Brewbound Podcast: BevPort Seeks to Open Distribution Access for Craft Brewers

[00:00:00] Justin Kendall: Heading to CBC? Kick things off the day before at Brewbound's meetup at Love City Brewing in Philly, Sunday, April 19th from 5 to 7 p.m. Connect with beer industry leaders, grab a drink, and catch up with the Brewbound team. It's free to attend and walking distance from the convention center. Head to Brewbound.com slash lovecity.rsvp. And don't forget to catch the Brewbound team at booth 956 during CBC. Next on the Brewbound Podcast, we'll talk about some opportunities out there in the on-premise, at retail, and in other states. Hello and welcome to the Brewbound Podcast. I'm Justin Kendall.

[00:00:50] Jessica Infante: I'm Jessica Infante. And I'm Zoe Licata.

[00:00:53] Justin Kendall: And this week we have an interview with Phil Guana from Bevport Distribution. Bevport is a self-described three-tier compliant digital distribution portal. So stay tuned for that. Also, we got to plug CBC. We are going to be actually on the floor this year at the Craft Brewers Conference in Las Vegas. We'll be recording the Brewbound Podcast on location April 21st through the 24th. I'm looking forward to this.

[00:01:22] Phil Guana: Yeah, this is going to be a lot of fun. We just did a trial run at the California Craft Brewers Association Summit, and that was great. It was really interesting and fun. Sorry, I feel like I've used the word fun a million times here. But we did a bunch of rapid fire podcast combos with industry leaders from all over California. So I can't wait to do this with people from all over the country.

[00:01:45] Jessica Infante: You guys got to handle Sacramento, just the two of you, so I'm excited to see how this goes in good old Las Vegas. And CBC, like Justin mentioned, this is the first time we've been personally on the floor as a company, as Brewbound representing, which is really cool. We're going to be in booth 1989, so all you Taylor Swift fans, basically we have the coolest booth. Brewbound's version. Yes, Booth 1989 BrewBounds version. We are still scheduling all of those conversations right now. So if you are going to be in Vegas, you want to chat with us either in a Brewbound Podcast on location discussion or you just want to come say hi, let us know and we can try to set something up.

[00:02:34] Phil Guana: Yeah, shoot us a note at podcast at Brewbound.com. We've still got a couple of scheduled slots left, so would love to fill some of those up with your smiling faces.

[00:02:45] Justin Kendall: Excellent. So let's get into the news of the week. And let's start with you, Jess. You have a story on District 9. It's a sibling company of Bevana Partners. It's filed for Chapter 11 bankruptcy.

[00:02:58] Phil Guana: Yes, and if you have been following along with communitybrewingventures.com since the fall, this probably doesn't come as too much of a surprise. You know, like I just said to you guys on Slack earlier, these three companies are basically the Holy Trinity. They are entirely interconnected and slightly mysterious, and this is why you keep the Catholic school kids around. But the company known as Bevana, that is a licensing, contract brewing, sales, distribution, e-commerce, all in one platform that, you know, we've been chronicling some of their troubles of late, that grew out of this District 9 Brewing, which was a brewery, And basically the way that I understand it is D9, District 9, D9's debts are kind of a drag on the whole organization. So they filed for Chapter 11 protection to reorganize some of those debts. So we'll see what happens. I poked around those court filings a little bit, and it sounds like they have eight people on payroll still, but I feel as though we were getting releases pretty hot and heavy for a while that would have, you know, implied that they had a much larger staff than they do at the moment. They've done all the customary things, filing motions that allow them to continue having cash flow and access to their bank accounts so they can continue making payroll, so they can continue paying the utility companies. Interesting thing in here that I hadn't seen anywhere else is that they have filed a motion to seek post-petition financing. That's normal, but from the CEO's mother-in-law, which is not so normal. So that particular document had quite a few little nuggets that really kind of painted quite a picture. So in a nutshell, basically what Bevana was doing is signing on partner breweries and obtaining the rights to license their brands. And then in some cases, those breweries would produce their own beer under these licenses that Bevana would go out and sell. In other cases, they had a different brewery contract brewing for them, but I'm just going to quote from the documents here because it was something. So, well, I'll quote myself first to set this up because I write better than I talk. So, court filings paint the picture of a licensing and contract brewing business whose business relationships have deteriorated past the point of salvage. D-9 wrote in its own document, quote, while the debtor is known for providing first-rate craft beer as one of Mecklenburg County's best craft brewers, the debtor holds rights to certain rights as a licensee of intellectual properties such as brands and recipes of other well-known breweries. Due to certain disputes with regards to the licensors of these intellectual property as well as the production house charged with producing this beer, certain inventory and receivables have been held hostage, resulting in a rapid decline of the debtor's receivables. Consequently, the debtor needs at least $150,000 in additional working capital to get the debtor's post-petition operations and to otherwise pay associated costs with this case. And that $150,000 they are seeking to borrow from the mother-in-law of CEO and founder Andrew Dershowitz. Basically, in these documents, they admitted they wouldn't be able to find anybody else that would lend them this money. So, interesting situation. hope it plays out or else there's going to be some real awkward family holiday gatherings in their future.

