Packaging

Packaging which takes a look at the many different aspects of packaging beverages including packaging equipment, proper service and maintenance, sanitation considerations, types of packaging systems and more.

Obligations of beer wholesalers

posted May 14th, 2014 (updated Feb 26th, 2022) by Stan Hieronymus

The following article was posted on May 15,, 2014. It has been reviewed and updated as necessary by the ProBrewer editorial staff.

The relationship between a brewer and wholesaler is a very complex and regulated one. State alcohol regulatory agencies mandate certain responsibilities of both the wholesaler and brewer such as payment terms, incentives, price posting, contracts, to name just a few. Every state has a different set of regulations. It is extremely important that you familiarize yourself with the rules and regulations pertaining to the brewery and wholesaler relationship before doing business in that state. Many states also have franchise laws that define very specifically the parameters for terminating a wholesaler. Even in non-franchise states, a brewer can not terminate a wholesaler without cause unless they are willing to compensate the wholesaler for relinquishing the brand.

Generally, it is safe to consider your wholesaler as a warehousing and delivery service, with perhaps some brand maintenance (merchandising, stock rotation, POS placement, etc.) provided at the retail level. But distributors are not generally sales mechanisms and are not responsible for the marketing of your products. These functions are incumbent on the brewer to provide.

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The distribution handbook

posted May 14th, 2014 (updated Jan 26th, 2022) by Tom McCormick

The following article was posted on May 15, 2014. It has been reviewed and updated as necessary by the ProBrewer editorial staff.

In the current distribution climate, where distributors have many more brands than they are able to adequately and properly attend to, it is imperative for the supplier to take steps to gain and retain mind-share within each distributor. Many times, the distributor needs information about a particular brand, either by request of a sales rep or a retailer. The easier it is for the distributor to access that information, the more likely that information will be passed on as a sales tool to the person in need.

An easy and effective way to make sure your distributor has easy access to the information they need about your brand and company is to provide a “Distributor Handbook”. This is typically provided as a hard copy in a spiral bound binder so that pages can easily be taken out to photocopy and/or in digital form. Managers and sales reps should each be supplied with a copy. Often, it is a good idea to also provide a copy to key internal management such as the inventory and warehouse manger, etc.

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Distribution 101 – A short course in distribution basics

posted May 14th, 2014 (updated Jan 26th, 2022) by Tom McCormick

The following article was posted on May 15, 2014. It has been reviewed and updated as necessary by the ProBrewer editorial staff.

Distribution has become one of the most important yet overlooked components in the operation and success of running a microbrewery. A common misconception by those entering the craft beer industry is that once the beer is brewed, packaged and shipped to a wholesaler, the brewer can essentially forget about it, leaving the sales, marketing and promotion up to the distributors. This is not the case as beer wholesalers are primarily a delivery and warehousing mechanism; most do little actual selling and promoting of the brands in their portfolio. Hence, it is imperative that the microbrewer know and understand the second tier of the business to ensure their products are adequately marketed and handled after leaving the caring hands of the brewer.

Self-distribution

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Other packaging line automation equipment

posted May 6th, 2014 by Stan Hieronymus

For any packaging operation machines exist to do the work of each stage more quickly and with less or no manpower.

Case Packers – Automatic case packers can be very beneficial to a brewer who produces either cans or bottles. In either case, the case packer should be designed to accumulate a series of bottle configurations so as to maximize production throughout. Configurations of 12, 24 or 36 cans are common. Bottles are most often packaged in 6, 12 or 24 packs.

Typically, the filled can or bottle is delivered to the case packer by way of an automatic conveyor. Once delivered, cans or bottles are then configured into their respective packages ie. 2×6, 6×4, 6×6. After assembled into the end configuration, cans and bottles are typically drop packed into a corrugated tray or box. By utilizing this technology, R.O.I., on some systems, can be less than 1 year.

