In a recent series of Sightlines pieces, we looked at distribution and the way it’s changing across the country. Some breweries aren’t just self-distributing, they’re becoming distributors. And some old-school distributors are having to adapt to keep up with the quickly changing markets. Or, even worse, they’re not adapting at all. So this week, we asked the Fervent Few what they think distributors need to do to make a difference in the way they find, buy, and drink beer.
Zack Rothman: “Innovation is the future of distribution, and there are two innovative distributors here in Massachusetts that are changing the game: Craft Collective and Night Shift Distributing. They are both small, independent distributors that serve small, independent brewers. They go the extra mile to reach out to these brewers and connect with them on a personal level. They regularly host special events featuring their portfolios that showcase unique beers not otherwise distributed. They have plenty of cold storage and a fleet of refrigerated trucks. In the case of Night Shift, the brewery behind the distribution company even collaborates with the distributed brewers to bring entirely new beers to life. They are honest and transparent in their dealings with brewers and retailers. These are the qualities that have changed the way I see distribution. It is their diligence and dedication to taking care of the beer they are entrusted with that makes me seek out the beer they distribute. They have a reputation for freshness and proper storage, and they curate their selection of brewers so that they can give them the attention they deserve. That gives me confidence in any product that they distribute. They are the new gold standard!”
Dom Cook: “[Distributors need to] stop doing what they’ve always done that’s outdated and not working, and change with the times. Depending on the distro and their beliefs, protocols, etc., that’ll look different, but they need to stop moving like dinosaurs. The bottom line is numbers, but numbers are stagnant and/or falling, so a shift in the mentality needs to change. Become more relevant to the consumers that buy the beer they distro and partner with the breweries to bring in new drinkers. New drinkers are key. But that’s not solely dependent on distro. Breweries lead the charge and distro is the army on the ground. It requires teamwork to make the dream work.”
Rob Day: “1. Cooperative approach: I recognize that I do not have all the answers to all of the markets of the world, but I may have some techniques learned elsewhere that could make us both better, and all I ask is that distributors are open to those discussions and willing to employ the tools that make sense.
2. MAKE YOUR RETAILERS BETTER: Don't focus on just selling your beers into the account. Make your accounts better. I've been amazed at some of the amazing tools I've seen distributors use to make their retailers more effective. And on the contrary, [I’ve been] amazed at some that do very little.
3. The days of taking every brewery that calls and riding the wave is over. Distributors will play a part in the curation cycle and need to set the right standards, quality, craftsmanship, business acumen, etc.”
Thad Parsons: “As someone that deals with distro companies on a daily basis, here is what I want to see (and I'm going to go slightly off base, because I deal with several companies that deliver a mix of beer, wine, and cider):
1. Your main job is to deliver beer. Know what is in stock, when it is going to arrive, and then get it to me in a timely manner. Don't mess with my delivery dates, don't tell me that ‘logistics’ need to determine something. We all want to sell beer, and I can't do that without it on my shelves. If one company can't/won't do that, then I will find another one that will!
2. Be a familiar face. This is a business that is built on trust, and if I never see you (or only know you as a number that I text or email address that I type), then I'm less likely to trust your opinion or your ability to help me when I'm in a bind. Furthermore, with the flood of new beers on the market, being able to have conversations helps me build a network of trusted people that give me direct feedback, both direct and indirect, about beer and breweries.
3. Don't try to sell me. I spend all day selling wine, beer, and cider to people. Don't try to hard sell me on your new seasonal or new brewery pickup. Give me the facts and the tools to make a decision and then the support to be successful!
4. Share your beer! Coming from the wine side of the business, I wish that more reps would share their beer. Hit the streets with samples and let us taste them. Both myself and my staff will do our jobs better when we know what your product actually tastes like!”
James Hernandez: “1. Do a better job on managing inventory and how many SKUs you bring in. Sales staffs are overwhelmed with the insane amount of different packages in their portfolios nowadays. It’s hard to keep share of mind when there are too many packages or draft options. This helps with code dates, finished product loss, and cultivating a strong market.
2. Don’t be afraid to tell a brewery that their new product that’s killing it in San Diego is not gonna work in your market. Nobody knows your market like you do. You don’t have to bring everything in. Find what works for you and go for it. You can’t be afraid to take chances sometimes, though.