[00:06:15] Justin Kendall: Yeah, that's a big ask.

[00:06:16] Phil Guana: Big ask. Yeah. I mean, this, you know, to put some broader context for what this is for Craft Beer on the situation, you know, only a month ago, we published the story about Pontoon and their, you know, clawing their way back to operating after their initial closing. Pontoon signed on as a Bevana Partners last spring. And they were in a situation where they needed to get some additional volume to fund some expansions that they had done. They were under the impression that becoming a Bevana Partners would give them access to chains, which is huge, and able to get them into new markets. So they signed on, the relationship was not what they thought it would be. And you can go back and find the podcast from a few weeks ago where Zoe and I broke this whole story down. But basically, they felt as though the relationship was not working for them. They filed for bankruptcy of their own. And it just it's not surprising that this has all come to pass, because it sounds like D9 slash Bevana slash Community Brewing Ventures was was going to need to reorganize. Yeah.

[00:07:25] Co-founder Phil: This episode is brought to you by the Craft Brewers Conference, where big ideas, bold beers, and brutally honest shop talk collide. Join thousands of industry pros leveling up their game. Don't miss it. Register now at CraftBrewersConference.com.

[00:07:45] Justin Kendall: Let's get into a couple of sign of the time stories. And Zoe, you were on both of these. One was Lester Jones talking about the opportunity that exists for breweries in the on-premise channel. And the other is you just had a story go up earlier this week on Bump Williams Consulting's latest report that shows that while innovation is slowing down, it might lead to more efficiency for beer at retail.

[00:08:13] Jessica Infante: Yeah, so I can start with Bump first because that one was really interesting in that when you're looking at numbers where the number of beer brands on shelf are declining significantly and the number of new innovations coming to shelf are declining significantly, that might set off alarm bells like, what is happening? But the way Bump framed this was actually it's just the marketplace becoming more efficient because you're having less just throwing everything out there into the marketplace and more being pretty strict about what's going on your shelf, what is going to sell, and how much money is that going to bring in. So in 2022, the number of beer brands just in off-premise retailers, this NIQ tracked retailers, was just over 27,000. Then it had been increasing every year, it had increased four and a half percent about since 2021. And that fell in 2023 to like 26 and a half thousand and is falling again this year. We're around 22.5. It's expected to continue as more brands are cutting some of those extensions, like all those hard seltzer brands that we saw come out. And the biggest cut in a lot of those brands is just those big innovation brands. So the number of new beer brands declined in 2023 by 28.3% to 2,950. Innovations had been declining before, but by like two or 3%. So that's a huge difference, a huge cut. I mean, that's what, like more than a quarter. So that means that there are less new brands going to the marketplace. The brands that are out there have the opportunity to put more dollars per item on the shelf.

[00:10:03] Justin Kendall: This definitely dovetails to something that bump is sort of preached for a while about eating incremental dollar sales, bringing those to the table. And I mean, when we peruse the like circana data or whatever, there's only one new craft brand that's really broken through into the top, I think, 30 brands. And that's a voodoo ranger juice force offshoot, which is the tropical version.

