COVID-19

What Wholesalers Can Expect & How to Adjust Business Accordingly

Adjusting to COVID-19

VERNO’S BEER BRIEF | MARCH 2020

As the reality of the COVID-19 situation continues to develop, it is evident that day-to-day life as well as the beverage distribution business as we know it will start to look very different in the coming days, weeks and months.

We have been in constant contact with wholesalers all across the country, each beginning to face the immediate and long-term challenges that the virus presents on the market, the workforce, and the business. As the impact of the virus and the restrictions on accounts and personnel continue to expand, every wholesaler will have to adjust.

We hope this information helps provide direction and ideas that you can take action on right away and in the coming weeks. We are all in this together, any support or assistance we can provide, please reach out at any time.

If you have any questions or would like to learn more about how we work with wholesalers on subjects like these, please contact us.

 

COVID-19 and The Future for Beer Wholesalers

We believe wholesalers will experience three distinct phases of the COVID-19 impact, each with their own sets of challenges and opportunities:

The 3 Phases

PHASE 1 – IMMEDIATE ADJUSTMENT PERIOD

EST. TIME FRAME:

March – April 2020

IMPACTS TO BEVERAGE MARKETS:

  • On premise decrease
    • Accounts close or limit service to take-out only
  • Off premise increase
    • Especially in grocery & large format accounts

IMPACTS TO WHOLESALERS:

  • Employee adjustments
  • Route adjustments
  • Inventory ordering adjustments
  • Discontinuing of certain activities
    • Ex. special events, draft, etc.

PHASE 2 – INTERIM PERIOD

EST. TIME FRAME:

Several Months (until virus restrictions are lifted)

IMPACTS TO BEVERAGE MARKETS:

  • Temporary market adjustments have settled in
    • Know which accounts will be open / closed / limited
    • Know how off premise accounts will be impacted

IMPACTS TO WHOLESALERS:

  • Employee reassignment / adjustments have been made
  • New temporary routes are in place
  • Certain functions / activities are suspended or significantly adjusted
  • Start working on special projects with excess capacity (if any)

PHASE 3 – NEW NORMAL PERIOD

EST. TIME FRAME:

Post virus restrictions

 

IMPACTS TO BEVERAGE MARKETS:

  • Market will begin to get back to the way it was, but never fully be the same
    • On premise accounts will be reopen (many accounts will stay closed)
    • Off premise volumes will normalize from current spikes
    • Consumers will have less discretionary income

IMPACTS TO WHOLESALERS:

  • Wholesaler will adjust back to full-service capacity
    • Increase staffing
    • Start doing functions that were stopped (special events, draft line cleaning, etc.)

Relevant Beer Briefs

If you are a subscriber of Verno’s Beer Brief, you have access to all 130+ back issues we’ve published. Here are some issues that address topics we mentioned throughout the Special Edition Beer Brief on COVID-19.

E

Services Management

  • Minimizing off day deliveries (2020)
  • Delivery minimums (2018)
  • Managing Merch Frequency (2016)
  • Routing project checklist (2015)
  • Delivery route cost reduction (2015)
  • Service policy strategy (2013)
E

Sales Management

  • Protecting Tel-sell draft (2018)
  • Sales go-to-market self-test (2016)
  • Super-Merch Sales Models (2014)
  • Drug & discount store strategies (2014)
E

Employee Management

  • Length of workday (2018)
  • Employee feedback (2018)
  • Employee surveys (2016)
  • 4-day work weeks (2015)
E

Brand & Supplier Management

  • Success with less from suppliers (2020)
  • SKU rationalization (2019)
  • Policies for managing suppliers (2017)
  • Managing craft ROI (2015)
  • Total sign shop cost (2014)
E

General Management

  • Things to stop doing (2019)
  • Managing out-of-code (2019)
  • Developing strategy (2017)
  • Managing resets (2016)
  • Cycle counting & inventory control (2013)
  • Managing costs (2013)

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