3. You are a partner with suppliers. Not their boss. You do not just sell their beer or carry their product. Work on what’s best for the tiers in your market as a team with the retailers. You’ll be more successful that way and build great relationships—this is most important. Make sure brewery market managers are putting solid work days together in the market. If they win, you all win.
4. Make sure retailers do their part as well. You cannot sample every single product you have available. Remember you are operating on margins and operating costs as well, not just them. Provide the best service possible within a reasonable request. If it’s a great account, going over and beyond is necessary sometimes.
5. You sell beer for a living—remember that. Put some fun into the business and enjoy yourselves. Know what you sell and be confident. Teach and inform where you can.”
Miles Liebtag (responding to Thad Parsons): 1. The rep’s main job is to sell beer. The logistics team’s job is to get the beer to market. There’s often a wide gap there—that’s the general beer division of labor, after all. Your sales rep typically has little or no control on what day your truck comes, or when.
2. This is a completely fair point. That being said, the relationships we build in this business are reciprocal. Reps should be willing to work for your business, but if you’re expecting them to show up every week and you’re barely breaking a $100 order, you should understand that they may also have to go fish elsewhere. It’s not personal. Usually.
3. It’s their job to sell you. They’re salespeople. It is literally what they are paid money to do every day. If your reps aren’t trying to sell you, they suck at their jobs. That being said, if they’re trying to hard-sell you, or you feel like you’re constantly getting a canned pitch, they probably also suck at their jobs.
4. Whether or not a given rep has samples to share may not be under their control. Many craft wholesalers, for example, give their reps almost no discretionary budget for sampling or promotions, so if you’re sweating one of your indie guys for samples constantly, you might consider that. It sounds like you run a conscientious business where you do a lot of hand-selling, so it’d probably behoove your reps to bring you more samples, but I hope you’re not making decisions about what to carry based primarily on your personal opinion of the liquid. Sell what sells, then handsell what doesn’t. Anybody (sales rep or shop owner) can sell a hot new IPA—it takes zero effort. Now, go sell a Scotch Ale or an Altbier.
Miles Liebtag: So, I’ve been ruminating on this all week because it’s a topic pretty close to my heart. I’ve worked for different wholesalers in NYC and Ohio over the years, and have seen a lot of good and bad. The middle tier is still my favorite, for a lot of reasons. I think it’s where the best jobs are in the industry, there’s usually less volatility there, a little more job security, and a better work-life balance. Building brands is also extremely exciting, fun, and frustrating in equal measure, when you’re the one actually punching the day-to-day orders. Selling beer directly is hard. Way, way harder than being a brewery/brand rep who can be a friendly face and never have to ask for the sale or explain why the truck is late. But I digress...
I find the original question kicking off this topic…odd. Unless you work directly for a brewery, wholesaler, or retailer, or are an incomparable nerd, you probably don’t even have a perspective on what distributors do. Bryan Roth nailed it in his recent piece: the vast majority of drinkers don’t think about how what they’re consuming makes it to their glass. And I’m not even certain that’s a bad thing. I don’t know what increased visibility of the distribution tier would do for anybody. There’s a running joke among me and my friends: the brewery rep is a celebrity, the wholesaler rep is a pleb. The brewery rep is there to make her brand seem exciting, accessible, authentic, whatever. The wholesaler rep is there to fuckin’ sell ya beer and get the fuck out, if she knows what she’s doing—and then maybe come back for happy hour. Even within sales overall, the tiers make for strange divisions of labor.
Bryan and several of you also touched on the fact that distributors vary greatly in their mien and character, especially today. While there used to be more clearly defined actors in a given market (the Bud distributor, the Miller distributor, the craft distributor, the boutique craft distributor, etc.), the lines have become increasingly blurred through acquisitions, consolidations, and the generally insane proliferation of craft brands. A huge Budweiser distributor who now finds itself the lord of an ever-growing stable of craft brands has different priorities and different approaches to market than does an independent family-owned craft wholesaler with a handful of rockstar national craft brands and a very fucking deep bench beyond that.
So the Bud guy who’s spent a decade on the same route dealing with pasteurized alcoholic seltzer with 9+ months shelf life now has $15 6/4/12-oz. can packages that come out of the warehouse with 75 days on them—that guy could probably benefit from some guidance and retraining. By that same token, the craft wholesaler rep who’s been able to rely on the momentum of her brands and essentially be an order-taker—just reciting a list of what’s new every week, adding it to a replenishment order, and moving on—is getting eaten alive by the new realities of a viciously competitive marketplace, where it’s no longer just the BMC guys encroaching on her shelf space with their craft-y brands, but a whole galaxy of indie brewery startups who came to be in part because of the hard work done at distribution by craft-centric wholesalers.