[00:10:30] Jessica Infante: Yeah. The tropic force. I mean, this has been in almost every single report last year. Bump was really emphasizing the need for incremental dollar sales. Like just because you are increasing or growing doesn't mean you're actually adding to anything. And so this is like, hey, let's actually cut back and make sure that the items that are out there are providing enough money on their own. You're not just growing because there's more of things. It all leads back to this efficiency of beer. Beer is potentially getting more efficient. The dollars per item per store selling for craft specifically was down 0.2% in the last 26 weeks, but that's basically flat and that's a significant improvement over some declines that the segment has had before. Hard seltzer was actually the only beer segment to grow its efficiency, so that's that dollars per item per store selling. which is kind of crazy or a change to see that hard seltzer has something positive happening in its space. So that that's showing, you know, the hard seltzer items that are sticking around are contributing more dollars.

[00:11:41] Phil Guana: Yeah. And hard seltzer is getting like a very serious pruning that's probably almost near its end because it's been going on for so long. So that's exactly what what I'm talking about. Exactly. I mean, it's the difference between being on a treadmill and going out for a run. Maybe. I don't do either of those things, so maybe I'm not the person that should be talking about that.

[00:12:05] Jessica Infante: So yeah, so that story is up if you want to check that out. Bob Balto dives into some of the top growth brands, a lot of new hard tea innovation as well. Those are the things that are sticking out in that space. So you can read that. And then the number of story that we had even earlier in the week was from Lester Jones. He did a webinar along with FinTech, and they were diving into retailer purchasing habits for 2023. So this isn't what the consumers are buying. These are what retailers are buying from wholesalers. And he pointed out that on-premise retailers increased their spend more than off-premise retailers did in 2023, first 2022. So, on-premise retailers bought $400 million more worth of beer for the on-premise, and off-premise retailers spent $100 million more. So the on-premise is still a very small part of the total amount of beer purchases by retailers, just about 14%. there's more growth dollars-wise than what's happening in the off-premise. So Lester has been preaching for a while. He talked about this during Brewbound Live when he was presenting with Bart Watson for the BA. The on-premise, we've heard a lot that it's struggling, that it's not anywhere where it needs to be, but there's a huge opportunity there because retailers are willing to spend more money on beer there right now. At least they were in 2023. Lester also pointed out that there's a significant amount of tap handles, which we all know, that are open and that are available to pick up. There are about 28,000 tap handles that have been vacant for at least a year across 9,000 locations. Obviously, those are not all going to come back to beer, as Lester pointed out. A lot of those are gone forever, but 10,000 tap handles across 5,000 locations have been vacant for just between one week to one month. So those are things that had beer in them, maybe a month ago and they don't have anything in them right now. So you could potentially go to those on-premise accounts to be like, hey, you should put my brand here, here's why. It's an opportunity that a lot of suppliers may not be looking at because the off-premise is such a big part of their business. But there's still places in the on-premise that you can find some opportunity.

[00:14:22] Justin Kendall: Now I've got Macklemore's 10,000 hours stuck in my head, although I've switched it to 10,000 tap handles.

[00:14:29] Phil Guana: Yeah. I know like the old ad age that brands are built in the on-premise has largely kind of been tossed out the window, but I still think it's a really important place to make sure your brand is seen and tasted.

[00:14:42] Jessica Infante: Yeah. During our Brutalks event at GABF last year in Denver, We had two conversations about the on-premise, so definitely go back and watch or listen to those if you haven't yet. Lester's presentation also dove into what retailers spent on major brands, including how much less they spent on AB products last year, as we are now, as of this week, one year to the date of the Bud Light boycott. So you can read all those there. I don't want to spend too much talking about it, since we've spent literally a year talking about this at this point, but I will tell you that there was $1.57 billion less on AB products in 2023 versus 2022. That's crazy. A lot of money.

[00:15:29] Justin Kendall: It wasn't just the consumers who weren't spending money on Bud Light. It was the retailers.

[00:15:34] Jessica Infante: Yeah, that's the big thing here. These are what retailers are buying. So this is not consumer behavior. Some of their decisions, of course, are going to be based on trends, but that is what retailers decided. And Lester, of course, works for the MBWA. So you pointed out that's a lot of money not going to the distributors who had these products.