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Bottle rinsers

posted May 6th, 2014 by Stan Hieronymus

Bottle rinsers are used to sanitize and remove environmental debris from bottles prior to filling. Various forms of rinsing are available with a few shown below.

Twist Rinsers use belt drives to feed the bottles into a set of rails which twist and invert the bottle over a set of spray nozzles. After rinsing, the bottle travels along a short straight inverted section that allows it to drain, then re-inverts it to return to the line right side up. Speed is determined by rail length.

Rotary Rinsers (aka Gripper Rinsers) are compact and efficient alternative the twist unit. These machines are equipped with a rotary turntable, grippers to invert, rinse and re-invert the bottle. They generally offer a much smaller footprint than the twist rinser for comparable output. They can also handle different bottle sizes part changes.

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Labeling

posted May 6th, 2014 by Stan Hieronymus

Most cans and some bottles come pre-branded or labeled. The date the beer was bottled and also a “best before” date (three months after the bottling date) are printed on the label.

1) Cut and Stack (C & S) Labels are an economical way to decorate many containers for the food and beverage industry. They can provide an economical container decoration with enhanced shelf impact. C&S labels are usually printed digitally on sheets and then cut unto individual labels by precision laser cutters.

For Cut and Stack labels that come without adhesives, labels are applied to bottles by a glue applicator. This ensures the labels will stick to the bottles securely. The cut labels are “stacked” into the applicator magazine and fed individually onto a series of rollers that apply the hot glue to the back of the label. Each bottle is then directed to the contact point where labels are fed, one by one, onto the passing bottles.

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Packaging line basics

posted May 6th, 2014 by Stan Hieronymus

The first and most important concern when packaging beer is preventing contamination by two of the main culprits that reduce the shelf-life of beer, stray yeasts, and exposure to oxygen.

A very basic breakdown

The basic steps for transferring beer to bottles or cans are fundamentally the same.

1) Empty containers are rinsed and then blasted with CO2 to remove debris and any cleaning solution that may have been used in the rinsing cycle.

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Packaging

posted May 5th, 2014 by Stan Hieronymus

Table of contents

– Packaging line basics
– Labeling
– Bottle rinsers
– Other equipment

History

Beer is one of man’s earliest fermented beverages, followed rather quickly by the vessel needed to carry it to friends, family and customers. Beer jugs have been discovered dating back to the Neolithic period. (From 10,200 BC to around 4,500 or 2,000 BC)

Bottles

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Keg terminology

posted Apr 23rd, 2014 by Stan Hieronymus

Beerstone – A stubborn type of scale also known as calcium oxalate (C2CaO4).

Bung – A specially made plug used to seal the “Bung Hole” in the side of old-style kegs and casks. (aka – Bung Plug)

Bung hammer – Special tool for seating bung plug in keg or cask.

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Keg safety

posted Apr 23rd, 2014 by Stan Hieronymus

Download the Keg Safety checklist (.pdf)

Below are some basic safety cautions to keep in mind when handling kegs:

Safety inspection

1. Keg exterior – Sharp edges from cracked drain-holes or split hand-holes or split chimbs can cut and injure an operator when handling the keg. That’s why it is important to make sure that kegs are inspected regularly and in case of such an unsafe condition, they should be either professionally repaired or alternatively scrapped.

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Keg maintenance

posted Apr 23rd, 2014 by Stan Hieronymus

A brewery’s keg inventory represents a substantial investment, add to that the value of the precious cargo it carries, and the importance of a properly functioning keg system becomes pretty clear. Implementing procedures for receiving, cleaning, and storing your kegs is vital.

Download a Keg Cleaning checklist (.pdf)

Here is a typical check list of tasks followed when the kegs are returned. Note that your cleaning techniques may vary, but the desired result is the same – sanitary kegs.

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Keg management

posted Apr 23rd, 2014 by Stan Hieronymus

Leasing Programs – Many companies offer leasing options through finance companies or keg rental as an alternative to purchasing kegs outright.

