Facebook  Twitter  Linked In  You Tube  GooglePlus  Pinterest
By November 27, 2018 1 Comments Read More →

A Pathway to Success in the Three-Tier System for Small and Medium Brands

By Paul Vigna

BevStrat, a 2018 WINnovation Award Winner

Brian Rosen said the timing for the creation of what is now BevStrat in 2010 couldn’t have been better, with the Big 6 distributors shrinking to three while the acceptance of craft producers worldwide was increasing.

“So when you put that all in a blender it’s just economics,” he said of BevStrat, short for Beverage Strategy. “You’ve got an increased kind of supply chain and a decreased output for it, and you’ve got a shrinking funnel that’s contracting. So all of that happened at the exact same time over the last five years as we were opening our business.”

That increased the need for support to build small and medium brands, Rosen said, “through data and boots on the ground we support the independent brand, because frankly the distributor doesn’t have the time nor inclination.”

Rosen and his company have aggressively moved into that vacuum, as of August 2017 adding its 100th brand to its portfolio. Not only has its growth, “about 35 percent year-over-year,” Rosen said, turned the industry on its head, but the way it has used data and its sales force has earned it one of Wine Industry Network’s 2018 WINovation Awards

Brian RosenBevStrat’s presence is worldwide, spanning several continents in addition to employing more than 200 salespersons working on commission in nearly two dozen American states.

That Rosen has revved up BevStrat to this level shouldn’t surprise anyone: The beverage industry is in his blood, having started as a cashier and eventually becoming CEO for Sam’s Wine and Spirits, a family-owned Chicago-based company that became America’s largest independent retailer. That work within the adult beverage industry continued, first at PricewaterhouseCoopers and later at Anhauser-Busch, where he saw first-hand how small brands struggled for shelf space and a spot in consumers’ minds.

“There is an inherent David and Goliath dynamic in three-tier distribution,” Rosen said in a 2017 interview. “It is skewed toward the top 300 brands globally, and the top five distributors focus on these brands, through which 98.4% of all wine, beer, and alcohol is sold BevStrat was formed to give the small independent producer a fighting chance in the three-tier system.” Rosen writes on that system for Wine Industry Network in a column called Three Tier Talk.

Around 40 percent of BevStrat’s clients are wineries, with the rest split between breweries and distilleries. Rosen mentioned three examples of BevStrats work:

4 Pines Brewing Company in Manly, Australia. “We took them from Australia, found them a co-brewer here in the States, never had sold a drop here, found them a distributor in Florida, New York and California, pitched them to the leading retailer in California and sold the container of beer to said retailer. So you’ve got a brewery in this case that has never even been on U.S. shores is all of a sudden in 163 depots, and this is from zero to this in four months.”

Levantine Hill Estate Winery, in Coldstream, a township outside Melbourne, Australia. “We went over to Melbourne, met with leadership and all of a sudden we‘re the exclusive sales agent for the brand, which is now selling in New York and California.

Common Well Spirits. “They had never sold an ounce in New York City, now they’re selling 100 cases a week in New York City. They’ve been with us for eight weeks. Now part of it is the brand, it’s a good brand, easy to sell. But the reality is these are activations that we did, these are relationships that we had, and these are clients who sought us out to expedite their sales in the US.”

Part of this success Rosen attributes to the model of hiring salespersons rather than using brokers, who will sell what is easiest to sell to gain the most commission. That leaves a lesser known or small brand “at the bottom of the pecking order. In our model, everyone is a client.” So no matter who you are, he continued, “you get equal attention, you get equal phone calls, you get equal showings, because we’re paid to do so.”

Complementing that setup is a process that uses data to find the optimal demographic and client of the product, then they do a web scrape for accounts that are located near the product’s demographic. Drawing on variety of sources, they use a call center to phone the account and schedule an appointment, expediting the process and improving the opportunity for a sale.

“You’re prescreened to know before you go anywhere,” Rosen said, describing the innovation. “Essentially, the sales [visit] can go one of two ways, either ‘not right now’ or ‘yes,’ but it’s not a ‘no’ because you’re already prescreened.”

1 Comment on "A Pathway to Success in the Three-Tier System for Small and Medium Brands"

Trackback | Comments RSS Feed

  1. Elias Mitri says:

    Amazing <3

Post a Comment