[00:15:55] Justin Kendall: Absolutely. Well, let's talk about one more story and get out of here and we'll just do this real quick. But Orange County, California is The Bruery is heading to Idaho later this year. They're going to be opening a tasting room in the Boise area. It's actually in Meridian, but that's about 10 miles west of Boise. And this gets to something that Jess has talked about for a little while, and that's where these next craft hubs and I think that they are onto something here with this one. You can read the story if you're a Brewbound insider at Brewbound.com. But they explained that, you know, since 1969, the U.S. population has grown 65% while the Boise metro area has grown 330%. And they're getting a lot of those Californians who are trying to escape the high price of living in California to go somewhere like Idaho, or in my case, Iowa.

[00:16:57] Phil Guana: My husband's uncle literally moved from San Diego to Idaho. He lives a gluten-free life, so he cannot partake of The Bruery's products, but he's one of those people.

[00:17:09] Justin Kendall: Yeah, that's an opportunity. And I think that's a story and a conversation that we want to dive into a little more at another time. But before we get out of here, let's play Another Round or Tabbing Out. And unfortunately, we learned last week that Hermit Thrush in Vermont, a dedicated sour brewery, is going to shut its doors permanently later this month. They will close the tasting room. I think it's April 8th and they will see sales all together by the end of the month. And this is a story that isn't unfamiliar. We've heard about breweries who are shifting their sour production and taking those resources and dedicating them to other products, including lager. So are you buying Another Round or Tabbing Out on the future of sour houses?

[00:18:06] Phil Guana: I mean, I would like to believe in them. I hope they continue. Sours are some of my favorite beers, like a good barrel-aged sour, delicious. Here for it, here for all of it. And I know that consumers are kind of having, I think we're kind of at the end of it, but had like a weird dalliance with sours somewhat recently, but they're the things that you can make by taking a couple shortcuts. And I am all in favor of everybody working harder, not smarter. Nope, that's not right. I am all in favor of working smarter, not harder. But this is one of those times that I cannot abide. I think it's cheating and no. to the citric acid stuff. So yeah, I was real sad about this news.

[00:18:53] Jessica Infante: Yeah, I want to be optimistic and say I'm Tabbing Out on them shutting down and that there's, or I guess getting around on there being future. Because we know, like I've talked about a million times, sours are what really got me and some of my friends to try a lot of different craft breweries in the first place, because we liked the sour beers. I feel like that's kind of gone away a lot because a lot of the younger drinking age consumers have so many other beverage alcohol options now. Sours were kind of this very fruity, flavorful, more like beer adjacent way for them to get introduced into the category. Now they have hard seltzers and canned cocktails and they can kind of go other directions.

[00:19:35] Phil Guana: Hard refreshers, hard spritzers, who the fuck knows?

[00:19:38] Jessica Infante: Yeah, literally everything under the sun. So I don't see as many people like raving about them and it makes me really sad. But on the other hand, I like was just at a brewery with some of Lawrence's coworkers a few weeks ago. And yes, they all work in a brewery setting. But they all were like super excited when they saw that there were sours on the menu. And they're between the ages of like 21 and 24 mostly. So these are like the youngest legal drinking age consumers and they're excited about sours. So I feel like there could be a comeback that could just be optimism though.

[00:20:14] Phil Guana: Yeah. I mean, the thing is they take a long time to make. So yeah, I get it.

[00:20:20] Justin Kendall: How much money did you spend on Hermit Thrush this final round, Zoe? Give us a ballpark estimate.

[00:20:27] Jessica Infante: I think the money's deceiving because they also have everything on sale right now. I will tell you that I got, I think we got six, four packs and a couple bottles, I think is what we went with just to try everything. Last final things we could get our hands on. And my lovely sister will be picking up for me in Brattleboro, Vermont. Not that we needed any more beers in our apartment. I don't know where we're going to put them, but I had to get as much as I could.

[00:20:59] Justin Kendall: It's totally understandable, and I commend you for making one last go of it. So the last thing, this really isn't Another Round of Tabbing Out, but I will say I'm tabbing in on Deschutes Fresh Squeezed non-alcoholic IPA. I tried it over the weekend. I received a package of N.A. beers and it is incredibly juicy. Kind of blown away and impressed by what they put out.

[00:21:26] Jessica Infante: Cool. Now we'll have to try.

[00:21:28] Justin Kendall: Yeah, definitely. With that, let's get to our featured interview with Bev Portsville-Guana. BevPort Distribution launched in Florida last month. The new wholesaler describes itself as a three-tier compliant digital distribution portal. Joining us now to discuss is Phil Guana. Thanks for being here, Phil. Thanks for having me.

