New Wave Beverage Distributors

Different types of beverages exist in the market and newer ones are getting added to the list daily. The retailer has to decide which kinds of beverages he sells to his customers carefully because it has significant effect on his sales, and invariably, his profits.

Beverages are one of the fastest-selling goods in a retail store. Findings reveal that in convenience stores, varied beverage categories contribute about one-third of the total sales made.

The kinds of beverage your store offers is a crucial decision to be careful about.

What kind of beverages…

Consumer’s choices are changing and, as a result, the kind of beverages they demand are not just about refreshments anymore. There are now a number of factors influencing their choices. The trends in the beverages industry are reflecting these disruptive changes. Beverages that had high demands before are gradually losing ground in the market. Newer kinds of beverages that barely existed few years ago now appear to be the darling of everyone.

Non-alcoholic and alcoholic beverages are the two basic kinds of beverages that should be available in your retail stores. Energy drinks, carbonated soft drinks, juices, coffee, and tea are examples of non-alcoholic drinks.  Alcoholic drinks in retail channels, however, are dominated by beer and spirits.

Energy drinks and soft drinks are traditional beverage products. However, modern consumer behaviors indicate that there is an increase in the awareness of the substance they consume, thus there is a demand for healthier and more quality products. More than just a jolt of energy or refreshing feel, the drinks should provide vitamins and essential benefits. Consumers are getting more concerned about the functionality and sustainability of the products they buy. You should stock more organic, green, and clean label products to meet these demands.

In addition to the standard beverages, premium beverages should be available. In recent times, consumers are attracted to beverages that have unique tastes, high nutritional and health benefits, and made with exotic ingredients. They are willing to pay expensive prices to purchase these kinds of beverages.

Water, now more than ever, are essential beverage stocks in a retail store. Before now, Americans hardly drank bottled water, just one of every six. But in recent times, more than half that number consume bottled water. Sales of bottled water accounted for about 25.6% of total sales in US grocery stores in 2019 according to Statista.

Ready-to-drink beverages such as coffee and tea are today’s consumer favorites. Newer offerings such as cold brewed coffee are purchased even more than the traditional types.

To determine the kinds of beverages you stock your retail store with, the not-so-simple rule of thumb is to study what your customers want. This might not be an easy task to do if you are just getting started. By following the trends in the beverage industry however, choosing the kinds of beverages you should stock can be made simpler.  But the final decision should factor in the demographics of your immediate customer community.

More than 100 million Americans visit convenience stores for daily supplies. There are more than 150,000 convenience stores in the country. They are popular destinations for meeting our needs of gasoline, tobacco, beverages, snacks, and grocery. Convenience stores are known for speedy and immediate service. They are either together with gas stations or standalone stores.

Beverages are one of the most selling items in convenience stores. In 2018, it was reported that there was an increase of 15.2 percent in the sales of non-alcoholic beverages like carbonated soft drinks, water, sports drinks, and teas in convenience stores, compared to the previous year. Though, consumers are shifting towards healthier and premium-quality choices, beverage companies have continued to come with innovative products that attract customers’ interest.

Packaged beverages sold in convenience stores include beer, water, soft drinks, energy drinks, iced tea, juice, alcohol, sports drinks, and wine. Energy drink products top the list of the most sold beverages in a convenience store. Almost half of the total energy drink sales are made through convenience stores. Other members of the list include other drinks.

Sales of beer, tobacco, and alcoholic beverages have been observed to be declining in recent times. This has been attributed to consumer’s changing choices about their health. They are leaning towards healthier and functional non-alcoholic drinks. Although, there are regulations that bind the sale and distribution of alcoholic beverages.

Consumers are buying premium beverage products even more than beer and soda. They are demanding products that provide more than just refreshment. Today, people seek drinks that contain vitamins, have unique tastes, provide a jolt of energy, and all-encompassing health benefits.

Although standard beverages still dominate the market, premium beverage offerings are also selling fast in convenience stores despite their relatively expensive prices.

Ready-to-drink beverages like tea and coffee have gained increasing popularity among customers of convenience stores. Many large beverage companies are offering different brands of cold brew coffee to the public. Cold brew coffee is a healthier and suitable alternative to soda. Its availability as a ready-to-drink beverage makes it a true convenience store product. Health-conscious consumers who want to try something new find the beverage as a delight.

For most consumers, purchases of beverages are impulse buys. GasBuddy reported that about 65 percent of participants of a survey say their drink purchases in convenience stores are usually not planned.

