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Distribs Seek Better Covid Communication/Transparency, Per Tamarron; Suppliers Seek Better E-Comm Service

2020 Tamarron Consulting Brewer Partnership Compass Overview

INSIGHTS Express (by: Beer Marketer's Insights)

While distribs gave top supplier partners – AB, MC, Constellation, HUSA, Boston Beer, Sierra Nevada – top marks for proactive approach toward out-of-code beer reimbursement, many still felt suppliers could be doing more to help enhance revs and offset losses due to temporary closures of on-premise, latest Tamarron Survey on Covid-19 period shows. Part of offsetting losses also has to do with “ongoing” evaluation of keg reimbursements, as “many” distribs indicated reimbursements were “insufficient to cover their costs,” also asking for “reduce[d] co-op spending and inefficient marketing spending.”  At same time, brewers also received best grades on making accommodations for temporary workforce reductions and ability to shift marketing messages “to be relevant to consumers in COVID-19 era.” But communication “across most supplier functions,” supply chain “transparency,” production and “flexibility” and “understand[ing] and adapt[ing] to the new normal at local levels” were other oppys for improvement. Among lengthy list of recommendations, distribs seek better communication from both senior leadership and local teams on adapted 2020 and 2021 plans as well as supply availability, learnings from other mkts and more.

Tamarron surveyed 132 distribs of all shapes and sizes. About half of ’em were under $75 mil in annual revs and the other half over $75 mil, including 25% between $25-50 mil and 21% between $75-$150 mil, 17% less than $25 mil, 15% between $150-300 mil, 13% over $300 mil, and 9% between $50 and $75 mil.

E-Commerce is Biggest Oppy for Improvement, Sez Suppliers; Inventory Mgmt a Two-Way Street Suppliers highlighted ability to service e-commerce platforms as biggest area for improvement among distrib networks, via separate Tamarron survey of suppliers conducted in Jun. Just 29% of suppliers felt their distrib networks were mostly (75+%) “aware of accounts that participate in their own or third-party e-Commerce applications and has ramped up efforts to ensure accounts have sufficient service and inventory to accommodate growth of e-Commerce during the COVID-19.” Separately, just 38% of suppliers felt most of their distrib networks adequately “increased usage of automated services with customers without impacting their overall service to customers (e.g. automated payments, online ordering, remote/video sales calls, etc.)” And suppliers rated distribs’ inventory forecasting among one of the lower-scored areas as well, with just 56% of suppliers saying that “at least 75% of their networks” have “effectively adjusted and clearly communicated…forecasting and logistics strategy to account for” Covid-19 impact.

Over Half of Distribs Expect Anywhere from 11-30+% of On-Prem Accounts to “Permanently” Close While 40% of 132 distribs expect less than 10% of on-premise accounts in their mkts to close permanently, remaining 60% expect anywhere from 11-30+%, Tamarron showed. About 35% of distrib respondents expect between 11-20% accounts to close permanently, 21% of distribs expect 21-30% permanently closed and just a handful of distribs (4%) expect over 30% of on-premise accounts in their mkt to permanently close.