[00:21:52] Brewbound Podcast: I appreciate it.

[00:21:54] Justin Kendall: You and your partner, James William, launched BevPort on February 1st. It is a digital distribution portal, as I mentioned. You service Florida. How exactly does this all work?

[00:22:08] Brewbound Podcast: Great question. So yeah, we launched, it seems like it's been forever until we finally got launched, but we launched February 1st, really in the testing phase until we came out of that in March 1st. But the idea is that we've created a digital platform distribution channel that's going to adhere to the three-tier system, but also help provide better access to brewers across the country. We're launching starting in Florida. as our first state, and then we expect to have Texas and California on board by the end of the year, or hopefully beginning of next year. The idea is that we're providing access to the little guy. Currently, the three-tier system is very difficult for small brewers across the country who want to access markets, such as Florida, Texas, or California. They're balked out by the big distributors who really have an overwhelming amount of brands to deal with, and most brands don't get in. And so the idea is to provide them instant access. The way it works is a brewer can come online, sign into Bevport, put in their details, and then upload their labels. And within 24 hours, we're having them approved into the state of Florida so they can start distribution. And we provide them, we are a distribution company, so we provide them that access, and then they can able to ship product into the state and sell across the state.

[00:23:23] Justin Kendall: Is this pretty open access? I mean, are you having conversations with them ahead of time to sort of vet things? Or can any brewery across the country sign up to be a part of Bedport's distribution in Florida?

[00:23:37] Brewbound Podcast: Yeah, that's the beauty of what we do. There is no vetting in the sense that, of course, they have to be a legal company. and have legal licenses and permits. But really any brewer that wants to come on board and wants to sign up to Bedford has access to the state of Florida. We want to remove barriers of entry for brands. And this works for a lot of brands that already may have an audience in the state and wants to be able to service that audience directly. Additionally, also with our distribution partner and our delivery partner, we have access to 5,000 retailers immediately in the state of Florida. So we have an audience for them and we have a platform for them to show their product.

[00:24:17] Jessica Infante: So you and James, before this, you were both at New Planet, which is a gluten-free beer brewery in Colorado, and then you're at Edge Consulting. Why did you want to do something in distribution?

[00:24:29] Brewbound Podcast: That's a good point. So we still own New Planet and we still own Edge Beverage. When I started Edge Beverage back in 2016, my frustration was that such few brands had access to retailers at that time. Distribution again locked up everything and they had access to shelf space. And I wanted to give a voice to the little guy. I wanted to take those brands and show them to retailers. And having been the vice president of sales and marketing for Spillama Cider at the time, I had access to buyers across the country. So I said, why don't I start a company where I can give brands a voice? So Edge Beverage started on the same mission as Bevcord is continuing. But the Edge Beverage mission was to help brands access retailers and help them grow their distribution footprint. And we've done that over the last nine years. Now with Bevcourt, it's the same thing. We wanted to remove barriers of entry, give brewers a chance to get distribution in the States and help them grow their brands. And so the mission continues the same. So it seemed like a great fit to continue to push for the little guy. And that's what we've always done since we've always been a little guy.

[00:25:34] Jessica Infante: One of the things that you all emphasized in the press release about this is that using BevPort could save brewers between 10 to 15%. Where are those savings coming from? What are brewers getting from that?

[00:25:48] Brewbound Podcast: So regarding the cost model, so typically distributors charge a 35 to 40% margins on the products that they bring in. Bedport takes a straight 10% only. We do have a monthly fee, which is only $29.99, but we take only 10%. And so what we do is we'd like to take the difference and offer it back to the brewers either in savings or give them the ability to hire somebody and put them in the market. Because many times now, the first thing distributors say is, yeah, we'll bring your brand in, but do you have any sales support in the market? And if they don't, then it's too bad you can't come in. So now distributors, large distributors, shall I say, want brands to foot the bill for a marketing person and a salesperson, as well as still take the 30% to 40% margins. So we wanted to give it a different look and say, you know what, we're only going to charge you 10%. We're going to warehouse, give you access, push you on the website and give you access to retailers immediately and save that money and use it for marketing or whatever else you'd like to use it for.

[00:26:47] Justin Kendall: How many brewers have signed on so far?

