel rewards will be extremely high when the shutdown ends. This will not last forever, and there will be compelling bargains to be had as resorts and hotels at top destinations endeavor to resume business.

  Additionally, you can use a mix of rewards and tier them for different levels of performance or segments of your channel. For instance, it might make sense to offer an online points program for individual sales reps, while running an incentive travel promotion for the brand managers at the distributor level.

Structuring Promotions to Target Strategic KPIs

Incentives work by modifying the behaviors of your wholesale and distributor sales reps. Each step these reps take that bring you closer to your goal is also known as a KPI (key performance indicator). KPIs can be measured to predict or prove program success. For instance, the more participants that enroll in your program, the more likely they are to sell your product. Enrollment bonuses are a common incentive promotion, but you can also reward points bonuses for KPIs such as:

•    Attending tradeshows or taking online certification courses;

•    Participating in product-related trivia and quizzes;

•    Providing referrals;

•    Filling out surveys or updating their contact information; or

•    Making a first-time sale of a specific product.

  However, priorities change! For craft beer distributors, it’s important to have the ability to set multiple promotions and change reward parameters to target strategic initiatives, capitalize on analytics and respond to the tactics of the competition.

Marketing Your Program to Stay Top of Mind

  Once you have outlined your strategy and structure, the next step is to spread the word. Incentive programs create an easily communicated value proposition, but it’s necessary to consistently reach out and engage with your wholesale and distributor sales reps over a variety of channels.

  From program launch to reward redemption, you should be communicating with your supply chain trading partners across email, SMS, web platforms, direct mailers, flyers and phone calls. Get them excited about participating in your program, educate them on your brand, inform them about new promotions and remind them about the rewards they have the opportunity to earn. Your incentive program provides the chance to personalize your communication with your indirect sales reps in a way that may be otherwise difficult to achieve in the craft beer distribution channel. Additionally, you can use analytics to spot opportunities for growth or which accounts you should reengage and create targeted marketing campaigns for those accounts.

Using Digital Platforms to Drive Your Program

  Finally, you have to consider the user experience of engaging with your platform, as well as the administrative functions you need to successfully manage your program. Today’s incentive programs, like most business platforms, are software-driven. Gone are the days of analog catalogs, manual processes and investing in channel marketing strategies that don’t produce measurable results.

  When exploring potential incentive program providers, craft beer producers should ask themselves questions such as:

•    Does this incentive program software integrate with my CRM and other existing platforms?

•    How will this program software help me capture the data and analytics I need to improve my channel marketing?

•    How will this program software improve my ability to communicate with my supply chain trading partners?

•    Will my reward program website present an engaging and accessible user-experience that is a strong reflection of my brand?

•    What other features, such as gamification and sales enablement tools, does this platform include to keep participants engaged and to help them succeed?

  Luckily, these are areas where the incentive industry has made exciting strides over the last decade or so. As data, analytics, automation and providing digitally connected channel partner experiences continue to become increasingly important, incentive companies have shifted their focus from just providing reward fulfillment to offering complete channel sales and marketing solutions.

  This focus on technology has made launching and managing an incentive program less time intensive. In a 2019 survey, Incentive Solutions found that 70 percent of our clients, including several notable craft beer producers, spend less than two hours a week managing their incentive program. Additionally, some incentive companies provide the option to take full responsibility for program management to free up your resources for other priorities.

  After all, chances are you didn’t get into the craft beer industry to manage channel partners and set parameters for sales promotions. You got into it because you are passionate about brewing great beer!  

Nichole Gunn

  Nichole Gunn is the VP of Marketing and Creative Services at Incentive Solutions (www.incentivesolutions.com), an Atlanta-based incentive company that specializes in helping B2B companies improve their channel sales, build customer loyalty, and motivate their employees. Nichole Gunn can be reached at ngunn@incentivesolutions.com.

Combining the Cannabis and Cocktail Cultures

Cyndi

By: Becky Garrison

Terms like “The Wild West” and “Gold Rush 2.0” have been used to describe the rapid shift of cannabis from an underground illicit practice to a legalized market. Global brands like AB InBev and Constellation Brands have invested in cannabis-infused beverages. (For now they appear to be focusing on the Canadian market where cannabis is legalized at the national level.)

Also, after hemp became legalized at the federal level in 2018, CBD-infused drinks for the adult market (21+) began popping up at bars, restaurants, and select grocery stores. In addition, the increasing legalization of cannabis for adult use has led to the rise of non-alcoholic drinks called “mocktails” that contain THC and are available for purchase in those licensed cannabis dispensaries located in states where recreational cannabis is legal. 

As one example of the increasing normalization of cannabis, in 2019, Feast Portland, a food and drink festival celebrating the bounty of the Pacific Northwest, included in its educational offerings a panel titled “Cannabis & Cocktails: Best Buds?” During this panel, Jeremy Plumb, Director of Production Science at Prūf Cultivar, lent his 30-years of expertise in the cannabis industry to illuminate this new trend. He describes this current state of cannabis as a “frontier culture” where people are exploring a all the dimensions of over thousand compounds found in the cannabis plant.  

The two compounds in cannabis getting the most buss are  buzz is CBD (Cannabidiol) and THC (Tetrahydrocannabinol).  Both CBD and THC possess analgesic and anti-inflammatory properties that can help with a range of conditions such as relieving pain and reducing stress.

For those unfamiliar with this plant, Plumb breaks down cannabis into three types. Type 1 cannabis is high THC with almost no CBD. THC is that compound that produces a psychoactive high and is the most heavily regulated (in the U.S.). Type 2 cannabis is a 1:1 ratio of THC to CBD,  a combination that produces a balanced high. Finally, Type 3 cannabis contains less than .3% THC and is also called hemp-derived CBD. This is the form of cannabis that’s theoretically legal in all 50 states and the one being used in beers and cocktails available in bars, restaurants, and other public settings.

Rather than focus on just CBD and THC, Plumb encourages people to explore the “entourage effect” that happens when one consumes a cannabis infused product. This term describes the overall sensations a consumer experiences when consuming a particular product. In particular, Plumb homed in on terpenes, which are the organic chemicals present in food and drinks that produce certain effects. Among of the more common terpenes found in cannabis include Pinene (pine), Myrcene (musky, earthy, fruity) fruity), Limonene (citrus), Humulene (hoppy, earthy), Humulene (musky, earthy, spicy), Linalool (spicy, floral), Caryophyllene (peppery, spicy), and Terpinolene (woodsy, smoky).

While cannabis and hops belong to the same Cannabaceae family, Plumb notes that cannabis offers a broader range of flavors and aromatics than what one finds in hops. According to Plumb, cannabis is the most genetically diverse plant on the planet. “Any aroma found in nature can be found in some variety of this plant.” In his work, he explores whole-plant infusions that take advantage of all the plants properties rather than distilling a single compound and adding that to the products. 

How Cannabis  is Used in Cocktails  

Once hemp derived-CBD. became legalized at the Federal level in 2018, CBD drinks became the latest craze. Howeer, until the FDA and USDA formalize the legal guidelines for how to regulate food and beverage products made with hemp-derived CBD, these products will not be available for adult use in all 50 states. Furthermore, The Alcohol and Tobacco Tax and Trade Bureau (TTB) has not approved cannabis or CBD as approved ingredients for use by a distillery, brewery, cidery, or winery.

But while one cannot expect to see these cannabis or CBD-infused alcoholic products available in the near future, CBD drops can be added to alcoholic beverages. According to Brandon Holmes, CEO of Danodan Hempworks, the challenge in using their Hemp Flower CBD shots in a drink is the same as using any other ingredient in cocktails. “Mixologists make great drinks because they experiment with ingredient ratios that captivate the senses and amplify each ingredient’s characteristics.”

Joanna Matson,  founder and CEO of  ZVEDA Botanicals, created her CBD wellness drops using fusions of Ayurvedic herbs, cannabinoid-rich Hemp-CBD oil, and signature essential oil blends as a natural product to help promote health and wellness. Presently, she also partners with the Portland Bitters Project to produce a line of bitters infused with CBD and organic botanicals. 

For those looking for a lighter taste, East Fork Cultivar’s CBD drops are not flavored as strongly as other hemp products. Their CBD Drops are a glycerine-based tincture made from their USDA Certified Organic Oregon-grown craft hemp flower to produce an accessible, mild-tasting, broad-spectrum, water-soluble form of CBD to be added into drinks.

While CBD affects everyone at different dosage levels, one can generally expect to feel a light, pleasant feeling of relaxation after taking a 10-50 mg dose. However, some people can experience these feelings with only 2mg of CBD.

Sparkling beverages such as those produced by Ablis CBD Infusions and clēēn:craft can be used as mixers or consumed as stand-alone products for those wanting a non-alcoholic lift courtesy of the CBD present in these product but also desiring products made with organic ingredients. For those desiring products infused with THC, companies such as Magic Number and SōRSE Technology manufacture non-alcoholic THC beverages available in different strengths. These zero-proof cocktails work well for those who want a sophisticated drink in a social setting but do not wish to consume alcohol.

The Future of Cannabis-Infused Cocktails 

Lee-Ellen Reed of East Fork Cultivars, speaks to the role of CBD in the bar space. “They offer an alternative to alcohol for those who still want to “take the edge off.” Also, both cannabis and cocktails could produce some new experiences when combined together. In Plumb‘s experience, sipping on a whole plant vaporizing creates a new experience which could be incorporated into a cannabis infused cocktail. 

