{"id":4195,"date":"2017-06-27T06:00:47","date_gmt":"2017-06-27T11:00:47","guid":{"rendered":"http:\/\/www.beerbusinessunplugged.com\/?p=4195"},"modified":"2017-06-24T13:14:22","modified_gmt":"2017-06-24T18:14:22","slug":"compromise-works-well-in-this-world-when-you-have-shared-goals-chapter-2","status":"publish","type":"post","link":"https:\/\/www.beerbusinessunplugged.com\/?p=4195","title":{"rendered":"Compromise works well in this world when you have shared goals…chapter 2….."},"content":{"rendered":"

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Well now, that did not take long, did it? \u00a0On May 9th<\/sup>, this post wrote about the future of the beer industry in conjunction with the major retailer, Amazon. \u00a0Now, less than two months later, the industry is on alert as Amazon has announced its purchase of Whole Foods for an incredible $13.7 billion dollars! \u00a0In the May 9th<\/sup> blog, the questions were:\u00a0 \u00a0How would Amazon secure a foot hold on the alcoholic side of the retail business.\u00a0 And if Amazon was successful, when would the acquisition occur? \u00a0Those two questions have been answered, so we are now aware of at the least the first step of the equation.<\/p>\n

As expected, industry pundits have pontificated about their views of the future once Amazon jumped into the mix. \u00a0Nobody really knows for sure how Amazon will approach our industry, but one has to believe craft brewers are jumping for joy with the news.\u00a0 Whole Foods specializes in crafts and imports, they do not sell domestics, so perhaps the ABI and MC might not be concerned. \u00a0That being said, a couple of possibilities seem feasible.<\/p>\n

First, the craft industry\u2019s on going issues with the middle tier distribution system, and their inability to access markets and the resulting lack of focus on said markets. \u00a0We know that. I hear that concern every day. \u00a0With Amazon taking over Whole Foods, the possibility of a craft brewer self-distributing and eliminating the wholesaler entirely is now more attractive in states where legal, quality discounts come into play. \u00a0Pallet drops to Whole Foods, at prices no other retailer can obtain (e.g., Costco), will enhance the craft brewer\u2019s ability to gain sampling, volume and consumers, thus eliminating the wholesaler.<\/p>\n

If, in fact, this model becomes a sizable part of the retail business, which it could over time, the self-distributing craft may focus solely on this model that enables elimination of the middle-tier for off premise volume. \u00a0Again, where legal, the craft brewer could appoint a wholesaler for only on-premise distribution, and keep the off-premise in house! \u00a0Perhaps, where legal, craft brewers could crave out Whole Foods as a \u201chouse account.”\u00a0A wholesaler could even benefit as Whole Foods and Amazon become the primary means of driving a craft brands\u2019 consumer demand.<\/p>\n

In a more traditional model, the wholesaler and vendor have to revisit their contracts. \u00a0A number of contracts address a wholesaler selling beer to a retailer, they know will ship their beer out of the wholesalers assigned footprint. \u00a0How will that be addressed?<\/p>\n

A second model possibility would include when an importer, for example, owned by a European brewer could make a statewide agreement with Whole Foods using Amazon and ship their product directly to their warehouse. \u00a0The wholesaler of record could receive a $1.00 per case commission for simply allowing the paper to hit their dock. \u00a0No warehousing, no delivery costs and no commissions paid. \u00a0Do you not think a wholesaler might find this model attractive? And even if they did not use this model, the wholesaler\u2019s competitor might use this method, thus giving way to further pressure to adopt said model.<\/p>\n

No doubt, it will be awhile before it becomes clear how Amazon will operate.\u00a0 As stated on May 9th, however, Amazon will figure it out. It is only a matter of when\u2026.not if.\u00a0 We just did not realize Amazon would act so quickly.<\/p>\n

Compromise works well in this world when you have shared goals.<\/p>\n","protected":false},"excerpt":{"rendered":"

Well now, that did not take long, did it? \u00a0On May 9th, this post wrote about the future of the beer industry in conjunction with the major retailer, Amazon. \u00a0Now, less than two months later, the industry is on alert as Amazon has announced its purchase of Whole Foods for an incredible $13.7 billion dollars! […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_s2mail":"yes","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_newsletter_tier_id":0,"jetpack_publicize_message":"","jetpack_is_tweetstorm":false,"jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[1],"tags":[],"jetpack_publicize_connections":[],"aioseo_notices":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p2xRTi-15F","jetpack_sharing_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/posts\/4195"}],"collection":[{"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4195"}],"version-history":[{"count":4,"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/posts\/4195\/revisions"}],"predecessor-version":[{"id":4199,"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/posts\/4195\/revisions\/4199"}],"wp:attachment":[{"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4195"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4195"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4195"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}