Becoming a “Best Supplier” – The Value of Mutually Beneficial Partnerships

© MadTree Brewing Company

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Author: Steve McGlone, MadTree Brewing

The number of beers available in a retail environment is growing at an unprecedented rate and thus the focus of a distributor’s sales team is becoming increasingly important. According to the Brewers Association (BA), there are currently more than 7,700 operating breweries in the U.S. Of those, approximately 80 percent distribute beer outside of the brewery and around 40 percent sell a majority of their beer outside their premises.

Breweries who rely on a distributor network must understand the needs of their distributor partners and distributors should be openly and actively pushing suppliers to be better partners. 

Suppliers should be researching how they can improve relationships and enhance the value they bring to the partnership. Distributors should be actively pushing their suppliers to be better partners while being transparent with them on needs.

Cincinnati’s MadTree Brewing was founded in 2013 to cultivate the love of craft and community. MadTree distributes its beers in Ohio, Kentucky, and middle and eastern Tennessee, and its vision is to be one of the most respected breweries in the region. MadTree believes in growing with integrity and intention and balancing long-term sustainability in all decisions. They do this by working to build a purpose-driven brand that goes beyond quality liquid, creating a culture that embraces the “MadTree way,” and expanding at a sustainable pace.

MadTree recently asked personnel at their distributors to identify the things that a supplier can provide (given that quality beer, competitive pricing, solid marketing, etc. is already in place). Eight key areas were compiled from the feedback generated by the MadTree survey. Ranked in order of importance to the distributor, they are:

  1. Communication
  2. Consumer demand
  3. Supplier support
  4. Brand visibility
  5. Core lineup
  6. Adherence to distributor processes
  7. Supplier expectations
  8. Seasonal lineup

Here are some insights gleaned from the survey results in the top four ranked categories. 

Communication

According to the survey, communication from a supplier is the most important part of any wholesaler partnership. Effective communication needs to happen at all levels:

  • Supplier sales reps with their distributor counterparts
  • Supplier sales management with distributor management
  • Supplier production with distributor warehouse on logistics
  • Supplier marketing teams with distributor print shops and event teams

Utilize a CRM such as Lilypad or VIP KARMA notes in order to capture account call details and communicate follow-ups effectively with your counterpart. Communicate things in a timely manner; create a process calendar with timed deadlines for actionable communication items. Management teams must understand what each other needs from the partnership to build mutually beneficial accountability. This involves sharing financials and company goals to build trust and ensure each side is solving the right problem. Work internally with all departments in order to ensure that all channels of communication are creating alignment for your distributor.

“Work with your distributor, not against them… Relationships can be frustrating sometimes, especially with the onslaught of breweries that have opened in the past 10 years… Be stern, fair, and realistic when asking to complete any set goals.”

Stephanie Sutton, Craft Brands Manager – Cherokee Distributing

Consumer Demand

With an increased variety of beer brands available on shelves, it is extremely important for your brand to have consumer demand. Rate of sale is an ever-changing number and without consumer demand it effectively falls to zero. It is difficult for distributors to affect consumer demand beyond making sure that their portfolio is brand-blocked well, displayed prominently, and priced accurately. It’s up to the supplier to plan and execute impactful marketing programs, execute samplings and events, and manage the overall brand health to ensure that consumer demand is strong and rate of sale is growing.

“It’s tough for wholesalers to generate the brand pull through off the shelf. We can ensure that it’s fresh, priced correctly, and merchandised well but we can’t stand next to the box and make consumers pull it off the shelf. Brewers have to generate that desire for the consumers.”

Kyle Lawing, Director of Craft & Import Beer – Ajax Turner Co.

Supplier Support (Sales Reps)

The supplier sales force is the best way to drive market sales and build share of mind with a distributor’s sales team. A well-trained and well-equipped sales team out in the market goes a long way in becoming a preferred supplier. Spend the extra time and energy to develop the individuals on your sales team. Support them with extra investments into event/organization sponsorships and well-planned and executed marketing programs. An effective supplier sales team is the liaison between the accounts, the distributor sales force, and the brewery. Beyond the day-to-day selling and incremental depletions, supplier reps should be selling to the consumer level as well. Sampling events in on- and off-premise are a great way to get beer directly into the hands of consumers. 

“Having supplier support in the market is one of the most important things I evaluate when meeting with new potential suppliers. While ultimately it is our job as distributors to sell product, we are working with 50 to 100 brands at a given time, and having that regular support in the market reinforcing our sales efforts is a huge benefit and one we appreciate greatly as distributors.”

Justin Wellington, Assistant GM – Beer House Distributors

Brand Visibility

Brand visibility includes POS materials, sponsorships, shelving standards, and marketing programs. Spend a day in the market and pay close attention to how your brand looks in comparison to your competition. Look for these key areas:

  • Brand blocking on the shelf
  • Merchandising standards aligned with portfolio priority
  • Unique point of sale materials
  • Event/organization sponsorships
  • Compelling marketing programs

All of these pieces, large and small, need to fit together to form a cohesive brand message for consumers to connect with. They need to be well-branded and consistently executed in order to stand out to consumers and effectively build brand awareness. 

“In a saturated market, look on shelf is becoming more important to capture impulse and trial buyers. POS and visibility in the trade help with brand awareness, whether it translates into attracting new consumers, or if it more reinforces buying habits of existing loyalists.”

Ben Eberly, Sales Director – FL, IN, OH – Cavalier Distributing

Key Learnings

When completing the MadTree survey, distributor employees were quick to point out specific opportunities that we weren’t even aware of. Asking the right questions can lead to valuable results. The collected survey data allowed us to change how we interact with all levels of our distributors. We wanted to understand how important each area was across our distributor footprint and then see how we were doing in each area. The survey was structured for ranked importance, then comparative assessment versus other suppliers in each of their portfolios. Our combined distributor network portfolio includes local/regional and national craft along with imports and macro brands; it was beneficial to see how we compared at each individual wholesaler.

Coming out of the survey, we generated a prioritized list of actionable next steps. Distributor relationships are improving and we are eager to re-survey at the end of the year to see how we are doing against the baseline data. The results will be shared with our distributor partners in alignment with the transparency of our organization.

Why Become a Best Supplier?

Our best supplier initiative comes directly from a few of our values at MadTree Brewing – leadership and transparency. We hold these values, among others, to be extremely important to our business, and our community of stakeholders and consumers.

Leadership is performing with exemplary actions to move a peer, the organization, or even the industry forward. It means being the best and understanding the areas where you may fall short. As a leader, everything you do should be done with the goal of inspiring others around you to grow. We recognize that being the best supplier to our distributors is all about leadership and being the force responsible for business and industry growth.

Transparency is a motivational force working to empower others around us to own a portion of the business. The empowerment builds engagement, provides clarity, and allows team members to take responsibility and make insightful and informed decisions. Providing insight and reasoning into why we make decisions helps those around us to gain perspective, and we can learn from their perspective as well. Transparency between distributors and suppliers is paramount to a good partnership.

Improving communication, building consumer demand, developing sales support, and improving brand visibility all work towards improving the partnership between suppliers and wholesalers. By working in these areas, incremental value is brought into the partnership in the form of trust, commitment, accountability, and increased margins. That means the business grows on both sides of the partnership.


This article was written by the market development committee as part of the BA Insider—a free email publication sent quarterly by the Brewers Association. Each issue covers topics relevant to craft beer distributors.