Also, anecdotal evidence suggests that consuming cannabis could help reduce the amount of alcohol consumed and prevent hangovers. However, further research is needed to ascertain the effects of combining alcohol and cannabis

In Plumb’s estimation, blending together cannabis and cocktails makes sense from a craft perspective. He believes cannabis should be seen in the same context of other craft food and beverages that produce nourishment and enjoyment. “There’s a whole community of passionate craftspeople who existed in this underground [cannabis] economy for a very long time, aspiring to simply be at the table with other brilliant crafts people who are producing spirits, ales, wine, and food.”

Special Considerations and Latest Innovations for Growlers & Kegs

Cyndi
beer glass with a small keg

By: Alyssa L. Ochs

Growlers and kegs have been staples in breweries for many years. With the bevy of options available to brewers today, choosing the right size, shape and material for these essentials may be an overwhelming task. To make the best choice, brewers need to consider their options as well as the new and exciting innovations in the world of portable containers.

Types of Portable Containers

  Growlers can be made with various materials, such as glass, stainless steel, ceramic and plastic. Vacuum-insulated growlers go beyond a standard glass growler’s functionality to keep beer colder and fresher for longer. Some popular models include Hydro Flask beer growlers, DrinkTanks, GrowlerWerks, 45-Degree Latitude stainless steel growlers, Yukon insulated beer growlers and two-liter Euro Growlers with metal handles.

  Meanwhile, keg types vary based on volume, capacity and weight. The most common kegs are sixth barrels, quarter barrels, slim quarter and half barrels. Consumers also have access to Cornelius kegs, mini-kegs, one-way kegs and eighth barrels.

  With headquarters in Atlanta, Georgia, Schaefer Container Systems North America manufacturers ECO KEGS that are lightweight, durable and stackable stainless-steel kegs, and 100% stainless-steel Sudex Kegs. The company also offers fully or partially encased Plus Kegs, the FreshKEG and SmartDRAFT keg with flexible small-scale dispensing systems and Party Kegs that are stylish and easy to use with a gravity-fed system. Schaefer’s specialty kegs include yeast brinks and cellar topping kegs that are adaptable by using tri-clover and tri-clamp fittings.

  “The most popular are our ECO KEGS,” said Richard Winslow, the president of Schaefer Container Systems North America. “These kegs provide immediate brand differentiation, are highly customizable, and offer significant value-added features and long terms cost advantages. Also very popular are our Party Kegs, which use a gravity-fed system with all the utility of a Firkin and none of the hassles.”

  Yet there are even more types of portable containers that are trending and particularly attractive. For consumers looking for less than the standard 64 oz fill, smaller containers, like Swig Savvy’s stainless-steel water bottles, are popular. Some breweries are now equipped to fill 32-ounce crowlers, aluminum cans filled and sealed on demand that keep the beer fresh until it’s cracked open at its destination.

Best Materials for Growlers and Kegs

  Since the advent of the modern growler, glass has been a popular material. Easy to clean, easy to fill and easy to find, glass growlers can be clear or amber color. However, the material is heavy and easily broken, among other problems.

  “Glass has a highly non-porous surface and does not absorb microorganisms which can spoil your beer, but annealing is weakened with use and when subjected to temperature changes. Thus, glass weakens over time or when subjected to an impact and will eventually break,” said John Burns, Jr. of Craft Master Growlers. “Glass is not suitable to be pressurized.”

  Based in Tacoma, Washington, Craft Master Growlers creates the next generation of growlers forged from high-quality stainless steel and designed for performance and durability.

  Stainless steel is sturdy and keeps beer cold; however, during filling, bartenders are unable to determine the fill level accurately, often leading to a loss of product. However, stainless is sustainable and durable, resists oxidation and corrosion, and is ideal for pressurization.

  Ceramic growlers have a classy look but are heavy, more difficult to clean and prone to chipping. Plastic is also used for growlers because of its low cost and low likelihood of breaking, but is less durable with multiple uses and may cause oxidation in the beer.

  For kegs, stainless steel is the most commonly used material because it is durable, sterile, long-lasting and affordable with reuse. Aluminum was once used for kegs because of its strength and low cost, but is prone to corrosion and runs the risk of being stolen for scrap metal. Plastic kegs are cheaper, lightweight and stackable, but they also create concerns about durability, oxidation and exposure to heat and sunlight.

  Emma Shepanek of G4 Kegs told Beverage Master Magazine that food-grade stainless steel is the best material for kegs. Founded in the craft beer destination of Bend, Oregon, G4 Kegs offers high-quality and durable kegs, as well as various keg services and leasing.

  “All stainless-steel kegs are the most durable, reliable and safest kegs on the market,” Shepanek said. “There have been recent innovations with plastic kegs, but they are still not as safe or sustainable as all stainless-steel kegs.”

Refill Policy Considerations

  For both growlers and kegs, there are considerations to keep in mind about refill policies. First, check local and state laws concerning portable container fills to ensure you comply. Make sure to openly and publicly share your brewery’s policy about refills with consumers to avoid confusion.

  As a general rule, never refill a container with questionable sanitation or cleanliness to avoid compromising a consumer’s health. Brewers may always want to avoid refilling containers with other breweries’ names and logos on them to avoid misconceptions about whose beer is inside. Some states have laws against filling any growler that does not feature that brewery’s logo. Again, brewers should check state and local regulations for more information.

  Many breweries have a policy of not refilling plastic containers since plastic cannot be cleaned as well as other materials and is more likely to harbor bacteria. Brewers should only use and fill containers that maintain the integrity of the beer that they’ve worked so hard to produce, such as insulated stainless-steel or colored glass.

Return Policy Considerations

  Return policies are important to have in place if the brewery is in the business of leasing kegs to consumers. Always provide written policy details to consumers and include details about how to reserve kegs, the time frame for reservations and the length of time before it must be returned.

  Other important information to provide includes how long the brewery will honor deposit refunds, the charge for unreturned kegs and the deposits amounts for barrels and hand pumps. Brewers may want to advise customers where to park while picking up their keg and how to properly exchange an empty for a full one.

New Technology for Portable Containers

  The world of portable beverage containers is continually changing due to new technology and innovations in the industry. Portable beer systems are gaining popularity by allowing consumers to pour their favorite beer anywhere. Pressurized growlers serve as mini-kegs to maintain carbonation levels for longer and even include customizable tap handles and pressure gauges. Entrepreneurs are even turning shipping containers into mobile multi-tap kegerators to help beer lovers enjoy their favorite brews outside the taproom.

  Burns of Craft Master Growlers said that new pressurized growlers substantially extend the longevity and usability of fresh craft beer for a couple of weeks or longer. This is a significant upgrade from glass growlers with virtually no shelf life.

  “Double-wall insulation lets you enjoy a cold or hot beverage for hours when outside or on the road. Oxygen is substituted for CO2, as oxygen will cause the beer to go stale. A pressurized growler goes beyond just beer, to cider, kombucha, spritzer, seltzer and more,” said Burns. “At Craft Master Growlers, we are innovating the CO2 delivery system, giving the user a way to control and monitor the pressure for the appropriate beverage, and offering ways to infuse and ferment in a small-batch container. The way we think of it is broadening the appeal and accessibility of all the great things local craft brewers and homebrewers are doing.”

  Schaefer Container Systems’ FreshKEG and SmartDRAFT technology allow brewers to pour beer without CO2 tanks or draft systems. “The CO2 and beer are contained within a single keg body, and the unit is tapped by an easy-to-use dispensing unit,” Winslow said. “It’s ‘plug and play’ for the consumer!”

  Because kegs have been designed well and there’s little need for improvement, manufacturers look to technology as the next big thing.

  “Kegs are actually quite boring and basic,” said Shepanek of G4 Kegs. “The design and engineering of the keg have already been optimized, so there’s not much to be improved with the form or function. Yet spear and keg manufacturers continue to innovate to sustain consistent quality. There are some exciting things brewing in the keg tracking and software space. Services that give breweries access to their own data about their keg fleets and that can be used for other business insights could be really beneficial.”

The Importance of Modern Portable Containers

  The demand for portable beer containers is growing, especially for small batches, and as more beer drinkers begin thinking about how their consumption impacts the environment. Beer consumers are a mobile population that’s on-the-go and looking for ways to enjoy local craft beer while traveling and enjoying the outdoors.

  Portable containers are an eco-friendly option to help consumers control their waste, while also allowing more access to rare and special-release beers. With the right marketing, portable containers encourage brand loyalty with greater exposure in the community and cost-effective refill programs.

  Burns said Craft Master Growlers’ products are ideal for anyone who likes beer, enjoys their local craft brewery scene, and also homebrewers who want to share their hard work and innovations.

“Craft Master Growler can be a delight for campers, boaters, tailgating, picnics and barbecues where a cold and fresh local craft brew is coveted,” Burns said. “Craft Master Growlers were designed for people who want a luxury, high-end product for their home, and the professional food service industry where quality and durability are so important.”

Expert Advice About Growlers and Kegs

  Industry experts who work with growlers and kegs every day have a lot of useful advice and tips about how to choose the best portable containers.

  “I think most people are aware that fads come and go, and plenty of companies jump briefly on the bandwagon,” said Burns. “So, you want to make sure you are not buying a cheap consumer product that will break or is destined for the basement, the yard sale or donation center.”   

