Brand Growth ManagementSteve Cappella
Square Footage vs. Cubic Footage in Distribution
With the explosion of the craft beverage industry, it has created new sales opportunities while greatly challenging existing warehouse operations.
Beverage retailers and consumers are demanding access to a wider variety of brands in all markets including wine, spirits, beer and non-alcoholic beverages.
Beverage Wholesalers that are willing to branch out are able to gain more clients by offering a wider selection. The ability to deliver more items per stop reduces transportation and delivery costs, and specialty brands typically provide a better gross margin.
By 2019, there will be more beer, wine and spirits consumers than any other time in history.
Today, the challenge for many wholesalers is the common struggle between balancing sales goals, warehousing costs and customer service levels. Most warehousing facilities are not equipped for the management of rapid brand growth.
These facilities are already at maximum floor stack capacity and slower moving brands take up more cubic capacity per item due to either layer or single pallet inventory levels.
Today’s climate requires an updated facility design and implementing the best methods for improving existing storage and labor usage.
New facilities should be designed with flexible temperature control and taller clear heights for the potential of four high storage. More docks are considered simply as Drive-Thru areas and side loaders are rapidly being replaced by pick-to-stop end loaders.
A dedicated pick line should be taken into consideration, in order to reduce travel for order selection and reduce honey combing of deep lane picking in storage areas. The best practices for pick line design include one-way traffic with the ability to stack each order effectively and top off each order with slower movers toward the end of the pick.
Existing facilities can greatly benefit from storage system enhancements; the key to beverage warehouse optimization is to better manage the slower moving brands and to streamline the pick line.