Best-selling beverage brands in convenience stores are Red Bull, Monster Energy, Coca-Cola, Pepsi, Rockstar, Mountain Dew, LIFEWTR, VPX Bang, Starbucks, Buns, Reign, and NOS. These brands introduce and sell innovative products that satisfy the demand of consumers who want immediate satisfaction and refreshments with all-round health benefits.

Consumption of beverages is taking a new course. Beverage brands that continue to innovate and create products that satisfy the ever-changing consumer cravings and demand are positioning for themselves for increased dominance of the beverage industry.

The beverage industry is one of the fastest-growing and largest in global economies. In the United States, the industry has evolved from the traditional setting to a multi-million enterprise. Many beverage products that were non-existent just a few years ago are rapidly dominating the shelves.

Like all trades in this civilization, the beverage industry is ever evolving and with each year comes newer methods of conducting business. These constant changes are tied to consumer behaviors. Consumer taste and preferences are transitioning. Increased awareness and technological advances are influencing choices and causing major changes in the way the industry operates.

These trends present opportunities for growth in the industry. However rapid and continuous these changes have been, three key trends that have remained constant over time are explained below.

Sustainability is Paramount

Consumers’ have become more conscious of what they take into their bodies and, more importantly, how this impacts the environment. This has caused disruptions in the traditional ways of doing many things. Consumers now want more from their food and drinks. Health and wellness are the top priorities of consumers; therefore, they demand more functional products.

Also, environmental concerns about excess packaging and single-use plastics are influencing consumer’s choices on the kind of products they buy. The beverage industry is also responding by adopting methods that are eco-friendlier for all their processes. Studies indicate that about 23 percent of Americans’ buying choices are influenced by sustainability. This is an increase compared to previous years.

Online Sales Are The New Gold

Sales of beverage products in online stores have been observed to be on the increase. On Amazon, the best-selling products in the grocery category are beverages. Convenience stores used to be strongholds for most beverage purchases but recently, consumers are shifting to e-commerce platforms to attend to their needs. They are seeking convenience in more convenient ways. This has created a more efficient and effective channel to get products across to consumers.  An example is the direct to consumer offering which small and startup beverage companies are taking advantage of to promote their products.

Increased Product Diversity and Mashups.

To meet up with the increasing demand for healthy and quality drinks, beverage companies are coming up with creative and innovative solutions. They are expanding their offerings by introducing newer formulations that satisfy the consumer’s cravings and desire for wellness and satisfaction. Brands now create product mashups and introduce premium offerings. Category definitions and prices are no longer constraints, thereby resulting in a growth spurt amidst the host of other opportunities available. Carbonated coffee drinks, sparkling coffee, and sparkling tea are products of such endeavors.

On a final note, consumers may not be demanding for beer and soda as frequently, but they still want ready-to-drink beverages that provide more nutrients and contain natural ingredients, lower calories, and sugar content at the same price. Beverage companies are also responding to these demands by creating products that offer new drinking experiences for consumers and, at the same time, drive growth and increase profits.

The beverage industry has witnessed drastic changes in the last few decades. It is evolving at faster rates to accommodate changing consumer choices. These changes are often drastic turns from conventional methods. Innovative and disruptive methods of doing business have been prevalent in the industry in recent years.

Even with the significant changes, the revenue generated in the food and beverage industry keeps shooting up yearly. There’s high demand for energy drinks, carbonated soft drinks, and other beverages. Consumers are seeking better value for their money, more variety, healthier and better-tasting drinks made with natural ingredients with better and convenient packaging.

The changes in consumer lifestyle and choices make it necessary for beverage companies to seek alternative ways to satisfy consumers, while maintaining operation at a minimal cost. These laudable changes have, however, affected the entire production processes and distribution channels

Sustainability: reducing environmental impact.

Beverage companies are taking sustainable approaches to their operational procedures. Eco-friendly practices are now a must. Consumers are now aware of the impact of waste and their activities on the environment. Thus, they are seeking more environmentally friendly options.

In terms of packaging, there are environmental concerns about the single-use plastics. Beverage companies are minimizing their use and seeking green alternatives like paper packaging and edible packaging made from seafood.

Functionality: increased focus on wellness and health.

Consumers’ demand for healthier products is shifting the beverage companies’ attention to the need for the production of more functional products. They are producing drinks with more emphasis on quality rather than quantity. Beverage types are mashed up to produce different flavors.

This rise of innovative beverage products has caused category blurring. Before now, soda was just soda. But in recent times, mashups of different categories to form unique products and added benefits. Energy drinks infusions, sparkling water, sparkling tea, and coffee are products that have risen along with this category blur.

Convenience.