  Winslow of Schaefer Container Systems’ said breweries should spend the money to customize their kegs for distribution. “You want to maximize your chances of getting them back!” he said.

  Shepanek advises craft breweries to invest in their own fleet of kegs. “Kegs are a great investment as they can last 30 years and pay for themselves quickly,” she said. “Leasing is a great option to keep cash flowing, but make sure it is an ownership-based program. Rental and logistics options can seem attractive and convenient, but many breweries end up locked into contracts for services they don’t need.”

Reflections From One Year in Operation

Cyndi
2 men toasting while sitting down

By: Brian D. Kaider, Esq.

I met Christian Layke in April 2016, when he was still the head brewer at the Rockville, Maryland location of Gordon Biersch.  Like many others I had spoken to before, and since, he wanted to open his own brewery.  But, he wasn’t a homebrewer with romantic ideas of going pro with a 5 barrel system and a shoestring budget.  He had many years of education and experience in brewing (in addition to being a homebrewer) and had grandiose ideas of opening a full production brewery with a world-class taproom and launching immediately into distribution.  I was skeptical…at first.  I quickly came to realize that Christian had already developed a clear vision of what he wanted to build and had concrete plans to get there. 

  Fast forward to March 2020.  Christian and his business partner, Brett Robison, just celebrated the first anniversary of opening Silver Branch Brewing Company in Silver Spring, Maryland.  I sat down with them recently to reflect on the legal lessons they had learned in the three years leading up to their opening.

The “Harajuku Moment”

  One of the things that impressed me most about Christian was that when he first contacted me, he was already focused on obtaining federal trademark registration of the brewery name.  For many people, this thought comes much later.  But, Christian and Brett’s story highlights why this should be one of the first decisions.

  After conducting a trademark clearance search on their proposed brewery name, I had to give them the bad news that not only was it unlikely they could register the name, but that using it could expose them to legal liability based on another trademark owner’s rights.  This set off a back and forth discussion of new potential names that lasted many months.  In the meantime, they were moving forward with other phases of their brewery development; we were drafting operating agreements, deciding how to raise capital, and they were looking for commercial space.  Many months, many names, and many trademark searches later, we were still kicking around names.

  Then they met with their commercial real estate broker and had what Brett refers to as their “Harajuku moment;” an epiphany that turns a nice-to-have into a must-have.  Any landlord of the type of property in which they were interested was going to want to know what the branding of the prospective tenant was going to look like and they were going to want to negotiate with a company, not two guys with the idea of a company.  They needed a name and a branding image immediately. 

  They landed on Parallel World Brewing Company and we filed a federal trademark application on January 18, 2017.  On July 18, 2017, we received a notice of allowance from the trademark office, meaning that the mark could be registered as soon as they began using it “in commerce.”  In the meantime, they formed their LLC, opened a bank account, applied for their brewery permits, and began lease negotiations, all under the name Parallel World.

  That is when we got a cease and desist letter from another brewery with a registered trademark that they felt was too similar.  Although we believed their claim was without merit and that we would likely prevail if they followed through on their threat to file a cancellation proceeding against the Parallel World mark, it would have cost Christian and Brett money, time, and energy, all of which were precious commodities at that point.  Since they were still in the planning and building phase and had not yet opened their brewery, it made more sense to just abandon the name and try again.  As Christian put it, “if you’re not in business, you have no business being in this fight… just sigh and move on.”

  Ultimately, they feel that this process ended up benefiting them.  As they went back to the drawing board for a name, they spent significant time discussing and honing their vision of what they wanted their brewery to be.  It was an amalgamation of what they consider four key brewing cultures, Belgium, Britain and Ireland, Central Europe, and the Americas.  From this focus, they developed the imagery of their beer labels using cityscapes of those regions and they designed their taproom to have sections that pay homage to each culture.  From this concept they also found their new name, Silver Branch; a nod to their home location of Silver Spring, Maryland blended with the old world tradition of putting a branch outside your door to signify that you had beer for sale.  Additionally, in developing their new name, they also ended up with an extensive list of unused names, many of which have now become names of their beers.

  There are two overarching lessons from this experience.  First, start as early in the planning process as possible to develop a clear vision of what you want your customers’ experiences to look like.  Use this vision to guide your brand identity and the brewery name.  Second, file for trademark registration on the name as soon as possible.  Christian and Brett did everything right; they hired an attorney, researched the name, filed for registration, and got approval from the U.S. Patent and Trademark Office, and they still had to rebrand.  If they had waited until they were open for business before filing their trademark application and then had to face a cease and desist letter, it could have been devastating. 

The “Vegas Clause”

  The second thing that struck me as unusual when I first met with Christian and Brett was their focus on drafting an Operating Agreement.  Many clients will try to use a form they find online or ask if I have a “standard” operating agreement they can sign.  That is a huge mistake, because as Brett pointed out to me, “you don’t write these things for the agreement itself,” rather the value in drafting the agreement from scratch is that you get to know your partners extremely well and quickly learn whether you will be able to work together effectively.  In preparing the agreement, as Brett put it, “you put your soul to bare in front of another person and tell them everything embarrassing about yourself.” 

  In their case, one of the defining moments came when we discussed what would happen if one of them were to die unexpectedly.  It’s something most people don’t think about, but led to us drafting what they affectionately refer to as the “Vegas clause.” 

  The discussion began with two premises: 1) that if one of them died, their ownership interest would pass to their heirs, and 2) if one of them was divorced the ownership may be considered marital property, half of which would pass to the ex-spouse.  While that was fine on its face, it meant that the surviving owner could find themselves in a situation where they suddenly had a new partner who had no brewery experience, perhaps no interest, and possibly hostile intent. 

  So, we divided ownership interest in the business into two classes of LLC membership units; Class A, which were tied to managerial powers to run the business and had greater voting rights, and Class B, which had no managerial powers and lesser voting rights.  If one of the partners died, their ownership interest that was passed down to their heirs was immediately converted to Class B.  The same was true for any shares given to an ex-spouse in a divorce.  So, the heir or ex-spouse maintained the economic interest without the power to run the business. 

  The problem was that at the time we drafted the operating agreement, Christian was married, but Brett was not.  So, when the agreement was to be signed, we could have Christian’s wife sign her acknowledgement of the clause that her interest would revert to Class B shares.  But, we could not do the same for Brett.  This created a loophole where, purely hypothetically, Brett went on a bender in Las Vegas, found himself unexpectedly married (with or without Mike Tyson’s tiger in his bathroom), and quickly got a divorce or was killed and Christian would be stuck with a new partner with Class A shares, because Brett’s new wife had never signed the agreement.

  Thus, the “Vegas clause” was born.  It provided that Christian or Brett had to provide the company with a signed acknowledgement of the conversion to Class B clause from their spouse-to-be at least 5 days before entering into a new marriage.  Failure to do so would cause their Class A shares to convert to Class B.  The converted units could be reinstated to Class A upon receipt of the signed acknowledgement and upon a 2/3 vote of the Members.

  The lesson here is not in the details of this clause, but that these issues would never have come up if Christian and Brett had just pulled a “standard” agreement off the internet.  There is tremendous value in discussing these issues and ensuring that everyone is comfortable with the relationship.  Like an insurance policy, you hope that these clauses never come into play, but if something bad happens, it is a relief to know that there is a plan to allow you to move forward.

The “Curve-Ball”

  Ask anyone who has opened a brewery and they will tell you that EVERYTHING takes more time and money than you expect.  With a nod to Helmuth von Moltke, “no business plan survives first contact with the government.”  Christian and Brett learned that lesson painfully. 

  The location they found for their brewery was the bottom level of an office building in downtown Silver Spring.  It was a massive undertaking that required significant renovation, including raising the floor of one section of the building to match the rest.  After multiple rounds of discussions with architects and engineers, they were literally one signature away from getting their building permit.  Just then, the person whose signature they needed last went on vacation.  So, their application went to that person’s boss, who decided that because their proposed business required a “change of use” for the premises from office use to light industrial, they were required to bring the entire building up to specification with the new energy code. 

  What this meant was a very expensive upgrade to the building’s HVAC system and a construction delay of months.  After much blood, sweat, and tears (and money), the upgrade was completed and they celebrated in the moment captured in the photograph above; Christian and Brett toasting with a glass of scotch outside the door of what would become their brewery, the building permit in Brett’s hand.

  The specific legal lesson is that if your proposed location would require a change of use, ensure that the property is grand-fathered into the old code specifications before signing the lease.  More generally, though, think through all of the issues as thoroughly as possible before you get started, but be prepared for the fact that you will be thrown curve balls.  Budget for more than you think you will need (it won’t be) and build a team around you to help navigate the unexpected.

A Year Later

  Even with extensive experience, Christian and Brett faced a steep learning curve in building their brewery. That didn’t end when Silver Branch opened its doors.  Expanding their food service, working with artists to develop product labels, adding or changing vendors, and building their distribution network, they have encountered numerous new challenges. But, it sure is nice to meet those challenges with a glass of world-class pilsner in their bustling taproom.

  Brian Kaider is a principal of KaiderLaw, an intellectual property law firm with extensive experience in the craft beverage industry. He has represented clients from the smallest of start-up breweries to Fortune 500 corporations in the navigation of regulatory requirements, drafting and negotiating contracts, prosecuting trademark and patent applications, and complex commercial litigation.