[00:26:50] Brewbound Podcast: So currently we have, we have about, I'd say about 50 brewers that have come on board. They're in some state or Another Round the sign-on process. We have about 10 completed through the process. And, you know, we've only been at it three weeks, which has been great. We wanted a slow launch a little bit because you know how it is. There's always bugs and things to work through and we're adding new features. And so starting next month, we're going to be adding some new features that are going to give more opportunities and more options to the brewers. Who is signed on so far? I haven't looked at the list as of yesterday, but we have Mayflower Brewing on board. We have Good Life Brewing and a few others. Long Cat, I believe, Brewing is on board. So there's just a handful of people that are going through the process right now.

[00:27:34] Justin Kendall: I heard Mayflower and that's clearly Massachusetts. Yeah. So like, is this mostly out of state breweries who are signing on to the, to be a part of this or are you getting a lot of Florida breweries?

[00:27:50] Brewbound Podcast: Yeah, no, it makes most sense for out-of-state breweries to come into Bedport at this point, because in-state breweries obviously have access to be able to self-distribute, and they may already have partnerships in that state, but that doesn't preclude one from coming on board with Bedport. We'd love to have local Florida breweries as well.

[00:28:07] Jessica Infante: I also emphasize in that press release, you could introduce any participating breweries and up to 5,000 buying accounts. What are some of the accounts that you guys are connected with? What are the main types of retailers in there?

[00:28:22] Brewbound Podcast: In that 5,000 is, of course, all the independent off-premise retailers, a handful of restaurants, but then we also have access to Publix, ABC stores, Goody Goodies, and all the main chains across the state as well.

[00:28:37] Jessica Infante: That's a pretty big connection for some of these buries to get in.

[00:28:41] Brewbound Podcast: What we did is we partnered with Sunshine State Distributing, and they're our delivery partner in the state of Florida. So we immediately have access to all their clients. So what we've done is we've been able to partner with really great partners like Country Mall Group, who I'm sure you're familiar with, and then for logistics and warehousing and then delivery, we have Sunshine State Distributing. So we have great partnerships to help us launch Florida, which is going to make it easier rollout for brands to get access and to retailers to start ordering.

[00:29:09] Justin Kendall: So is Sunshine essentially fulfilling these orders then?

[00:29:14] Brewbound Podcast: No, Sunshine State is essentially just our delivery partner. They pick up and they deliver to the retailer. But because they're already familiar with the retailers and the retailers know who they are, they're already doing business with Sunshine State, it's an easy fold for them to bring us in. And so that's what we're counting on and it's what's been going.

[00:29:32] Justin Kendall: And the breweries in this, they're basically shipping to Country Malt, which does the warehousing of the products.

[00:29:40] Brewbound Podcast: So Country Malt and Bedport share a space inside the same warehouse. So it's just a movement from shelves to one side of the warehouse to the other, and then out to the delivery.

[00:29:51] Jessica Infante: Is there anything that, I mean, I know you said this is still very early on. Is there anything that you have learned so far, any adjustments you've had to make in this process?

[00:30:02] Brewbound Podcast: Yeah, that's a good question, Zoe. We've learned a lot. We've been doing a lot of testing for the last year, so we've been fine-tuning and fine-tuning, but until you go live, you don't know some of the hurdles you're going to run into. But we've learned some lessons on navigation on the website, so that makes it easier for our brewers to find things and navigate more easily. And then one of the surprising things has been the demand. We always know that this is going to be successful. We have a feeling that this is something that's wanted. Last year, we did a soft introduction at Craft Brewers Guild in Nashville, and we were mobbed by interest. And so we said, OK, this could work. And now we're going to be back at CBC with our own booth inside the Country Malt Island. And we're already getting a lot of buzz out of that. And we're also surprised by some of the partnerships and people that want to join us. aligned with the National Black Brewers Association and people like that who are eager to jump on board and have to give their brewers an opportunity for access as well. So that's been exciting. We've got a lot of really great industry partnerships and people that are really, really, you know, pushing for us to succeed, which is always nice.

[00:31:09] Justin Kendall: So you started in Florida, but you're looking at other key markets. Where are you looking to go next and how fast?