Consumers want the best quality in the most convenient way. In response to this, we have beers, wine, hard seltzer, spirits, all available in cans. Consumers are provided with ease of drinking to satisfaction with their favorites at their chosen locations.

Online platforms are new market platforms for beverage manufacturers to sell their products. Direct-to-consumer strategies are employed by manufacturers to get their products to consumers. These platforms enable them to obtain data from their consumers, analyze the data, and use it to deliver further personalized consumer experiences.

The major driver for the changes in the beverage industry has been consumer preferences. However, these changes are present opportunities for development in several ways. As beverage companies take advantage of these changes and align their products to meet the demands of the consumers, there is no telling of the changes and possibilities that could happen.

The demand for food and drink products keeps increasing daily. There is a need for more distributors to help channel these products to the consumer. Distributorship is a profitable business. According to entrepreneur, it contributes about 7 percent to the United States GDP. Though the business is a lucrative one, it is not immune to failures.

To get you started with the process of becoming a beverage distributor, here are some tips.

Start with the basics.

Try to understand the industry and how it works. There are many sub-sectors in the beverage industry and each sector has its peculiarities. It is paramount that you identify where your interests lie and research about it. The kind of beverage you want to distribute would determine the sector of the industry you operate in.

Know the requirements and government regulations guiding the industry. For example, in the United States, beer distribution follows a three-tier system. The manufacturers require distributors to get their products to the retailers before the consumer can access it.

Make sure you draft a business plan. Define your distribution model, start-up costs, target market, and operating costs. Outline strategies that will help your business soar.

Get licensed.

Make sure you obtain the proper licenses and permits. Your company should be registered with the government and organizations that govern the distribution industry in your operating location and market. You need to do some legal work, obtain official documents and industry permits from the State and Federal government. Strict regulations guide operations in this industry. Right certification and licenses are what can keep your business safe.

Build relationships

A strong network of partners, clients, and suppliers is crucial to success in the distribution industry. Build relationships with manufacturers, retailers, and other distributors. Successful beverage distributors have a network that consists of partner distributors, manufacturers, and clients.

Make sure your books are in order

Inventory management and record-keeping are essential to the distribution business. You need to develop systems to ensure that your books are in order; every stock and business proceedings are well accounted for. Your profitability in the business depends on how well you manage and track your business operations.

Remain Fresh

To be leaders of your game, you need to stay current on new trends in the industry. Every member of the supply chain is affected, each party has to find ways to make the business profit them. Successful distributors spot trends and use them to their advantage.

Also, use technology to your advantage. The use of the right tech and software would allow you to minimize your operating cost and increase your profit margin. For example, technological advancement may help with customers and inventory management.

Your chance for success as a beverage distributor is high if you start off on the right foot. This implies that you have the necessary tools that can guarantee your success; the right connections, business finesse, keen insight, and proper equipment.

Whether you have perfected your formula, or are just about to start the process of creating a new beverage, it is essential to understand how the beverage industry works and how you can get the best of it.

The beverage industry is one of the largest in the world. When combined, the alcoholic and non-alcoholic beverage industries are estimated to be valued at nearly 1.5 trillion dollars. The industry is dominated by giants who know their cards well. To be successful as a new player therefore, you need to know certain fundamental rules.

Below, we’ve curated some of the things you need to know when launching a new beverage, here goes nothing!

1.   Understand Your Consumers And What They Want

Satisfying your customers’ cravings and wants should be your goal. And if this is the case, you need to understand what they want and how they want it.  Your product, drink, has to be a solution to their problem. If you identify the problem, you would be able to develop the right solutions, and they would buy it.  Know what your consumers want and make sure your product satisfies that craving.

2.   Branding is Vital

Show that you are unique. NielsenWire estimates that only about 10 percent of new products launched in the food and drink industry survive the first 5 years. This does not necessarily mean that new products are inadequate, rather it is attributable to the fact that businesses suffer identity crisis in their early days. This mainly serves to emphasize the importance of branding.

Branding simply means identifying your niche and what you stand for. It is your selling point and competitive advantage. While creating your brand, you should focus more on the distinct selling appeal of your product. These could be its outstanding benefits, pure ingredients, rare taste, and or excellent feel.

Branding also involves fashioning the appropriate packaging for your beverage. The ideal packaging should be so remarkable that customers can instantly identify it among 100 other brands.

3.   Your Map to the Promise Land

Developing a brand and identifying your unique selling point may not be enough. You need to communicate well. You need to build the right strategy to let people know how you intend to solve their problems. Simply put, you need a marketing plan.