Lessons Learned from Opening a Taproom-Focused Brewery

Cyndi
taproom at pike place signage

By: D.C. Reeves, CEO, Perfect Plain Brewing Co., Pensacola, Florida

Blame craft spirits, seltzer or industry saturation, but the reality today is that craft beer is going to face its biggest challenges yet in the coming years. This is a turning point for the industry, and at a micro level, this challenge can present a turning point in your own market.

  Every brewery should be assessing what it does well, what it doesn’t and coming up with a plan to set itself apart. I wanted to share more of the more unique lessons we’ve learned about where we concentrate our time and resources that could help those thousands of taproom-focused breweries around the U.S. build and sustain their niche.

If you have a brewery you understand the value of top-quality product. We don’t need to cover that part. Let’s dive in on things that can separate you from your competition.

  I discuss a multitude of ways to do this in The Microbrewery Handbook. Graciously, Sam Calagione from Dogfish Head, Jeffrey Stuffings from Jester King and other experts shared their thoughts in the book about what they’ve learned along the way.

  Here are three key things that we learned and adapted as we opened and ran Perfect Plain Brewing Co. in Pensacola, Fla. starting in 2017 that helped us grow to one of the busiest taprooms in the state of Florida.

Taproom Vibe Matters (More than equipment sometimes)

  We spent a great deal of time deciding on the marriage in our budget between equipment “nice to have’s” and taproom. We ultimately decided to gear money towards the taproom and the taproom experience, and we’re thankful for that.

I visit breweries all over the nation that have sparkling new brewing systems and a neglected taproom. Imagine if a restaurant hired the most accomplished chef in New York City, built the most expensive kitchen, then left the dining room with bad lighting, plastic tables and old carpet? Would the chef and kitchen be worth the investment? Of course not.

  Don’t overlook the expenses of creating a great taproom. Having good furniture and fixtures. Good doesn’t mean expensive, it just means if you can afford a $300,000 10-barrel turnkey brewing system, you shouldn’t have your taproom look like a mismatched thrift store.

We can always grow into and upgrade equipment. It’s much, much more difficult to pick up and move a taproom or overcome a lacking first impression if your taproom isn’t up to par when you open.

  We are about to expand into a wood-aging program next door – it’s called The Well and will open this fall. This growth is attributed to us focusing on taproom first, and that success allowing us to do even more on the beer equipment side later.

Focus on Programming Your Space

  In the taproom model, the taproom is your sole business engine. We need to fuel it with events and fun to keep it busy, not just sit back and hope people come in.

  This is something we focused on from the start, but we’ve ramped up significantly in the past year or so. We wanted to be proactive about what brings people into our taproom. When we moved from one manager to two managers, we created an events position that would be charged with just one responsibility: Bring people into our taproom.

  So we’ve done all sorts of things: Drag shows, Harry Potter nights, trivia, we decorate the entire taproom for four days for Pensacon (our community’s version of ComicCon), we do pop-up theme bars in Garden & Grain, our cocktail garden behind the brewery.

  There are other things you can do: Synergize and integrate your brewing schedule and batch planning with your programming calendar from the get-go to give your patrons an immersive experience that has fun beer releases tied to it. A shared calendar with reminders set three months in advance can give you enough time to plan a special beer release, prepare a one-off pilot batch, or order seasonal ingredients for use in a beer for an approaching holiday. At Perfect Plain, we’ve found success with this simple reminder system that we check when we sit down to do our batch planning and raw material orders.

  What NOT to do is get desperate and offer deep discounts on your product as an attraction model. While you may see an increase in taproom foot traffic, you slowly devalue your product to the point that customers no longer desire to pay “full price” because they know they can get it somewhere else.

Learning to care about your employee culture, engagement and hiring well

  One distinct advantage I was fortunate enough to have when opening Perfect Plain Brewing Co. was working for Quint Studer, who pioneered customer service and organizational change in healthcare with his company, StuderGroup. They taught hospitals all over the nation about how to treat patients, treat employees and build winning cultures.

I was able to learn from Quint and adapt some of those tools to the beer business. That said, this also made me realize how much of a forgotten piece of the puzzle hiring and employee culture are in our business. We like to talk about how collaborative we are as an industry, but ask yourself, how are we when it comes to focusing on treating our own employees well?

Here are a Few of the Things We Installed at PPBC

  We have a three-interview hiring process for all positions that ultimately ends with peers making the decision on who to hire. I know, sounds like overkill. Maybe a little crazy. But it works. It allows all parts of the organization to have ownership of new hires and it gives employees the sense of ownership that their opinion on employees matters.

  We are one of the only bars or restaurants in North Florida with less than 50 employees to start offering comprehensive health benefits to our employees for 2020. It’s a significant expense, but an important one to send the message that these jobs are important, these people are important, and their work is important. I’m not saying you have to go to that extreme but think about measures you can put in place that build your employees’ sense of ownership.

  Another key piece to caring about your staff and culture – and a must for us each year – is doing an employee engagement survey. This is an assessment of how your employees feel in many different categories. The value of this is to not only know where you and your company stand with your employees, but it lets your staff know that their opinion counts and is heard. We have made some adjustments each year based on this feedback, so it has proven immensely valuable.

Questions Like:

•    Does the organization employ people whom I like to work?

•    Do my coworkers and I share a strong work ethic?

•    Are many of my coworkers performing at an acceptable level or better?

•    Do I feel connected to my coworkers?

•    Is the work I do meaningful?

  In The Microbrewery Handbook I have more details of how we conduct this survey (it’s not hard!) and the complete list of the 34 questions I ask my employees that could help you get started with your own survey.

  These tactics are especially important with a taproom focused staff. Your taproom staff is the face to your entire revenue stream. You want them happy and feeling a sense of ownership about the company.

For more information about The Microbrewery Handbook or brewery consultation email dc@perfectplain.com

Soul of the Beer

Cyndi

Origin Malt’s barley roots in Ohio fosters promising growth for the Midwestern malt market

hand grabbing grains

By: Tracey L. Kelley

It’s taken nearly a century, but barley production for craft beverages in Ohio is making a comeback. Victor Thorne and Ryan Lang, the founders of Origin Malt in Marysville, just north of Columbus, are ready to fulfill brewers’ and distillers’ demand for local products. “From seed to sip” is not only the company’s motto but also a source of intention.

  “In 1900, there were over 4,000 breweries in North America. Four of the largest malt houses in the continent were in Ohio, and over 300,000 acres of malting barley were grown in the state,” Thorne told Beverage Master Magazine. “In 1978, there were fewer than 50 breweries, and no malting barley produced in our region. Now, with over 8,000 breweries in the country, and roughly half of the 27 million barrels produced within a day’s drive, we still have no industrial malting plant within 300 miles.”

  Barley was a viable crop in Ohio and throughout the Midwest before Prohibition. After repeal, beer and spirit makers disappeared, and regional farmers switched to more valuable commodities such as corn, wheat and soybeans, growing barley mostly as animal feed. While producers in the Great Northern Plains and the Pacific Northwest provide some access to quality malting barley, crafters in other regions have to look elsewhere.

  “Our craft brewers import the majority of their malt from Canada and Europe,” Thorne said. “Also, craft brewers require more than three times the amount of malt per barrel that they produce when compared to large industrial brewers, so as the craft segment grows, demand for malt exceeds domestic supply.”

  Thorne, a tech serial entrepreneur but no stranger to the foodservice industry, believes in building relationships from the ground up. One of his first ventures provided a solution for process automation software by partnering with titans such as Cargill, Sysco and Tyson. Origin Malt’s co-creator, Lang, is a fourth-generation distiller and co-founder of Middle West Spirits in Columbus. He understood a crafter’s desire for local products. The two opened the malt house in 2015.

  “I enjoy matching complex challenges with experts who can solve them. In the beer, spirits and specialty foods sectors that procure sprouted and malted grains, we require a range of expertise to tackle each of the delicate steps to provide the highest quality products at competitive prices,” Thorne said. “Before taking steps to build a malt house, Ryan and I spent several years forming trusted relationships with the agricultural community, from seed breeding, seed production, agronomists, university researchers, established global maltsters and the end customer—brewers and distillers. Our equity partners represent all of these key relationships.” 

More Than Malt

  “Malt is the foundation of beer—some people may say the ‘soul’ of craft beer. After working in the industry and learning so much about the brewing process—sensory, fermentation and quality—what struck me was that malt sets us up. It’s the canvas with which wort is created,” said Sara Hagerty, sales and marketing director for Origin Malt.

  “The question we want to answer is, ‘Why isn’t barley grown [in the area], and how can we bring it back to the region in a functional, sustainable and economically-impactful way?’” she said. “Victor and Ryan found a way to truly shorten the barley supply chain. For me personally, I could get behind that and feel confident that the groundwork was laid for a revolution in sourcing, procuring and bringing high-quality malt products for brewers and distillers to market.”

  From her passion as a dedicated homebrewer to her work for a leading liquid yeast provider, and later with a global malt provider, Hagerty’s experience helps her envision an integrated purpose for Origin Malt. “Suppliers should be more than salespeople with a price list and a catalog. Suppliers should be educators, listeners and visionaries. From our work with consumers, our customers, and our directly-contracted growers—every step of our supply chain is highly regarded and valued.”

  Supply starts with seed—in this case, that of LCS Puffin, a two-row winter malting barley. It’s derived from the heirloom variety Maris Otter—a popular grain grown in the United Kingdom and appreciated by brewers worldwide. Puffin was initially identified from 50,000 stock seeds by Eric Stockinger, a molecular biologist at Ohio State University, and now bred by the Miln Marsters Group.