KEG Tracking – Many brewers use manual systems or bar codes to track their beer kegs. With large keg inventories, these methods make it difficult to track which customer has which keg and who is responsible for kegs that are returned damaged, or not at all. RFID (Intelligent radio tagging) allows you to keep track of your valuable inventory.

– Current keg location and status
– Fill-to-fill cycle time for each keg
– Length of time at distributor
– Keg turn rates by distributor

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Selecting kegs

posted Apr 23rd, 2014 by Stan Hieronymus

Before you even begin shopping for kegs, make sure you are aware of any limitations for draught sales in the area you plan to distribute. Some places restrict the size of kegs allowed, others don’t allow sales of draught beer at all from a pub or brewery, and some areas ban the use of certain types of kegs. Also, distributors sometimes have their own restrictions regarding the sizes and types of kegs they handle. Deciding which is best for you could also depend partly on what is already prevalent in your market. Usually, selling a draught placement means displacing another brand. If switching to your brand involves the additional hurdle of installing a new tapping device, you may lose the sale.

New or used?

As with all used equipment, before being seduced by the low sticker price, make sure the minimum attributes a keg must possess in order to function properly are met. Otherwise you’ve just paid a premium for a load of scrap.

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Keg systems

posted Apr 23rd, 2014 by Stan Hieronymus

Kegs themselves are considered either open system or closed system:

– Kegs with a bunghole on the side that allows the interior to be readily accessed for inspection and cleaning (ie: Hoff-Stevens and Golden Gate kegs) are examples of an open system keg.

– American Sankey-style kegs, which require specialized automated equipment for cleaning and filling, represent the closed system design.

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Distribution Glossary – Terms to know about beverage distribution

posted Apr 22nd, 2014 by Stan Hieronymus

ABC. Alcohol Beverage Control or other name of a state agency that is responsible for regulating the production, sales and distribution of alcoholic beverages.

ABV. Percent alcohol measured by volume.

ABW. Percent alcohol measured by weight.

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Valuing beer distributors – How to value that important relationship

posted Apr 22nd, 2014 by Stan Hieronymus

by Lamont Seckman

Old wives’ tales keep being told, I suppose, because sometimes they have a modicum of truth. A common old wives’ tale is that “an apple a day keeps the doctor away.” Of course fresh produce has antioxidants which can lower the risk of heart disease, stroke, cancer, and other diseases. However, the same can be said of many other fruits and vegetables…no need to focus on just the apple. And how about this one: the blue sky for beer distributors is valued at 1.5x gross profits, or $5 per case. I’m not sure why many old wives would be sitting around discussing intangible asset values in the beer industry, but these tales keep re-surfacing. And, similar to the tale of the apple, there is a modicum of truth to such “rules-of-thumb.” But of course focusing solely on rulesof- thumb is a mistake. In fact, speaking of old wives, many believe the origination of the term rule-of-thumb is derived from references in old legal works to the idea that a man may legally beat his wife, provided that he use a stick no thicker than his thumb. Many researchers have dispelled this myth but are unclear on the real derivation of the term.

Most conclude it relates to the use of the distance from the point of the thumb to the first knuckle as approximating an inch. In my never relenting quest for further understanding I measured this distance on my own thumb and arrived at a figure of one-and-three eighths inches. In other words, if I were to use my thumb to approximate an inch, I would be off by nearly 38%! Perhaps such levels of precision are satisfactory in some situations, but I would propose that buying or selling beer brands and/or distributor operations requires more. Rules-of-thumb should be understood and used for what they are: very broad attempts at describing the values that have resulted from a variety of transactions impacted by a variety of transaction-specific dynamics. While rules-of-thumb, like some old wives’ tales, can have a modicum of truth, they can be significantly wild off the mark in valuing any given brand or distributor operation.