[00:31:18] Brewbound Podcast: Obviously, we want to get Florida under our belt, so we're comfortably running and rolling down the street, as I say. The first market's going to probably most likely be Texas, and we will open Texas before the year is over. We already have some partnerships lined up in Texas. And if time permits and things will go smoothly, as we hope, which they never do, but we hope, we plan on getting California up and running as well. We have partnerships ready and waiting in California. So we think this is a model that we're going to be able to get into key markets across the country within the next 24 months.

[00:31:46] Justin Kendall: And when you say partnerships, do you mean like the delivery and warehousing portions of those partnerships?

[00:31:52] Brewbound Podcast: Yeah, CountryMalt's our partner across the country. They have warehouses in, I believe it's 14 states. Don't quote me on that, but they have a number of warehouses all over the country. So we're going to always be working with CountryMalt within their warehouses. That'll be a wonderful thing for us to be able to access those markets through their warehousing.

[00:32:09] Justin Kendall: Do they own a portion of Bedport?

[00:32:12] Brewbound Podcast: They do not. They are strategic partners and they're also investors, but they don't at this time own anything when it comes to Bedport.

[00:32:21] Jessica Infante: So if there's breweries that are interested in just learning more, want to connect with you, what's the best way that they can do that?

[00:32:28] Brewbound Podcast: Well, the best way they can do it is by going to the website. We obviously want to drive as many people as we can to the website, and we are open to questions and calls. We have our number on the website so they can call us directly and have questions. We want to make this different than your typical distributor. Yes, we are distributors, but we are also an IT company, and we're trying to provide a solution in the industry. So we want to be able to be accessible and easy for brewers to come on board.

[00:32:56] Justin Kendall: Yeah, I think that's an interesting distinction to make that you're essentially like half distributor, half IT company.

[00:33:02] Brewbound Podcast: Yeah, exactly. It's true. It's a weird world we're in because as Zoe pointed out earlier in the conversation, we own New Planet Beer. So we're also brewers and we are on the other side of the retail world as well with Edge Beverage. So we've kind of stuck our finger in everything and that's okay. So we understand and we are able to empathize with brewers and understand some of the challenges they have. So it put us in a good position to really launch something like this with some years of experience behind us and understanding of the industry.

[00:33:30] Justin Kendall: What's the feedback you're getting so far from retailers on this?

[00:33:33] Brewbound Podcast: Retailers are loving it. We haven't fully launched to the retailer yet because what we wanted to do is we want to get obviously a library, so to speak, of brands on board, get them in the warehouse and get them ready to launch. And then once we have a first group of brands, then we'll open it up to retailers. We have opened to select retailers so that they can help us test and run through the product. And so far, they love it. They think it's great. You know, the funny thing is that had we launched this three years ago, it would not have been as accepted as it is now. You're starting to see the industry shift and there's an online process for a lot of these big distributors now. Last year when I attended the National Brewers Association, I'm sorry, Wholesalers Association, there was a big push on what's happening with digital online ordering. And they're finding that 60% of ordering is happening outside of business hours. So people are wanting to get online and order and do it from the ease of their own house or off hours when they're placing orders for their product. So this is already being done on a distributor level. So it's been an easy adopt for retailers to understand. Okay. Yeah. Okay. I get it. I know how this works. And I think that in five more years, sales reps will be almost obsolete. You will not see sales reps walking into, into retailers, selling them brands the way they do currently and taking orders.

[00:34:51] Justin Kendall: That's a scary proposition.

[00:34:55] Brewbound Podcast: I don't know. Is it good or bad? I guess it depends on which way you look at it for the retailer. It's a good thing. You know, they don't really like being bombarded with retailers all day long, but for the industry, I guess for employment, I guess it's different. But I think that, that, that, that shift is going to happen. And, and, and what's going to happen is sales reps will become more of trainers and educators and it'll, they'll take on a different role, but I don't think you're going to see as many sales reps as you used to anymore. There won't be a need for them.

[00:35:22] Justin Kendall: Well, Phil, we appreciate you taking the time out to join us.

[00:35:26] Brewbound Podcast: I appreciate it. Thanks so much. And it was great talking to you guys. And that's our show for this week.

[00:35:31] Justin Kendall: Thanks to Jess and Zoe for all they do. Thanks to our audio team. And thanks to all of you for listening. We'll be back next week.