  “In the Midwest/Great Lakes region, Puffin is planted in early fall and harvested in late spring/early summer. As a winter grain, the variety comes with some standard characteristics—a well-adhered husk, low protein and winter hardiness. These attributes and more play a part in how we malt it and the flavors it creates,” Hagerty said.

  Base and specialty malts include Pilsen, Brewers, Light Munich, C40, C60 and C90. “Some of the flavors and appeal that Puffin has can be identified in its classic nutty characteristic, and as more pronounced roasted almond flavor in some of our specialty malts,” she said.

  “How we decide on the base and specialty malts we bring to market is based on the general needs of our customers, and also the ability to provide a solid lineup of products that are versatile. Meaning, you could utilize all of them across a set of recipes or pull in one or two for a specific recipe,” Hagerty said. “While our established products exist with industry specifications in mind, we’re always keeping our eye on the opportunity to produce limited-edition specialty and custom products for customers.”

  The company currently uses a partner malting facility, but plans to establish one of its own in central Ohio so, as Thorne puts it, the supply chain shortens to “300 miles from seed-to-sip.”

  At press time, Origin Malt’s products are used in more than 50 beers and spirits, as well as health foods, baked goods and other items. To help producers explore the possibilities, the team frequently hosts beer dinners and “Seed-to-Sip Malt Schools” with brewing and distilling partners using a Hot Steep method to evaluate aroma and flavor.

A Boom for Midwest Agriconomy

  Puffin is sourced from directly-contracted family farms in Ohio, Pennsylvania, Michigan, Indiana and Illinois. Growers in New York are interested, too. Producers in search of a reliable winter cover cash crop have an advantage with Puffin not only because of its cold heartiness and disease resistance, but also its ability to help reduce soil erosion and runoff, improve terroir and water quality, and provide wildlife habitat.

  “By growing winter malting barley in combination with double-cropping soybeans, farms can reduce soil erosion and phosphorous runoff by as much as 80%. This is significant since we’re growing in the Great Lakes region, and phosphorous is the primary feed for algae blooms,” Thorne said. “I didn’t anticipate this being a major discovery that reinforces our commitment to conservation and sustainability.”

Origin Malt expects a 2019–2020 harvest of 10,000 acres, but the five-year projection is 75,000.

  “Puffin has a rich European heritage, and has had amazing results since we began producing and testing the variety—initially a cup of seed—nearly a decade ago,” Thorne said. “Our process and demonstrated commitment to bringing malting barley varieties to large has inspired more interest in our region from seed breeders who have been more focused on developing varieties suited to grow in other regions around the world.” 

  Reintroducing an integral ingredient in a multi-level supply line isn’t without risk, but Hagerty thinks Origin Malt’s best practices are factors growers and crafters can trust.

  “Every crop year can yield slightly different results, and it’s up to us—the maltster—to manage how we adapt and uphold our specifications and adjust our malting protocols. I’m a big believer in that it comes down to how you’re educating and keeping your customer informed—as that relationship needs to be lock-step to make sure that everyone can do their best,” she said.

  “We’re very focused on risk management, which is why we’re strategic in where we grow and how we develop and diversify our growing region,” Hagerty told Beverage Master Magazine. “That being said, if barley volumes or quality were low, there’s an established global market for high-quality malting barley that Origin Malt could procure. Maintaining those secondary-sourcing relationships is something we already have in place in case of a North American shortage or crop failure.”

  Thorne said weather is the challenge he worries about most, but cannot control. “To mitigate the risk of weather damaging our crops, we’re committed to spreading our seed across a several-hundred-mile range from Illinois to the Atlantic coast.”

  The company’s agriconomy roots will filter even deeper in the coming years. “When our plant is at capacity, we’ll be ‘reshoring’ tens of millions of dollars every year from the local researchers, seed sales, malting barley production, agronomists, local storage and transportation, and our malting facility,” said Thorne. “Total economic impact will exceed $2 billion from seed-to-sip.”

  He said he loves all the people Origin Malt works with, “aligning every day to make this a success. I’m driven by the potential to make a sustaining impact on an important supply chain.”

  Hagerty is always excited by the “amazing products made with our malt and watching consumers learn about our supply chain and the processes and products that come as a collaborative effort between Origin Malt, barley growers and our brewing and distilling customers.”

  “The value that our malt house has is in the ability for our future facility and the agricultural economy to tie in more deeply with the craft beverage movement, and most critically with craft beverage consumers,” she said. “Sustainability isn’t just an outlook for the short term, but a long-term goal that will continue to be challenged and achieved with the efforts of our team, our growers, our brewing and distilling customers, and, most importantly, consumers who seek to support American agriculture.”

How Craft Beer Producers Can Incentivize Distributors and Wholesalers to Help Them Go to Market

Cyndi
lone beer glass in front of a beer stall

By: Nichole Gunn, Vice President of Marketing and Creative Services, Incentive Solutions

As a craft beer producer, competition is fierce. According to the Brewers Association, there were 7,346 craft beer producers in the U.S. last year competing for $27.6 billion in sales. That’s a lot of beer! And, that doesn’t even take into account competition from “The Big Five” or import beer for shares of the overall U.S. beer market.

  For craft beer producers who are looking to scale and increase sales, it might be tempting to start pouring your marketing funds into consumer marketing. But will that really make a splash? Think of the hundreds of millions in media spend by beer companies every year that you’ll be going up against.

  Could there possibly be a more efficient way to use that marketing spend? For craft beers producers who are trying to go to market, it’s important to sit down and ask yourself, “Who has the biggest impact on whether or not end consumers find my beer? And how can I motivate them to prioritize my business?”

Understanding the Craft Beer Sales Channel 

  When it comes to connecting with end consumers, craft beer producers have four options:

•    On-Site: Selling directly to consumers at your brewery.

•    E-Commerce: Selling directly to consumers online.

•    Retail: Selling to consumers through other retailers.

•    On-Premise: Selling to consumers through bars and restaurants.

  However, on-site sales are limited by geography and e-commerce sales require brand familiarity or extremely creative (or very expensive) marketing. For a scalable sales and marketing strategy, craft beer producers have to turn their attention to retail and on-premise sales and the indirect sales force that helps them achieve penetration with these vendors.

Incentivizing Distributor and Wholesaler Sales Reps

  Outside of smaller, highly localized breweries, most craft beer producers rely on distributors, wholesalers and other supply chain trading partners to market to retailers and restaurants. Distributor and wholesaler sales reps are responsible for selling vendors on the value of your beer, negotiating pricing and terms of sale agreements and ultimately getting your craft beer to market.

  There’s one small problem: no matter how awesome your craft beer is, it only a small fraction of your distributor or wholesaler’s supply mix. In this battle for mindshare, it’s up to you to educate reps about your brand, enable them to sell your product and supply them with a value proposition that inspires them to take action on your account.

  This is where an incentive program comes into play. When many people think of incentive programs, they think about rewards. But while rewards play a big role in building relationships with your channel partners and adding to your overall value proposition, modern incentive programs take a more holistic, software-driven approach.

  Today’s incentive programs act as comprehensive sales and marketing platforms that enable craft beer producers to:

•   Build mindshare with distributor and wholesaler sales reps.

•   Target promotions by qualifying participant type, regions or product line.

•   Fill data gaps within their channel.

•   Enable sales reps to sell their product to vendors.

•   Deepen relationships with partners throughout their channel.

Building Mindshare with Distributors and Wholesaler Sales Reps

  Sales reps, for the most part, sell what they know. However, in a crowded supply mix, building this awareness and product knowledge with sales reps can be challenging. While every supplier wants something from these outside sales reps, far fewer supplier focus on offering value and creating memorable brand interactions.

  Inviting these sale reps to enroll in an incentive program where they have the opportunity to earn millions of rewards or exclusive incentive travel opportunities (and perhaps giving them a generous point bonus upfront) is more than a nice gesture. It’s a strategic differentiator and an opportunity to stand out from your competitors.  

  Your rewards program also creates new opportunities for communication and engagement that aren’t strictly business. These brand interactions are an opportunity to improve personalization and build relationship capital, which can be difficult to achieve in supply chain partnerships.

Targeting Promotions to Minimize Cost and Maximize Return

  It’s worth noting that a channel partner program is an investment. When planning an incentive marketing strategy, craft beer producers need to focus on maximizing the return on their marketing spend. This means that they should target first and scale second.

  For instance, would it make more sense financially to target your program to the sales and brand managers at the distributor level or the individual reps who work beneath them? It depends on your go-to-market strategy and the size and number of distributors you work with. If you sell through smaller wholesalers with a handful of reps, who each are responsible for a significant portion of your overall sales volume, then it might make sense to structure your program to reward individual sales reps. On the other hand, if you’re selling through a number of wholesalers and distributors, or an extremely large distributor with thousands of reps, it might make more sense to target your incentive programs to sales and brand managers.

  Additionally, from those managers and sales reps, craft beer producers can set qualification thresholds, based on sales volume or engagement, to ensure that their incentive program spend is allocated toward the participants who are most impactful to their sales growth.

  Another aspect of your targeting strategy is choosing to set incentive promotions by specific regions or product lines, based on strategic initiatives and opportunities for growth.   