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10 tips for a valuable distributor sales meeting

posted Apr 22nd, 2014 by Stan Hieronymus

Distributor sales meetings are perhaps the single most time effective way to make an impact on your distributors sales force. It allows you face to face time with the entire sales force and helps put a personal touch on your brand. Distributors should allow you access to a group sales meeting on a quarterly basis. Sales meetings can vary significantly from distributor to distributor. Some wholesalers will only allow you a short 15 or so minutes, often sandwiched in between numerous other suppliers also giving a presentation. Other distributors may give you the opportunity to speak for most of the meeting.

How to best utilize that valuable time? Here are 10 tips for conducting a distributor sales meeting:

1. Have a plan – Have a written outline for your meeting and stick to it. Writing it down helps you stay on course. Be concise and precise. Have specific goals you want to achieve during the meeting; such as introduce a new incentive program, present sales goals or increase sales of a new style.

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Brewpubs and distribution – Special considerations for brewpubs

posted Apr 22nd, 2014 by Stan Hieronymus

What’s wrong with this picture?

A loyal customer, one of those regulars who act as goodwill ambassadors, comes into your brewpub with five friends in tow. He adores your pale ale and he introduces his friends as pale ale lovers who have never had your beer. They are here to drink, have dinner and run up a good-sized bill.

Sorry, you have to tell them, but you are out of the pale ale. It will be back on tomorrow, but a sudden run on the beer by outside accounts has left that tap dry. You suggest that they head to the Italian restaurant down the street because you know you just sent them a fresh keg earlier in the day. You watch a sizable ticket and five potential customers head out the door.

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Off-site draft sales for brewpubs

posted Apr 22nd, 2014 by Tom McCormick

As brewpubs continue to proliferate across the country, many are opting to sell their products through retail accounts to utilize excess capacity and increase revenue. Off-site sales can also increase your walk-in business by creating exposure and interest in your brewpub. As attractive as this may seem, off-site sales entail a great deal of time, resources and effort to successfully achieve these objectives. And in some states, brewpubs are not allowed to sell their products outside the confines of the licensed premise.

Where allowed by state law, the practice of off-site distribution has been employed successfully along a full spectrum of implementation. Some brewpubs have grown into full size production plants with the majority of their sales sold off-site through a far-reaching distribution network. This, however, is the exception rather than the rule. Most brewpubs sell their products in draft only to a handful of local accounts. Whatever the applicable scale, it is important to understand the basics of off-site distribution.

Considerations before initiating distribution

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Specialty Beer Distributors meeting a first

posted Apr 22nd, 2014 by Tom McCormick

In a small windowless hotel conference room amongst sweating carafes of water and large steamy coffee urns, more than 40 individuals from the specialty beer business gathered for a roundtable discussion on the business of distribution. The first-ever Specialty Beer Distributors Conference had convened, and although the setting was classic drab hotel conference room, the spirit and enthusiasm was radiant, and conversation flowed steadily for the two-day meeting.

Taking place just prior to the 21st annual Association of Brewers Craft Brewers Conference and BrewExpo in mid-April, the SBDC was the brainchild of Greg Koch, co-founder and president of Stone Brewing Company, a brewery and distributorship in San Marcos, just north of San Diego. The purpose of the forum was to gather together small, independent specialty beer distributors to fuel the exchange of ideas and information in this growing new category of wholesalers. Attending were a wide variety of distributors, from medium sized operations with a sales force of over 20 reps to companies of only two people and one truck. The common thread was that each company specialized exclusively, or at least primarily in wholesaling specialty beer. It was an opportunity, as Eric Wallace, president of Tabernash/Lefthand Brewing Company and Indian Peaks Distributing said “to learn from each of our various experiences and learn how to survive.”

Anheuser-Busch, Miller, Coors and many large import brands provide various levels of support and training to their distribution network – not to mention high volume sales that support the infrastructure of a distribution company – but specialty beer distributors have few resources from which to draw. There were discussions among a group of small distributors at the 1997 Craft Brewers Conference in Seattle to form a trade organization and market the various companies with a web site, but that effort never materialized. This year’s gathering was the first of its kind, and it had a hint of resemblance to the first craft brewers conferences.

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