Shifting market dynamics in the beverage-alcohol industry have forced many manufacturers, distributors, and retailers to assess their business and rethink the way they operate to meet consumer demand. Labor challenges, limited packaging supplies, increasing fuel costs, and more inflationary headwinds are causing major supply chain issues, including more frequent out-of-stocks.
It has become clear that decades of disparate and legacy systems, manual processes, siloed inaccessible data, and a lack of transparency and sharing between and across the three tiers of the supply chain can stunt business growth and threaten survival. But by adhering to this status quo, we are keeping the industry from being agile and advancing to its full potential.
It’s time to unlock data, share insights openly, and enable more transparent communications across the supply chain. Let’s have a look at the immediate and long-term benefits of an open sharing of data for manufacturers, distributors, retailers, and for all of us, as consumers.
Manufacturers Control Their Market Presence and More Accurately Forecast Consumer Demand
Live Retail Sales and Inventory Insights: Many manufacturers rely primarily on the previous year’s distributor sales-to-retail data for demand planning and forecasting. This has proven less effective with fast-growing products, volatile market conditions, and dramatic changes in consumer preference.
Passing live inventory and product insights up the supply chain helps the industry understand consumer demand on a more intimate level. Ongoing visibility into what sold or didn’t sell provides time to do something about it. These retail insights also equip manufacturers with the agility to adjust production efforts to match consumer demand so they know how much liquid to make and when.
Accurate and Up-to-Date Product Information: As manufacturers introduce new products, the ability to manage how products are perceived gives them control over their brand and market presence downstream.
Product Information Management (PIM) tools strengthen the communication of data between tiers by providing a single source of truth about a product. ABV, product descriptions, sell sheets and more all inform purchasing decisions. Each person moving a product down the supply chain, including end consumers, operates from one source of information to minimize confusion, miscommunication, and lost sales.
Distributors Attract and Retain Top Sales Talent and Maximize Sales Efficiency
Live Retail Insights: Distributor sales reps have not previously had the luxury of live retail sales and inventory data at their fingertips because it’s been locked up in the retailers’ point-of-sale (POS) systems. Reps spend most of their time carrying out manual tasks like counting inventory, creating orders, and sometimes chasing payments.
Open data sharing replaces these manual processes by empowering distributors to reinvest time where it matters most: spending time with their customers to uncover new opportunities, sharing local consumer trends, and making strategic decisions for mutual business growth. Sales reps can now ensure shelves stay stocked, products don’t go stale and get wasted, and individual retail accounts continue to grow.
Retail insights also help distributors attract and retain top sales talent. When sales reps are able to enjoy more of what they do best, it’s easier for them to earn more and grow the business.
eCommerce Marketplace: Online ordering enables retailers to browse and review a distributor’s product catalog at their convenience. Of course, timely information is important. With more informed retailers, distributor sales reps can better guide, consult, and answer retailers’ questions. An online product catalog is a powerful marketing tool and a virtual sales rep. It complements the human rep by making a wealth of product information accessible to the retailer on-demand.
The online platform streamlines the way distributors and retailers do business together. They can communicate and share information like ads, pricing sheets, promotional material, and more. Retailers can easily browse for new products, place orders on-demand, and potentially buy more. Data compiled through DSDLink, an Encompass eCommerce platform, indicates that the average volume per order increased more than 18% from 2020-2021 for retailers who shopped online.
Additionally, electronic payment through the same platform is saving distributors immense amounts of time and money. With payments using ACH, credit cards, and debit cards, distributors get paid faster while offering retailers flexible payment with scheduling options, saving on fuel, and minimizing health risks associated with cash transactions. Digital payment decreases errors, eliminates manual reconciliations, and reduces excess travel.
Retailers Can Leverage Innovation to Modernize Processes and Grow Sales
POS Integration: With retail insights derived from POS integration, distributor sales reps are now equipped with vision into fast-moving products, stagnant SKUs, and product performance in various categories to help retailers make better purchasing decisions. Ultimately, reps can focus on new product placements, optimizing product combinations, a wider category selection, promotional opportunities, and more so retailers can become more competitive and improve margins.
Digital Invoice Management: In addition to live product information, ongoing pricing visibility and on-demand online ordering, retailers can digitally reconcile invoices and scan-check received products to eliminate outdated, error-prone, and time-consuming pen and paper processes.
While the immediate effects of open data sharing are felt by the bev-alc supply chain, the ultimate winner is the consumer. As the industry breaks down the barriers of siloed data disparate systems, it also creates healthy competition. Modern best practices and innovation are positioned to minimize out-of-stocks and reduce product waste, allowing consumers to buy the products they want, when and where they want them.
The number of manufacturers, distributors, and retailers that buck the status quo continues to grow every day. An agile, digitally connected supply chain is now a reality because open data sharing helps to reimagine how we work together.
Jonathan O’Neil is CEO of Encompass. Encompass offers modern, cloud-based ERP for manufacturers and distributors, as well as CRM, eCommerce, data, and insights solutions shared across the three tiers of the beverage and food supply chain.