Collecting More Complete Data Throughout Your Channel

  Craft beer producers, like many other companies who sell into a channel, often struggle with having inaccurate and incomplete data about their channel. Your incentive program is an opportunity to motivate distributors and wholesalers to provide more complete data. There are several ways craft beer producers can use their incentive program to fill in gaps in channel data:

•   Structuring enrollment forms that capture contact information and firmographic data during program registration.

•   Including automated tools for sales reps to attach invoices or other documents as part of the program’s sales verification process.

•   Offering rewards to participating sales reps for referring other reps within their organization.

•   Rewarding sales reps for completing voluntary surveys that can be used to clean up your existing database or collect more information about your participants’ interests, demographic and lifestyle.

•   Analyzing engagement datapoints the program generates to spot highly engaged accounts that are ripe for upsells and cross-sells.

  All of this information can be used to inform your sales and marketing strategy and increase the level of personalization you offer your supply chain partners.

  However, all the data in the world is useless unless you’re able to act on it. Modern incentive software includes CRM integration, data filters, reporting dashboards and custom reports to streamline this data for optimal use.

Enabling Your Distributor and Wholesaler Sales Reps

  Do you know one of the quickest ways to build brand preference with an indirect sales rep? Provide quality sales enablement. Using proven strategies to educate sales reps on your brand and your products makes it easy for them to sell your products to vendors.

  Integrating interactive quizzes and training videos with your incentive program is a powerful tool for supplying your external sales reps with the knowledge they need to sell your beer. This education can be supplemented by your incentive program’s digital communication platforms. (If you use this kind of strategy, make sure to break things up into bite-sized pieces and focus on the highlights your partners will need to help you go-to-market). Additionally, these quizzes are another opportunity for sales reps to earn rewards, increasing the overall value proposition of your program.

Deepening Relationships Throughout Your Channel

  Finally, in addition to short-term sales growth and marketing penetration, your incentive program has another benefit that will have a lasting impact on the success of your go-to-market strategy: relationship-building. Non-cash rewards are a social currency that achieve emotional impact and memorability with sales reps at distributors and wholesalers. In addition to motivating sales growth and reinforcing desired behavior, the rewards your program offers create a sense of personalization.

  For craft beer producers, your distributors and wholesalers are more than just conduits to the end consumer. They are your partners – an indispensable part of your go-to-market strategy. Offering your sales reps the opportunity to choose from exciting rewards or treating top performers to unforgettable incentive travel experiences represents the type of brand interactions that will set you apart from the competition. But more than that, these rewards inspire your distributor and wholesaler sales reps to emotionally invest in your brand and take an active interest in your success.

Unsure About Where to Start? Be Smart, Explore Your Options and Focus on Scalability

  An incentive program can be an integral part of a craft beer producer’s go-to-market strategy. However, what about companies who have never used this type of strategy before? If you are interested in creating a channel marketing program for your distributors and wholesalers, do your homework. Identify a goal for your program and the software functionalities you’ll need to achieve that goal.

  Compile a list of incentive program providers who fit your requirements and who have a proven track record, with case studies and testimonials to prove it. From there, begin reaching out to these providers and enlist their help in planning your incentive strategy. Use these conversations to refine your strategy and learn more about what has worked for companies with similar goals and similar distribution channels to yours in the past.

  Once you’ve decided on a provider, you don’t have to go all in. It’s prudent to start small, maybe with a pilot program or highly targeted incentive promotion. You can always scale, once you’ve proven that you can do this successfully.

  However, it’s also important to have a sense of urgency. As craft beer sales continues to grow, so will competition for craft beer dollars. Beating your competitors to building an incentive program for your distributor and wholesale sales reps can be a major competitive advantage. Plus, you owe it to your future customers to help them find their new favorite beer!

  Nichole Gunn is the VP of Marketing and Creative Services at Incentive Solutions (www.incentivesolutions.com), an Atlanta-based incentive company that specializes in helping B2B companies improve their channel sales, build customer loyalty, and motivate their employees. Nichole Gunn can be reached at ngunn@incentivesolutions.com

Distribution Agreements: Negotiate Your “PreNup” Carefully

Cyndi
Business people shaking hands, finishing up a papers signing
Business people shaking hands, finishing up a papers signing. Meeting, contract and lawyer consulting concept.

By: Brian D. Kaider, Esq.

Starting a brewery requires learning a lot of new skills and practices that have nothing to do with making great beer.  One of the most confusing and frustrating is the issue of distribution.  If their state allows, most new breweries initially distribute their own products and, if the brewery is content to be relatively local, that might never change. 

But, in many cases, brewery growth necessitates working with a distributor.  This is not a relationship to be entered into lightly. A distributor becomes an ambassador for the brewery’s brand and, once retained, the supplier may have little control over how its beer is marketed. Further, these relationships can be difficult or financially impossible to break once established.

  Supplier/distributor relationships are governed by franchise laws in most states. In the absence of franchise laws, the relationship is defined entirely by a distribution agreement between the parties. But, even in franchise states, the distribution agreement can play a critical role, particularly in the termination of the distributor relationship.

  Too often, however, breweries accept a distributor’s “standard” agreement and when the relationship sours, the supplier finds that they are stuck with no viable option to terminate. The best practice is to engage an experienced attorney to negotiate the terms of the distribution agreement. While even the best attorney cannot evade state franchise laws (which generally prohibit a distributor from waiving its rights), there are ways an attorney may help bring balance to the supplier/distributor relationship.  Some of the key terms to negotiate include termination, territory, brand scope, and exclusivity.

Termination

  The most critical section of the agreement sets forth the manner and circumstances under which a supplier may terminate the distributor. In a franchise state, the law typically says that a supplier may terminate for “good cause.” If good cause is defined in the law, it is paramount that the distribution agreement mirror the language of the law, because in many cases, a contract that contradicts the law will be held invalid, leaving the supplier in the position of effectively not having an agreement at all.

  For example, the Virginia Beer Franchise Act states that good cause includes “failure by the wholesaler to substantially comply, without reasonable cause or justification, with any reasonable and material requirement imposed upon him in writing by the brewery.”  Further, the Act provides, “good cause shall not be construed to exist without a finding of a material deficiency for which the wholesaler is responsible.”  Tracking that language, a distribution agreement in Virginia should clearly define certain of the distributor’s obligations as “material requirements” and explicitly define certain actions as “material deficiencies.” 

For example, the Virginia law identifies failure to “maintain a sales volume” of a brewery’s brands as being a reasonable and material requirement.  But, the law does not specify what volume is required.  So, the distribution agreement should clearly lay out specific minimum sales volumes (preferably on an escalating scale) and identify the requirement to hit those volumes as a material requirement of the contract. 

  When the law does not define good cause, and in non-franchise states, it is essential for the distribution agreement to do so. The contract should clearly set forth the distributor’s requirements that are critical to the business relationship and for which failure to perform will be grounds for termination.

Examples of common requirements include: meeting specified sales and marketing goals, maintaining appropriate records and reports regarding inventory and sales, transporting and storing the product under specified temperature and lighting conditions, exercising adequate quality control measures to ensure product freshness, and paying invoices within a specified time frame. It is also common to include termination rights if the distributor is declared bankrupt, enters a voluntary’ petition for bankruptcy, enters into a compromise or agreement for the benefit of its creditors, or fails to maintain in good standing all Federal and State licenses and permits necessary for the proper conduct of its business.

  In some cases, sale of the distributor or even a change in the ownership structure may be justification for termination.  In February 2019, Bell’s Brewery of Kalamazoo, Michigan completely pulled all of its distribution in the Commonwealth of Virginia.  The issue was that its distributor in Richmond was sold to a subsidiary of Reyes Beer Division, the largest distributor of beer in the United States.  Per its distribution agreement, the original distributor was to have provided Bell’s with certain information about the sale to Reyes, but it failed to do so and Bell’s believed that because it did not have the opportunity to properly vet the new distributor, termination of the franchise was warranted.  To this day the dispute has not been resolved and Bell’s beer is not available in Virginia.

  In most states, a supplier must compensate the distributor for the lost business even if the supplier is able to terminate for cause.  Sometimes the law simply says the supplier must pay the distributor the “fair market value” of the distribution rights.  There can be an expensive battle just to determine that compensation if fair market value is not defined in the distribution agreement.  Often the value is defined as a percentage of the prior year’s case volume multiplied by some dollar amount per case. The “standard” contracts pushed by some distributors can be very severe in this section. In the beer industry, it is not uncommon to see values set at an entire year’s worth of profits times a multiplier that can range from 1.5 to many times higher. In practice, often a new distributor will buy out the distribution rights from the old distributor, but if the supplier wants to return to self-distribution, this buy-out provision may be cost prohibitive. 

  While the beer franchise laws in most states were written at a time in which large beer manufacturers had significant market power over small distributors, those roles have substantially reversed.  Slowly, state laws are being revised to accommodate this change.  In Maryland, for example, the law changed on January 1, 2020 to eliminate the “for cause” provision of termination for suppliers who manufacture fewer than 20,000 barrels per year and the termination notice was shortened from 180 days to 45.  However, the manufacturer still has to give the terminated distributor fair market value of the franchise.

Territory

  Depending on the size, experience, and reach of the distributor, there may be an opportunity to creatively carve out different territories. Territories are most commonly limited to certain states. However, a supplier may be able to limit a smaller distributor to certain counties or even specific types of establishments (grocery stores, but not restaurants, for example). One of the clearest breaches of the distribution agreement, that may constitute good cause for termination, is for a distributor to make sales outside of its contracted territory. 