A marketing plan details description of your target market, which represents the people that are most likely to purchase your product. It includes the various advertising and marketing channels you will harness to reach these targets. It takes account of the sales strategies and distribution channels you would employ to get your products to your customers.

Regardless of where you choose to begin, whether it is the local or global market, understanding these underlying principles is crucial to a successful product launch.

You should recognize that there is intense competition in the industry, and thus, you need to create a brand that sells your uniqueness and calls attention to the privileges customers will gain from buying from you. With strict adherence to the golden rules mentioned above, your success rate in the beverage industry is guaranteed. Congratulations!

Beverages are reported to be one of the fastest-selling products in convenience stores. With an estimation of over 150 million Americans visiting convenience stores daily, there is a thousand-and-one opportunities for manufacturers of convenience products.

Both large- and small-scale manufacturers are taking advantage of these opportunities. The convenience store is a destination for new beverages and their initial sampling is done via the distribution channel.

If you are look forward to getting convenience stores to carry your beverage, it is vital that you develop a strategy to get your product into these stores.

What possibilities are available?

Convenience stores depend exclusively on distributors to supply their stock. These distributors serve as links through which manufacturers get their products on the shelves of these stores.

There are different types of distributors: wholesale and retail distributors, as well as, broad-line and specialized distributors.

Wholesale or regional distributors buy from the manufacturer in large quantities and sell directly to convenience stores or smaller retail distributors that sell to convenience stores.

Broad-line distributors, such as McLane and Core-Mark, distribute a wide variety of products. In contrast to specialized distributors, who deal with specific products, they provide the convenience stores with every product ordered.

In addition, there are self-distribution opportunities for beverage manufacturers. As a small beverage manufacturer, self-distribution involves you contacting convenience store managers directly and pitching your products to them. Most non-alcoholic beverage manufacturers use their extensive distribution to get their products into a variety of stores.

Pros and Cons

For manufacturers seeking a wider market reach, convenience store distributors are viable options. They can provide you with wider market coverage at lower costs because of their already established network with convenience stores. We’ll be discussing shortly on types of distributors, merits, and demerits as they case may be.

Working with specialized beverage distributors makes it even easier. However, it is not an easy task to convince distributors about the market feasibility of your products. Broad-line distributors distribute limited brands of a single product and make sure these brands have market dominance.

Self-distribution, on the other hand, incurs extra costs on the manufacturers. The market coverage may be limited by how much the manufacturer has to spare in reaching convenience stores in their different locations.

You can access convenience store distributors via the distributor directories published by trade organizations. Also, you may find these directories online on websites like C-Store.  In these directories, you will find contact addresses and physical locations of these distributors. To your strategy, make sure to add quality and effective marketing tactics.

The beverage industry is a thriving industry due to its indispensable relevance to human survival. This sector owes its success to efficient supply chain systems, especially the distribution segment.

Distribution in the beverage industry has taken significant turns. It is evolving with pressures from consumers for faster access to the products. In the same vein, manufacturers’ desire to make the most efficient use of its resources. A complex, but exciting scenario, builds upon the chain with pull from both ends.

Here are five things you should know about beverage distribution:

Different distribution systems.

The beverage industry is further divided into different sectors. The two main sectors being, alcoholic and non-alcoholic beverages. Each of them has various sub-sectors. These sub-sectors produce different beverage products, and they utilize different distribution channels to ensure that it gets to the consumers.

Evolution.

Distribution in the beverage industry is dynamic and is always improving. Technology is a significant influence. Technological initiatives are deployed in market analysis, customer management, inventory management, marketing, and business planning. The industry stakeholders are always seeking ways to operate with minimal costs and also increase efficiency.

Branding.

This is an integral part of the distribution processes in the beverage industry. There is a plethora of products available in the market based on consumers’ preferences. The winning brand is one that convinces the consumer; thus, distribution channels are designed to create the perfect conditions for sales.

Beverage companies devise creative means to ensure that their products are purchased by consumers by highlighting their differences and benefits. Thus, creating a lasting impression that ensures the continual demand for the product.

Prices & Competitions.

The prices and competitors affect the distribution of a beverage brand significantly. Price pressure from retailers, and the competition for more market shares determines which distribution channels would be utilized for a beverage product. This is because stakeholders of the supply chain seek ways to operate their businesses at the minimum cost possible.

It is Risky

Distribution is based on demand, and this poses serious challenges. Demand is founded on consumer preferences, which are subject to changes, and responding quickly enough to these changes is a game of luck beverage distributors have to play. Anticipating these changes might be possible via market analysis, but human behavior is not always totally predictable. Other risks associated with beverage distribution include compliance with regulations and packaging hazards

Beverage distribution is a soup with many essential ingredients. There are limitless possibilities that could be explored in the beverage distribution industry if there are proper understanding and deployment of the principles of its operation.