The craft rep is an endangered species. If you can’t sell, I can’t imagine many distributors who’d want you around. Product knowledge is great, it helps the salesperson build confidence in what she’s coming to market with, both materially and personally. But the days of failing upward because of your strong book or the excitement around craft beer are over. As wholesaler profitability on craft falls, belts are definitely getting tightened all over the place, and the salespeople who get by on their passion for beer are gonna be the first to go. If you can’t—or don’t want to—learn to sell wine, spirits, energy drinks, sodas, alcopops, etc., then it might be time polish the ol’ resume.
It’s hard to tease out what this all means for consumers. In the short term, I guess it means the ultimate triumph of choice which, as we all know from reading Infinite Jest, is the beautiful labyrinthine prison of modernity. Even as the industry has been talking for years about SKU-pocalypse and fed up retailers running out of shelf space, I don’t see distributors jettisoning brands. Quite the contrary: everyone is still acquiring distro rights at a manic pace. While it’s true that there’s 'no Lord Hobo coming to save you,' nobody wants to miss signing the next Rhinegeist, either. If I’m a wholesaler with a big stable already, though, I’m increasingly looking at my gross profit per package and putting muscle there when and wherever I can, probably at the expense of brands with less-profitable packages. The wholesaler, more than anyone else in the industry, is tasked with a really difficult balancing act: trying to do right by its brands, its customers, and (hopefully foremost) its employees.
Brad Redick: “I'd like to weigh in here, if I may. Burn three tier to the ground. If distro dies with it, then so be it. Let them be remade in a new vision.”
Miles Liebtag (responding to Brad Redick): “There’s always going to be some kind of distribution armature attached to beer, just as in virtually every other consumer goods industry. Whether or not the breweries do it themselves is a question to be decided brewery by brewery, but not everyone who wants to brew beer also wants to run a trucking company.”
Brad Redick (responding to Miles Liebtag): “Three tier. I'll bring the gas and matches.”
Thad Parsons (responding to Brad Redick): “Actually, I say burn the required three-tier system down! It will leave a very different system in its place. But I do miss being able to call my local brewery in Oxfordshire for beer!”
Matthew Modica (responding to Brad Redick): “This is so far off. You have no idea what a proper distributor does.”
Brad Redick (responding to Matthew Modica): “Don't distributors just deliver beer in their Dodge Calibers?”
Matthew Modica (responding to Brad Redick): “Please be joking. Please?”
Brad Redick (responding to Matthew Modica): “I'm sure they use other crossover vehicles as well, not just Dodge Calibers. I think I've also seen a Toyota Matrix or two.”
Matthew Modica: “The ideal distributor has a finger on the pulse. They offer their employees a say in what and why they sell what they sell. This is the separation. This is an absolute trait of a successful business, especially in this realm. I cannot tell you how many people were jealous of the distributor I worked for (all-craft and 100% commission). They used to ask me why I would do such a thing, why would I work without a guarantee? It was because I actually believed in the product we had to sell. It was because I believed that they deserved the time of day. It was because I was taught how to actually balance my hours instead of having to ‘show up’ for a ‘promo.’ My company took an interest in their people and an interest in training them to sell beer into the right accounts—not just shove craft where it didn't belong. They paid us. THEY PAID US. THEY PAID US. THEY PAID US. They paid us to go out into the world and be able to have the proper conversations. They paid us to have insight, and be able to understand the mind of your buyer. They paid us to understand that every account has a purpose and it's up to you to find out what that purpose is. THAT IS WHAT YOU'RE PAID FOR. The distributors who are struggling are employing false hope. False hope in the idea that warm bodies taking orders who are not interested in the betterment of the person sitting across from them will somehow thrive. This is the problem. We talk about the ‘long game’ and the ‘short game.’
I just can't with this.
The distribution game is losing touch. It's a shame. The only thing you need to do is start listening. Pay your talent, and keep them educated. Not with gift cards, but with experience that they can pass along. It’s an old and proven idea.”
Things got a little heated around this topic on the Fervent Few Slack, but I think we’re all stronger, better people for it. If you’d like to get into lively beer debates with some of the nicest beer fans in the world, head over to our Patreon, plop a few bucks down, show your support for all the amazing work getting done on Good Beer Hunting, and come chat with us!