Brands

  Generally, when a distributor is hired to carry a brewery’s brand, it has the right to all of the products in that brand. But exactly what constitutes a  ‘brand” is unclear both in the statutory language of most state franchise laws and in many distribution agreements. 

In Maryland’s beer franchise law, for example, “brand” is not explicitly defined, but the law appears to favor the distributor in terms of brand scope. Specifically, section 105 of Maryland ‘s Beer Franchise Fair Dealing Act prohibits a brewery from entering into a beer franchise agreement with more than one distributor for “its brand or brands of beer” in a given territory. One might argue that the language “or brands” means that the first distributor has the right to all brands of the manufacturer in a given territory.

In fact, that very’ issue was litigated in the 1985 case of Erwin and Shafer, Inc. v. Pabst Brewing Co., Inc. and Judge Couch, writing for the panel of The Court of Appeal of Maryland, disagreed. The court held that if a brewery retained a distributor to handle one or more of its brands within a territory, it could not then contract with a second distributor within the territory for those same brands. It could, however, contract with a second distributor to carry a different set of brands.

  How far the court would take its interpretation of what is a “brand” is unclear, however. In the Pabst case, the first distributor was given the right to distribute Pabst brand beers, but Pabst later merged with Olympia Brewing Company and gave the second distributor the right to sell its newly acquired Hamm’s brand beers. Whether the court would have allowed the brewery to contract with one distributor for Pabst and another for Pabst Extra Light it did not say.

Exclusivity

  Even if rights under a distribution agreement cannot be divided by brand (as in the case of the beer franchise law in Maryland), some states may nevertheless allow a supplier to contract with more than one distributor within a territory. If permitted in their state, a brewery should ideally enter into all of its distribution agreements for a given territory simultaneously, providing notice to each distributor. At a minimum, the brewery should ensure that the first agreement entered into is explicitly designated as non-exclusive. Otherwise, the distributor may view the agreement as giving it exclusive rights to the territory and could sue the brewery for diminishing the distributor’s business if it were to engage a second distributor in that territory.

Final Thoughts

  Whether a brewery is in a franchise state or not, it is critical that it review and negotiate its distribution agreements carefully, with the assistance of an experienced attorney. It is also important to remember that the supplier’s diligence does not end when the agreement is signed. No matter how well the terms of the distribution agreement are negotiated and drafted, they are effectively useless if the supplier cannot back up its claims for good cause.

Accordingly, thorough documentation is essential. If a distributor is not meeting sales goals, mishandling product, or failing to provide adequate reports, they must be given written notice of those deficiencies each time they occur.

  There are great distributors out there who become essential partners in a brewery’s business. But, sometimes those relationships can sour and signing an agreement without anticipating complications down the line can make it virtually impossible to sever those ties. A little forethought and planning and a lot of diligence will go a long way toward a successful termination of a bad relationship.

  Brian Kaider is a principal of KaiderLaw, an intellectual property law firm with extensive experience in the craft beverage industry. He has represented clients from the smallest of start-up breweries to Fortune 500 corporations in the navigation of regulatory requirements, drafting and negotiating contracts, prosecuting trademark and patent applications, and complex commercial litigation.

Suds & Soldiers: Beer and World War I, 1914-1919

Cyndi
beer carriage

By: Doran Cart, Senior Curator, National WWI Museum and Memorial

By the time of World War I, which started in 1914, beer was already an ancient beverage made and consumed by most the nations involved in the war. In light of the long history already written about beer, this article will center on the personal, official and period-printed references of beer during World War I held in the archives of the National WWI Museum and Memorial in Kansas City, Missouri.

  Many of the early war photographs show soldiers, especially German, posing for their gone-to-war photographs with beer mugs in hand and often sitting on beer kegs. Ceramic beer tankards were illustrated with scenes of soldiers’ service so they could be reminded of what they had gone through while enjoying their favorite brew. A German/Anglo brewery in Tsingtao, China was in production at the beginning of the war and was there when Japanese forces attacked the German garrison taking control. A graphic illustration of that attack is on exhibition at the museum. The brewery still exists.

  Changes in the opening and closing hours of pubs in England occurred during the war when the situation became dire from many of the war industries’ workers spending more time drinking beer and “other intoxicating liquor” than producing artillery shells and airplanes. The Defense of the Realm (Consolidation) Regulations of 1914 specifically prohibited the sale and consumption “on weekdays 12 noon to 2:30 p.m. and 6 p.m. to 9 p.m. and on Sundays [the same hours].”

  British soldiers wrote in their diaries about beer:

“Hallowe’en was celebrated in our billets – beer, soup, roast beef, plum duff.” A. Stuart Dolden, 1st Battalion, London Scottish Regiment

  October 1916 – “I was amazed to get two bottles of Guiness to drink.” George Coppard, British Machine Gun Corps, after being wounded.

  C.H. Williams, 5th Battalion, the Oxfordshire and Buckinghamshire Light Infantry, British Army, wrote after Christmas of 1916: “We had our Christmas dinner in Albert, France in an old sewing-machine factory.  We had beer for our dinner – plenty of it – and a good tuck-in to go with it!  Roast pork!  Beautiful after bully beef!” [Bully beef was canned processed beef issued as a ration].

  In England in 1918, the Hart Family Brewers produced a commemorative extra pale ale called the “Flyer.” It was brewed to honor Wellingborough, England’s “Own Flying Ace, Major Mick Mannock.” Major Mannock was a Victoria Cross recipient for his World War I actions in which he recorded 61 aerial victories with the Royal Flying Corps (later the Royal Air Force). He was killed over France on July 26, 1918.

  Although the American Expeditionary Forces were technically “dry,” prior to the US 18th Amendment ratified in 1920, enterprising soldiers soon learned where the beer and wine were. One US Signal Corps photograph is captioned: “American soldiers in a captured German trench drinking beer out of steins and smoking cigars.”

  From the papers of Captain Clarence J. Minick, 361st Infantry, 91st Division the following order was found: “Headquarters 3rd Battalion, 91st Division, Sarrey, France, July 24, 1918. Extract General Order No. XXI. 1. “The following regulations for the government of troops billeted in Sarrey are hereby published for the guidance of all concerned: (a) Cafes will be open to troops for sale of light wines and beers during the following hours: 1:30 A.M. to 1:00 P.M. 6:00 P.M. to 9:00 P.M. Absolutely no drinking of other intoxicants will be permitted and all cases of intoxication will be summarily dealt with. Wine or beer purchased in cafes will be used on the premises and not carried away in bottles or other receptables.”

  At the Battle of St. Mihiel, France, September 1918, this report of the 353rd Infantry Regiment, 89th Division Intelligence Section related:

  “In the evening of September 13, the Regimental observers established an O.P. [observation post] on the high ground south of Xammes. While occupying this O.P. the observers lived on the fat of the land. An abandoned German commissary in Xammes furnished bread, honey, butter, jam, gold-tipped cigarettes and cigars – from the well-kept German gardens in the vicinity came a variety of vegetables – and crowning all, German beer, wine and schnapps were on tap in former Boche (German) bars (for the ‘dry’ All-Kansas regiment).”

  During the American occupation of Germany in 1919 when the rules regarding consumption of beer and wine had been unofficially loosened, Charles MacArthur, 149th Field Artillery Regiment, related that in his [cannon] battery’s stop in Bittenburg, “we ran into real German beer, a little watery for the famine in grain.”  Another discovery was made in Bittenburg:  eierkuchen, or German waffles.  “With a helmet full of flour and a little corn syrup any hausfrau could produce an elegant set of waffles.”  Evidently, the waffles reached such an esteemed place that “the very name of eierkuchen was transferred to anything that looked appetizing, especially young women.”

  A Captain Biggs related that the clothing worn by German civilians seemed serviceable, but that the “shapeless, heavy shoes” was a noticeable feature.  Much of the material was ersatz [substitute], made of paper products.  Beer was plentiful at 20 to 30 pfennings a glass, but “of a poor grade,” as was the wine.

  As part of the agreement for the occupation of Germany after the signing of the Armistice on November 11, 1918 was one unpopular requirement that all dram shops be closed except during a few hours of the afternoon and early evening.  The sale of any intoxicant except beer and light wines was prohibited.

  A printed announcement of a “Reunion and Smoker” party for the 77th Division’s MP Company on October 25, 1919 at the 77th Division Association Club House in New York City. states that “they will organize an American Legion Post and there will be a keg. Organized by Francis N. Bangs.” Captain Bangs was in the MP Company, 77th Division, AEF.

  A postcard with an inscription, described the outdoor tables in Bourges where the French would gather to drink and socialize, as pictured. Inscription on the back: “the French people like to have this little beer table outside. This is very typical.”

  On a printed card from the YMCA, “The Y.M.C.A accepts no responsibility for money or valuables kept by soldiers during the night. These should be handed for safe keeping to the Leader in charge of the Hut. Overcoats, rifles, or other equipment should be stored in the cloak room. You are urged to leave no articles of clothing or equipment in the cubicle after dressing or about the Hut at any time. By order of the Police, Beer and Spirits must not be brought into the Institute.”