The distribution process is essential to the success or your products in markets. It increases your market coverage at lesser costs. However, establishing a strong relationship with your distributor is the key to tap into these immense benefits of distribution.

Working out a strategy for your beverage distribution is one of the first things you do when you meet your distributor. To do this, you need to evaluate your chances by asking questions. The information you get will help you work out an effective strategy with commitment from both ends that would seal your success and help achieve your aims.

The following are a list of questions you should ask your beverage distributor:

1.  What do you find unique about our beverage product and our company?

The beverage distributor would have worked with different beverage products. An understanding of the uniqueness of your product, among other products, would make him see the need to patronize your brand.

This question would help you know what the distributor thinks of your product; if he is customer-oriented or just interested in his products and not your business needs.

2. What solutions are you providing, and how do you intend to incorporate it with our current solutions?

You need to understand what solutions he is proposing to help you achieve your stated aims and how he intends to apply it. Also, how he will integrate these solutions with the current methods you operate with.

3. What are your terms and conditions?

You should seek to understand what he requires, the modalities of his business relationships. Ask him for his price and every necessary information. If you think his prices are high, you may bargain for a lesser price. Meanwhile, this would help you identify a range of possibilities and price ranges that suit your budget.

4. Tell us about your past experiences and give references.

Ask for past experiences, former clients, who can shed more light on the nature of business relationships with the distributor. This information would help understand the nature of doing business with the distributor. Just a quick warning, you don’t ask for references until you are genuinely ready to commit with the distributor.

5. What information do you require from us?

There may be a need for specific information, probably contacts with some of your personnel. Ask ahead, so you can have control over what kind of information you are giving out.

6. What information would you relay back to us?

You need information on how your product performs in the market. Sales data are essential. You need to set things straight before entering into a partnership that is crucial to your success.

Asking the right questions is equivalent to getting the correct answers. If you develop a mutually beneficial relationship with a beverage distributor, you stand to gain higher rewards.

The beverage industry is made up of two sub-sectors; the alcoholic and the non-alcoholic industries. The supply chain in each sector follows different trajectories and bear little similarities depending on the economic environment and government regulations.

Products of the non-alcoholic beverages industry are collectively known as liquid refreshment beverages (LRB) and they include bottled water, carbonated soft drinks, energy drinks, sports beverages, fruit beverages, and ready-to-drink coffee and tea.

The demand for non-alcoholic beverages has been reportedly high. On the global scale in 2016, the industry was valued at 967 billion dollars and was projected to grow by 5.8 percent. This rising interest and consumption of non-alcoholic beverages are due to changing consumer behaviors.

For health and safety issues, and also preferences, consumers are getting more concerned about making conscious choices about the kinds of foods and drinks they consume.

In the United States, the non-alcoholic beverage sector operates a unique distribution system. Instead of the three-tier system observed in the alcoholic beverage industry, distribution in the non-alcoholic beverage industry is, mostly, a direct connection between the manufacturers and the retailers, and even the consumers.

This distribution system is what enables large soft drink manufacturers to expand their market reach and sustain their acceptability. And also make it difficult for smaller brands to penetrate the market.

The choice of distribution channels for non-alcoholic beverages is dependent on certain factors.

The marketing strategy of the beverage manufacturer and the kind of beverage are important factors that contribute to how the beverage product is transported from the manufacturing plants to the consumer’s reach. Direct distribution channels like vending machines and convenience stores may be utilized if the manufacturer’s goal is to minimize cost or penetrate an existing market.

On the other hand, dairy beverages cannot be passed for too long in a distribution chain. Otherwise, big losses await the manufacturers.

There are a lot of safety precautions and strict regulations that must be followed in the production and distribution of food and drink products. Many regulatory bodies are dedicated to ensuring compliance and they monitor every step and process in the industry. There are strict rules guiding the production processes, there are also regulations that guide the distribution process. Strict compliance with the rules is necessary to ensure that the product is received in a wholesome condition. And the manufacturer does not run at loss.

Distribution is the soul of the beverage business. The unique supply chain and distribution system in the non-alcoholic beverages industry is its greatest asset. However, for the industry to realize its full potential, industry stakeholders must find creative ways to handle the pressure of the ever-increasing demand for more by consumers.

Soft drink manufacturers like Coca-Cola have extensive distribution channels that transcend conventional distributors. They deliver their products directly to retailers who sell to the consumers in most cases. Wholesale distributors are involved, but they are not the sole distribution channel.