Episode 4 of What's Up Dock? Podcast

Key Takeaways

• U.S. beer moves through three tiers: brewers, distributors, and retailers.
• State-by-state alcohol rules make beer distribution highly complex.
• COVID forced distributors to reverse course and collect unsold kegs.
• NBWA training now helps drivers spot signs of human trafficking.

You're with a few friends on a Friday evening, enjoying a well-deserved beer. While they talk about the beer itself, your mind wanders to a different question: how did it get here?

Beer logistics is complicated. It's heavy, it can spoil, and it comes in several kinds of packaging, which is why so many beverage distributors depend on dock scheduling software to keep trucks moving through their warehouses.

Lester Jones, VP of Analytics and Chief Economist at the National Beer Wholesalers Association (NBWA) at the time of recording, gives us the points about pints.

Join us as we discuss:

• The unexpected way COVID disrupted beer supply.
• How the NBWA looks out for distributors.
• Training truck drivers to become real-life superheroes.

How Does Beer Distribution Work in the U.S.?

In the U.S., beer moves through three separate tiers of business: brewers and importers, distributors, and retailers. Each tier has a distinct role:

• Brewers and importers. They make, import, and market the beer.
• Distributors. They buy beer from brewers and importers, take ownership of it, and then need to turn that beer back into cash.
• Retailers. Bars, restaurants, and stores sell the beer to the public.

This episode focuses on distributors, the businesses responsible for getting beer into the hands of retailers everywhere. Why not let brewers distribute their own beer? Not every brewer has distribution expertise to match its brewing ability. It makes more sense for brewers to focus on brewing and distributors to focus on distributing, so that when a crisis hits, everyone is already in the right position to pivot quickly.

Why Does Beer Distribution Involve So Many Regulations?

Beer distribution is heavily regulated because each state sets its own rules for how alcohol can be sold and consumed. As Lester explains, "We know that different states have very different views, perspectives, policies, and ideas on how alcohol should be sold and consumed. Think of going to Salt Lake City and going into New Orleans in the same week. And how your experience with alcohol would play out."

Federal policy adds another layer. Keeping up with it all takes significant time, which is where the NBWA comes in. The association tracks policy across agencies including:

• Health and Human Services.
• The Department of Education.
• The Department of Agriculture.
• The Department of Transportation.
• The Department of the Treasury.

"We advocate for distributors, mainly at a federal level. We have a federal affairs team, a communications team, an industry affairs team, and we all work together to keep an eye out on what policies are coming up that may influence our members." (Lester Jones)

How Did COVID Disrupt the Beer Supply Chain?

COVID forced beer distributors to run their process in reverse, collecting unsold beer from bars that suddenly couldn't sell it. Because the pandemic began just before March Madness and St. Patrick's Day, on-premise bars were stuck with large amounts of beer.

Distributors had to bring that beer back, something they rarely did. Getting heavy kegs down into a bar's basement is manageable. Hauling them back up is another challenge altogether. Other industries had to rethink their supply chains too, as Uponor's Tom Rowbotham describes in episode three, on diversifying suppliers after COVID.

How Does the NBWA Support Beer Distributors?

Beyond policy advocacy, the NBWA offers training that helps distributors handle beer safely and run their operations smoothly. Even in the best of times, distributing beer comes with challenges:

• Moving heavy kegs safely.
• Operating different kinds of equipment.
• Keeping beer from spoiling.

Lester says, "We have lots of programs and services that include training videos that are well received amongst our members that do everything from hand truck safety, to handling a keg, to dealing with everything logistically when it comes to moving beer around." Documenting how the work should be done is the same foundation our first guest, Keith Moore, says every effort at tailoring automation to large-scale operations depends on.

Training Truck Drivers to Spot Human Trafficking

The NBWA takes driver training a step further by helping drivers recognize suspicious activity linked to human trafficking. After seeing other industries make the effort, Lester and the NBWA knew they could do their part too.

"They're learning how to identify the signs of human trafficking and how someone may behave if they're in that circumstance." (Lester Jones)

With thousands of beer distributors on the road, that adds a substantial number of trained eyes looking out for people in danger.

Where Does the Warehouse Dock Fit In?

Every distributor's warehouse is where heavy, perishable beer gets received, stored, and loaded, so a congested dock slows everything downstream. Beer distribution is far more than a brewer shipping to a retailer. It's a network of distributors doing what they do best, and each one needs smooth receiving to keep product fresh.

Beer distributor Crescent Crown Distributing saw this firsthand. Its Phoenix warehouse ran first come, first served, and on Monday mornings up to 45 trucks tried to deliver at once. After moving carriers onto scheduled appointments, capped at five simultaneous deliveries to match its doors and crews, Crescent Crown cut detention and saved an estimated $25,000 to $50,000 a year in overtime.

Replacing first-come, first-served receiving is exactly the kind of outdated method episode two's Roberta Tamburrino urges logistics teams to rethink.

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From tracking state and federal policy to fighting human trafficking and reversing the whole process during COVID, the NBWA shows how much work goes into getting a single beer to your table.

Frequently Asked Questions

Who Is Lester Jones?

Lester Jones was VP of Analytics and Chief Economist at the National Beer Wholesalers Association (NBWA) when he joined What's Up Dock? He explained how beer distributors navigate alcohol laws and keep beer moving safely from brewers to retailers.

Why Don't Brewers Distribute Their Own Beer?

Most brewers don't have distribution expertise to match their brewing ability, so the U.S. three-tier system splits brewing and distribution between specialists. That way, each business focuses on what it does best and can respond quickly when disruptions hit.

How Did the Pandemic Change Beer Distribution?

The pandemic forced distributors to reverse their usual process and collect unsold beer from bars and restaurants that had shut down. Tasks like hauling heavy kegs out of basements, which distributors rarely had to do before, suddenly became routine.