  From the service of Private Walter G. Shaw, 18th Infantry Band, 1st Division. He died at Charpentry in the Argonne in 1918:

  Oct 31, 1917 “I like France fairly Well don’t think I would like to live here always [sic] they have fine roads here. white and red wine can be bought for 1.50F a bottle (30c) some of the soldiers get tanked up on it I don’t like it because it is so sour French people have it with every meal. Champagne can be bought for 9.00F a bottle $1.75 this is extra dry costs about $7.00 in the U.S. Beer costs .30 centimes a bottle 10c….”

 From the service of Corporal Reid Disman Fields, Ordnance Detachment, 13th Field Artillery, AEF:

“Feb. 23/19

Dear Clara:

  No doubt you will be surprised to hear I am going down into Germany. Left Mehnin today 11AM. Am going to the Third army. So far as I know somewhere near Coblenz. So don’t expect I will be back very soon. Tell your mother I will drink her share of beer. Ha! All for the time so Bye Bye, Reid.”

  The roster and menu for Christmas dinner, 1915 from the 133rd Company, US Coastal Artillery Corps, Fort Terry, New York listed that the dinner included oyster stew and crackers, roast turkey, oyster dressing, cranberry sauce, mashed potatoes, creamed corn, creamed peas, stuffed olives, tomato catsup, celery, pumpkin pie, mince pie, cocoanut layer cake, chocolate cake, bananas, oranges, apples, grapes, figs, cigars, cigarettes, apple cider, and bottled beer.

  From US volunteer truck driver, Ned Henschel, December 8, 1918, Verdun, France:

  “…a rumour floated around that there was beer to found in a neighboring village. Another lieutenant and I walked eight kilometres to investigate – and found that it was all wrong; there wasn’t even Pinard!” Pinard was a red French table wine.

  During the Easter Uprising in Dublin of 1916 of Irish citizens against British rule, the British Illustrated War News of May 10, 1916 reported that British troops took cover behind a barricade of beer barrels.

  One postcard shows a “German concrete cellar used as cooler for beer, in woods, Meuse, France.” A British humorous postcard shows a tent surrounded by flood waters with a downcast soldier poking his head out lamenting “‘Ah! If it were only beer.” A German postcard that a Karl Rosendahl in writing to Frieda Rosendahl of Riemsloh, Germany related: “My dear Freidelchen, We are sitting in the Train with a nice glass of beer and send you greetings.” [translated to English].

  A letter from F. Thunhorst of Riemsloh Germany to Carl Rosendahl, June 3, 1915, related that one of their acquaintances “Old [illegible] is still the same and he just keeps going. The beer still tastes excellent, and he still drinks a few pints daily. He sends his greetings.” [Translated from German to English].

  American Dale E. Girton, Base Hosp. #78 wrote on May 8, 1919,

“Hello Rummy:

  I guess that is a fitting salutation for one who has told me in a – past letter he has started drinking Rum, BEER, Wine & Cognac. How about it? Haven’t heard from you for some time and we are expecting to leave Toul for a port of embarkation at any day now, so I thot [sic] I would write you a word so that if I am quite a while.”

  Beer was universal in WWI. It was used to quench thirst, to enjoy in comradeship, to relax and possibly, to help for a moment, to forget about the horror of war.

  From the Archives of the National WWI Museum and Memorial.

Profiling Software: Used by the Breweries, Cideries, and Distilleries

Cyndi
map seen in an iphone

By: Becky Garrison

As we enter into a new decade, an increasing number of breweries, cideries and distilleries are moving from recording their finances, employee logs and other data from offline pen and pencil accounting methods to online software systems. Here’s a sampling of some of the latest techno-logical developments that are specifically geared towards helping these outfits better manage their businesses.  

ShiftNote

  ShiftNote is an online manager logbook and employee scheduling software. The program, re-leased in 2002, gives owners, managers and employees the ability to communicate in one place. Employees can change their shifts and request time off in a few easy clicks. Then managers can approve or deny these changes and requests.

  The scheduling feature allows users to create and publish schedules and shift notes that can be viewed on any mobile device. Additionally, the manager log book can track key daily sales, re-pair and maintenance schedules, upcoming events and labor stats. As this logbook is entirely cus-tomizable, business owners can add custom categories and stats contingent on their particular needs.

  Help articles, tutorials and free screen share trainings are available for those who need assistance in setting up and using ShiftNote. A major software update slated for 2020 will offer new and enhanced features.

Whiskey Systems Online

  Whiskey Systems Online is a complete production tracking and TTB reporting system tailored to the unique needs of American craft distillers. Launched in 2014, this software offers complete distillery operations tracking, from raw materials to cases shipped out. Features include invento-ry and barrel management, cost of goods sold, manufacturing cost accounting, forecasting and planning, batch tracing, auto-generated TTB monthly reporting and federal excise tax returns, QuickBooks integration, employee task management, TTB audit preparation, success metrics dashboards and much more.

  Whiskey Systems’ propriety hardware interface allows distillers to track the temperature and humidity of their warehouse during a barrel’s entire aging lifecycle. By tying the aging history to their Whiskey Systems barrel inventory, the software can both optimize aging conditions and eliminate manual data entry from a third-party monitoring system.

  In 2020, the company plans on launching a brand new interface to improve the user experience and navigation. The update will include more production planning and forecasting tools and more success metrics and dashboards. As Whiskey Systems is a “subscription as a service,” there are no required downloads, and eve-rything is available via a browser. Users just activate their subscription online for immediate ac-cess. Whiskey Systems has extensive online resources such as training videos and help pages, as well as one-on-one support and set up for no additional charge.

Daruma Tech

  Since 2015, Daruma Tech has been developing mobile loyalty applications for beer guilds. For the more significant guilds and associations, it has a customizable solution that can be tailored to suit their marketing needs. For smaller guilds, the “lite” version can help them get started with their digital loyalty program.

  This loyalty program software rewards consumers for visiting participating locations. App users can keep track of the breweries they’ve been and the places they want to visit next. Users collect stamps at each brewery and claim prizes based on the number of stamps they’ve collected.

  Brewers who participate can access a portal where they manage their content, including location-specific information, beers, events and deals. The app also provides a marketing channel where brewers can communicate directly with their target audience, as well as a social component where users can share their thoughts on different breweries and beers.

  The mobile app is powered by a cloud-based mobile content management system. Participating locations can update the content in real-time through their MCM. There is nothing to maintain, download and install, as it’s also a subscription-based service. A knowledge library where users can access help documents is available online.

  Current guild users of the app are New York State Brewers Association, Ohio Craft Brewers As-sociation, Brewers of Pennsylvania, Massachusetts Brewers Guild, Rhode Island Brewers Guild, Connecticut Brewers Guild and the Washington Beer Commission.

  In 2020, Daruma Tech will begin offering these services for other craft beverages and related craft foods.

KegID

  KegID is a cloud-based asset scanning and tracking application that’s been available to brewers since 2001. The software allows brewers to track how many kegs they currently have in use by providing visibility and insight. This application can create accountability by pinpointing the lo-cation of a barrel, its contents and dwell time.  

  Scanning can be done with a variety of equipment, from Android or iOS mobile devices to fixed in-line scanners. In addition to scanning kegs at the brewery, they can be scanned in the field and marked for special handling if any part of it is found to be damaged or malfunctioning. It can al-so identify kegs that are due for routine maintenance.

  Also, KegID is automatically included on any kegs leased through its lease-to-own solution, KegFleet, at no extra charge. Each brand new European keg comes laser-etched with the scan codes and the ID numbers pre-loaded into the application. They are ready to scan and track upon delivery. 

  In addition to online resources, a team of people located in KegID’s Houston-based office are available to provide personal assistance to new users during business hours.

  The app can also be used to manage other reusable assets like pallets and tap handles.    

Kegshoe

  For the past four years, cideries, breweries, distilleries and other craft beverage producers worldwide have been using Kegshoe tracking software. Using either an iOS or Android app alongside Kegshoe’s barcode stickers, producers can track their keg fleets throughout the entire production, storage and distribution cycle.

  The application then offers insights into the status, location and development of a keg fleet, ensuring that turnover cycles are kept in check and kegs are not being lost. Having the reporting and logging tools available to show the contents, location and details of each barrel allows customers to manage their fleet inventory better.

  To make setup and operation as convenient and affordable as possible, the company eliminated the need for additional hardware. Producers can download the Kegshoe app on their devices and start scanning. Other features include rental customer logging and tracking, and production batch assignment and monitoring 

  Kegshoe is currently in the process of releasing a craft beverage-focused customer relationship management software. The CRM will help to provide an industry-tailored system for sales reps and managers to log and manage their customers, sales cycles and productivity. With both desk-top and mobile functionality, it is meant to make the sales process for craft beverage producers as efficient and affordable as possible.

  All new customers receive a series of onboarding materials, including detailed product tours that walk them through the app and desktop software, as well as a support article library. Additional-ly, Kegshoe offers around-the-clock support, ensuring all issues and questions are addressed promptly and don’t interrupt brewing operations.

Small-Batch Maps

  Released in 2019, Small-Batch Maps is designed to help breweries and distilleries better manage their distribution and sales. The company wants to lessen the challenges of market forecasting by helping producers determine if they should market one product or concentrate on all of their of-ferings.

  The software allows potential customers to search for products on a website, and for beverage companies to gain marketing insights, estimate product needs and discover new distri-bution regions. Producers can then use this data to market the products most in-demand, or those with less traction.

  Breweries and distilleries can easily add Small-Batch Maps to their websites and other online properties. Once they’ve added the feature, they can head over to their website, log in, and add new locations as their distribution networks grow.